Collaborate, Innovate, and Participate in a "Reset" Health Care System

Atul Gawande- Remembering What We're Fighting About

2012-01-16T11:01:00.000-08:00

When you are in the middle of a fight, very seldom to you ever stop, assess, and confirm that you remember why you are fighting in the first place. Most of the time we just keep on fighting.

That’s what we’re doing with health care. Even though legislation has been passed to change the way things work, we’re just continuing to fight because many adamantly disagree with the approach that is being used to make the changes and most don’t really understand what is going on. If you didn’t understand the health care system before- you really don’t understand it now. If we don’t change, it is very likely the end-result will cost a lot more and create more damage before we are through. The health care debate has become a part of a much deeper discussion our country is having with itself and still hasn’t quite figured out the right answer.

Atul Gawande’s June 1, 2009 New Yorker article had quite an influence on getting us where we are today. (It’s a good article- You can link to it Here) Sometimes it’s important to step back and reflect on why this fight started in the first place.

The health care system Gawande describes is influenced by many different incentives both internally created and externally driven. The influence of the incentives and the personal make-up of the health care stakeholders determine the type of health care system that is developed in a local community. The health care system then determines the economics (how much it costs and how it is delivered). Gawande believed the health and age of a population have little to do with significant variations in the cost of health care we are experiencing today; it’s the system used to deliver health care that really matters.

Yes, critics have challenged some of the facts but the challenges don’t erase the picture of health care the article constructs. The challenges don't negate the reality.

Even as we continue to fight about it, we should also take some time to step back and reflect on the health care system described by Gawande almost 3 years ago. We need to take a moment and remember what we’re fighting for- and hope we are making some progress to come to a solution as we fight.

At this point, the progress seems questionable.

Iowa Caucuses- Health Care IS an Economic and Debt Issue

2012-01-04T07:15:00.000-08:00

The Iowa caucuses are over and it’s on to New Hampshire. To nobody’s surprise, it was a close contest, a lot of money was spent, and a lot of negative advertising was used in the strategies. Republicans still aren’t united behind any single contestant- but the field will narrow over the next few weeks.

Iowa gave us the first look at the results of the Citizens United decision made by the Supreme Court last year. There is going to be even more money spent, with candidates hiding behind the covers of the “super PACs” created on their behalf. Free speech? We’ll see.

Iowan’s are a rational bunch. They look at things from a different perspective than those in Washington D.C., New York, California or the other highly populated areas. They care about community, about agriculture, and about things that are relevant to themselves. They don’t usually like the negativity associated with politics- but the Iowa caucuses proved the negative ads work. We’ll see a lot more of them.

Interestingly, Iowa Republican’s participating in the caucuses listed the economy and the debt as their primary issues of concern. Health care and abortion listed in the distance.

The Iowa caucuses proved that we continue to keep health care as a separate and distinct political issue even though fixing our health care mess is directly related to both the economy and the debt. A Pew Research Foundation study in April, 2011 determined the unfunded liabilities associated with pensions and health care for state governments increased 26% (to $1.6 trillion) in one year alone. Health care IS an economic and debt issue.

Iowa has always been the starting point of the presidential election process and used to either gather momentum or begin the elimination of candidates. Iowa also provides lessons as to what works and what doesn’t work in the campaign process.

The Iowa caucuses taught us: The Republicans are still not sure who to get behind to run against Obama in 2012, Super PAC negativity works (unfortunately)- and we’ll see a lot more, "retail/door-to-door" politics is still effective, and we still don’t believe reforming health care has much to do with jobs, the economy, or our debt.

We’ll see what we learn in New Hamphshire.

2011 Government Financial Report- Unacceptable

2012-01-01T09:11:00.000-08:00

Right before Christmas (December 23) the Government Accountability Office (GAO) released its “2011 Financial Report of the United States Government.” The GAO works for Congress and operates as a bi-partisan watchdog to monitor how taxpayer dollars are being spent.

The press release associated with the release of the report stated, “The U.S. Government Accountability Office (GAO) cannot render an opinion on the 2011 consolidated financial statements of the federal government, because of widespread material internal control weaknesses, significant uncertainties, and other limitations.

Specifically, the press release cited; 1. Serious financial management problems at the Department of Defense (DOD) that make its financial statements unauditable, 2. The federal government’s inability to adequately account for and reconcile intragovernmental activity and balances between federal agencies, and 3. The federal government’s ineffective process for preparing the consolidated financial statements.

The report identified a material weakness of $115.3 billion in improper payments, information security issues across government, and tax collection activities.

I’ve posted the study in the Library of our site. It discusses some of the basic numbers ($1.3 trillion deficit compared to $2.1` trillion in 2010; 1.9 million new jobs compared to 350,000 in 2010) and an overview of some of the actions taken to try to get the country on the right track. You can look at the numbers and decide how well they are working for yourself. The numbers indicate some progress was made- just not nearly enough.

From a health care perspective- the report makes two significant points- Medicare, Medicaid, and Social Security are big parts of the problem (representing 45% of all spending), and the Medicare Trust Fund will run out of funding in 2024- five years earlier than was projected in 2010.

While many are calling for “cuts” that usually impact the “boots on the ground” citizen, this report shows we would likely find huge opportunities to reduce spending simply by putting accountable accounting systems in place to track where money is going and how well it is being invested.

In a nutshell, the accounting controls and books used to measure how well we’re doing financially as a country are a mess. In all honesty, we probably don’t have a real clue how big our debt really is- and its inexcusable. The financial managers associated with such a report in the private market would likely be fired.

We should expect no less from those responsible for the allocation of our taxpayer dollars- including the Congress (both Republican and Democrat alike). They need to be held accountable for the results of their efforts. This effort is unacceptable.

Too Confused to Use?

2011-12-12T07:30:00.000-08:00

A study by GfK Custom Research of 502 private-sector employers painted a picture of where employers stand today regarding the Affordable Care Act and offering health insurance benefits to employees. Not surprisingly, most still don’t believe the Affordable Care Act will have much impact on the future costs of health care, and many believe it will actually increase the costs in the future. However, the majority of employers still don’t understand what is in the law and how it is supposed to work- so, the comments are based more on perception than fact.

Over 55% of the employers indicated they would continue to offer health insurance to their employees even after the major components of the “insurance reforms” of the Affordable Care Act are put in place. However, the responses were dependent on the size of the company. Most large companies plan to continue to provide health insurance- while smaller companies aren’t so sure. Over 30% of the companies (both large and small) are unsure whether they will continue to offer health insurance as a benefit to the employees in the future. Not surprisingly, the majority not offering health insurance now base their decision on cost (not on the Affordable Care Act).

In 2004, about 68% of the employers offered health insurance to their employees. The number stands at 60% today. By 2014 (when the theoretical “health insurance exchanges” are supposed to be operational) the number will likely be somewhere between 50-60%.

If the numbers hold, consumers are going to need to purchase health insurance different than they have in the past. They are going to need more education, more guidance, and more “transparency” than ever before. Transparency has never been a core competency of Health Care.

So, while Health Care focuses on all of the other transactional details to establish exchanges, develop new delivery models (Accountable Care Organizations), collect data, and all the rest let’s hope it doesn’t forget about the needs of those who can really have an impact on changing the trajectory we are on today- the individual/the patient.

All the new ideas won’t make much of a difference if the individual doesn’t understand how they work- or are too confused to be engaged to use them.

