Innovation Number One
Reprinted from Physician Leaders, June 14, 2007
Facilitating patient-physician information exchange as a key of productivity.
Many believe we can’t change the productivity of health care, changing the system would be akin turning around a battleship in a pond. Americans will only accept incremental change. In other words, because of the contrariness and fixed behaviors of patients and doctors, the system cannot and will not change. Besides, they will argue, human interactions take time, are imponderable and immeasurable.
If you believe that, you believe only rationing will cut health costs.
I reject this line of thinking. Instead, I believe soon most doctors' offices will feature information exchange stations. Some will be "virtual," connected to the Internet; others will be "real," located in doctors' reception areas.
These stations may go by various acronyms. Some may be analogues of ATMs, hence ACM (Automated Clinical Machines), and will feature "free" data entry, an important ingredient of clinical productivity. Others may be information shopping centers and may go by the name of EKIE (Engagement Kiosks for Information Exchange). Whatever one calls these information exchange sites, they will have four broad purposes:
•To make it convenient for patients to judge the nature of the practices and their services, view the qualifications and quality of its providers, schedule visits, refill prescriptions, submit personal health cards demographic, financial, and medical data, and communicate by email with their doctor about minor health problems.
•To allow patients to share their complaints and tell their full stories electronically without interruption in a narrative form by using easy-to-understand clinical algorithms, while at the same time, permitting doctors to zero in on patient perceptions without being overly intrusive and saving time and appreciating the complexity of the patient’s problems.
•To give patients realistic expectations about their disease or the procedures that may undergo using automated multimedia presentations--visual, voice, verbal--for patients to view and study in the comfort of their homes and to share with friends and relatives.
•To increase the productivity of the patient-physician encounter and information exchange by saving time and costs for both, reducing the time and personnel costs of data entry, making the transaction more transparent, completing or financial transaction or its credit terms at the point of care, and allowing the patient to leave the office with the histories, findings and treatment plans in hand.
Saturday, June 30, 2007
Friday, June 29, 2007
Clinical Innovations - Six Innovations to Increase Productivity, Cut Costs and Extend Coverage
Six Innovations to Increase Productivity, Cut Costs, and Extend Coverage
Innovation Number One
Reprinted from Physician Leaders, June 14, 2007
Facilitating patient-physician information exchange as a key of productivity.
Many believe we can’t change the productivity of health care, changing the system would be akin turning around a battleship in a pond. Americans will only accept incremental change. In other words, because of the contrariness and fixed behaviors of patients and doctors, the system cannot and will not change. Besides, they will argue, human interactions take time, are imponderable and immeasurable.
If you believe that, you believe only rationing will cut health costs.
I reject this line of thinking. Instead, I believe soon most doctors' offices will feature information exchange stations. Some will be "virtual," connected to the Internet; others will be "real," located in doctors' reception areas.
These stations may go by various acronyms. Some may be analogues of ATMs, hence ACM (Automated Clinical Machines), and will feature "free" data entry, an important ingredient of clinical productivity. Others may be information shopping centers and may go by the name of EKIE (Engagement Kiosks for Information Exchange). Whatever one calls these information exchange sites, they will have four broad purposes:
•To make it convenient for patients to judge the nature of the practices and their services, view the qualifications and quality of its providers, schedule visits, refill prescriptions, submit personal health cards demographic, financial, and medical data, and communicate by email with their doctor about minor health problems.
•To allow patients to share their complaints and tell their full stories electronically without interruption in a narrative form by using easy-to-understand clinical algorithms, while at the same time, permitting doctors to zero in on patient perceptions without being overly intrusive and saving time and appreciating the complexity of the patient’s problems.
•To give patients realistic expectations about their disease or the procedures that may undergo using automated multimedia presentations--visual, voice, verbal--for patients to view and study in the comfort of their homes and to share with friends and relatives.
•To increase the productivity of the patient-physician encounter and information exchange by saving time and costs for both, reducing the time and personnel costs of data entry, making the transaction more transparent, completing or financial transaction or its credit terms at the point of care, and allowing the patient to leave the office with the histories, findings and treatment plans in hand
Innovation Number One
Reprinted from Physician Leaders, June 14, 2007
Facilitating patient-physician information exchange as a key of productivity.
Many believe we can’t change the productivity of health care, changing the system would be akin turning around a battleship in a pond. Americans will only accept incremental change. In other words, because of the contrariness and fixed behaviors of patients and doctors, the system cannot and will not change. Besides, they will argue, human interactions take time, are imponderable and immeasurable.
If you believe that, you believe only rationing will cut health costs.
I reject this line of thinking. Instead, I believe soon most doctors' offices will feature information exchange stations. Some will be "virtual," connected to the Internet; others will be "real," located in doctors' reception areas.
These stations may go by various acronyms. Some may be analogues of ATMs, hence ACM (Automated Clinical Machines), and will feature "free" data entry, an important ingredient of clinical productivity. Others may be information shopping centers and may go by the name of EKIE (Engagement Kiosks for Information Exchange). Whatever one calls these information exchange sites, they will have four broad purposes:
•To make it convenient for patients to judge the nature of the practices and their services, view the qualifications and quality of its providers, schedule visits, refill prescriptions, submit personal health cards demographic, financial, and medical data, and communicate by email with their doctor about minor health problems.
•To allow patients to share their complaints and tell their full stories electronically without interruption in a narrative form by using easy-to-understand clinical algorithms, while at the same time, permitting doctors to zero in on patient perceptions without being overly intrusive and saving time and appreciating the complexity of the patient’s problems.
•To give patients realistic expectations about their disease or the procedures that may undergo using automated multimedia presentations--visual, voice, verbal--for patients to view and study in the comfort of their homes and to share with friends and relatives.
•To increase the productivity of the patient-physician encounter and information exchange by saving time and costs for both, reducing the time and personnel costs of data entry, making the transaction more transparent, completing or financial transaction or its credit terms at the point of care, and allowing the patient to leave the office with the histories, findings and treatment plans in hand
Thursday, June 28, 2007
Academic Medicine - Rip Van Relman
No Margin, No Mission
A company's primary responsibility is to serve its customers and to provide needed goods or service. The company exists to produce a profit. Profit is not the primary goal, but rather an essential condition for the company's continued existence. Other responsibilities, e.g., to employees and society, exist to support the company's continued ability to carry out its primary purpose.
Peter F. Drucker, Management and Social Philosopher, 1919-2006
In 1999 I wrote “No Margin, No Mission” for The Physician Executive. The article opened with this paragraph,
A tough-minded Catholic nun, the CEO of a major not-for-profit health system on the West Coast, captured the dilemma of our health system with this down-to-earth comment:” No margin, no mission.” This article and many others indicate any organization, however noble its mission , whether “for-profit” or “not-for-profit,” must make a profit to survive as an institution and to serve its constituents. Whether a business or a charitable organization runs the enterprise makes little difference. Both need to make profit to survive. No mission is morenoble than caring for the sick. That's what medicine and hospitals are for. But to say openly that one must "make a profit" running a hospital, medical practice, or health insurance company or "compete for patients" is unseemly. For example, you may recoil at the thought of New York City hospitals' escalating competition for cancer patients to build cancer "market share."
I thought of this passage when I read a review of Arnold Relman’s latest book, A Second Opinion, Rescuing America’s Health Care, A Century Foundation Book, 205 pp, New York, Public Affairs, $24, 2007) in the June 28 New England Journal of Medicine.
Arnold Relman. M.D., has been fighting a valiant war against profit-making U.S. health care companies since 1981, when he wrote “The Medical Industrial Complex,” in the The New England Journal of Medicine, of which he was then the editor. Relman, a nephrologist, is a long-time card-carrying member of the New England academic intellectual elite who believe they hold the best answers to most U.S. health system problems, if only the rest of the world would listen.
Here are some of Relman’s solutions.
•Eliminate all for-profit health companies
•Implement a single payer system run by government or quasi-government agencies
•Have doctors provide care through organized, not-for-profit prepaid group practices
•Limit primary care practice panels to 1500 patients (the average is now 2300 patients)
•Finance health care through a national tax earmarked for health care
•End health care commercialism and multi-payer financing
•Return health care to a human service rather a market commodity
•Organize preventive, acute, and chronic care programs of consistently high quality.
There is much to admire in these proposals. Relman has been fighting his gallant, noble, and losing campaign for 25 years now. But in many ways, he is a modern day medical Rip Van Winkle. He has remained asleep in his intellectual academic cocoon in Boston while the rest of the real world moves on.
•Is he aware 75% of physicians beyond Boston and its medical schools practice in groups of 5 or less?
•Does he know 95% of doctors still charge fee-for-service while prepaid capitated care languishes?
•Does he know there are now over 190 recognized medical specialties in which physicians can obtain board certification and to organized them into prepaid groups borders on the impossible?
•Does he realize most health care innovations, e.g. new drugs and new devices, flow out of the commercial sector, not out of academia?
•Does he appreciate academic institutions have extraordinarily high costs, vis a vis community hospitals, and those high cots pose cost problems for patients and insurers?
•Is he oblivious to the reality most not-for-profit hospitals behave precisely like their for-profit brethren?
•Does he realize health care professionals live and work and pay their debts in a capitalistic democracy fueled by profits?
Without profits, there’s no money to invest in opportunities to improve care, recruit better doctors, train and educate future doctors, retain doctors you already have, invest in new technologies, build new hospitals, establish new medical schools, and lobby in Washington for what you believe in.
Not all academic Bostonians think alike. Regina Herzlinger, a professor of business at Harvard Business school, prefers a market and consumer driven system to big government and big academia. In her book, Who Killed Health Care? she argues that government and academics and general hospitals are a big part of the problem—not the solution.
She and Relman reside at opposite ends of the ideological spectrum and operate at cross-purposes. The debate between the “commercial” interests, which in Relman’s world include all those who make a “profit” and idealistic reformers, who believe health care should be “money-neutral” and guided by high ethical principles of academics and policies of government officials, will rage on.
Where it stops no one knows.
Wednesday, June 27, 2007
Hospital Physician Relationships - Thoughts That Go Bump in the Night and Suddenly Awaken Hospital CEOs
From Sailing the Seven “Cs” of Hospital-Physician Relationships: Competence, Convenience, Clarity, Continuity, Competition, Control, Cash (Practice Support Resources, A Practice Support Resource Publication, www.practicesupport.com)
1. Medical staff will revolt and cause firing of hospital CEO.
2. Hospital quality ratings will be published in local newspaper and will place hospital at bottom of list.
3. Hospital will experience an uncontrollable epidemic of drug resistant staphylococcus infections.
4. Orthopedic surgeons and cardiovascular specialists will withdraw from medical staff and build their own specialty hospitals.
5. Dickie Scruggs, Mississippi lawyer, will bring successful class action suite against not-for-profit hospitals, converting them into taxable entities.
6. Medicare pay-for-performance movement will catch fire, forcing hospital to invest heavily into IT system.
7. Hospital loses multibillion dollar malpractice lawsuit.
8. Debt burdens from paying for uninsured grow, and hospital is forced to pursue program and merger with main rival.
9. Demand for transparency and for quality based purchasing and quality reporting to support evidence-based medicine and improved coordination of care overwhelms hospital IT department.
10. Pressures on margins force hospital to tighten integration with physicians – to employ more specialists, to strike partnerships with competing physicians, to fund EMR technologies for physicians, and to jointly negotiate prices for costly supply chain technology items.
11. Regional Health Information Organizations are for real, and the government will force hospitals to share tightly held , secret information with competitors.
12. As consumer-driven movement gains traction, hospital will force greater price transparency, patient-friendly billing, public reporting of pricing in advance, bundled billing with physicians, more collection and billing from individual patients, longer payment cycles, and more competition from lower-cost providers.
13. Political events in Washington, D.C., and state capitols will impose heavy taxes and more regulations upon hospitals.
14. Forces of decentralization will compel hospitals to abandon central facilities, to outsource many services, and to cede partial control of management and finances to providers at peripheral sites.
Tuesday, June 26, 2007
Consumer Communiction -It Ain’t All About Information: It’s About Communication
Notes of a Health Care Market Watcher
Paula Dean, one of the most popular cooks in the food channel, has a book out called It Ain’t All About the Cookin’ Her point is there’s more to cooking than meets the eye. Cooking reflects your life experience. Cooking is something everyone can connect with. We all have to eat, and we’re all thinking about that next meal.
Similarly there ‘s more to health care than information. We’re up to our hips in information. There’s information everywhere – on TV, the Internet, blogs, newspapers, magazines. Much of it, particularly on the Internet, is undigested and unedited. There’s so much of it in health care, in fact, that there’s a new executive in the health system C-Suite – the CIO, Chief Information Officer.
But information has gotten so overwhelming for the CIO, that we’ve added another "C" in the C-Suite , the CXO, or Chief Experience Officer. Here’s how the Cleveland Clinic explains the duties of the CXO in a press release:
The Cleveland Clinic has named Dr. Bridget Duffy as its first chief experience . a new role aimed at making sure each patient has a high-quality expererience that meets their medical, physical and emotional needs.
"As a leading healthcare provider, we must exceed the expectations of those we serve, offering compassion, showing empathy and passion for patient-centered initiatives," said Dr. Toby Cosgrove, the Clinic's chief executive, in a written statement.
Duffy, who most recently was a health-care consultant and advisor in San Francisco, is known nationally for building health-care environments that treat the whole person, humanize the delivery of medical technology, and support the role of doctors and nurses as leaders in patient care.
The Chief Experience Officer might also be called the Chief Communication Officer, for it is her duty to communicate to the public just what they are likely to expect and experience in the hands of health care professionals.
This communication requires a mastery of multimedia technologies and marketing strategies. It will also require fulling “engaging” the patient (I still prefer “patient” to “health care consumer” in the experience of their own care. Here is how I explain it in an article of mine that appears this week in Healthleadersmedia.com
What will this "engagement" take? I believe it will take three things:
•Cogent, relevant and understandable communication between patients and doctors giving compelling reasons to engage as partners in care. One example of this are Internet-based videos, "prescribed" by doctors for patients before surgery, telling patients what to expect at surgery--the details of the procedure, its anatomy, its benefits, its risks and its consequences.
•A more structured approach to the patient doctor encounter. A standardization of the medical history so that one can compare performances and outcomes based on a commonly understood basis.
•New financial arrangements that reward patients and doctors based on realistic incentives for both to produce more favorable outcomes and on the recognition that outcomes depend heavily on what goes on outside as well as inside the office.
