Fryer's Blog in the Mountains

Healthcare Reform: Lessons from the Department of Agriculture

A must read article from the New Yorker.   I love analogies.   In this one the author examines the mess that was agriculture 100 years ago here in the U.S.   40% of a family's income went to food:

America’s agricultural crisis gave rise to deep national frustration. The inefficiency of farms meant low crop yields, high prices, limited choice, and uneven quality. The agricultural system was fragmented and disorganized, and ignored evidence showing how things could be done better.

Sound familiar?   The government tried many things, but what proved most effective was working from the bottom up.  They worked with the farmers, and when they saw success, they told their neighbors.   Seaman Knapp from the USDA said: “What a man hears he may doubt, what he sees he may possibly doubt, but what he does himself he cannot doubt.”

This is what we're doing with our new company ProtoHIT.  It's not enough that we have best practices based on 12,000 cases, each clinic needs to see for themselves how it is working for them.   In real time.   And that is how we all will get efficient in health care.

Health Care Reform: Rationing vs. Gluttony

Health Care is expensive here without the best outcomes.   You would think the conversation would revolve around efficiency: how to get more bang for the buck.  Yet there is a chorus of objections anytime someone actually wants to control costs (like doing studies to find out what drugs, treatments, etc. work best).  Then the outcry of "rationing" can be heard.

 The opposite of rationing is gluttony.  You consume too much and it's not good for you either.   Any treatment, drug, or hospital stay introduces new risks, besides costing money.  Like going to a buffet in Vegas, the true costs are hidden from us.

The solution?  More transparency and more untainted data to us the consumers and our physicians.

You don't get your cars undercoated, why do we want useless undercoating in our health care?  Or do we just enjoy be gluttons?

Current U.S. examples of Public Option, Single Payer and Socialized Medicine

As a marketing person I get a kick how people mangle semantics, especially when talking about health care reform.  So here are some simple definitions and examples where this is being used in the U.S. today:

Public Option:  In essence a government entity set ups a competitive insurance carrier.  After being setup, the taxpayers are paid back and the entity runs on its own.  Both New Mexico and Utah (there may be more) have already done this years ago for workers compensation.   The state legislatures set these companies up to drive down the cost through competition.

Single Payer: In this case, the government acts as the insurance carrier, collects premiums and uses private business to deliver the health care.  Medicare is an example of this.

Socialized Medicine:  Here the government runs everything.  They collect the money, build the hospitals and clinics and hire the doctors.  The Veterans Administration is an example of this.

As you can see, we have all three examples running currently.  So when we discuss health care reform, let's understand what the words mean.

Pay as you go Health IT

According to this article, Health IT projects require hefty investments.   I'm going to have to disagree with Dr. Caitlin Cusack.   Maybe current Health IT projects do, but that doesn't mean they have to.   Your two cost factors are the actual hardware / software you use and the cost of training your people.

I believe that the customers should invest nothing for the software.   Just like you can get "pay as you go" mobile phones, Health IT should be delivered as "pay as you go".   How?

Build it in the cloud and scale horizontally.  It's not hard or expensive to build a system for a 3,000 patient clinic.  But instead of designing a massive silo (aks Salesforce.com), for 10,000 customers, deploy 10,000 cloud servers.    And then just charge when the customer actually uses the thing.  Which will keep you on your toes at all times.

As for hardware, it doesn't take much.   A great netbook or desktop costs $300-$400 and you can set up secure wireless for $100 per building.   So you can automate a 5 physician office with a total investment of $5-$10K.  Because all the heavy lifting is done in the cloud (aka Amazon Web services, my favorite).  And you can run a dedicated server 24/7 with a lot of storage for less than $1,000 a year with zero installation costs.

And deployment (where the real costs are) should be done in an iterative fashion.  Prototype, pilot, repeat until satisfied.  Then expand.

This is a different way of looking at things.  When I was at Baxter Healthcare, conventional wisdom said all IT projects were heavily invested in, took many months (or over a year) to get implemented and then get everyone trained.  Working in the divisions I was rolling out new applications in 6 weeks.   And that was 25 years ago.