Transparency- Getting People To Use Information Is The Real Key

2011-12-04T10:52:00.000-08:00

The November, 2011 publication of the American Journal of Medical Quality found 80% of the “highly findable” health care rating sites (rating doctors and hospitals) draw on anecdotal patient reports (the patient opinion and experience) more than anything else. According to the article, the sites many are using to research care providers and show highly ranked in the search engines don’t use some of the measurements Health Care would like them to use to help make informed health care decision. Only half of the highly findable sites include quality information and a third feature cost data. Forty-four percent featured performance results based on claims data or board-certification information.

Despite the effort Health Care is making to increase the amount of data and information available to the general population, a large segment remains frustrated with their inability to find what they need when they need it. Their frustration lies in three key areas: A lack of awareness of what is available, not knowing what questions they need to ask, and then finding the information once they know what they need. Individuals will likely continue to rely on family, friends, and their social networks as a more reliable source until Health Care packages and markets the information in a way that is relevant to the individual.

As Health Care continues to improve the "transparency" of how with works with the general public it will need to continue to acknowledge the “trust barrier” that exists with many individuals. Individuals will gravitate to the sources they feel they trust and provides information that is relevant to them. Collecting information is the first step, analyzing the information is the second step, packaging and communicating the information is the third step. And, it seems as if “experiential rating sites” have done a better job packaging and communicating their relevance to the general population than those that use the metrics Health Care prefers.

Maybe Health Care can learn from them.

Down to the Thanksgiving Wire

2011-11-05T15:58:00.000-07:00

The Joint Select Committee on Deficit Reduction has until November 23 to come up with a plan to cut $1.2 trillion from the deficit. Then, Congress needs to have an up or down vote on the plan by December 23. We’re in for an interesting few more months watching the congressional version of “Survivor.”

Here’s a prediction: The plan will arrive at the very last minute and it still won’t deal with the fundamental systemic dysfunction our economy is facing today. The numbers may add up to $1.2-$1.5 trillion- but the way getting there will likely hurt a lot of people unnecessarily. The politics continues to avoid addressing the “causes” for the dysfunction instead of addressing them head-on.

The costs associated with Medicare and Medicaid need to be on the table. They are a large part of the problem and can’t be ignored. Unfortunately, the “super committee” will likely focus on the level benefits provided to beneficiaries and the costs paid to providers (“end result items”) as opposed to creating the environment to help the health care system eliminate the waste, inefficiency, and fraud (“the cause items”) that create the costs in the first place.

Eligibility will change for both Medicare and Medicaid, contributions will increase, current benefits will be scrutinized or reduced, and the amount paid to those delivering the care will be reduced as well. The “end results” will be covered.

Nothing will likely be mentioned about changing the current pay-as-you-go reimbursement methods, very little mentioned about improving consumer education and understanding to help them make better decisions, not much will be discussed about improving the coordination and communication of care decisions when inside the health care system or creating systems where health care providers in general agree with what works and what doesn’t.

I suppose the super committee will assume that the private market will simply need to adjust to the new reality- there were no other options. Many of these items are somewhat addessed in the Affordable Care Act but consumers aren’t so sure of that one either. But, there are other options. If the super committee really focused on “the cause items,” Medicare and Medicaid could contribute significantly toward the deficit reduction goal without cutting benefits or payments nearly as significantly as they are likely to propose.

I guess we’ll just have to wait and see what happens. It will be another down-to-the-wire episode.

Steve Jobs- A Role Model of What Our Country Needs Today

2011-10-06T06:30:00.000-07:00

Our country lost one of the great innovators of our time- perhaps of all time. Steve Jobs was only 56 when he died but fundamentally changed the way we live during the short time he was with us.

Most of us never met Steve Jobs- but we all felt his creativity and passion for excellence every day. We saw the results of what can be accomplished when you dream, you believe, and you persevere. Our lives have been changed by his commitment to dream. Our world was changed by his example of believing and passionately working as a team for the accomplishment of a common good.

Perhaps health care, politics, and our country as a whole should take a break from acting the way it is today to reflect on the legacy of a true innovator and creator. We need more passionate and innovative creators to dig us out of the hole we are in. I’m sure Steve Jobs wouldn’t see the hole- but the opportunities available to dig us out.

We may have lost the dynamic presence of Steve Jobs in the world but we will forever live on with his legacy.

As Facebook creator Mark Zuckerberg wrote in a brief eulogy to Steve Jobs, “Thanks for showing that what you build can change the world.”

We need to continue to dream, create, and work together toward a common goal. It will be the best tribute to one of the most creative innovators of all time.

Armageddon Hypochondria

2011-09-29T07:20:00.001-07:00

I attended the monthly meeting of the Association for Strategic Planning the other day. Dr. Jim Paulsen, Chief Investment Strategist for Wells Capital Management was the speaker. He topic was to provide an update on the economic and financial markets and provide some insight into this insanity that seems to be reality today. Dr. Paulsen and I grew up in two small towns about five miles apart in southeast Iowa. We both went to the same church in small rural Iowa and both of us attended Iowa State University. I hadn’t seen him in many years and I primarily went to the meeting just to see him and see if he remembered me (he vaguely remembered). And as if I really needed it, I was also interested in hearing one more perspective of what is going on in the world.

His message was different. He laid out a compelling argument and one that is not nearly as loud as the “gloom and doom” message we’re hearing from the politicians and media. Dr. Paulsen peppered his talk with a portfolio of graphs and charts comparing this recession to those in the past showing how this recovery (and he does believe we are in a recovery) is “normal.” He doesn’t ignore the challenges (housing, credit/lending levels, and health care costs) but believes the positive economic indicators (company profits, investment, and manufacturing) are moving exactly as he would expect and ahead of where we’ve been before. He also presented a clip of a 1991magazine article from Time Magazine describing the economic environment we were dealing with. You could paste the same words used back then into any article today and you wouldn’t know the difference- political paralysis, health care costs, rising debt, etc. etc.

Dr. Paulsen believes our country is a victim of “Armageddon Hypochondria.” While the recovery, from an economic perspective, is proceeding as almost every other recovery has in the past, he believes we have become victims to the politics and the media hype creating the feeling of gloom and doom and extremely low levels of confidence we are experiencing today.

The numbers in his presentation all made sense and it was nice to hear someone believe we are doing ok- not perfect, but ok.

“Armageddon Hypochondria” is a dangerous disease especially in rough economic times. The endless political-cycles in this country and the 2012 elections will very likely make the disease grow in the future- especially to the uninformed or susceptible. We also can’t confuse Armageddon Hypochondria with the Brutal Reality of what is happening in our country and in the world. Health care costs are absolutely unsustainable, unemployment levels are unacceptable, middle-class America is shaken, and the hyper-connected global economy has changed the game for everyone. Doing nothing and letting the market “self-medicate itself” (Dr. Paulsen’s prescription for Armageddon Hypochondria) is a standard free-market solution.

Using the past to predict the future is standard operating procedure and makes perfect sense. I just wonder if the world dynamics have fundamentally changed too much over the past five years to provide any reliable predictions to what will happen in the future.

I’ve concluded (self-diagnosis) I don’t have Armageddon Hypochondria- but I do believe if we continue to address critical economic , healthcare, and policy issues as we have in the recent past, we could bring ourselves closer to the edge.