Finally, it will take observing and applying some of the strategies and techniques that have worked in the American retail sector. Retailing is America’s most productive sector. In the last dozen years, chains like Wal-Mart, Starbucks, Staples, Home Deport and Home Stores have sparked America's remarkable productivity. How have they done this? By restructuring the way they do business. According to marketing guru, Erich Joachhimsthaler, retailers have done it by looking at behaviors and demands of customers from the "outside-in," i.e., through the eyes of time-bankrupt hardworking two-career families, seeking convenience and by adopting a strategy of DIG (Demand-first Innovation Growth). Retailers have introduced multiple sites for shopping (mail-order catalogues, Internet, television), increased convenience by minimizing travel time (by placing outlets in malls, neighborhood stores, office buildings, transportation terminals), placed goods in huge stores that offer one-stop shopping, reorganized contents around lifestyles and trained employees to play defined roles concentrated on serving the customer.
Similar changes are beginning to occur in health care:
•Retail clinics in drug stores, grocery stores and retail outlets
•Urgent clinics that are specialized easy-to-reach
•Exercise and fitness facilities in retirement villages
•Big MACCs (Multispecialty Ambulatory Care Centers), conveniently located in suburban and rural settings
•Big Boxes (large buildings co-owned by hospitals and doctors with joint reception areas, support personnel and support services)
•Specialty surgical hospitals for heart, orthopedics and neurosurgical disorders
•"Focused-factories" with integrated teams to treat diabetes, AIDS, heart disease, back disorders, hernias, infertility
•Companies that specialize in providing care in the home for the frail elderly (that socially isolated one percent segment of the population that account for as much as 20 percent of health costs).
Experiences are building to provide Americans with better and more accessible care. Now all we need to do is to communicate what we’re doing to the American people. After all, the biggest variable in America’s health care future is public opinion.
Paula Dean, one of the most popular cooks in the food channel, has a book out called It Ain’t All About the Cookin’ Her point is there’s more to cooking than meets the eye. Cooking reflects your life experience. Cooking is something everyone can connect with. We all have to eat, and we’re all thinking about that next meal.
Similarly there ‘s more to health care than information. We’re up to our hips in information. There’s information everywhere – on TV, the Internet, blogs, newspapers, magazines. Much of it, particularly on the Internet, is undigested and unedited. There’s so much of it in health care, in fact, that there’s a new executive in the health system C-Suite – the CIO, Chief Information Officer.
But information has gotten so overwhelming for the CIO, that we’ve added another "C" in the C-Suite , the CXO, or Chief Experience Officer. Here’s how the Cleveland Clinic explains the duties of the CXO in a press release:
The Cleveland Clinic has named Dr. Bridget Duffy as its first chief experience . a new role aimed at making sure each patient has a high-quality expererience that meets their medical, physical and emotional needs.
"As a leading healthcare provider, we must exceed the expectations of those we serve, offering compassion, showing empathy and passion for patient-centered initiatives," said Dr. Toby Cosgrove, the Clinic's chief executive, in a written statement.
Duffy, who most recently was a health-care consultant and advisor in San Francisco, is known nationally for building health-care environments that treat the whole person, humanize the delivery of medical technology, and support the role of doctors and nurses as leaders in patient care.
The Chief Experience Officer might also be called the Chief Communication Officer, for it is her duty to communicate to the public just what they are likely to expect and experience in the hands of health care professionals.
This communication requires a mastery of multimedia technologies and marketing strategies. It will also require fulling “engaging” the patient (I still prefer “patient” to “health care consumer” in the experience of their own care. Here is how I explain it in an article of mine that appears this week in Healthleadersmedia.com
What will this "engagement" take? I believe it will take three things:
•Cogent, relevant and understandable communication between patients and doctors giving compelling reasons to engage as partners in care. One example of this are Internet-based videos, "prescribed" by doctors for patients before surgery, telling patients what to expect at surgery--the details of the procedure, its anatomy, its benefits, its risks and its consequences.
•A more structured approach to the patient doctor encounter. A standardization of the medical history so that one can compare performances and outcomes based on a commonly understood basis.
•New financial arrangements that reward patients and doctors based on realistic incentives for both to produce more favorable outcomes and on the recognition that outcomes depend heavily on what goes on outside as well as inside the office.
Finally, it will take observing and applying some of the strategies and techniques that have worked in the American retail sector. Retailing is America’s most productive sector. In the last dozen years, chains like Wal-Mart, Starbucks, Staples, Home Deport and Home Stores have sparked America's remarkable productivity. How have they done this? By restructuring the way they do business. According to marketing guru, Erich Joachhimsthaler, retailers have done it by looking at behaviors and demands of customers from the "outside-in," i.e., through the eyes of time-bankrupt hardworking two-career families, seeking convenience and by adopting a strategy of DIG (Demand-first Innovation Growth). Retailers have introduced multiple sites for shopping (mail-order catalogues, Internet, television), increased convenience by minimizing travel time (by placing outlets in malls, neighborhood stores, office buildings, transportation terminals), placed goods in huge stores that offer one-stop shopping, reorganized contents around lifestyles and trained employees to play defined roles concentrated on serving the customer.
Similar changes are beginning to occur in health care:
•Retail clinics in drug stores, grocery stores and retail outlets
•Urgent clinics that are specialized easy-to-reach
•Exercise and fitness facilities in retirement villages
•Big MACCs (Multispecialty Ambulatory Care Centers), conveniently located in suburban and rural settings
•Big Boxes (large buildings co-owned by hospitals and doctors with joint reception areas, support personnel and support services)
•Specialty surgical hospitals for heart, orthopedics and neurosurgical disorders
•"Focused-factories" with integrated teams to treat diabetes, AIDS, heart disease, back disorders, hernias, infertility
•Companies that specialize in providing care in the home for the frail elderly (that socially isolated one percent segment of the population that account for as much as 20 percent of health costs).
Experiences are building to provide Americans with better and more accessible care. Now all we need to do is to communicate what we’re doing to the American people. After all, the biggest variable in America’s health care future is public opinion.
Monday, June 25, 2007
Sermo -In Search of Physician Search Engine Innovations
AMA and Sermo.Com Sign Deal
Q: What’s new these days?
A: Well, it’s summertime, and the news is slow, but I’m still on the hunt for innovations that might level the playing field for doctors and improve the system.
Q: Anything exciting?
A: Yes, I think so. I just became a member of Sermo.com. Sermo is a Web 2.0 application that allows physicians to exchange interactive online views with each other about what’s going on out there. Sermo just signed a deal with the AMA to help doctors respond more quickly to the clinical and professional issues of the day.
Q: Doesn’t sound like a big deal to me. Who is this Sermo?
A: It’s a small 2-year old software company developed by Dr. Palestrant, a Cambridge-Mass general surgeon. Wall Street firms who use it pay $100,000 to $500,000 to track doctor trends, view doctor postings, and take doctor surveys. Sermo just entered into a partnership with the AMA to magnify the physician’s voice on medical issues of the day. Doctors will be paid $20 for each opinion of theirs that is posted.
Q: I still don’t see why this is big news.
A: I’ll bring you up to speed. Sermo is a “human powered search firm.” That means it features more than a simple mechanical algorithm ranking like Google. In their June 23 Sunday section on Innovation, “Bright Ideas,” the New York Times says human-powered sites brings humans into the search engine field.
The Times goes so far as to say The human touch may loosen Google’s grip on the search engine field. You may not be aware of it, but Google is the 800 pound gorilla in the search field. Google had $28 billion of cash in its pocket by the end of March, far outdistancing Yahoo and Microsoft who are mere pygmies in the search engine race.
Q: Maybe I’m dense, but why should doctors care what each other think? What makes Sermo so powerful for doctors?
A: It allows the nearly instantaneous collective feedback of thousands of physicians in small practices. It gives them a voice and a forum for exchanging ideas.
Besides, a lot of big time businesses care a lot about what doctors think. After all, they’re a $500 billion industry, and doctors’ pens may be the most single powerful medical instrument known to man.
Q: I’m still not impressed.
A: Maybe I should let Sermo explain. Here’s what they say in their press release.
Launched in September 2006, Sermo is already the largest online physician community, ever. Sermo’s Web-based platform provides a medium for physicians to aggregate observations from daily practice— rapidly and in large numbers — to challenge or corroborate each other’s opinions. This forum accelerates the discovery of emerging trends and provides new insights into medications, devices, and treatments.
Through Sermo, physicians exchange knowledge with each other the minute it is learned and gain potentially life saving insights from colleagues as they happen instead of waiting to read about them in conventional media sources.
Sermo harnesses the power of collective wisdom and enables physicians to discuss new clinical findings, report unusual events, and work together to improve patient care in a way never before possible. Through its unique business model, Sermo is free to physicians and has no advertising or promotion.
Based on a system of information arbitrage, Sermo allows health care organizations, financial services firms and industry analysts to access the community’s collective knowledge on a subscription basis.
Q: That explanation is a little long-winded for me. “Information arbitrage!” That’s a new one on me. You’ll have to do better than that.
A: OK, here goes.
•Think of Sermo as a collective edited blog.
•Think of it as an expression of the collective wisdom of the medical profession.
•Think of it as a doctor-type Google with the addition of human interaction, rather than just a mechanical algorithm.
•Think of it as a Wikopedia for doctors.
•Think of it as an algorithm with a heart and soul.
•Think of it as the embodiment of human interaction with machines.
•Think of it as giving doctors a hammer with which to hit the nail they want to hit.
•Think of it as converting doctors’ voices into action.
•Think of it as a tipping point for physicians where their collective experience on clinical and professional issues tips things in their favor and on the side of patients.
Q: You certainly have a way with metaphors, but sometimes you mix your metaphors too much and let them spin out of control
A: I know. Some people say I suffer from bouts of metaphorrhea. But thank you for the backhanded compliment anyway
Q: What’s new these days?
A: Well, it’s summertime, and the news is slow, but I’m still on the hunt for innovations that might level the playing field for doctors and improve the system.
Q: Anything exciting?
A: Yes, I think so. I just became a member of Sermo.com. Sermo is a Web 2.0 application that allows physicians to exchange interactive online views with each other about what’s going on out there. Sermo just signed a deal with the AMA to help doctors respond more quickly to the clinical and professional issues of the day.
Q: Doesn’t sound like a big deal to me. Who is this Sermo?
A: It’s a small 2-year old software company developed by Dr. Palestrant, a Cambridge-Mass general surgeon. Wall Street firms who use it pay $100,000 to $500,000 to track doctor trends, view doctor postings, and take doctor surveys. Sermo just entered into a partnership with the AMA to magnify the physician’s voice on medical issues of the day. Doctors will be paid $20 for each opinion of theirs that is posted.
Q: I still don’t see why this is big news.
A: I’ll bring you up to speed. Sermo is a “human powered search firm.” That means it features more than a simple mechanical algorithm ranking like Google. In their June 23 Sunday section on Innovation, “Bright Ideas,” the New York Times says human-powered sites brings humans into the search engine field.
The Times goes so far as to say The human touch may loosen Google’s grip on the search engine field. You may not be aware of it, but Google is the 800 pound gorilla in the search field. Google had $28 billion of cash in its pocket by the end of March, far outdistancing Yahoo and Microsoft who are mere pygmies in the search engine race.
Q: Maybe I’m dense, but why should doctors care what each other think? What makes Sermo so powerful for doctors?
A: It allows the nearly instantaneous collective feedback of thousands of physicians in small practices. It gives them a voice and a forum for exchanging ideas.
Besides, a lot of big time businesses care a lot about what doctors think. After all, they’re a $500 billion industry, and doctors’ pens may be the most single powerful medical instrument known to man.
Q: I’m still not impressed.
A: Maybe I should let Sermo explain. Here’s what they say in their press release.
Launched in September 2006, Sermo is already the largest online physician community, ever. Sermo’s Web-based platform provides a medium for physicians to aggregate observations from daily practice— rapidly and in large numbers — to challenge or corroborate each other’s opinions. This forum accelerates the discovery of emerging trends and provides new insights into medications, devices, and treatments.
Through Sermo, physicians exchange knowledge with each other the minute it is learned and gain potentially life saving insights from colleagues as they happen instead of waiting to read about them in conventional media sources.
Sermo harnesses the power of collective wisdom and enables physicians to discuss new clinical findings, report unusual events, and work together to improve patient care in a way never before possible. Through its unique business model, Sermo is free to physicians and has no advertising or promotion.
Based on a system of information arbitrage, Sermo allows health care organizations, financial services firms and industry analysts to access the community’s collective knowledge on a subscription basis.
Q: That explanation is a little long-winded for me. “Information arbitrage!” That’s a new one on me. You’ll have to do better than that.
A: OK, here goes.
•Think of Sermo as a collective edited blog.
•Think of it as an expression of the collective wisdom of the medical profession.
•Think of it as a doctor-type Google with the addition of human interaction, rather than just a mechanical algorithm.
•Think of it as a Wikopedia for doctors.
•Think of it as an algorithm with a heart and soul.
•Think of it as the embodiment of human interaction with machines.
•Think of it as giving doctors a hammer with which to hit the nail they want to hit.
•Think of it as converting doctors’ voices into action.
•Think of it as a tipping point for physicians where their collective experience on clinical and professional issues tips things in their favor and on the side of patients.
Q: You certainly have a way with metaphors, but sometimes you mix your metaphors too much and let them spin out of control
A: I know. Some people say I suffer from bouts of metaphorrhea. But thank you for the backhanded compliment anyway
Sunday, June 24, 2007
Costs - Is Fee-For-Service Medicine the Primary Cause of High Health Costs and Mediocre Care?
If So, Should It Be Curtailed, and How?
A chorus of opinion is growing out there among health care critics, academic pundits, integrated systems with salaried doctors, employers, and government health officials that fee-for-service is the main cause of bad elements of U.S. medicine. These include,
•Soaring costs
•Inconsistent quality
•Duplicated services
•Poor coordination
•Sketchy collaboration
•Inadequate follow-up
•Too many specialists chasing too many sick patients
•Incentives to commit greed, and even fraud
If only, some argue, we could,
•Herd doctors into larger groups
•Place doctors on salaries or hourly wages
•Adopt universal prepaid care
•Remove incentives to perform procedures and tests.
•Create “medical homes” for patients by placing them under one doctor’s or one group’s guidance.
•Pay a single fee on a risk-adjusted basis for spectrums of care for disease episodes.
•Integrate services for chronic disease into discrete reimbursable packages
•Bundle bills for hospitals and doctors into one predictable and transparent fee package known in advance
No doubt, discrete fee-for-service paid by third parties for every imaginable service generates real problems.