Prototype, pilot, repeat.

Health Care Reform: Avoiding the Billy Tauzin Effect

Health Care reform is a pretty straight forward proposition:  Improve patient health, for the lowest cost, covering the maximum number of people.  But the people in Congress many times have other agendas, namely how can they raise money to get re-elected or get a cushy job in the future.   Not paying any attention to those who elected them.

The last big overhaul was Medicare Part D which gave prescription coverage to seniors.   Unlike the VA system, Billy Tauzin lead the effort prohibiting Medicare from negotiating drug prices.  The result?  The VA gets their drugs for 58% less.  And Tauzin?  He leaves Congress and takes a $2M job with PhRMA the lobbying group.  Sticking the taxpayers with the bill.

Can't happen today?  Think again.   Comparative Effectiveness Research finds out the most effective way for treatment.   But Sens. Jon Kyl (R-AZ), Mitch McConnell (R-KY), and Pat Roberts (R-KS) introduced a bill to prohibit Medicare from using it to deny coverage for less effective treatment.   They want us taxpayers to pay the pharmaceutical companies for treatments that don't work as well as competitive ones.

I'm hoping the American public holds Congress accountable for their actions and keeps them on task.

Why US Healthcare is so Expensive: Measuring the Wrong Thing

"Whatever you measure, will improve".   In the case of Healthcare, reimbursements by procedure and office visits are measured, so they have increased 10x since 1960.    However the patients are not getting better.

As the Washington Post points out:

Of 37 industrialized nations, the United States ranks 29th in infant mortality and among the world's worst on measures such as obesity, heart disease and preventable deaths.

Bright young physicians trained at prestigious and expensive universities enter a profession built on perverse financial rewards. They, like assembly-line workers of the past, are paid on a piecemeal basis, earning more money not by doing better but simply by doing more.

Yet more care rarely translates into better health.

So pay more attention to measuring the outcome you want and don't fall into the trap of emphasizing false indicators just because they are easy.     

Health Care Effeciency: The VA System Outperforms

I chuckle when I hear someone say "Everyone knows that _______".    And if you repeat it enough times and send it in enough chain emails it must be true?   

Here's one: 'The government cannot run anything well".   Then comes out this report.  Turns out the VA delivered health services with cost increases of .3% annually per enrollee .  Medicare's increase was 4.4% per year.   And how much have your insurance premium's been rising?  Employer's went up 5% last year.   Worth a closer look.

Here's another one: "Healthcare in Canada is so bad, a large number come to the US for treatment".   Turns out that isn't true.

Before you make assurtions take the time and go through multiple sources.   You will make better business decisions.  Getting to the root causes and solutions is time consuming, but well worth it.

Just in Time Patient Data: A Solution for Electronic Medical Records (EMR)

Bruce Schneier's post on "Unfair and Deceptive Data Trade Practices" pointed out how the RealAge quiz sells your answers to drug companies who then send you spam targeted email.

And this got me thinking about the nightmare of EMR.  When your patient data is in color coded paper files, it's a lot harder for abuse.   And there are the conflicting interests: the insurance companies who want to spend as little money as possible, the doctors who (hopefully) want you to get better, and those who want to maximize reimbursements (e.g. revenue), the drug companies who want to sell more.   But in the end, there is one person who needs to be in control.

The patient.

And this needs to be the bottom line of any good EMR system.  The patient is in control.  But data exists in many different silos of information, held by different parties, for different purposes.   In reality this is a policy based data access problem.

The solution in "Just in Time" patient data.    If you check into an ER, the attending physician should be able to pull together all relevant information real time.  When done, it goes away.   The monolithic solutions proposed by Walmart and Google are doomed for failure from the beginning.  There is no way people want to put that much information in just one place.  Ripe for abuse. (remember the Patriot Act?)

note: or someone steals the information and holds it for ransom.