I may have the symptoms- I just don’t have the disease- yet.

Remembering the Passion of 9-11-01

2011-09-06T13:56:00.001-07:00

The clear blue skies and the crisp chill of early fall bring the memories back again. Some call it “9-11 Blue.” These are the mornings when we recall the time when most Americans lost their naivety and innocence to confront the reality of the world we live in today.

Each year we dutifully honor the lives lost in the tragedy of September 11, 2001. The pain of loss will never leave for some. For the rest of America, it pauses, it honors, and then moves on. Unfortunately, we don’t spend enough time reflecting on the magnitude of what happened on that day. There are too many other things to worry about today.

Since 9-11-01, over 6,000 American heroes have given their lives in the wars in Iraq and Afghanistan. Another 45,000 have been wounded. Thousands of families, friends, and loved-ones grieve for the losses and the sacrifices that have come about as a result of this blatant attack on America’s ideals. Countless others struggle to help those who have returned from these wars to somehow become a part of a different kind of America than existed ten years ago when all of this began. Today’s America can seem like it’s paralyzed and confused.

Yes, we have some challenges. We have some big challenges. But, let’s not forget it wasn’t the government, or politicians, or the military, or big business that pulled us together in 2001. It was the will of the American people who established the direction we wanted to follow. We were united in a cause.

As we pause once again to honor all of those who have sacrificed on 9-11 and beyond, let’s not get distracted by the “self-interest politics” that has slowly but surely become part of the fabric of our political process today. Let’s work together to solve our debt problems, support those fighting for our freedom, fix our educational system, grow our economy, create jobs, and finally fix our health care crisis in a way that can only happen in America; a unified nation of individuals with a common purpose and a passion for liberty and democracy for all. We’ve done it before and we can do it again.

Those who have already sacrificed deserve nothing less.

Participation and Engagement Are Not The Same Thing

2011-07-29T06:59:00.001-07:00

I gave a talk to a group of businesses on the transactional side of health care the other day. My topic was to provide my perspective of approaching “consumer engagement” for the transactional side of health care from the lessons learned from the health and wellness side.

I spent a lot of time thinking about the topic. The politically correct approach would have been to provide all of the appropriate statistics to show how incentives, benefit designs, and the other “economic” approaches were improving participation in wellness programs (47% participation in completing a Health Risk Questionnaire with an incentive and 26% without) and how innovative communication/marketing strategies improve participation, and all of the other stuff. The politically correct approach would have been to say to just take what we’re doing so well on the health care side and use it in some of the other areas.

But, my topic was engagement, not participation.

Engagement, to me, is deeper. Engagement is commitment, its understanding the context, it’s taking steps beyond the minimum necessary to get by or getting paid to do it; it’s becoming part of the solution.

As I put my thoughts research together I began to realize (actually I had always assumed) that consumers aren’t engaged in health care. Seventy-five percent don’t understand it and many continue to be frustrated by it. Yes, the participation numbers may be improving for some of the wellness/preventive components (25% on average but higher for some program areas and for some organizations in general). However with such a high confusion factor and a health care literacy rate of only around 15% we could do much better. Add to that an industry “trust ranking” of Health Insurance and Managed Care only above Telecommunications, Oil, and Tobacco I concluded we might have a problem with real engagement.

My message to this transactional group ended up being that they need to be aware that they may be “branded by a brand” in health care and the health care brand with consumers right now is not all that hot (except with hospitals and doctors). I told them that they need to be aware that consumers were being asked to play many roles in health care today (Benefit Manager, Financial Manager, Care Navigator, Legal Manager, Information Manager, Personal/Family Wellness Manager) and they need to look at consumers in the total context as they develop products or strategies impacting a single one. I told them they would need to provide the appropriate guidance to consumers to help them fill their role as an Informed Health Care Consumer. And, building trust with the consumer would be a key to building engagement.

Yes, you can certainly improve the participation numbers by paying people and designing benefits to influence what they do. For most, the participation will only be short-term and dependent on continuing to pay them or maintaining the benefit structure directing them what to do. However, if you have them engaged, the participation numbers will be longer-term and the approaches you can use are more flexible. You may not even need to pay people to get them to do the right thing.

This transactional group was only interested in participation- not real engagement. They wanted to hear how incentives and economic structures could drive people to their businesses. They wanted to hear me validate what they were doing today and how participation (how many bodies) was the real indicator- not engagement. I think they wanted to hear the standard stuff. They didn’t want to hear about reality of the consumer perception of health care today.

Well, I still believe building trust in this industry is the real key to engagement. And, building trust starts with confronting the reality of where you are today and what may need to do to change. You build trust with open communication, honesty, integrity, and partnerships. You build trust with collaboration and dialogue. Building trust is more than just a software application, an incentive program, or an HRA. It’s about building a relationship with an individual.

Transactional health care may still be focused on participation. The real solution is engagement- and that’s tougher to earn.

From Minnesota- No Piling On Please!!!

2011-07-11T14:01:00.000-07:00

I have to admit, living in Minnesota is never dull.

In addition to being the home of ten thousand lakes, beautiful communities, good people, and some innovative businesses we have created quite a collection of politicians to guide our state to where it is today including: Humphrey, Mondale, Wellstone, Ventura and more recently Pawlenty, and Bachmann. It’s quite the collection of personalities when you think about it. Minnesotan’s have become a pretty versatile people. We’re always looking for the right combination of personalities that can get something done. We’re willing to take some chances.

While historically Democrat, slowly but surely (just like the rest of the country), Minnesota has become ideologically partisan and divided. Last November, we elected a Democratic Governor, and a Republican legislature that work so well together we are now beginning the third week of a government shut-down.

What is the primary issue?; Balancing an “out-of-control” budget combining the right balance of expense reduction with revenue. The right and the left couldn't come to an agreement and is at a stalemate. Now, only the “essential services” in government are funded, the rest of the state is closed.

State parks are shut down (during the 4^th of July holiday), rest areas are closed, renewing your driver’s license or getting a fishing license (almost a requirement to live in Minnesota) is unavailable. Because the politicians could not do their jobs the rest of us are being asked to “suck it up” and live with it. In the meantime, Minnesota’s credit rating was devalued resulting in increased interest costs at a time we don’t need any additional costs.

In Washington we’re now in the midst of heated debate concerning raising the debt limit. What is the primary issue?; Addressing an “out-of-control” budget by combining the right balance of expense reduction with revenue (Sound familiar?) At this point, we’re at a similar stalemate at the federal level and we’re nearing the point that the effects could be worse than what is already being experienced in Minnesota if some resolution isn’t reached.

Since 1962, the debt limit has been increased 74 times. Many times it was increased as a part of some other legislation and never received much attention. Over the past 10 years, however, the debt limit has increased 10 times as the debt of our nation has exploded because of weak economic growth, the 2001 and 2003 tax cuts, funding two wars, and a stimulus package that was intended to prevent us falling into a bigger recession than we already experienced. Both sides need to assume some responsibility for the crisis we now face.

Unfortunately, the debt limit vote this time has become political instead of rational. Politicians are covering their asses as they protect their special interests and are already looking to use the process for leverage in the 2012 Presidential and Congressional elections. As in Minnesota, neither side is budging.

Some argue we aren’t really at any crisis point and can get through by simply juggling how we pay our bills until some resolution is reached. I would ask these people to just take a look at the fragile nature of the global markets. Whether these people want to accept it or not, August 2 is a “real date” to the markets- they will react accordingly.