One case in point is the 10% Medicare fee reduction doctors will face in 2008 under current law, followed by eight annual reimbursement cuts to follow. If these cuts go through, 28% of 9000 doctors in a national AMA survey said they will stop accepted new Medicare patients in 2008, and 64% will cease seeing these patients by 2015. That happening, coupled with an anticipated doctor shortage, could trigger a national access crisis.
Another problem is “fragmented care.” Critics use this umbrella term to describe when occurs when doctors are paid individual fees for what they do. In a June 21 Wall Street Journal Op-Ed piece, “How Many Doctors Does It Take to Treat a Patient,” Dr. Peter Bach, a doctor at Memorial Sloan-Kettering who recently served as senior advisor to CMS, described the situation:
“Medicare patients bounce between many doctors, most of whom are unaffiliated with one another and as a result, few patients have a single doctor who is central to the care they receive.
The typical Medicare patient in one year sees seven different doctors, including five different specialists, working in four different practices. For vulnerable patients with multiple chronic conditions, care is even more fragmented and involves more doctors. Forty percent of the patients in our study had seven or more chronic conditions and they saw on average 11 doctors in seven practices. The upper quartile of this group saw 16 or more different doctors in nine or more different practices.
Health care is like this because of the way doctors are paid. Few doctors receive an hourly rate or a set annual salary; most are paid according to a system called “fee for service,” in which visits, tests and procedures are reimbursed separately. Doctors face incentives to provide more services and more expensive services and they do just that.”
Bach says doctor spending will rise 6% in 2007, and may top $500 billion in 2008. He believes patients would be better off seeing fewer doctors working together to develop “a cohesive coordinated plan of care.” He commends the American College of Physicians and the American Academy of Family Physicians for recommending a “medical home” model for Medicare beneficiaries. Congress is now considering the home model for Medicare patients (Tax Relief and Healthcare Act of 2006). But Bach quickly adds doctors shouldn’t be paid extra for “coordinating care” or for providing “appropriate” care.
What will it take to tamp down fee-for-service? And how we do it? By government fiat or market forces? A lot of models have been tried – prepaid care, diagnosis related groups, systematic fees reductions, claims rejections , utilization review, gatekeeper physicians, exclusion of expensive doctors or those doing inappropriate services from “preferred “networks, large integrated systems offering prepaid one-stop care - and a lot of models have failed, at least on a large enough scale to deflate overall medical costs. Whatever’s tried, it seems, fee-for-service doctors find a way around.
Furthermore, how do you address these realities?
•75% of America’s 750,000 doctors are in groups of five or less and are paid FFS,
•40% practice solo or in groups of two, also paid FFS
•Who will choose the “medical home”?
•What about “cash only” practices”?
•What about rural practices?
How do fence off doctors from the rest of the American economy, which operates on a fee-for-service basis? How do you exclude or include those doctors who make their living doing mostly single procedures – colonoscopies, vasectomies, cosmetic surgeries, and a myriad of other things? What about those doctors who function in 190 different medical specialties? And what about innovative niche practices – like retail clinics – that keep cropping up? What about the trend towards on-site work clinics in corporate settings? Do these corporate clinics qualify as “medical homes?”
And what about all those federal regulations – Stark rules, certificates of need, anti-monopolistic rulings, IRS laws – that stifle innovation, cooperation, and collaboration between doctors and hospitals? After all, hospitals are where 50% of health costs reside. Will adding thousand of other pages to curtail fee-for-service to the already fat 140,000 pages of the Mesdicare code book make a difference?
Lastly and perhaps most importantly, what about those assertive new health consumers armed with HSAs and/or in high deductible health plans who are comparison shopping for price and who want choice, convenience, and freedom to choose and dictate their own care – and to go to whomever they want for care?
I‘m skeptical centralized top-down government can seriously curtail individual fee- for-service or even control the underground medical economy. Regional market forces may cause these fees to be bundled and integrated into packages for a range of services for a given disease or procedure to be established, and prepaid care may prevail in the far West, but I don't foresee and can't envision abandonment of fee-for-service medicine in America.
Fee-for-service is the market engine that drives decentralized Western capitalism. It’s the basis for market transactions in every sphere of our daily lives. It rests on trust and integrity of responsible seller and informed buyers. Maybe health care radically differs from other transactions, but I doubt that it does.
Moreover, we live in a democracy, where people are free to seek opportunity, act in their own self-interest, live and move where they please, and outside of Medicare and Medicaid and health plans, physicians are free to set the fees they please; and consumers are free to accept or reject those fees.
The question is, if I may use a bad pun, what’s feesable across the broad health care economy? Maybe taking away the present physician reimbursement formula, which calls for a 40% reduction in fees over the next five years and replacing it with fees geared to annual cost of living increases, or increases in overhead expenses may be a start. I invite readers out there to offer suggestions and comments.
A chorus of opinion is growing out there among health care critics, academic pundits, integrated systems with salaried doctors, employers, and government health officials that fee-for-service is the main cause of bad elements of U.S. medicine. These include,
•Soaring costs
•Inconsistent quality
•Duplicated services
•Poor coordination
•Sketchy collaboration
•Inadequate follow-up
•Too many specialists chasing too many sick patients
•Incentives to commit greed, and even fraud
If only, some argue, we could,
•Herd doctors into larger groups
•Place doctors on salaries or hourly wages
•Adopt universal prepaid care
•Remove incentives to perform procedures and tests.
•Create “medical homes” for patients by placing them under one doctor’s or one group’s guidance.
•Pay a single fee on a risk-adjusted basis for spectrums of care for disease episodes.
•Integrate services for chronic disease into discrete reimbursable packages
•Bundle bills for hospitals and doctors into one predictable and transparent fee package known in advance
No doubt, discrete fee-for-service paid by third parties for every imaginable service generates real problems.
One case in point is the 10% Medicare fee reduction doctors will face in 2008 under current law, followed by eight annual reimbursement cuts to follow. If these cuts go through, 28% of 9000 doctors in a national AMA survey said they will stop accepted new Medicare patients in 2008, and 64% will cease seeing these patients by 2015. That happening, coupled with an anticipated doctor shortage, could trigger a national access crisis.
Another problem is “fragmented care.” Critics use this umbrella term to describe when occurs when doctors are paid individual fees for what they do. In a June 21 Wall Street Journal Op-Ed piece, “How Many Doctors Does It Take to Treat a Patient,” Dr. Peter Bach, a doctor at Memorial Sloan-Kettering who recently served as senior advisor to CMS, described the situation:
“Medicare patients bounce between many doctors, most of whom are unaffiliated with one another and as a result, few patients have a single doctor who is central to the care they receive.
The typical Medicare patient in one year sees seven different doctors, including five different specialists, working in four different practices. For vulnerable patients with multiple chronic conditions, care is even more fragmented and involves more doctors. Forty percent of the patients in our study had seven or more chronic conditions and they saw on average 11 doctors in seven practices. The upper quartile of this group saw 16 or more different doctors in nine or more different practices.
Health care is like this because of the way doctors are paid. Few doctors receive an hourly rate or a set annual salary; most are paid according to a system called “fee for service,” in which visits, tests and procedures are reimbursed separately. Doctors face incentives to provide more services and more expensive services and they do just that.”
Bach says doctor spending will rise 6% in 2007, and may top $500 billion in 2008. He believes patients would be better off seeing fewer doctors working together to develop “a cohesive coordinated plan of care.” He commends the American College of Physicians and the American Academy of Family Physicians for recommending a “medical home” model for Medicare beneficiaries. Congress is now considering the home model for Medicare patients (Tax Relief and Healthcare Act of 2006). But Bach quickly adds doctors shouldn’t be paid extra for “coordinating care” or for providing “appropriate” care.
What will it take to tamp down fee-for-service? And how we do it? By government fiat or market forces? A lot of models have been tried – prepaid care, diagnosis related groups, systematic fees reductions, claims rejections , utilization review, gatekeeper physicians, exclusion of expensive doctors or those doing inappropriate services from “preferred “networks, large integrated systems offering prepaid one-stop care - and a lot of models have failed, at least on a large enough scale to deflate overall medical costs. Whatever’s tried, it seems, fee-for-service doctors find a way around.
Furthermore, how do you address these realities?
•75% of America’s 750,000 doctors are in groups of five or less and are paid FFS,
•40% practice solo or in groups of two, also paid FFS
•Who will choose the “medical home”?
•What about “cash only” practices”?
•What about rural practices?
How do fence off doctors from the rest of the American economy, which operates on a fee-for-service basis? How do you exclude or include those doctors who make their living doing mostly single procedures – colonoscopies, vasectomies, cosmetic surgeries, and a myriad of other things? What about those doctors who function in 190 different medical specialties? And what about innovative niche practices – like retail clinics – that keep cropping up? What about the trend towards on-site work clinics in corporate settings? Do these corporate clinics qualify as “medical homes?”
And what about all those federal regulations – Stark rules, certificates of need, anti-monopolistic rulings, IRS laws – that stifle innovation, cooperation, and collaboration between doctors and hospitals? After all, hospitals are where 50% of health costs reside. Will adding thousand of other pages to curtail fee-for-service to the already fat 140,000 pages of the Mesdicare code book make a difference?
Lastly and perhaps most importantly, what about those assertive new health consumers armed with HSAs and/or in high deductible health plans who are comparison shopping for price and who want choice, convenience, and freedom to choose and dictate their own care – and to go to whomever they want for care?
I‘m skeptical centralized top-down government can seriously curtail individual fee- for-service or even control the underground medical economy. Regional market forces may cause these fees to be bundled and integrated into packages for a range of services for a given disease or procedure to be established, and prepaid care may prevail in the far West, but I don't foresee and can't envision abandonment of fee-for-service medicine in America.
Fee-for-service is the market engine that drives decentralized Western capitalism. It’s the basis for market transactions in every sphere of our daily lives. It rests on trust and integrity of responsible seller and informed buyers. Maybe health care radically differs from other transactions, but I doubt that it does.
Moreover, we live in a democracy, where people are free to seek opportunity, act in their own self-interest, live and move where they please, and outside of Medicare and Medicaid and health plans, physicians are free to set the fees they please; and consumers are free to accept or reject those fees.
The question is, if I may use a bad pun, what’s feesable across the broad health care economy? Maybe taking away the present physician reimbursement formula, which calls for a 40% reduction in fees over the next five years and replacing it with fees geared to annual cost of living increases, or increases in overhead expenses may be a start. I invite readers out there to offer suggestions and comments.
Saturday, June 23, 2007
Michael Moore - Sicko! Wacko! Stinko?
Michael Moore Movie,”Sicko”: The Truth or Pinko Lingo?
Michael Moore, favorite wacko of Hollywood, George Soros, and far-left bloggers, has produced a documentary portraying Cuban medicine as superior to American medicine. The true test of his convictions will be where he will go for treatment when he gets sick.
Fast forward 20 years. What happens when Moore’s health goes blotto, and he needs medical help pronto? Who knows? But for now, we know these truths. Moore has aroused the ire of two of America’s most ardent advocates of a market-driven system, and earned the admiration of the New York Times movie reviewer.
Here are their comments.
First, Greg Scandlen, President and Founder of Consumers for Health Care Choice, June 22, 2007
"Sick and Sicker" to Counter Michael Moore
CHCC Foundation Sponsors New Movie
If you go see Michael Moore's "Sicko" you will probably leave the theater wondering why nobody ever presents the other side of the story. Most people agree that Moore's critique of American health care is not just right, but his answers are seriously off-base. I mean, c'mon -- CUBA, for Pete's sake?
Moore's premise -- that over-reliance on Third Party Payers results in bureaucratic interference in medicine -- is sound. But his remedy -- to create one colossal Third Party Payer in the federal government -- will only make the existing problems that much worse.
The CHCC Foundation has arranged to be the fiscal sponsor for a new movie being produced by Logan Clements that will answer Moore's charges. Logan is actively filming in Canada right now, exploring the disastrous results of Canada's system. Deaths from neglect, two year waits for basic services, long waits for critical consultations such as oncology for cancer that delay treatment until is too late are common in Canada. The Canadian Supreme Court recently ruled the Canadian system violates the Canadian Charter because it denies the human right to use one's own recources to save one's own life and as a direct result many are dying.
The American people need to know that although our insurance system is flawed and needs a good injection of consumerism and transparency, replacing it with Canada's system will make a sick system much sicker. Access to a long waiting list is not access to care.
As the fiscal sponsor of the film, the CHCC Foundation will be able to accept tax deductible contributions to pay for the production of the feature-length movie and ensure that Michael Moore's propaganda is met with a factual examination of the realities of socialized medicine.
But he can't complete the movie without funds. Michael Moore had big Hollywood bucks behind him. All we have is people like you. Instead of just complaining about one-sided propaganda, this is your chance to help ensure that America hears the whole story. Any contribution -- large, small, or in between -- will help complete this important project.
To find out more about the movie, go to the film's web site -- http://www.sickandsickermovie.com/index.html.
To contribute, go to the CHCC Foundation's site - http://www.chcchoices.org/foundation.html
Contact Information
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
email: greg@chcchoices.org
phone: 301-606-7364
web: http://www.chcchoices.org
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Next, Grace-Marie Turner, Founder and President, The Galen Institute
Health Policy Matters®
SiCKO. Need we say more?
June 22, 2007
So Michael Moore brought his latest film to town on Wednesday for a well-publicized preview. SiCKO seems to have pushed most other serious health policy discussions off the agenda this week, even while key congressional committees were voting on more than a dozen important health care bills on prescription drug safety and health spending.
Heaven forbid that we would wind up making policy by propaganda, because that is exactly what would happen if anyone were to base any serious health reform proposals on Moore's film.
First, he makes the ridiculous assertion that Cuba's government-run, single-payer health care system is far superior to the United States. Give me a break! Cuban doctors even botched surgery on Fidel Castro, and a Spanish surgeon had to be called in to try to repair the damage.
In a film scene reminiscent of the Keystone Cops, Cuban doctors dash around to care for several American patients (9/11 rescue workers) that Moore has brought over on a fishing boat he commandeered. The care they get is purported to be representative of the care that anyone in the socialized health care system in Cuba gets. Credible? You tell me.
Moore has also been doing the TV interview circuit, and one question he was asked seemed to get to the heart of his incongruity. An interviewer for FoxNews asked why he would be calling for a health care system run by government when he is so opposed to government in the first place. “Good question,” Moore responds. He then uses the opportunity to slam the Bush administration, saying that government used to do things right before the current administration took over.
Exactly when was it that we had that perfect government?
Today, it is overwhelmed just trying to issue passports. Could any government magically run an infinitely more complex health care system for 300 million Americans?