So, once again (and as predicted when the federal budget was passed to avoid a federal shut-down), we’re going to go down to the wire. Because of the political reality of today, if a deal is reached it will not nearly be what is needed to address the crisis we are facing. If a deal is not reached, we will just have to wait and see what the market reaction will be- and it won’t be pretty.

Either way, once again the American people will be left living with the effects of a partisan political quagmire. We’re already going to have to live with the mess created by shutting down the government in Minnesota- we don’t need the federal government piling on.

Both sides are to blame on this one- so, get to work, put your politics aside, and do what is right for the country.

The Collaboration Health Care Elevator Speech

2011-06-11T07:50:00.000-07:00

I’ve been asked many times over the years for the “elevator speech” for Collaboration Health Care. Honestly, I’ve sometimes been at a loss to respond because when I say, “I want to change the way the general population “thinks” about health care,” nobody cares.

Despite the different types of projects we have been involved in over the years, they seem to still boil down to the same thing- we’re still trying to change the way all of the stakeholders look at and think about health care. But still, nobody seems to look at it that way.

It’s still all about ROI, production, diagnosis, measurement, and all of the “transactional” aspects now involved with health care. It’s all about regulations and bureaucracy and following an established set of rules and processes as opposed to looking at the world a little different and trying to have a basic understanding of why all of this is necessary in the first place.

Don’t get me wrong. Measurement and accountability is important. We’re just now going to the extreme and don’t seem to be solving the problem.

Solving our health care cost crisis is not going to be solved in a partisan manner. The Affordable Care Act was a very partisan piece of legislation and needs to be modified. Repealing it is not the answer either. We need to have a basic framework in place we can all work from. We aren’t working from it together today.

And, most of the general population is confused. We’re more knowledgeable than we were before all of this health care talk started- but we’ve been informed from very partisan sources. We really don’t know who to believe.

Despite much of the population still indicating they are relatively satisfied with the way things are, there is a very rapidly growing segment saying they aren’t. More are feeling the affects the rising health care costs are having on their personal finances. And, it’s only going to get worse if something doesn’t change- and change fast.

Our health care costs eat up a substantial portion of our national budget and are a key component of our national debt. The “unfunded” liability (what isn’t paid for) for Medicare over the next several decades will reach $46 trillion. Health care costs have the real potential to be the final straw to bring down our economic foundation if they are not addressed.

So, I suppose the elevator speech should be changed; “Helping stakeholders change the way they think about health care” doesn’t seem to matter much to anyone.

How about, " Protecting our national and personal economic future by changing the way stakeholders think about and interact with the health care system- through education, information, partnerships, and dialogue.”?

It’s a little long, but maybe more folks will get it.

Newt's Comment Is Right- But He Got Creamed For Saying It

2011-06-02T19:33:00.000-07:00

Newt Gingrich has been a guest on Meet the Press thirty-five times. He’s covered a lot of territory on the show over the years. During his visit on May 15th, host David Gregory asked Newt his opinion of Paul Ryan’s approach to address the budget deficit and ultimately addressing the unsustainable costs of Medicare. He replied, “I don’t think right-wing social engineering is any more desirable than left-wing social engineering.”

His defection from the party-line quickly reverberated throughout the conservative ranks raising a huge obstacle to his chances of becoming the Republican nomination to challenge President Obama in the 2012 presidential elections.

Despite speaking the truth, and despite being accurate in his assessment- his thirty-fifth visit cost him a lot. The reaction he received from the Republicans illustrated how far apart we are as a country to address the challenges we are facing. Unfortunately, we are being guided by the far-right or far-left politics when the real solutions are somewhere in between.

In the meantime, our health care costs continue to rise. Price Waterhouse Coopers released a new assessment of the medical cost trends for 2012 (Behind the Numbers; Medical Cost Trends for 2012). While medical cost trends increased 7.5% in 2010, they are projected to increase 8% in 2011, and 8.5% in 2012. As the economy struggles along at 2-3% growth (or less) we just continue to lose ground. Any possibilities for relief through initiatives included in the Affordable Care Act will not be felt for several more years- if at all.

The PWC assessment commented, “An interesting blend of reactions to the recession, the slow recovery, health reform, and other variables will affect the medical cost trend in 2012.” The problem is only going to get deeper the longer we wait to take real action beyond the party-lines of the politics and special interests.

Quite simply, the philosophies of the free-market purists will not solve this problem. The theories of the government-control liberals will not solve it either. We need a rational collaboration of both public and private initiatives to eliminate the waste, reduce the inefficiencies, and develop a solution that makes sense for the country.

We need to be able to talk about some of the solutions that are not necessarily “right” or “left.”

Newt’s comment on Meet the Press reflects what we need. Unfortunately he was creamed for saying it.

2011 Physician Compensation Report- An Interesting Picture

2011-05-03T05:42:00.000-07:00

Whenever we start talking about the increase in health care costs we invariably start to think about the amount of money made by the providers. The costs of paying the providers make up 30% of the cost of care so it’s pretty easy to make them a target.

Medscape WebMD recently published their Physician Compensation Report for 2011. It paints a pretty interesting picture of the current economics of the general provider community.

Overall, the average “salary” for the 15,794 physicians across 22 specialty areas averaged somewhere around $250,000 a year. Orthopedic Surgery and Radiology did the best at around $350,000 and Primary Care and Pediatrics received the least at slightly under $200,000 per year.

About half of the respondents indicated their income “remained the same” between the years 2009-2010, but more indicated their incomes increased than decreased during this time.

Those in the North Central U.S. averaged the most ($225,000) and those in the Southwest and Northeast averaged the least ($190,000).

All respondents felt they should be earning more and less than half of the Primary Care practitioners felt they are currently fairly compensated for their efforts.

They all work a lot of hours and spend way too much time on paperwork and non-patient administration.

Almost a third are not so sure they would choose medicine as a career if they had to do it all again. They would either go into business, law, or teach.

When looking at the pure numbers we need to remember these amounts don’t include the general costs of education, general overhead, malpractice insurance, staffing, and all the other costs that we require providers to assume as a part of participating in the health care system we have created.

The question isn’t really “how much” but what is the value? That is the challenge we just haven’t been able to determine very well.

So, before we look only to putting some arbitrary limits on the fees paid to providers as the sole way to control costs we should first look at the ways we can measure and improve the value of the dollars that are being spent; more electronic technology, accessing best-practices, reducing administrative nonsense, and creating more informed consumers come to mind. And, providers need to be accountable for the value they provide, just like we’re expecting other stakeholders to be accountable in their new roles as well. Providers can’t just do whatever they want any more and expect someone else to pick up the tab.

Princeton economist Uwe Reinheardt estimated that if you cut physician income across the board by 20% you would only shave 2% off national health spending. That’s not a very big dent.

While health care spending is a problem, how we’re spending the money is an even bigger one.

Just Wind The Clock- It's Going To Happen Again

2011-04-14T13:15:00.000-07:00

Last Friday the leadership in Congress and the Executive branch finally came to a last-minute agreement to narrowly avert a government shutdown. As expected, everyone waited until the last minute before finally showing their hand.

A soldier in Afghanistan (supporting a family back home) wondered if he was going to be paid. Some of these heroes literally live paycheck-to-paycheck. So, while dodging Taliban snipers and trying to avoid IEDs planted in the road, he now had to worry if his wife and children would have the money they needed for support while he was gone.

It's inexcusable- unfortunately this is the world of politics, partisanship, and debt we live in today.

Congress will likely pass the $38 billion in "reductions" that were part of the final agreement to create the FY2011 budget (many months late). Just to add to the confusion surrounding what was actually accomplished, the CBO posted their analysis of the deal the day before the vote stating the number isn't really $38 billion but somewhere around $350 million for FY2011 due to the maze of IOUs, transfer accounts, and other accounting gimmicks included in our federal accounting process. To add more fuel, they posted their projections indicating our deficit for the first six months of the year will be about $800 billion- over $110 billion more than the same time last year. We aren't making much progress.

The politics are getting uglier- and Americans have no idea who to believe.

While the lights remain turned on for now, these last-minute agreements are unfortunately going to be the norm. The fiasco that occurred last week is a drop in the bucket compared to what we're going to experience when the votes to raise the debt ceiling and the 2012 budget debates really get underway. Quite honestly, the stability of our economy is at stake.

Republicans want to use the scorched-earth approach, Democrats want to protect self-interests. Most of us know the right answer is somewhere in between. It's now a game of chicken- and we're all on the receiving end.

We'd better brace ourselves. The coming months are not going to be pretty. Whether we want to accept reality or not- addressing health care and entitlements (Medicare, Medicaid, and Social Security) will be or should be central to the discussion.

The world has changed and America has changed and now is the time we'll really see what we're made of. We had just better be sure we don't ask those who are already sacrificing so much while they are protecting our freedoms in hostile environments to sacrifice more just because we can't get our act together here at home.

We're better than that.

The New Proposed Rules for ACOs- Can We Make 429 Pages Understandable?

2011-04-03T16:16:00.000-07:00

The Department of Health and Human Services just released the “proposed rules” for creating Accountable Care Organizations. Accountable Care Organizations (ACOs) were legitimized in the Affordable Care Act as a way to try to curb the unsustainable Medicare costs occurring today by organizing the way beneficiaries receive care in a different way. I believe the idea could be simplified by simply saying they change the way providers are paid by working together better than they do today. These proposed rules (requesting comment from the public) are 429 pages and will be a field day of billable hours for policy consultants, actuaries, financial analysts, and statisticians. With all of the data requirements included, technology companies and the IT departments at health care organizations are going to have some great opportunities (and a lot of work) if they play it right. You can grab the proposed rules by clicking HERE (it’s a big PDF file so hopefully your computer won’t choke).

Accountable Care Organizations are part of the Medicare Shared Savings program included in the ACA and are intended to create organizations to “expand value-based purchasing, broaden quality reporting, improve the level of performance and feedback to suppliers, create incentives to enhance quality, improve beneficiary outcomes, and increase the value of care." The idea is to reward providers for delivering high quality, efficient clinical care for Medicare beneficiaries. The rules themselves sound remarkably similar to the HMOs that everybody hated- but ACOs are supposed to be different. They are going to be primarily run by hospitals and provider groups instead of insurance companies, and supposedly will be less restrictive with the patients and allow for individuals to see providers outside the network if they want. We'll see.

I read that the health care industry tends to operate with “kind of a herd behavior, rushing to implement an idea without working through the detailed business questions of how they’ll work.” ACO’s are the new hot topic in health care and the herd is building. They sound like a good idea (and could be a survival strategy for some provider organizations and hospitals) so many folks are jumping on-board, they just don’t know how it’s all going to work.

HHS estimates 5 million Medicare beneficiaries will be enrolled in ACOs in the next few years. Somewhere between 75 and 150 ACOs are supposed to be operational over the next three years and will cost around $1.75 million each to get set up. The start-up costs are primarily going to be borne by the private market. HHS believes Medicare will save a little over $500 million over the next 3 years (median number). That’s a pretty small portion of overall Medicare spending- but it’s a start.

Once again, I wonder about the patients.

The rules spend quite a bit of time talking about the importance of being “patient centered” but nobody is talking about how to get the patients and individuals ready to be “patient centered.” What will happen when a patient wants to go outside the network impacting any bonus payment the ACO might receive? What will happen when the patient wants every possible test and procedure that the ACO may not believe is necessary? That’s going to determine the real success of ACOs. Can health care finally relate to people on an individual level?

As they are outlined today, the rules acknowledge that public and patient support is going to be required to make all of this work- but doesn’t quite define how. The rules state, “The exercise of free choice, however, can be undermined or even nullified if beneficiaries do not possess adequate information to assess the possible consequences of available choices, or to evaluate which available options are most consistent with their values and preferences concerning their own health care.”

Health care is going to need to connect with people in new ways. Brochures, pamphlets, and marketing materials are not going to cut it any more. Individuals need to be educated and informed about the basics of ACOs to be able to participate like ACOs are going to need them to participate.

Consumer education needs to be a priority and not just an exercise shoved off to the marketing department or handled like health care has handled communication and education in the past. Consumers are having a tough time trusting health care right now- 429 pages of rules may be a billable hour windfall for the consulting companies, but it doesn’t make things any easier for those who are really going to need to know what is expected and are going to be asked to participate in ways they haven’t had to in the past.

Let's hope we can start connecting.

Rep. Bachmann- Is the Tea Party Out of Touch Too?

2011-03-07T08:09:00.000-08:00

Minnesota Representative Michele Bachmann certainly stuck to her talking points on Sunday’s Meet the Press.

Despite David Gregory’s persistent attempts, Bachmann danced around almost every question. She had a point to make and that point didn’t include responding to Gregory’s questions. She was sticking to her message and she was going to make it- no matter how embarrassing the outcome might be.

Her new “revelation” focused on the discovery of $105 billion in appropriations funding supporting the Patient Protection and Affordable Care Act passed last year. Her web site comments, “Recently, I read startling information about the funding of ObamaCare. . .” and goes on, “Because now, months after passage, we are discovering an astonishing $105,464,000,000 has already been appropriated to the Health and Human Services Secretary for ObamaCare through FY2019.”

Bachmann even sandwiched her “support card” showing the $105 billion number to all viewers in response to a totally unrelated question thinking it would provide extra emphasis.

She credits her revelation to an article she recently read- and the rest is history. She was off and running- despite the fact that these numbers have been out there since the beginning.

The numbers are true. There were a lot of appropriations made in the ACA for grants and funding in many different areas. These include funding for the health insurance exchanges, school-based health centers, expanded primary care residency programs, health care education at the community levels, and others. There were allocations made for many “oversight” organizations we could probably do without considering where we are from a fiscal perspective.

But unless you simply didn’t read the law, or are totally uninformed of what is included, this should not have been “startling information” especially for someone in Congress.

The Congressional Research Service published a report last October identifying the appropriations included in the law. There is nothing hidden. Representative Bachmann must just be getting to reading it now- or she has been waiting for another source to read it for her.

The costs of our health care system are continuing to increase and will continue to increase if nothing is done. The ACA needs a lot of work to fix if we’re going to fix it, or another approach had better be ready if we’re going to repeal it. Politics aside, we’re at a tipping point in health care.

If Representative Bachmann is going to be speaking for the Tea Party, I would recommend she get her facts straight before talking to a national audience again. If she is “shocked and surprised” at this late stage that is her fault for not being informed.