The Cato Institute held a forum on Capitol Hill on Thursday morning to show clips of SiCKO as well as clips from several other films which tell the other side of the story.
One of the presenters was filmmaker Stuart Browning of the Motion Picture Institute. He has produced a series of films at www.freemarketcure.com using interviews with patients to show the limits, restrictions on access, and rationing of care in single-payer health care systems, especially Canada.
Another film is in production to answer Moore. Called Sick and Sicker, producer Logan Darrow Clements is filming in Canada right now and has interviewed a number of us from the free-market policy community to talk about the value of a free-market health care system that values people and progress. The inimitable John Stossel of ABC News also is working on a major hour-long special this summer to offer what surely will be a more balanced portrayal of the U.S. and other health care systems.
One of Moore's core arguments in SiCKO is that profit in the health sector is evil. It is a view also shared by the chairs of many congressional committees and several presidential candidates.
They believe that the health sector can be forced to operate under a different set of rules than those which govern the rest of our economy.
But everywhere, profit is the reward that we give to the innovators, entrepreneurs, and risk-takers in our economy for offering something new or better. And the marketplace is where the conversation takes place between buyers and sellers to see if what they are offering has value and, if so, at what price.
That's the genius of our economy and how progress works. But a government-run system stops this conversation in its tracks and replaces it with price controls, centralized decision-making, and government micromanagement.
Single-payer advocates argue that we since we are such a rich country that wouldn't happen here - - that there is enough money for everyone to have all of the health care they need for the money we spend now.
But we do have centralized micromanagement of decisions and price controls in our own government-run health care systems -- Medicare, Medicaid, and the VA for example. Government makes decisions about what will be covered, under what circumstances and for whom, and how much doctors and hospitals will be paid for their services. And government seldom gets it right -- overpaying for some and underpaying for others, but also inducing huge demand for over-consumption of health care.
Earth to Michael Moore and crowd: The problems with the U.S. health sector aren't that it needs more government control and regulation but less!
In a system governed by free-market principles, people won't be asked to make decisions about their medical treatment when they are on a gurney in an emergency room. But they would make decisions about the kind of health insurance coverage they want to protect them if that happens, and they would gain more control over their routine and non-emergency care.
You do have to admit, however, that Moore is a master of publicity. He has created so much hype for his film, first premiering it before the liberal entertainment world at the Cannes Film Festival. Now, after a preview showing in Washington this week, he plans to open it in just one theater in New York today. And what will the cameras show? Long lines of people waiting to see the film, suggesting to all of the rest of us that this is a must-see movie.
Don't believe it.
Finally, the New York time movie critic, A.O. Scott
Open Wide and Say ‘Shame’
By A. O. SCOTT
June 22, 2007
It has become a journalistic cliché and therefore an inevitable part of the prerelease discussion of “Sicko” to refer to Michael Moore as a controversial, polarizing figure. While that description is not necessarily wrong, it strikes me as self-fulfilling (since the controversy usually originates in media reports on how controversial Mr. Moore is) and trivial. Any filmmaker, politically outspoken or not, whose work is worth discussing will be argued about. But in Mr. Moore’s case the arguments are more often about him than about the subjects of his movies.
Some of this is undoubtedly his fault, or at least a byproduct of his style. His regular-guy, happy-warrior personality plays a large part in the movies and in their publicity campaigns, and he has no use for neutrality, balance or objectivity. More than that, his polemical, left-populist manner seems calculated to drive guardians of conventional wisdom bananas. That is because conventional wisdom seems to hold, against much available evidence, that liberalism is an elite ideology, and that the authentic vox populi always comes from the right. Mr. Moore, therefore, must be an oxymoron or a hypocrite of some kind.
So the table has been set for a big brouhaha over “Sicko,” which contends that the American system of private medical insurance is a disaster, and that a state-run system, such as exists nearly everywhere else in the industrialized world, would be better. This argument is illustrated with anecdotes and statistics — terrible stories about Americans denied medical care or forced into bankruptcy to pay for it; grim actuarial data about life expectancy and infant mortality; damning tallies of dollars donated to political campaigns — but it is grounded in a basic philosophical assumption about the proper relationship between a government and its citizens.
Mr. Moore has hardly been shy about sharing his political beliefs, but he has never before made a film that stated his bedrock ideological principles so clearly and accessibly. His earlier films have been morality tales, populated by victims and villains, with himself as the dogged go-between, nodding in sympathy with the downtrodden and then marching off to beard the bad guys in their dens of power and privilege. This method can pay off in prankish comedy or emotional intensity — like any showman, Mr. Moore wants you to laugh and cry — but it can also feel manipulative and simplistic.
In “Sicko,” however, he refrains from hunting down the C.E.O.’s of insurance companies, or from hinting at dark conspiracies against the sick. Concentrating on Americans who have insurance (after a witty, troubling acknowledgment of the millions who don’t), Mr. Moore talks to people who have been ensnared, sometimes fatally, in a for-profit bureaucracy and also to people who have made their livings within the system. The testimony is poignant and also infuriating, and none of it is likely to be surprising to anyone, Republican or Democrat, who has tried to see an out-of-plan specialist or dispute a payment.
If you listen to what the leaders of both political parties are saying, it seems unlikely that the diagnosis offered by “Sicko” will be contested. I haven’t heard many speeches lately boasting about how well our health care system works. In this sense “Sicko” is the least controversial and most broadly appealing of Mr. Moore’s movies. (It is also, perhaps improbably, the funniest and the most tightly edited.) The argument it inspires will mainly be about the nature of the cure, and it is here that Mr. Moore’s contribution will be most provocative and also, therefore, most useful.
“Sicko” is not a fine-grained analysis of policy alternatives. (You can find some of those in a recently published book called “Sick,” by Jonathan Cohn, and also in the wonkier precincts of the political blogosphere.) This film presents, instead, a simple compare-and-contrast exercise. Here is our way, and here is another way, variously applied in Canada, France, Britain and yes, Cuba. The salient difference is that, in those countries, where much of the second half of “Sicko” takes place, the state provides free medical care.
No state-run medical system is “free.” It may be “free” financially at the point of care, but it is not “free” of taxes, restricts “free” choice of doctor, and limits “free” access to preferred care and cutting-edge technologies. If you're sick, waiting lines and times are "free" fiscally in state-run systems, but are not necessarily good for your physical health. Moore doesn’t mention these trade-offs. “Free” is in the eyes of the beholder
Friday, June 22, 2007
Kaiser - George Halvorson Powerpoint on Heath Care Industrial Revolution
With Emphasis on The “Wobbly” Parts of U.S. Health Care
The June 20 Wall Street Journal ran a piece called “The PowerPoint Turns 20, and Its Creators Ponder a Dark Side of Success.”
In 1987, Robert Gaskins and Dennis Austin, working for Microsoft, came out with PowerPoint1 for Macs. Americans now view 3.5 million PowerPoint presentations each year. PowerPoint has become something the world loves to mock but loves to use.
Powerpoint is the perfect match for presentations and graphics. It has the outline and the format to effortlessly deliver talks. Just rare back and let it flow.
For some, PowerPoint has a dark side. Critics say it elevates format over content, smacks of commercialism, reeks of salesmanship, destroys the ability to write and speak independently, impairs intellectual rigor, separates the speaker from the audience, and requires a bullet-point proof vest for bored listeners, who tend to drift off into the blue of the slides.
The Pentagon thought so little of PowerPoint that they disallowed its use. The military establishment now requires officers to speak their mind directly eyeball-to-eyeball – without colored slides, bullet points, and graphics.
I’m not a PowerPoint fan, but I’m often obligated to use it because conferences at which I speak ask for PowerPoint slides in advance, so attendees will have something to have in hand to show and tell when they go home.
But Powrpoint has its powerful points too, if you'll excuse the redundancy. PowerPoint is often just the ticket to reduce a complex subject to its elements.
The Powerpoint I have in mind is a George Halvorson, Kaiser chairman and CEO’s, presentation before the World Bank in September 2005 “It’s Time to Create an Industrial Revolution in Health Care.”
I’m not going to reproduce the Halvorson PowerPoint here. You can google it by going to George Halvorson, World Bank Presentation, clicking on PowerPoint, and view or listen to the presentation. It takes 40 minutes to view.
To give you a feel for Halvorson’s presentation, he starts by saying Kaiser has 8 million members, 142,000 employees, 32 hospitals, 12,000 salaried doctors, and $30 billion in revenues.
He goes on:
•It’s time for health care to stop floundering as a highly localized, unacceptably idiosyncratic cottage – with the exam room functioning as a medical cottage.
•It’s time to bring a significant degree of systems support and systematic thinking to health care.
•It’s time to give health care a whole new set of tools
When he says “tools,” Halvorson is mostly speaking of computer information at doctors’ fingertips at the point of care with accompanying systematic prevention, treatment, and follow-up measures to improve care..
Halvorson describes U.S. health care as:
1.The most expensive in the world
2.with superb high tech
3.with superior technologies for the sick
4.with mediocre outcomes
5.and inconsistent quality
Then comes my favorite part “The Wobbly Parts of U.S. Health Care.”
The most obvious “wobblies”, Halvorson says, are:
1.Inadequate medical records
2.Inconsistent access to current science
3.Poor patient compliance
4.Sketchy patient follow-ups
5.Lack of outcomes tracking
I won’t go on. Suffice it to say, Halvorson talks about how large integrated systems like Kaiser can fix the “wobblies” by bringing a systematic informed approach to health care by focusing on information technologies to give immediate access to science and organizing doctors in to act in teams in a unified system to improve care across the health care spectrum.
Halvorson has a noble concept, and he has facts to back up what he says. His ideas may yet catch fire. Presently, however, only about 12% of doctors are in groups of 50 more.
Maybe someday independent doctors can be “virtually integrated” in some fashion and can act in a more systematic, organized, and purposeful way, but that would require an EMR or its equivalent in every doctor’s office and a personal health record in every patient’s hand – an unlikely development for at least the next decade.
But don’t despair. Worthwhile reform takes time – and money.
Thursday, June 21, 2007
Hospital Physician Relationships - Hospital Quality Ratings
Useful Tools or a Flawed Exercise in Futility?
Perhaps I’m a contrarian. Perhaps I’m overly pragmatic. Perhaps I’m cynical when I always consider the source. Or maybe, just maybe, based on my experience on the Medical Advisory Board of America’s Top Doctors, I trust doctors’ judgments on who are the best doctors more than mere data. Reputation, in other words, in my mind often trumps data.
I know these attitudes must sound naïve, but that’s how the mind of many of us non-managerial types work. Reputation, and related factors, word of mouth, personal knowledge, private referrals, and closeness to home are more powerful than often conflicting ratings and data emanating from the Internet, government, or media sources.
In any event, three articles, one in Medscape’s General Journal, one in the AMA News, and the other in the New York Times, prompt this blog.
•The Medscape piece, posted 6/1/07, appeared first in the Journal of Hospital Medicine. It bears the title “Conflicting Measures of Hospital Quality from ‘Hospital Compare Vs the U.S. News and World Report’s Best Hospitals.” The article notes that in April 2005 CMS launched “Hospital Compare,” the first government sponsored hospital quality score care. The authors compared government rankings vs. U.S. News and World Report’s Best Doctors. Here’s what the authors’ conclude.
The Best Hospitals lists and Hospital Compare core measure scores agree only a minority of the time on the best institutions for the care of cardiac and respiratory conditions in the United States. Prominent, publicly reported hospital quality scorecards that paint discordant pictures of institutional performance potentially present a conundrum for physicians, patients, and payers with growing incentives to compare institutional quality.
If the movement to improve health care quality is to succeed, the challenge will be to harness the growing professional and lay interest in quality measurement to create rating scales that reflect the best aspects of Hospital Compare and the Best Hospitals lists, with the broadest inclusion of institutions and scope of conditions. For example, it would be more helpful to the public if the Best Hospitals lists included available Hospital Compare measures. It would also benefit consumers if Hospital Compare included more metrics about preventive and elective procedures, domains in which consumers can maximally exercise their choice of health care institutions. Moreover, voluntary reporting may constrain the quality effort. Only with mandatory reporting on quality measures will consistent and sufficient institutional accountability be achieved.
• The second article, in the June 18, 2007 AMA News, has this title and subtitle, “Coping with Rankings: More Plans are Rating Physicians, but Patients Aren’t Keeping Score. Doctors Still Have Time to Pressure Insurers for Accurate Data or None at All.” The article says demand for publicly available performance measurements are up, and corporations are demanding this data more and more. In response, the AMA-led Physician Consortium for Performance Improvement and CMS has created 184 measurements it believes provide accurate evidence-based measures and outcome data. The trend is inevitable, so doctors are learning to shape new data based on physician negotiation with health plans. Harris Interactive Polling indicate less than 1% of patients use ratings to select their doctor. Most patients still rely on word of mouth. But health plans and corporations may think differently. They believe ratings are an effective tool for identifying the best doctors.
•And then there’s the New York Times June 14 revelation In Health Care, “Cost Isn’t Proof of High Quality.” Reed Abelson, the reporter, leads off with this commentary,
“Stark evidence that high medical payments do not necessarily buy high-quality patient care is presented in a hospital study set for release today. In a Pennsylvania government survey of the state’s 60 hospitals that perform heart bypass surgery, the best-paid hospital received nearly $100,000, on average, for the operation while the least-paid got less than $20,000. At both, patients had comparable lengths of stay and death rates.
And among the 20 hospitals serving metropolitan Philadelphia, two of the highest paid actually had higher-than-expected death rates, the survey found.
Hospitals say there are numerous reasons for some of the high payments, including the fact that a single very expensive case can push up the averages.”
Still, the Pennsylvania findings support a growing national consensus that as consumers, insurers and employers pay more for care, they are not necessarily getting better care. Expensive medicine may, in fact, be poor medicine. “
The Times has been running a series of articles on medicine and money, and have reached the conclusions that doctors and hospitals vary in their pricing, that their results vary, that greed and fraud and bill padding must be involved, and that surely, if everyone including the public and payers, knew and understood the data, and the underlying costs, more homogeneous, more favorable, and lower pricing would logically follow.
T
he reporter concludes:
As eye-opening as the Pennsylvania report may be to the public, insurers have already been aware that their payment practices do not necessarily encourage hospitals to provide better care. Medicare, for example, pays essentially a flat fee, which varies depending on location and type of hospital, for the same surgery, regardless of outcome. Complications tend to simply mean additional payments.”
The basic idea behind data-seekers, as I see it, is that we should pay more for better care and less for lesser care. That intuitively makes good sense. It may sound simple, but it is not, and the process can be distorted by a few cases with horrible outcomes and by hospitals’ locations and their varying constituencies and their expectations.