She shouldn’t assume the rest of the American people are as uninformed as she is.

Finally- A Business Case For Hospital Readmissions

2011-02-11T14:29:00.000-08:00

A study in the New England Journal of Medicine concluded 1 in 5 elderly patients are readmitted to the hospital 30 days after leaving. This results in 2.3 million individuals being readmitted at a cost of over $17 billion to Medicare. A significant number of the readmissions are avoidable.We’ve known this has been an issue for a long time, but there was never the ability to develop the “business case” to fix it. Business cases are a big deal in healthcare. Even though we know it’s the right thing to do, if it costs in the short term or you can’t make money at it in the long term, things don’t change.

One part of The Affordable Care Act focuses on reducing avoidable hospital readmissions and will begin to penalize (reduce payment) to hospitals if their readmissions exceed certain targets. Suddenly, there is a business case and hospitals are taking steps to fix the problem and, for the most part, the initial steps to fix the problem are very simple: Make sure patients understand their responsibilities to care for themselves and get the follow-up care that is required. It may take a little more time to educate the patient or their care givers than before, but now the extra time is justified by the potential of lost revenue down the road.

While health care couldn’t make the business case before, I think about the 1 in 5 elderly patients who had to suffer being readmitted and the economic consequences that may go along with it. Somebody has to pay for it. And, I wonder why it takes threatening a reduction in what a hospital is paid to just take a little extra time to educate patients and care givers and do the right thing.

I guess that’s why it took a law to fix it. Our incentives are all screwed up.

My Journey Through The PPACA: Patient-Centered Research

2011-01-25T14:11:00.000-08:00

Trying to read the PPACA is brutal. I've skimmed it twice and am now going through in a little more detail- reading the words. I have no intention of being an expert on this- but, I do want to be informed with what it is and what it isn't. So, I'm going to share some thoughts as I go through it on the blog.

As with any legislation (not just health care) the words and the organization (sections, titles, and all the rest) probably makes sense to the lawyers but I doubt even the politicians can explain it. That is a large part of the problem with this- it is just hard to explain what is written. Very few have tried.

I was particularly interested in the "patient-centered" stuff. Section 6301 page 609 creates the "Patient Centered Outcomes Research Institute" and a boatload of money is allocated to it.

Here's the definition/purpose:

"to assist patients, clinicians, purchasers, and policy-makers in making informed he

alth decisions by advancing the quality and relevance of evidence concerning the manner in which

disease, disorders, and other health conditions can effectively and appropriately be prevented, diagnosed, treated, monitored, and managed through research and evidence synthesis that considers variations in patient subpopulations and the dissemination of research findings with respect to the relative health outcome, clinical effectiveness, and appropriateness of medical treatments services and items--"

Whew. Take a breath.

While this diatribe probably means something to those in health care- (health care loves to use a lot of words or acronyms to say simple things)- the average person will have no clue what this is and why it may be important. How this definition of purpose even remotely relates to anything "patient centered" is beyond me.

I've found there are some good things in the law and some things that make no sense. Many times I had to work to find them. The lack of education, communication and explanation of this reform approach at a very basic consumer level remains a huge part of the problem as this debate continues.

Beginning to organize the information in the health care system is a good thing. Starting to organize system-wide "best-practices" and prevention methods is a good thing for everyone involved. Unfortunately, the consumer is never going to know why this is important because nobody is telling them and they have to try figure it out on their own with the 77 word definitions provided. Or, they just do the easiest thing and listen to the talking points of cable news or the politicians.

We all know how balanced these sources are.

A Wake-Up Call For Our Country

2011-01-10T07:56:00.000-08:00

It’s unfortunate that sometimes it takes a significant event to force us to step back, reflect, and determine where we are. These events occur for us individually as well as collectively as a society and as a nation.

The tragic events in Tucson this past weekend is one of those.

The finger-pointing and accusations were flying within hours of the shootings even before any facts were known. We still don’t know many facts today and we never may know the real reasons for this insane act.

New York Times Nobel Prize winning columnist Paul Krugman quickly jumped to blaming the Tea Party, Glen Beck, Sarah Palin and conservatives in general. He commented, “Violent acts are what happen when you create a climate of hate.” He believes conservatives created this environment of hate.

Florida Democratic Congressman Alan Grayson didn’t help to create an environment of unity when he referred to Tea Party Challenger Daniel Webster as “Taliban Dan” during the mid-term elections. The rhetoric during these elections across-the-board was brutal.

Let’s just call it even. There is enough blame to go around on all sides. Regardless of whether the accused was politically motivated or not, we all know our political process and dialogue has grown toxic and does not help the cause of addressing the challenges we face as a country. We have serious challenges ahead of us. Whether we want to accept it or not- they will not be solved as Republicans, Democrats, or Tea Party; they will be solved as Americans.

Commentator David Gergen states it best, “This is not a moment to point fingers and make accusations. But it is a time to pray for the victims- and pledge to each other that we will struggle for a more civil and decent America.”

To honor the victims, and with prayers for Gabrielle Giffords, let’s come together to at least agree on that.

Health Care In 2011: Defining Ourselves as a Country

2010-12-30T07:30:00.000-08:00

2010 was another memorable year. We had the Gulf Oil spill, the passage of health care reform, the rise of the Tea Party, and an attempt to rebuild an economy devastated by the Recession of 2008. The November elections pointed out that Americans were tired and wanted change. The election results will change the course of politics in 2011. And, the wars in Iraq and Afghanistan (except for little spurts of topics) remained a side-issue for most Americans (2010 was the deadliest year of the 9-year Afghanistan War and less than 1% of the American population was asked to sacrifice in ways we can’t even begin to comprehend.)

All of these events are related. Slowly but surely they are defining the character of our country. Will we be able to come together as a nation to solve the many challenges we face, or will we remain partisan and divided and only expect others to sacrifice instead of ourselves. All Americans are going to need to sacrifice in some way if we’re going to pull ourselves out. It’s a new mindset for most. Time will tell whether we will.

Kaiser Foundation determined the uninsured in America grew by nearly 4 million people in 2009. Now, over 50 million Americans are without health insurance to finance the health care they may need. The number of Americans without access to some type of health care financing/insurance support now exceeds the population of Spain. This number will likely increase when the study is repeated for 2010.

Uncompensated care for the uninsured reached $57 billion in 2008 with the state and federal governments footing three-fourths of the tab. This number will continue to add to the strains of federal and state budgets as the number without health insurance increases.

The Employee Benefits Research Institute concluded that a couple will require $170,000 in savings for a 50% chance of covering their health care expenses during their retirement- including what would be paid through Medicare. Considering the average savings is only around $50,000 today, it doesn’t take a math wizard to conclude there are challenges ahead. Twenty-seven percent of those uninsured already used all of their savings to pay for the health care they need and many are delaying treatment simply due to cost. Sixty-percent of all bankruptcies are now related to health care expenses.

Only 20% of the Baby Boomers now beginning to flood the Medicare system believe it is financially stable and nearly half believe they will live longer than Medicare itself. The influx of Baby Boomers is going to put a strain on a system that is already strained and adding daily to our national debt.

Something has got to give.

As we enter 2011 and begin to argue again about reforming our health care system let’s not delude ourselves into thinking everything is ok. These numbers are only going to grow if we do nothing or just continue to tinker around the edges. We’ve tinkered around the edges for long enough.