It is fashionable in government and managerial circles to say that anything that can measured can be managed. It is also fashionable, in conservative circles, to say that health care is so full on interactive permutations and combinations and personal considerations and choices that only the impersonal forces of the market can sort it all out. Finally, there are those who say hospital care is too “secretive,” and therefore only data and total “transparency” can identify the best, reveal the outliers, and smooth out cost and quality variabilities.
All of these critics may be right and yet all of them may be wrong. Unfortunately, variable costs, variable quality, and variable outcomes are a function of humanity, regional cultures and their constituencies. Independent variables are part of the human condition. Some of these variations may be beyond managerial control. Health costs are 30% higher in Boston, because the Boston public is enamored with the halo of quality surrounding academic medical centers. Health costs in Miami are higher because the seniors there may consider health care “free” because of Medicare and Medigap policies. In New York City, last illnesses are 40% higher at Columbia Presbyterian than at the Mayo Clinic because people have different cultural expectations, e.g. access to the best independent specialists. Variation in cost, quality, and outcomes is not always about greed or fraud or mismanagement. They may be about cultural expectations.
I remember Peter F. Drucker’s comment, “Large health care organizations may be the most complex organizations in human history.” It’s going to take a while to establish criteria to judge and sort out the good, the bad, and the ugly. Public disclosure of outcome data and performance data on the processes of care may help, but they are only part of a complicated human equation.
Wednesday, June 20, 2007
Hospitals and Doctors – Cash Relationships
In the book James Hawkins and I wrote for hospital CEOs, Sailing the Seven “C’s of Hospital Physician Relationships: Competence, Convenience, Clarity, Continuity, Competition, Control, Cash (Practice Support, Inc), Jim observed:
Cash, in many ways, is the measuring stick for the other six “Cs.” The key questions that often determine the quality of the hospital-physician relationship may be the following -"At the points of intersection between the hospital and the doctor, is the hospital putting money into or taking money out of the doctor’s pockets?” If the hospital is contributing to the doctor’s ability to make a living and be professionally and personally satisfied, then the hospital will have gone a long way towards establishing a positive relationship. The converse is equally true.
Let’s examine the converse. What kind of net in patient and outpatient revenues do physicians in various specialties generate for hospitals? Here are the numbers derived from a 2004 survey, Merritt, Hawkins, & Associates conducted with hospital chief financial officers nationwide.
•Orthopedic surgery, $ 3.0 million
•Cardiology, $2.6 million
•Cardiology (invasive), $2.5 million
•General surgery, $2/4 million
•Neurosurgery, $2.4 million
•Internal medicine, $2.1 million
•Family practice, $2.0 million
•OB/GYN, $1.8 million
•Hematology/Oncology, $1.8 million
•Pulmonology, $1.8 million
On average, physicians generate over $1.5 million a year in inpatient and outpatient revenue for affiliated hospitals. That’s one reason why the physician shortage concerns hospitals. Each month that a needed physician is not in place can cost a hospital $100, 000 or more. On the other side of the equation, each time a high tech specialist, such an orthopedic surgeon or cardiovascular specialist pulls out of the hospital to form or own his/her own facility can cost the hospital $2.5 to $3.0 million for each departing specialist.
The cash problem get more complicated when you consider more and more physicians are seeking hospital employment or asking to be paid for doing hospital duties. Physicians are asking of hospitals, “Show me the money!” and I will cover the emergency room, take care of your inpatients, spend time on administrative committees, act as head of a hospital department, permit you to cover my malpractice premiums, and even allow you to pay me a salary.
In “The ‘Hire’ Road: Physician Employment Makes a Comeback” (Healthleadersmedia.com News, January 3, 2005), hospital consultant Preston Gee says “Hospital employment is back on the strategy radar screen and spreading like wildfire throughout the industry. If your hospital is not already pursuing the model, or seriously considering it, you are likely an anomaly.”
Today, it is specialists and sub-specialists and hospitalists, who are hot when it comes to physician employment. For hospitals, salaried specialists fill a void – in-house patient coverage, ER coverage, and prestige in the community.
For the physician, other factors are at work – a predictable 40 hour week, which fits the life styles of young or burnt-out physicians, a refuge from the unceasing bureaucratic demands of running a practice and pressures to buy EMRs. Many doctors are saying, “To hell with it, I am going to work for the hospital,” and escape from soaring malpractice costs. For others, there is a genuine desire to collaborate rather then compete with the hospital.
Cash, in many ways, is the measuring stick for the other six “Cs.” The key questions that often determine the quality of the hospital-physician relationship may be the following -"At the points of intersection between the hospital and the doctor, is the hospital putting money into or taking money out of the doctor’s pockets?” If the hospital is contributing to the doctor’s ability to make a living and be professionally and personally satisfied, then the hospital will have gone a long way towards establishing a positive relationship. The converse is equally true.
Let’s examine the converse. What kind of net in patient and outpatient revenues do physicians in various specialties generate for hospitals? Here are the numbers derived from a 2004 survey, Merritt, Hawkins, & Associates conducted with hospital chief financial officers nationwide.
•Orthopedic surgery, $ 3.0 million
•Cardiology, $2.6 million
•Cardiology (invasive), $2.5 million
•General surgery, $2/4 million
•Neurosurgery, $2.4 million
•Internal medicine, $2.1 million
•Family practice, $2.0 million
•OB/GYN, $1.8 million
•Hematology/Oncology, $1.8 million
•Pulmonology, $1.8 million
On average, physicians generate over $1.5 million a year in inpatient and outpatient revenue for affiliated hospitals. That’s one reason why the physician shortage concerns hospitals. Each month that a needed physician is not in place can cost a hospital $100, 000 or more. On the other side of the equation, each time a high tech specialist, such an orthopedic surgeon or cardiovascular specialist pulls out of the hospital to form or own his/her own facility can cost the hospital $2.5 to $3.0 million for each departing specialist.
The cash problem get more complicated when you consider more and more physicians are seeking hospital employment or asking to be paid for doing hospital duties. Physicians are asking of hospitals, “Show me the money!” and I will cover the emergency room, take care of your inpatients, spend time on administrative committees, act as head of a hospital department, permit you to cover my malpractice premiums, and even allow you to pay me a salary.
In “The ‘Hire’ Road: Physician Employment Makes a Comeback” (Healthleadersmedia.com News, January 3, 2005), hospital consultant Preston Gee says “Hospital employment is back on the strategy radar screen and spreading like wildfire throughout the industry. If your hospital is not already pursuing the model, or seriously considering it, you are likely an anomaly.”
Today, it is specialists and sub-specialists and hospitalists, who are hot when it comes to physician employment. For hospitals, salaried specialists fill a void – in-house patient coverage, ER coverage, and prestige in the community.
For the physician, other factors are at work – a predictable 40 hour week, which fits the life styles of young or burnt-out physicians, a refuge from the unceasing bureaucratic demands of running a practice and pressures to buy EMRs. Many doctors are saying, “To hell with it, I am going to work for the hospital,” and escape from soaring malpractice costs. For others, there is a genuine desire to collaborate rather then compete with the hospital.
Tuesday, June 19, 2007
Government Reform - The Government Giveth and the Government Taketh Away
Medicare Physician Payments and Medicaid Aid for Children
If Medicare cuts of 10% for physician pay go forward as planned in January 2008, here, based on an AMA survey of 9000 physicians, is how doctors say they will respond,
•Defer medical equipment purchase, 72%
•Defer health IT purchase, 67%
•Begin referring complex cases, 67%
•Discontinue nursing home visits,58%
•Stop providing certain services, 65%
•Discontinue rural outreach, 57%
•Reduce staff, 54%
•Close satellite office, 41%
•Shift more services to hospital, 40%
•Reduce workload services, 36%
•Leave the office setting or retire, 14%
Compared to a similar survey conducted in 2006, 15% more physicians said they would reduce or end acceptance of new Medicare patients, and 17% more said the would stop seeing existing Medicare patients.
Because the implications for a vulnerable patient population are similar to those for the Stage Children’s Health Insurance Program (SCHIP), the AMA would like SCHIP reauthorization, a state Medicaid problem and physician pay reform move forward as part of the same Congressional Bill. The current SCHIP program covers 6 million people, including 600,000 adults, has fallen short by $700 million.
As this point, it may be worthwhile reprinting a portion of a paper by John Goodman, PhD, health of the National Center for Policy Analysis. Here are four things he says should be avoided when considering health reform.
1. Do not turn a tax subsidy into an entitlement.
The primary way the government encourages private insurance is through tax subsidies. Many reform proposals would completely change the nature of the subsidies; e.g., by creating a refundable tax credit. The risk is that the new tax subsidy could become an
entitlement.
Medicare and Medicaid entitlements are already on a course to crowd out every other government program. We cannot survive creating more health care entitlements.
That means: government's commitment must be defined contribution, not defined benefit. Tax subsidies are going to grow roughly at the rate of growth of national income. Health care spending is growing at twice that rate. The new system of tax subsidies must also grow with national income, not with health care costs.
2. Avoid mandated coverage and mandated benefits.
Proposals to require everyone to have health insurance increase the likelihood that the government subsidy will become an entitlement.
It makes no sense to mandate a benefit package if the cost of the package is going to grow at twice the rate of the subsidy. By keeping the subsidy restrained, you will force health plans to curtail costs somehow - with HSAs, restricting payments to evidence-based medicine, HMOs, etc.
Pay-or-play is much better than a mandate. Since you will never be able to enforce the mandate anyway (and rigorous attempts at enforcement would cost far more than they are worth), let people choose whether to be insured or not. If they choose to be insured, give them a subsidy; if they choose not to be insured, make them pay a tax penalty and put the unclaimed subsidy (or the tax penalty) into the safety net.
Also, with pay-or-play you do not have to define a mandated benefit package, vulnerable to cost-increasing special interest measures.
3. Don't create perverse incentives for health plans.
Insurance pricing restrictions create perverse incentives. If people can switch plans annually at premiums that are unrelated to expected costs, the plans will seek out the healthy and avoid the sick. Once people are enrolled, the plans will over-provide to the healthy and under-provide to the sick.
A much better idea is to give plans an incentive to compete for the sick.
4. Don't encourage people to forgo private coverage by expanding public coverage.
There should be no expansion of Medicaid and SCHIP in a way that encourages people to drop their private coverage in order to get free public coverage. Instead, the incentives should work the other way. We should use public money to encourage private insura
If Medicare cuts of 10% for physician pay go forward as planned in January 2008, here, based on an AMA survey of 9000 physicians, is how doctors say they will respond,
•Defer medical equipment purchase, 72%
•Defer health IT purchase, 67%
•Begin referring complex cases, 67%
•Discontinue nursing home visits,58%
•Stop providing certain services, 65%
•Discontinue rural outreach, 57%
•Reduce staff, 54%
•Close satellite office, 41%
•Shift more services to hospital, 40%
•Reduce workload services, 36%
•Leave the office setting or retire, 14%
Compared to a similar survey conducted in 2006, 15% more physicians said they would reduce or end acceptance of new Medicare patients, and 17% more said the would stop seeing existing Medicare patients.
Because the implications for a vulnerable patient population are similar to those for the Stage Children’s Health Insurance Program (SCHIP), the AMA would like SCHIP reauthorization, a state Medicaid problem and physician pay reform move forward as part of the same Congressional Bill. The current SCHIP program covers 6 million people, including 600,000 adults, has fallen short by $700 million.
As this point, it may be worthwhile reprinting a portion of a paper by John Goodman, PhD, health of the National Center for Policy Analysis. Here are four things he says should be avoided when considering health reform.
1. Do not turn a tax subsidy into an entitlement.
The primary way the government encourages private insurance is through tax subsidies. Many reform proposals would completely change the nature of the subsidies; e.g., by creating a refundable tax credit. The risk is that the new tax subsidy could become an
entitlement.
Medicare and Medicaid entitlements are already on a course to crowd out every other government program. We cannot survive creating more health care entitlements.
That means: government's commitment must be defined contribution, not defined benefit. Tax subsidies are going to grow roughly at the rate of growth of national income. Health care spending is growing at twice that rate. The new system of tax subsidies must also grow with national income, not with health care costs.
2. Avoid mandated coverage and mandated benefits.
Proposals to require everyone to have health insurance increase the likelihood that the government subsidy will become an entitlement.
It makes no sense to mandate a benefit package if the cost of the package is going to grow at twice the rate of the subsidy. By keeping the subsidy restrained, you will force health plans to curtail costs somehow - with HSAs, restricting payments to evidence-based medicine, HMOs, etc.
Pay-or-play is much better than a mandate. Since you will never be able to enforce the mandate anyway (and rigorous attempts at enforcement would cost far more than they are worth), let people choose whether to be insured or not. If they choose to be insured, give them a subsidy; if they choose not to be insured, make them pay a tax penalty and put the unclaimed subsidy (or the tax penalty) into the safety net.
Also, with pay-or-play you do not have to define a mandated benefit package, vulnerable to cost-increasing special interest measures.
3. Don't create perverse incentives for health plans.
Insurance pricing restrictions create perverse incentives. If people can switch plans annually at premiums that are unrelated to expected costs, the plans will seek out the healthy and avoid the sick. Once people are enrolled, the plans will over-provide to the healthy and under-provide to the sick.
A much better idea is to give plans an incentive to compete for the sick.
4. Don't encourage people to forgo private coverage by expanding public coverage.
There should be no expansion of Medicaid and SCHIP in a way that encourages people to drop their private coverage in order to get free public coverage. Instead, the incentives should work the other way. We should use public money to encourage private insura
Monday, June 18, 2007
Blogging, General, - A Medical Blogger’s Self-Afflicted Interview
Q; Good Morning. It’s Monday, June 18. This is your 189th consecutive blog. By now, you must know why you’re doing these blogs. Tell me, are you a left wing or a right wing blogger?
A: I’m neither. I’m a MD Blogger, which means “Medical Doctor Blogger” or “Middle Blogger,” take you pick.
Q: Why do you talk so much about “innovation?”
A: Because you can always do things better, quicker, more conveniently, and cheaper for the benefit of patients. Besides, it’s never too late to innovate.
Q: Why not “consolidation” into one single system covering all?
A: Given the American culture’s desire for freedom of choice to providers, equality of opportunity but not results, distrust of centralized government, dislike of sweeping changes, and access to high tech care without rationing, I don’t think “consolidation” would work. It's been debated for 95 years, and it hasn't worked yet.
Q: Anything else?