And, yes, it will require sacrifice; sacrifice from everyone this time. Whether you are Republican, Democrat, Tea Party or any of the other variations, and no matter what demographic or economic class you are in, it is how we accept and address these challenges will define us in 2011 and beyond.

“For unto whomsoever much is given, of him shall much be required: and to whom men have committed much, of him they will ask the more.”

A good verse to keep in mind for 2011.

Happy New Year

Just Continuing To Kick the Can Down The Road

2010-12-16T07:14:00.000-08:00

It's almost Christmas.

Last year, Congress was frantically putting the pieces together on the health care legislation- which wasn't pretty. This year they are frantically trying to put together the pieces for the omnibus spending and tax bills- even less pretty. At a cost of over $850 billion and loaded with over 6,000 earmarks, this legislation is once again an example of cramming together what is politically viable instead of what is needed for the country. Before signing the omnibus spending bill in 2009, President Obama stated, "This piece of legislation must mark the end of the old way of doing business and the beginning of a new era of responsibility and accountability that the American people have every right to expect and demand." I guess he feels one more time won't matter. We'll really, really make this one the last time. I doubt it.

Last week the House passed the Medicare and Medicaid Extenders Act of 2010 avoiding the 25% cut in Medicare physician payments and freezing provider reimbursement at the current levels until the end of 2011. Physicians breathed a sigh of relief- the Medicare budget was blown to hell. This marks the fifth time we have set aside the sustainable growth rate (SGR) model this year and the fifteenth time it has been set aside since 2001 accruing a liability of another $300 billion. Do you think the SGR model might need to be changed instead of continuing to simply push dealing with Medicare cost increases off in the future?

A few days ago the first judge ruled against the individual mandate included in the health reform legislation signed earlier this year. Republicans celebrated as they felt this supported their calls for repeal. Democrats simply ran (or continued running- they have been running from this for a long time). In the meantime, the $2 trillion spent on health care costs continues to climb and our life expectancy compared to the rest of the world (one measure of how effective our system is) declined.

The Debt Commission report released a few weeks ago stressed we are nearing the edge of the cliff. We heard it, we know it, but we simply continue to put our hands over our ears and yell, "I'm not listening, I'm not listening, I'm not listening," hoping it will all just magically go away and we can return to the way things were. Ain't going to happen.

While stabilizing the economy in the short-term is important, considering the long-term impact of all of this on our debt is more important than ever. We all know we're in a very precarious situation as a nation; we just don't like to sacrifice anything if we don't have to. We're big into "screw-avoidance." Whenever sacrifice is mentioned, we think we're getting screwed. A hint; fixing our financial and health care structure is going to require some shared sacrifice from everyone whether we like it or not.

Or, we can just continue to kick the can down the road as we've always done and enjoy the scenery as we're falling off the cliff. We don't have very far to reach the edge.

Happy Holidays.

Health Care Consumers- An Enigma For Health Care

2010-12-06T07:15:00.000-08:00

Last week I sat in on one of the webinars hosted by the Institute for Health Improvement (http://www.ihi.org/). The topic was "bending the Cost Curve" and was intended to continue the never-ending discussion of how to address the health care cost crisis in this country (if you get a chance, sit in one one of these- some of the topics are pretty decent). There were over 600 health care professionals listening in to this one.

We heard all the usual numbers. We heard the usual descriptors; crisis, unsustainable, breaking-point. We listened as one of the speakers discussed the methods used to contain hospital costs in Maryland with propspective payment and bundling approaches. Then, there was one slide that seemed to create a stir with most of the audience (I've posted it here).

When discussing how to get consumers involved- the group was at a loss. When discussing the creation of "discernable health care consumers," changing consumer behaviors, and changing the expectations of individuals, the group honestly did not know what to do. Most in the audience are used to controlling, incentivizing, and directing. When realizing they may need to begin a real dialogue with the general population, this audience simply didn't know how to go about it.

Health care needs to change its image. It needs to realize that consumers are not simply a herd of cattle that needs to be driven in the right direction. With the right relationships and context, consumers (for the most part), know what they need to do. They just need some trust and guidance sometimes. Health care needs to realize that the individual consumer is not simply a component that needs a clinical fix that can be directed by free gifts an money- but an important part of the solution that needs to be part of the dialogue, discussion, and relationship.

If we're ever going to fix the problem we have, health care is going to need to communicate better with the general population. It is going to need to break down the clinical and technical communication approaches it has relied on in the past and begin a dialogue and discussion with the "Joe the Plumbers" of the world. It needs to regain some semblance of trust, relevance, and context for the average individual before they are ever going to get engaged and participate.

Only then will we be able to begin to address the issues with "Bending the Cost Curve." And, hopefully, we won't have 600 health care professionals wondering how to get consumers involved.

We'll have solutions to discuss already making it happen.

Health Isn't Just About ROI

2010-11-30T07:10:00.000-08:00

A familiar Einstein quote: "Not everything that counts can be measured. Not everything that can be measured counts."

W'ere trying to measure everything today in health care. We don't make a move unless the data is there to justify a positive "return on investment" (ROI) before we even start. We've reverted to use clinical and academic approaches to making decisions because we've been screwed so many times in the past. Data is safe. ROI is measurable. The way we make decisions today is justifiable in some cases and only holds us back in others.

Improving the health of our population is logical. When considering the costs of preventable chronic illnesses it only makes sense to help others change behaviors to prevent or minimize their effect- for the quality of life of the individual, and the costs associated with them. Yet, for any number of reasons, the health care system (employers, health plans, providers) continue to debate within itself with where the responsibility for "health and wellness" fits in the curative/sickness-focused model we have today. Who should pay for it? Will I get paid for doing this? Why should i keep someone healthy when they will only go to another employer or health plan when I'm done? What is the evidence and clinical model? With the costs of diabetes, obesity, hypertension, and other lifestyle-related chronic illnesses skyrocketing, a focus on creating a healthy population simply makes sense, we need to quit the debating, and begin to do something about it collectively.

An article in the December issue of the Harvard Business Review ("What's the Hard Return on Employee Wellness Programs?") further supports the value of wellness programs in the workplace. In typical academic fashion, the article identifies six "pillars" organizations included in the research used to create successful wellness programs in their organizations; Pillar 1: Multi-Level Leadership; Pillar 2: Alignment with organizational identities/aspirations; Pillar 3: Scope, Relevance, Quality; Pillar 4: Accessibility; Pillar 5: Partnerships; Pillar 6: Communication.

This isn't rocket-science.

I would argue these Pillars can and should be included underneath a more general platform of the need to create a "culture of health" that is trusted and embraced by the individual. The organizations included in the HBR article all had high "participation," positive ROIs, and focused approaches. But, all had also created a culture of health within their organizations that was a natural part of the organizational DNA. The health and wellness component was only an extension of the relationship these employers had created with their employees. It took time, and they all earned the trust of those participating with them.

Before relying on the 6 Pillars as the saving grace of what is required to create a healthy population of individuals we also need to focus on creating the culture of health throughout the landscape. This may take time and may not show a positive ROI for some time. Most individuals understandably do not trust the health care system we have today, some don't trust their employer relationship, and most certainly don't trust the health plans. Health care (providers, employers, health plans) need to build the trust and not simply rely on metrics or pillars to determine their success. They need to help individuals understand the relationships and provide the context they need to recognize they are part of the solution- and not simply a cog that is part of an external process. They need to be engaged.