A: Well, there’s this myth floating around out there that universal coverage means better care. That’s never been proven to be true. Medicare outcomes are no better for the elderly than they have even been. Federal entitlements like Medicare and Medicaid and child coverage are about financial security, on occasion “safety net” care, but rarely about overall improvement of care.
Q: Any other myths?
A: Yes. That somehow federally-run top-down care will be more even-handed, equitable, and fair to all. As a matter of act, centralized government is a lousy way to distribute resources. Take Medicare. Its payment schedules are so low and convoluted in paying primary care doctors, that primary care is on the verge of collapse. Or take Medicaid, Its payment rates are so low and its bureaucracy so unwieldy, that 40% to 50% of doctors refuse to take Medicaid patients.
Q: Are you suggesting a market-based system might be better?
A: In some ways, yes, because consumers on the ground spending their own money and making their own choices are wiser than federal or state bureaucrats and technocrats.
But suggesting that a market-based system would replace federal reimbursement is a fool’s errand. The government already pays for 46% of care, and as we all know, the sun never sets on federal programs, once established.
Besides, ideologically, one man’s meat is another man’s poison. Advocates of government-care and market-based care will never deviate from their “principles.” In the end, there will have to compromise.
Q: What about lowering costs? That seems to be the main theme of current reformers.
A: The reformers are right. Lowering costs is the key to reform. “How” is another matter altogether. Retail clinics, which charge less than primary care practices or emergency rooms, are a concrete step in that direction. Other innovations, mostly IT, such as having patients enter their own information through smart cards, personal health records, or debit cards and paying at the point of care – or patient-doctor communication through website, e-visits, or video education – will help. Other suggestions – universal interoperable computer systems, better coordination, obligatory public outcome data publication, regional information sharing, integrated health systems, pay-for-performance - are still largely abstractions.
Q: Are there things we ought to look for as the reform movement begins to play out?
A: Yes, and I would list them this way, but not necessarily in this order.
1.Experiments and compromises with “universal coverage” in Massachusetts, California, Illinois, and Pennsylvania – the big states with lots at stake and the size to see if new systems of care are possible.
2.Chronic-care management of Medicare, Medicare, and health plan populations, through “hands-on,” telephonic, and IT monitoring, of that 10% of the population causing 90% of costs.
3.Innovations in the marketplace – retail clinics, work-site clinics, disease-focused and integrated clinics, and strategically place big MACCs (multispecialty ambulatory care centers).
4.The decentralization activities of “everything-for-everybody” general hospitals, who now consume almost 50% of all health care dollars, and who know they must make moves, many specialty based - to become more productive and cheaper, please increasingly demanding constituencies – the public within their communities, demanding and assertive consumers, and restless specialists seeking more productivity and income, and to make their facilities more pleasant and safer places to be.
A; And the employers – what about them?
Q: They’re a huge factor, and they’re doing many things, -- becoming more active in their business coalitions, shedding and narrowing benefits, shifting costs, setting up wellness and preventive programs, establishing on-site clinics run by salaried physicians, insisting on use of generic drugs, clamping down and managing health care supply chains. A central issue in all of this is how to reduce costs so American businesses can compete globally. Businesses aren’t going to sit idly by and let their profits g down the drain.
A: Finally, what about the doctors?
Q: People tend to stereotype doctors as being of one mindset – compulsive, loyal to each other, oblivious to costs, focused only on themselves, resistant to change. I have never found this to be true. We are more like the “rats” (no disrespect intended because I admire doctors) of Hamelin City,
And out of the houses the rats came tumbling,
Great rats, small rats, lean rats, brawn rats/
Brown rates, black rates, gray rats, tawny rats,
Grave old plodders, gay young friskers.
Fathers, moths, uncles, cousins,
Cocking tails and pricking whiskers,
Families by tens and dozes,
Brothers, sisters, husbands, waves –
Followed the Piper for their lives.
Our Pipers are the patients. In the end, I believe we will do what pleases them, prevents their diseases, improves their health, cures them, and increasingly, costs them less in time, money, and inconvenience. Medicine is rapidly changing. Young doctors don’t think like old doctors. They seek security, stimulation, balanced life styles, and time off for themselves and their families. Doctors are innovating with new drugs, new procedures, new forms of organization, new specialties, new forms of payment, new forms of communication and education. Experimentation and innovation are the orders of the day.
A: Is that all?
Q: Isn’t that enough for now?
A: I’m neither. I’m a MD Blogger, which means “Medical Doctor Blogger” or “Middle Blogger,” take you pick.
Q: Why do you talk so much about “innovation?”
A: Because you can always do things better, quicker, more conveniently, and cheaper for the benefit of patients. Besides, it’s never too late to innovate.
Q: Why not “consolidation” into one single system covering all?
A: Given the American culture’s desire for freedom of choice to providers, equality of opportunity but not results, distrust of centralized government, dislike of sweeping changes, and access to high tech care without rationing, I don’t think “consolidation” would work. It's been debated for 95 years, and it hasn't worked yet.
Q: Anything else?
A: Well, there’s this myth floating around out there that universal coverage means better care. That’s never been proven to be true. Medicare outcomes are no better for the elderly than they have even been. Federal entitlements like Medicare and Medicaid and child coverage are about financial security, on occasion “safety net” care, but rarely about overall improvement of care.
Q: Any other myths?
A: Yes. That somehow federally-run top-down care will be more even-handed, equitable, and fair to all. As a matter of act, centralized government is a lousy way to distribute resources. Take Medicare. Its payment schedules are so low and convoluted in paying primary care doctors, that primary care is on the verge of collapse. Or take Medicaid, Its payment rates are so low and its bureaucracy so unwieldy, that 40% to 50% of doctors refuse to take Medicaid patients.
Q: Are you suggesting a market-based system might be better?
A: In some ways, yes, because consumers on the ground spending their own money and making their own choices are wiser than federal or state bureaucrats and technocrats.
But suggesting that a market-based system would replace federal reimbursement is a fool’s errand. The government already pays for 46% of care, and as we all know, the sun never sets on federal programs, once established.
Besides, ideologically, one man’s meat is another man’s poison. Advocates of government-care and market-based care will never deviate from their “principles.” In the end, there will have to compromise.
Q: What about lowering costs? That seems to be the main theme of current reformers.
A: The reformers are right. Lowering costs is the key to reform. “How” is another matter altogether. Retail clinics, which charge less than primary care practices or emergency rooms, are a concrete step in that direction. Other innovations, mostly IT, such as having patients enter their own information through smart cards, personal health records, or debit cards and paying at the point of care – or patient-doctor communication through website, e-visits, or video education – will help. Other suggestions – universal interoperable computer systems, better coordination, obligatory public outcome data publication, regional information sharing, integrated health systems, pay-for-performance - are still largely abstractions.
Q: Are there things we ought to look for as the reform movement begins to play out?
A: Yes, and I would list them this way, but not necessarily in this order.
1.Experiments and compromises with “universal coverage” in Massachusetts, California, Illinois, and Pennsylvania – the big states with lots at stake and the size to see if new systems of care are possible.
2.Chronic-care management of Medicare, Medicare, and health plan populations, through “hands-on,” telephonic, and IT monitoring, of that 10% of the population causing 90% of costs.
3.Innovations in the marketplace – retail clinics, work-site clinics, disease-focused and integrated clinics, and strategically place big MACCs (multispecialty ambulatory care centers).
4.The decentralization activities of “everything-for-everybody” general hospitals, who now consume almost 50% of all health care dollars, and who know they must make moves, many specialty based - to become more productive and cheaper, please increasingly demanding constituencies – the public within their communities, demanding and assertive consumers, and restless specialists seeking more productivity and income, and to make their facilities more pleasant and safer places to be.
A; And the employers – what about them?
Q: They’re a huge factor, and they’re doing many things, -- becoming more active in their business coalitions, shedding and narrowing benefits, shifting costs, setting up wellness and preventive programs, establishing on-site clinics run by salaried physicians, insisting on use of generic drugs, clamping down and managing health care supply chains. A central issue in all of this is how to reduce costs so American businesses can compete globally. Businesses aren’t going to sit idly by and let their profits g down the drain.
A: Finally, what about the doctors?
Q: People tend to stereotype doctors as being of one mindset – compulsive, loyal to each other, oblivious to costs, focused only on themselves, resistant to change. I have never found this to be true. We are more like the “rats” (no disrespect intended because I admire doctors) of Hamelin City,
And out of the houses the rats came tumbling,
Great rats, small rats, lean rats, brawn rats/
Brown rates, black rates, gray rats, tawny rats,
Grave old plodders, gay young friskers.
Fathers, moths, uncles, cousins,
Cocking tails and pricking whiskers,
Families by tens and dozes,
Brothers, sisters, husbands, waves –
Followed the Piper for their lives.
Our Pipers are the patients. In the end, I believe we will do what pleases them, prevents their diseases, improves their health, cures them, and increasingly, costs them less in time, money, and inconvenience. Medicine is rapidly changing. Young doctors don’t think like old doctors. They seek security, stimulation, balanced life styles, and time off for themselves and their families. Doctors are innovating with new drugs, new procedures, new forms of organization, new specialties, new forms of payment, new forms of communication and education. Experimentation and innovation are the orders of the day.
A: Is that all?
Q: Isn’t that enough for now?
Sunday, June 17, 2007
Hospital Physician Relationships - How Can Hospitals Simultaneously Engage Consumers and Doctors?
“The empowered and engaged consumers of health care – the passive ‘patient’ increasingly seems an anachronistic term – are a force to be reckoned with…The assertiveness and self-confidence that typify marginal consumers are evident in health care Internet users….More than 70 percent want online evaluations of physicians, and when they obtain the information, they use it.”
Regina Herzlinger, in “Why Innovation is Health Care is so Hard,” Harvard Business Review, May, 2006, and Who Killed Health Care? (McGraw-Hill, 2007)
Hospitals are looking for answers on how to simultaneously engage consumers and doctors. After all, without consumers, and without doctors who direct consumers to their facilities, hospitals would be nothing but empty shells.
The traditional answers to attracting consumers and doctors are,
•Beef up the hospital marketing department
•Set up referral services to doctors
•Run “feel good” ads in local media outlets – radio, TV, and newspapers –telling how the hospital “cares”
•Create messages saying how the hospital has acquired cutting edge technologies that make it a leader in the medical arms race
•Promote the hospital at one of the “top hospitals” in one or more of its centers of excellence
•Profile a leading doctor
•Stage a community event and bring in a national speaker on a hot topic
•Feature testimonials of patients pleased with hospital services
•Develop a hospital website
•Organize and Own ambulatory care or surgical centers
•Employ doctors, partner with them, build centers of excellence with their help, or become known as an integrated super clinic or health system with the hospital as the central piece
•Become a student of hospital marketing by buying books on the subject, subscribing to hospital marketing publications, or visiting websites like Healthleadersmedia.com, which regularly features stories on hospital marketing.
All of these are sensible and sound approaches, but they may fail to allay the hospital CEO’s apprehension about such questions as:
•How do we develop strategies that engage consumers and doctors at the same time?
•How do we directly address patients’ fears about coming to the hospital?
•How do we persuade them our institution is “safe”?
•How do we shape pateints’ expectations and give them clues of how to deal with their admissions for a disease or an upcoming surgery?
•How do we inform them in a sensible targeted way with a predictable return of investment?
•How can we give the doctors something of value without appearing to be meddling in their practices?
•How can we build a sense of “virtual integration” within the community – of getting everybody – local citizens , surgeons who use our facility, employers, and others – the sense we are all singing from the same page while we are pursuing steps towards more formal integration?
•In other words, how do we get the entire community behind us in this environment of competition and shifting loyalties?
The long answer to these questions is that you use multimedia approaches to communicate your message – simply, plainly, and effectively.
The short answer is that you must begin to address multiple converging factors together. You must recognize that you’r now operating in a consumer-driven environment; that doctors are restless about declining reimbursements; that 90% of your revenues come from heart, orthopedic, and other procedural specialists, most of whom are surgeons or endoscopists; that the American public now reads at the fifth grade literacy level; that between 80% to 90% of the public now has broad band access to the Internet; that visual communication is crowding out verbal communication; and that people are most concerned about effects them in their busy and time-short daily lives.
Samuel Johnson is famous for saying, “Nothing concentrates your attention so much as a hanging in the morning.” Similarly nothing concentrates a patient’s attention so much as an upcoming surgical procedure. And nothing concentrates a surgeon attention so much as the fear that the procedure won’t go well and he/she will be subject to a malpractice suit due to some misunderstanding which is usually difficult to document.
Now , for full disclosure. I’ve been working with a Chicago-based company, Emmi Solutions, that has developed over 80 online interactive programs (translated into Spanish) designed to teach patients what to expert from surgical procedures or episodes of chronic disease. Evidence indicates patients forget 85% of what they are told within 10 minutes of leaving a surgeon’s office after being told they need an operation. My job is to arrange for Emmi presentations to key players in the hospital “C suite.”
These programs consist of videos featuring an empathetic voice and vivid animated anatomical drawings or illustrations – both presented in simple language a fifth grader would understand. Doctors “prescribe” these videos by giving patients an access code. Patients, in their turn, can download the videos at their convenience in the comfort of their homes. A number of prestigious institutions – Cedars Sinai, Stanford, Kaiser, The Cleveland Clinic, Evanston Hospital, the University of Pittsburgh, and Columbia-Presbyterian, among others are using the online interactive programs. The University of Pittsburgh likes them so much its surgeons are required to prescribe them.
The virtues of this online interactive approach are:
1) the videos are a powerful patient education means of overcoming health illiteracy;
2) patients like the videos because they now understand risks, benefits, consequences, and complications of surgery;
3) doctors like them because it simplifies and clarifies the informed consent process, make them “heroes” in the eyes of their patients, and leaves a documented record of what the patient was told;
4) hospitals like them because patients and doctors like them, because they have a tangible return on investment (fewer cancelled procedures, shorter hospital stays, lower chances of misunderstandings leaded to complaints or even malpractice exposure), and because they require no changes in the hospital IT system.
Hospitals are moving into a era requiring new strategies to please more demanding consumers, to keep doctors closer to the institution, and to achieve a sense of “virtual integration” across the community. These strategies will require new and innovative forms of communication that are “win-win-win” for consumers, doctors, and hospitals.
Richard L. Reece, MD
15 Banbury Crossing
Old Saybrook, Connecticut, 06475
860-395-1501\
rreece1500@aol.com
Regina Herzlinger, in “Why Innovation is Health Care is so Hard,” Harvard Business Review, May, 2006, and Who Killed Health Care? (McGraw-Hill, 2007)
Hospitals are looking for answers on how to simultaneously engage consumers and doctors. After all, without consumers, and without doctors who direct consumers to their facilities, hospitals would be nothing but empty shells.
The traditional answers to attracting consumers and doctors are,
•Beef up the hospital marketing department
•Set up referral services to doctors
•Run “feel good” ads in local media outlets – radio, TV, and newspapers –telling how the hospital “cares”
•Create messages saying how the hospital has acquired cutting edge technologies that make it a leader in the medical arms race
•Promote the hospital at one of the “top hospitals” in one or more of its centers of excellence
•Profile a leading doctor
•Stage a community event and bring in a national speaker on a hot topic
•Feature testimonials of patients pleased with hospital services
•Develop a hospital website
•Organize and Own ambulatory care or surgical centers
•Employ doctors, partner with them, build centers of excellence with their help, or become known as an integrated super clinic or health system with the hospital as the central piece
•Become a student of hospital marketing by buying books on the subject, subscribing to hospital marketing publications, or visiting websites like Healthleadersmedia.com, which regularly features stories on hospital marketing.
All of these are sensible and sound approaches, but they may fail to allay the hospital CEO’s apprehension about such questions as:
•How do we develop strategies that engage consumers and doctors at the same time?
•How do we directly address patients’ fears about coming to the hospital?
•How do we persuade them our institution is “safe”?
•How do we shape pateints’ expectations and give them clues of how to deal with their admissions for a disease or an upcoming surgery?
•How do we inform them in a sensible targeted way with a predictable return of investment?
•How can we give the doctors something of value without appearing to be meddling in their practices?
•How can we build a sense of “virtual integration” within the community – of getting everybody – local citizens , surgeons who use our facility, employers, and others – the sense we are all singing from the same page while we are pursuing steps towards more formal integration?
•In other words, how do we get the entire community behind us in this environment of competition and shifting loyalties?
The long answer to these questions is that you use multimedia approaches to communicate your message – simply, plainly, and effectively.
The short answer is that you must begin to address multiple converging factors together. You must recognize that you’r now operating in a consumer-driven environment; that doctors are restless about declining reimbursements; that 90% of your revenues come from heart, orthopedic, and other procedural specialists, most of whom are surgeons or endoscopists; that the American public now reads at the fifth grade literacy level; that between 80% to 90% of the public now has broad band access to the Internet; that visual communication is crowding out verbal communication; and that people are most concerned about effects them in their busy and time-short daily lives.
Samuel Johnson is famous for saying, “Nothing concentrates your attention so much as a hanging in the morning.” Similarly nothing concentrates a patient’s attention so much as an upcoming surgical procedure. And nothing concentrates a surgeon attention so much as the fear that the procedure won’t go well and he/she will be subject to a malpractice suit due to some misunderstanding which is usually difficult to document.
Now , for full disclosure. I’ve been working with a Chicago-based company, Emmi Solutions, that has developed over 80 online interactive programs (translated into Spanish) designed to teach patients what to expert from surgical procedures or episodes of chronic disease. Evidence indicates patients forget 85% of what they are told within 10 minutes of leaving a surgeon’s office after being told they need an operation. My job is to arrange for Emmi presentations to key players in the hospital “C suite.”
These programs consist of videos featuring an empathetic voice and vivid animated anatomical drawings or illustrations – both presented in simple language a fifth grader would understand. Doctors “prescribe” these videos by giving patients an access code. Patients, in their turn, can download the videos at their convenience in the comfort of their homes. A number of prestigious institutions – Cedars Sinai, Stanford, Kaiser, The Cleveland Clinic, Evanston Hospital, the University of Pittsburgh, and Columbia-Presbyterian, among others are using the online interactive programs. The University of Pittsburgh likes them so much its surgeons are required to prescribe them.
The virtues of this online interactive approach are:
1) the videos are a powerful patient education means of overcoming health illiteracy;
2) patients like the videos because they now understand risks, benefits, consequences, and complications of surgery;
3) doctors like them because it simplifies and clarifies the informed consent process, make them “heroes” in the eyes of their patients, and leaves a documented record of what the patient was told;
4) hospitals like them because patients and doctors like them, because they have a tangible return on investment (fewer cancelled procedures, shorter hospital stays, lower chances of misunderstandings leaded to complaints or even malpractice exposure), and because they require no changes in the hospital IT system.
Hospitals are moving into a era requiring new strategies to please more demanding consumers, to keep doctors closer to the institution, and to achieve a sense of “virtual integration” across the community. These strategies will require new and innovative forms of communication that are “win-win-win” for consumers, doctors, and hospitals.
Richard L. Reece, MD
15 Banbury Crossing
Old Saybrook, Connecticut, 06475
860-395-1501\
rreece1500@aol.com
Saturday, June 16, 2007
The Doctor Shortage - Is Health Care Too Important to be Left to Doctors?
This isn’t an idle question. Sit back a moment and think about it. Many hospital CEOs, insurers, Congressmen, think tank leaders , Medicare bureaucrats, media pundits, employers, journalists, managers, and single-payer advocates think they can run the system better than doctors.
The question reminds one of Clemenceau’s famous statement, “War is too important to be left to generals.” I, for one, don't equate foreign wars with health care. Nevertheless, the reasoning goes like this. The issues of ware and disease are too big for generals or doctors to grasp or control. Health care may be even more important. It takes 16% of the GNP versus 3.5% for the military, and the casualties, estimated by the Institute of Medicine, are 100,000 unnecessary annual deaths in hospitals, exceeding by far Iraq’s combat deaths, approaching 4,000 over a five year period.
Let me state upfront I don’t agree with the analogy of generals, doctors, and war. My sympathies are with the doctors. Doctors may be fighting a war against disease, but federal rules and regulations unnecessarily and often unfairly hamstring them.
Physicians rarely set their own fees – or are seldom free to do whatever they might want to do for patients. Medicare sets physician payment rates for a wide range of services. Private insurance companies set their rates based on what Medicare pays. The money doctors receive often has little relation to costs of doing business.
I became acutely aware of this today. I was speaking to a family physician who is leaving town because his three person practice is collapsing economically. He said, “ I get $12 from Medicare for seeing a patient postoperatively in my office. The surgeon got $3000 for doing the operation. Medicare fees simply have no relationship with my costs of doing business. Primary care is on the verge of collapsing, but no one seems to care. You simply can’t practice independently anymore. You have to be salaried by a hospital.” Something has to be done, he said, to level the economic playing fields between hospitals, specialists, and the primary care doctors in the trenches.
Hospitals consume nearly half to the $2 trillion spend on health care in the U.S., But they too are bound by Medicare rules and regulations, which account for roughly ½ of their revenues. Hospitals and systems have sought for years to find ways to unite doctors and hospitals. These ways include: physician employment, joint ventures, gain sharing projects, centers of excellence, and integration into clinic model. Once again, federal rules make many of these ventures hard to carry out. In all of these efforts, hospitals – because of their superior resources, organization structures, access to capital, and sheer critical mass – have economic advantages over physicians.
In addition, third parties dictate what doctors can and can’t do for patients by declining to pay for services doctors think their patients might need. To complicate matters, the Medicare regulatory code for doctors is 130,000 pages long (compared to 11,000 pages for the federal tax code). Doctors must document everything they do or risk civil or criminal penalties for fraud.
According to Merritt, Hawkins, & Associates Guide to Physician Recruiting (Practice Support Resources, Inc),
"This is not the environment most of us work in. There is no ”third party” barrier between the lawyer, the accountant, the computer programmers, the plumber, the mechanic and his or her clients. They all set a fee, perform a service, and are paid directly by the person for whom they did the work. Imagine a plumber who fixes a pipe for a fee set by the government – a fee that does not meet the cost of his tools. The plumber then submits a bill - not to his client, but to an agency or insurance company. The agency then declines to pay the bill n the grounds that they do not cover that particular service under those particular circumstances. It would be no surprise if, under these conditions, plumbers became a generally cranky group – especially if they had to complete 11 to 15 years of post-college training to become plumbers.”
It should also come as no surprise that,
•The morale of the medical profession is at an all-time low.
•The U.S. faces a 50,000 shortfall of physicians by 2010 and 200,000 by 2020.
•Medical students are no longer entering primary care specialties – which Medicare pays at a rate of $90 an hour (actually $40 an hour after overhead is paid) – and going into specialties which pay as much as $600 an hour. Medical students are no fools, and word quickly gets around.
•Doctors, beset by declining federal reimbursements, rising practice costs, and worries over malpractice, are increasingly seeking employment, and in the process, forsaking autonomy and independence.
Why this state of affairs? It boils down to a matter of mindset. If you think of disease and death as inevitable and of patients as vulnerable, ill-informed, and potential victims of doctors, you have to protect them. If, on the other hand, you regard patients and doctors, as intelligent consumers of care and providers of integrity, who give that care, you may believe they are perfectly capable of fending for themselves.
If you regard health care as a “inalienable right,” then naturally government has to make the rules, set the fees, decline the payments, make everything transparent, provide the oversight, and supply the advice on how to make the system rationale.
The advice goes like this.
•Overhaul the payment system by eliminating fee-for-service. Fee-for-service, you see, gives doctors incentives to do more services. To use the words of critics, it creates a “fee-for service treadmill that runs faster and faster in pursuit of billable services.” Never mind that the rest of the economy runs on a fee-for-service basis, buyers tend to trust those who set the fees, and the market in general does a good job of weeding out and regulating miscreants.
•Organize doctors into bigger groups so they can have a managerial infrastructure that places them on salaries, gives them no incentives to do more, compels them to follow protocols, and otherwise integrates, rationalizes, and coordinates their professional activities. Never mind that this talk have been around for at least 50 years, that only about 10% of doctors practice in groups of 50 or more, that 75% still practice in groups of 5 or less, and that most doctors still think of themselves as automomous professionals, not unlike university professors, who deem themselves capable of making their own judgments.
•Create a homogenous national system that eliminates regional variations, charges uniform fees, pays only for evidence-based care, follows rigid protocols, documents performance of all doctors, and rewards those with the best outcomes. Never mind that Wennberg and his associates at Dartmouth have been decrying the sins of regional variation for 33 years with visible effect, that monolithic top-down regulation to achieve uniformity rarely works, that federal bureaucracies are easily manipulated to favor those doing the manipulating, that patient expectations and demands vary profoundly from one region of the country to the other, and that pay-for-performance and outcomes has so far produced a very mixed picture.
What is the solution? No one can say for sure. Right now an ideological battle is being waged between government and marketplace advocates. Government advocates say only government can achieve universal, evenhanded, and equitable care. Marketplace advocates say a free-market is much more efficient and innovative at distributing resources.
In the end, political and managerial compromises are likely, and public-private partnerships, i.e. “deals,” will result. As always, there will be “top-down” versus “bottom-up” considerations. It’s my belief that consumers and doctors, acting together, and with help from the business community with their management platforms and retailing strategies, are better equipped to achieve what patients and doctors want – efficiency, choice, convenience, value, access to technology without rationing, and freedom from bureaucratic rules and regulations
The question reminds one of Clemenceau’s famous statement, “War is too important to be left to generals.” I, for one, don't equate foreign wars with health care. Nevertheless, the reasoning goes like this. The issues of ware and disease are too big for generals or doctors to grasp or control. Health care may be even more important. It takes 16% of the GNP versus 3.5% for the military, and the casualties, estimated by the Institute of Medicine, are 100,000 unnecessary annual deaths in hospitals, exceeding by far Iraq’s combat deaths, approaching 4,000 over a five year period.
Let me state upfront I don’t agree with the analogy of generals, doctors, and war. My sympathies are with the doctors. Doctors may be fighting a war against disease, but federal rules and regulations unnecessarily and often unfairly hamstring them.
Physicians rarely set their own fees – or are seldom free to do whatever they might want to do for patients. Medicare sets physician payment rates for a wide range of services. Private insurance companies set their rates based on what Medicare pays. The money doctors receive often has little relation to costs of doing business.
I became acutely aware of this today. I was speaking to a family physician who is leaving town because his three person practice is collapsing economically. He said, “ I get $12 from Medicare for seeing a patient postoperatively in my office. The surgeon got $3000 for doing the operation. Medicare fees simply have no relationship with my costs of doing business. Primary care is on the verge of collapsing, but no one seems to care. You simply can’t practice independently anymore. You have to be salaried by a hospital.” Something has to be done, he said, to level the economic playing fields between hospitals, specialists, and the primary care doctors in the trenches.
Hospitals consume nearly half to the $2 trillion spend on health care in the U.S., But they too are bound by Medicare rules and regulations, which account for roughly ½ of their revenues. Hospitals and systems have sought for years to find ways to unite doctors and hospitals. These ways include: physician employment, joint ventures, gain sharing projects, centers of excellence, and integration into clinic model. Once again, federal rules make many of these ventures hard to carry out. In all of these efforts, hospitals – because of their superior resources, organization structures, access to capital, and sheer critical mass – have economic advantages over physicians.
In addition, third parties dictate what doctors can and can’t do for patients by declining to pay for services doctors think their patients might need. To complicate matters, the Medicare regulatory code for doctors is 130,000 pages long (compared to 11,000 pages for the federal tax code). Doctors must document everything they do or risk civil or criminal penalties for fraud.
According to Merritt, Hawkins, & Associates Guide to Physician Recruiting (Practice Support Resources, Inc),
"This is not the environment most of us work in. There is no ”third party” barrier between the lawyer, the accountant, the computer programmers, the plumber, the mechanic and his or her clients. They all set a fee, perform a service, and are paid directly by the person for whom they did the work. Imagine a plumber who fixes a pipe for a fee set by the government – a fee that does not meet the cost of his tools. The plumber then submits a bill - not to his client, but to an agency or insurance company. The agency then declines to pay the bill n the grounds that they do not cover that particular service under those particular circumstances. It would be no surprise if, under these conditions, plumbers became a generally cranky group – especially if they had to complete 11 to 15 years of post-college training to become plumbers.”
It should also come as no surprise that,
•The morale of the medical profession is at an all-time low.
•The U.S. faces a 50,000 shortfall of physicians by 2010 and 200,000 by 2020.
•Medical students are no longer entering primary care specialties – which Medicare pays at a rate of $90 an hour (actually $40 an hour after overhead is paid) – and going into specialties which pay as much as $600 an hour. Medical students are no fools, and word quickly gets around.
•Doctors, beset by declining federal reimbursements, rising practice costs, and worries over malpractice, are increasingly seeking employment, and in the process, forsaking autonomy and independence.
Why this state of affairs? It boils down to a matter of mindset. If you think of disease and death as inevitable and of patients as vulnerable, ill-informed, and potential victims of doctors, you have to protect them. If, on the other hand, you regard patients and doctors, as intelligent consumers of care and providers of integrity, who give that care, you may believe they are perfectly capable of fending for themselves.
If you regard health care as a “inalienable right,” then naturally government has to make the rules, set the fees, decline the payments, make everything transparent, provide the oversight, and supply the advice on how to make the system rationale.
The advice goes like this.
•Overhaul the payment system by eliminating fee-for-service. Fee-for-service, you see, gives doctors incentives to do more services. To use the words of critics, it creates a “fee-for service treadmill that runs faster and faster in pursuit of billable services.” Never mind that the rest of the economy runs on a fee-for-service basis, buyers tend to trust those who set the fees, and the market in general does a good job of weeding out and regulating miscreants.
•Organize doctors into bigger groups so they can have a managerial infrastructure that places them on salaries, gives them no incentives to do more, compels them to follow protocols, and otherwise integrates, rationalizes, and coordinates their professional activities. Never mind that this talk have been around for at least 50 years, that only about 10% of doctors practice in groups of 50 or more, that 75% still practice in groups of 5 or less, and that most doctors still think of themselves as automomous professionals, not unlike university professors, who deem themselves capable of making their own judgments.
•Create a homogenous national system that eliminates regional variations, charges uniform fees, pays only for evidence-based care, follows rigid protocols, documents performance of all doctors, and rewards those with the best outcomes. Never mind that Wennberg and his associates at Dartmouth have been decrying the sins of regional variation for 33 years with visible effect, that monolithic top-down regulation to achieve uniformity rarely works, that federal bureaucracies are easily manipulated to favor those doing the manipulating, that patient expectations and demands vary profoundly from one region of the country to the other, and that pay-for-performance and outcomes has so far produced a very mixed picture.
What is the solution? No one can say for sure. Right now an ideological battle is being waged between government and marketplace advocates. Government advocates say only government can achieve universal, evenhanded, and equitable care. Marketplace advocates say a free-market is much more efficient and innovative at distributing resources.
In the end, political and managerial compromises are likely, and public-private partnerships, i.e. “deals,” will result. As always, there will be “top-down” versus “bottom-up” considerations. It’s my belief that consumers and doctors, acting together, and with help from the business community with their management platforms and retailing strategies, are better equipped to achieve what patients and doctors want – efficiency, choice, convenience, value, access to technology without rationing, and freedom from bureaucratic rules and regulations
Friday, June 15, 2007
The Future of Health Information Technology (HIT)
“All I know is that the Internet will transform the world.”
Alfred Chandler, Jr (1918-2007) Business Historian
I would like to bring your attention to one event and two medical articles.
1.A Robert Wood Johnson Foundation announcement that it is sponsoring an international competition to identify the 12 most disruptive innovations. Entries for the competition will close on July 18. You may enter by googling “Robert Wood Johnson, Disruptive Innovation” to review the current entries, one or which is mine. Mine is titled “Spreading The News of Health Care Innovation in Health Care.” Simply click on the "enter the competition" button and describe your disruptive innovation.
2.An article in the June 14 New England Journal of Medicine, “Communication between Physicians and Patients in the Era of E-Medicine” by John H. Stone, MD, MPH, deputy editor for rheumatology at UpToDate. The article concludes, “It is our task to ensure that e-medicine – now inevitable in one form or another – improves the ways in which we deliver, receive, and pay for health care.”
3.Another article in that same issue of the New England Journal “Information Technology Comes to Medicine,” by David Blumenthal, MD, MPH, and J. P. Glaser, PhD, of Massachusetts General Hospital and Partners Health Care System in Boston. Their article raises three questions: a) Will the Bush Administration’s current decentralized. market-based approach to promoting IT spread prove effective in meeting the promise of HIT? b) Can we rely on benefits of HIT to materialize when the market rewards those who can afford it and deprives the disadvantaged? 3) How will the health system assist 75% of physicians who practice alone or in groups of five or fewer so they can afford electronic health records?
Like most Boston medical elite, Blumenthal and Glaser trust the government more than the market. They prefer federal mandates and imprimaturs to marketplace vagaries. The trouble is that government has not provided physicians with sufficient incentives to install EMRs. Most physicians in small groups simply do not see how EMRs give a sufficient return on investment to justify their expense, which may initially run $30,000 per physician not to mention annual maintenance fees.
The demand side of the IT market (consumers desiring doctor use of IT) has yet to sway the supply side (doctors investing in and using IT equipment or expertise to supply IT information). According to the Wall Street Journal (wsj.com), the demand is there.
Consumers would like to see these IT services from doctors.
•77% would like reminders by email from their doctors when they are due for a visit or some type of medical care
•75% would like the ability to schedule a doctor’s visit in the Internet
•74% would welcome E-mail communicate directly with their doctor
•67% would like to receive receiving the results of diagnostic tests by email
•64% would like doctors to have an electronic medical record to capture medical information
•57% would like home monitoring devices to send medical information like BP readings.
Many patients expect these email services to be free. Most e-medicine models focus on online appointment scheduling, prescription refills, general messaging, and “web visits” with physicians.
These services are fine and good. Their chief benefit so far has been to reduce the number of telephone, Fax, and paper messages flooding into doctors’ offices.
Doctors may be missing a good bet by not stressing the value of the Internet as a mean of interactively educating and engaging patients about their care. The Internet and home held devices now allows consumers to receive interactive multimedia information – through visual, verbal, and voices messages – transmitted through videos directly related to their immediate problem, to an impending surgery, or to questions on how to use medical devices. Patients embrace doctors who communicate with them by giving them clear, understandable, relevant jargon-free messages in language and images they can grasp
Alfred Chandler, Jr (1918-2007) Business Historian
I would like to bring your attention to one event and two medical articles.
1.A Robert Wood Johnson Foundation announcement that it is sponsoring an international competition to identify the 12 most disruptive innovations. Entries for the competition will close on July 18. You may enter by googling “Robert Wood Johnson, Disruptive Innovation” to review the current entries, one or which is mine. Mine is titled “Spreading The News of Health Care Innovation in Health Care.” Simply click on the "enter the competition" button and describe your disruptive innovation.
2.An article in the June 14 New England Journal of Medicine, “Communication between Physicians and Patients in the Era of E-Medicine” by John H. Stone, MD, MPH, deputy editor for rheumatology at UpToDate. The article concludes, “It is our task to ensure that e-medicine – now inevitable in one form or another – improves the ways in which we deliver, receive, and pay for health care.”
3.Another article in that same issue of the New England Journal “Information Technology Comes to Medicine,” by David Blumenthal, MD, MPH, and J. P. Glaser, PhD, of Massachusetts General Hospital and Partners Health Care System in Boston. Their article raises three questions: a) Will the Bush Administration’s current decentralized. market-based approach to promoting IT spread prove effective in meeting the promise of HIT? b) Can we rely on benefits of HIT to materialize when the market rewards those who can afford it and deprives the disadvantaged? 3) How will the health system assist 75% of physicians who practice alone or in groups of five or fewer so they can afford electronic health records?
Like most Boston medical elite, Blumenthal and Glaser trust the government more than the market. They prefer federal mandates and imprimaturs to marketplace vagaries. The trouble is that government has not provided physicians with sufficient incentives to install EMRs. Most physicians in small groups simply do not see how EMRs give a sufficient return on investment to justify their expense, which may initially run $30,000 per physician not to mention annual maintenance fees.
The demand side of the IT market (consumers desiring doctor use of IT) has yet to sway the supply side (doctors investing in and using IT equipment or expertise to supply IT information). According to the Wall Street Journal (wsj.com), the demand is there.
Consumers would like to see these IT services from doctors.
•77% would like reminders by email from their doctors when they are due for a visit or some type of medical care
•75% would like the ability to schedule a doctor’s visit in the Internet
•74% would welcome E-mail communicate directly with their doctor
•67% would like to receive receiving the results of diagnostic tests by email
•64% would like doctors to have an electronic medical record to capture medical information
•57% would like home monitoring devices to send medical information like BP readings.
Many patients expect these email services to be free. Most e-medicine models focus on online appointment scheduling, prescription refills, general messaging, and “web visits” with physicians.
These services are fine and good. Their chief benefit so far has been to reduce the number of telephone, Fax, and paper messages flooding into doctors’ offices.
Doctors may be missing a good bet by not stressing the value of the Internet as a mean of interactively educating and engaging patients about their care. The Internet and home held devices now allows consumers to receive interactive multimedia information – through visual, verbal, and voices messages – transmitted through videos directly related to their immediate problem, to an impending surgery, or to questions on how to use medical devices. Patients embrace doctors who communicate with them by giving them clear, understandable, relevant jargon-free messages in language and images they can grasp
Thursday, June 14, 2007
U.S. Health System -Review of Reece Book and Article by Grace-Marie Turner, Galen Institute
Prelude: Yesterday I spoke to Grace Marie Turner, who heads and speaks for the Galen Institute, a market-based health care think tank, in Alexandra, Virginia. She told me her greatest fear was that the government would completely take over health care through a series of incremental steps – e.g. universal coverage of children and government negotiation of Medicare drug prices. She said we are nearly there: the governments already pays for 46% of health care and, in one way or another, sets the fee schedules for most providers.
She was kind enough to: A: run the following brief review of my book in here widely read newsletter; B) to share this article containing her thoughts on U.S. health care vis a vis that of other nations;
A)Review o
INNOVATION-DRIVEN HEALTH CARE 34 KEY CONCEPTS FOR TRANSFORMATION \
Author: Richard L. Reece, MD
Source: Jones and Bartlett Publishers, 04/07
In his new book, Dr. Richard L. Reece, a pathologist, writer, editor, consultant, and speaker, provides an in-depth look at innovative trends health care from both the physician's and consumer's perspective. Reece breaks down health care innovations within six key areas, including hospital-physician joint venture innovations, employer an health plan innovations, constraining costs and expanding markets, and consumer innovations. Dr. Reece's book “is an intelligent, knowledgeable analysis of the impact of innovations on the future of U.S health care. ,” writes Harvard Professor and Manhattan Institute senior fellow Regina Herzlinger. “If you want to continue doing what you are doing, this book will enable you to assess how you fit into this new world and to adapt yourself if needed.”
B)You Get What You Pay For, By Grace Marie Turner
We have precisely the health sector in this country that we are paying for. As we are barraged from all sides with articles, books, and now movies about how absolutely awful our system is, it is important to realize that if we want change, we must start by improving the payment and incentive structures that direct how it functions.
•A conference of senior and seasoned health policy analysts that I attended in Princeton this week focused on the shortages today -- and the much greater shortages projected for the future -- in the health care workforce, especially primary care doctors and nurses.
But why is this surprising? Primary care doctors are paid an average of about $90 for half an hour of their time (which must cover their own salary as well as all of their office overhead) while radiologists, for example, are paid about $600 for the same amount of time. Medical school graduates are making very smart economic decisions in flocking to specialties because that is what we are paying them to do.
•Florida is becoming renowned for having a huge concentration of specialists catering to wealthy seniors. Between Medicare and their supplementary Medigap or retiree coverage, seniors' health care consumption is virtually free. (One Princeton speaker observed: If you think you are old and rich, go to West Palm Beach and you will find that you are neither…)
Jack Wennberg of Dartmouth and others have shown that seniors in Miami consume more than twice as many Medicare dollars as seniors in Minneapolis, for example, but the Miami outcomes are no better and in some cases, they are worse. Seniors in Florida are consuming a great deal of health care because that's what the system subsidizes them to do, and physicians respond by offering an abundance of services.
•And speaking of outcomes, one participant at the Princeton conference said our current system could just as easily be called “pay for mistakes.” Doctors and hospitals get paid even if they make errors. And you could argue that they get paid more if they make mistakes because they can be paid again to fix the problem.
This week, we received refreshing news that the Geisinger Health System in Pennsylvania is offering surgery with a guarantee: The hospitals will charge a flat fee that includes a 90-day warranty. And the doctors themselves came up with a list of what they considered best practices to help avoid errors in the first place. We offer a short summary of an article about the initiative in the round-up below.
•And the big news of the week was the saturation coverage of Michael Moore's newest movie, “Sicko,” due in a theater near you on June 29. That is, if the U.S. government doesn't ban it because Moore may have gone to Cuba illegally in his search of the best-on-the-planet health care for a group of sick American patients.
Give me a break! Cuban surgeons botched several surgeries on Fidel Castro, for heaven's sake, and a surgeon from Spain had to try to repair the damage. One has to wonder, if Moore were to need medical care for heart trouble, for example, do we really think he would go to Cuba for his care?
•Already a rebuttal to Sicko is circulating. It's worth a few minutes of your time to watch this short clip about the difficulty of obtaining surgery in Canada and the consequences of the long waiting lines for one woman who needed surgery for a bladder malfunction.
The only surgeon who could do the procedure in her region was limited to 12 a year, and he already had more than 30 people on his waiting list. The outcome for this Canadian woman was not good. And the film also depicts the distortions of decisions about who gets surgery in a health care system where payment decisions are made by politicians.
Canada spends a lot less on medical care than we do in the United States, and they, too, get what they pay for.
•And in the United Kingdom, Prime Minister Tony Blair had made improving the health care system one of his top priorities. The parliament boosted spending on the National Health Service from 6.5% to 9.4% of GDP, primarily focused on increasing access to care by hiring more health care workers and giving new incentives to general practitioners to produce better results.
They did boost the pay of GPs, but are questioning whether they got anything for the added spending. A report from the House of Commons shows that one group did particularly well -- the number of senior managers went up by more than 62% compared to an overall increase in the health care workforce of 24%.
But while Americans are being brainwashed into believing that our health care system is the worst in the developed world, opinion polls consistently show that the great majority of Americans are satisfied with their health care system.
We have an obligation to embrace what is good and to do a much better job than we have of fixing what is wrong, particularly by adjusting the incentives to get better care and lower costs and to cover more of the uninsured. We can show the world what a functional, responsive, innovative, and affordable 21st century health care system should look like. We just have to shift the incentives so that is what we are paying for.
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![Direct Pay Independent Practice Medicine and Surgery [Kindle Edition]](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgKJWM6SltCn4DnwWhN4vOVwSOfpffemkWEbuZ-sA3qYPS5DucGczP4X5yB9eJGpnCm41EkvBiXUgPa4B6kCMl8qW_VL_BLVMCB-EFyNzY_Yj_oMbVo58r9cbLt824oQOEnEx-ZRkiy_q19/s1600/direct-pay-independent-practice-medicine-and-surgery.jpg)