To paraphrase Ghandi- "a (health care system's) culture resides in the hearts and soul of its people."

The culture is not determined just by the short-term ROI or other metrics that may or may not be important right now.

Fixing Health Care- Making It A Patriotic Duty Instead of a Political One

2010-11-22T19:37:00.000-08:00

Last week we lost 18 soldiers and Marines in Iraq and Afghanistan. Unless you are family, friend, or part of a community hit by the reality of these wars (yes, they are wars) you don’t hear much about it. The country has too many other things to worry and argue about.

As we enter the Holiday Season this year, take a minute and say a prayer for the men and women half-way across the world and living in horrific conditions to protect the freedoms we enjoy today. Say a little prayer of thanks and appreciation for those who have made the ultimate sacrifice. While you’re at it, say a prayer for their families as well. These folks know what real sacrifice is all about. It’s not easy but they know their role, accept it, and make the best of a really rotten situation.

Instead of making health care a political football why don’t we think about pulling together a little to achieve a common mission in the best interest of our country. Let’s make it our patriotic duty to work together to solve one of the biggest economic challenges facing our country. We may not all necessarily agree with the rules and we may not even like those we need to work with. Mark my word, those serving in Afghanistan and Iraq face the same challenges. But, they adjust and look beyond themselves to achieve a common objective. They make things happen.

They are Americans before they are anything else. We can learn a lot from them.

Have a Safe and Happy Thanksgiving

The Brutal Reality: Health Care Today = Increased National Debt

2010-11-15T09:29:00.001-08:00

In their book "Confronting Reality; Doing What Matters to Get Things Right," Larry Bossidy and Ram Charan put forward a statement that has implications for everyone in our country today. They state, "To confront reality is to recognize the world as it is, not as you wish it to be, and have the courage to do what must be done, not what you'd like to do." Very appropriate to describe the reality of the financial situation in our country.

Last week, Erskine Bowles and Alan Simpson, Co-Chair of the National Commission on Fiscal Responsibility and Reform submitted their "Co-Chairmen Proposal" for tackling the $13.7 trillion dollar debt facing our country. This debt is the result of the policies and entitlement expectations we have accumulated over the years (not just over the past two years) and was exacerbated by the Great Recession of 2008 experienced in the global economy. We are now facing a level of debt that jeopardizes the economic foundation of the country.

We have posted their proposal on our website at http://www.collaborationhealthcare.com/ and you can also look at it by clicking HERE.

We encourage everyone to take a look at it. It's only 50 pages and is mainly a "powerpoint on paper" highlighting the key messages. It has already been blasted for its lack of specifics. I look at it more as a starting point, not the final solution.

Those on the right have been critical because it includes tax and revenue increases. They believe there is already plenty of revenue- just not enough spending discipline.

Those on the left have been critical because it takes on some of the entitlements that have historically been off-limits; Medicare and Social Security.

The brutal reality is that we need some combination of addressing both.

Why is this topic included in my health care blog? Because health care (Medicare/Medicaid) is a major contributor to our debt and our lack of action in the past is impacting our businesses in the private sector and ultimately negatively impacting our economy. It's only going to get worse and it's time to quit arguing about the way to fix what we know needs to be fixed - and just do it. The impact of our debt is going to impact every American sooner or later. To fix our debt problem and our economy we must begin to change the way health care works whether we have laws that require it or not.

Some are still in total denial that the problem is as bad as others are making it out to be (AARP and the Natinal Committee to Perserve Social Security). On the other hand, David Cote, Chairman and CEO of Honeywell International and one of the committee members, was shocked to find out how bad our situation actually is.

The first founding principal of the Debt Reform document states, "We have a patriotic duty to come together on a plan that will make America better off tomorrow than it is today." America can come together when it wants to. Unfortunately it usually some type of crisis or catastrophe to make it happen.

The country has an opportunity to address a real issue before it is too late and becomes a catastrophe. This is beyond politics or ideology. It's time we confront the reality, become informed, and recognize it's going to take some sacrifice from everyone.

We have said before that fixing health care is critical to fixing our economy. Let's quit putting the ideology in front of the actions- as stated by Bossidy and Charan- "we need to have the courage to do what must be done, not what we'd like to do."

Republicans- It's Time For Specifics and Not Just Campaign Rhetoric

2010-11-08T05:32:00.000-08:00

The $4 billion the country spent on this last election should be looked at as a little boom for the economy. Political consultants, media buyers, the hospitality industry, and others tied to the various campaigns got a little boost in revenue. So, that's good. You see, we can find money to spend when we want to.

While we had to suffer through the nauseating attack ads that are now part of the norm, we watched a country tell its government it wanted a change in direction. This was by no means an embracing of the Republican Party as the devout Republicans would like to think. It was the independent citizens telling the government they didn't like the direction the country was heading and wanted change. The level of trust in government is at an all-time low- for both major parties. In two years if we're in the same place, the same thing will happen- we'll have another change.

Now that the Republicans are driving the bus (or at least near the front) they now have an opportunity to step up to the plate with specifics on what they intend to do. They have been exceptional in the complaining department (and have brought up justifiable concerns). It's just they have been woefully short on the specifics of their alternatives. They now have the chance to show what they can do.

Repealing the health care reform legislation is becoming a central battle-cry for the "new government." Minnesota Governor Tim Pawlenty is leading the charge as he explores his presidential run for 2012. On CNN he once again denounced the "takeover of health care by the federal government" and instead wants to rely on the "free market" to do its magic- but there are not a lot of specifics beyond that. Michelle Bachmann (R MN) has jumped on the bus as part of the Tea Party movement commenting during her debates that she believes allowing consumers to purchase health care across state lines will solve the problems we have in health care. This is all great political-speak for the free-market purists, but, exactly what are you going to do and exactly how will it work? I guess they haven't got that far yet.

Solving our health care crisis is an economic issue, it is a debt issue. It is no longer simply a campaign debate. Health care (even before the reform legislation) was dragging our economy down. We seem to have lost this fact in all the political talking points we've heard over the past year. Medicare/Medicaid spending are the two biggest components of our growing national debt (along with Social Security) and is only going to get worse as the Baby Boomers create a tsunami within the Medicare system. The same is true for Medicaid as the rolls of recipients expand as a result of our depressed economy.

Regardless of what one thinks about the legislation that was passed earlier in the year (Pawlenty called it "the worse piece of legislation passed in modern times") it brought the issue of health care near the top of the national agenda- where it should be. Our health care system is (and has) impacted the competitive positioning of employers and thus impacts jobs- this is nothing new. It has economically wiped out average citizens and created hardships for many others with the fragmented and costly inefficiencies that are part of it today. Everyone agrees the health care system we have today is unsustainable for the future.

As Republicans assume their new role it's time they move beyond the broad generalities outlined in the Pledge to America and through the campaign rhetoric. They will likely find once again (as Democrats found in 2010 and as Republicans should have learned in 2008) that campaigning and governing are two totally different animals.

Americans are open to new ideas. Instead of focusing on the campaign message of "Repealing Obamacare" let's hear what your specific alternatives might be. The health care crisis is not going away.

Americans are listening and waiting to hear what you have to say. You've got two years.

Another Election- Colbert and Stewart To The Rescue?

2010-10-31T20:01:00.000-07:00

I wonder if all the ghosts and spirits of Halloween can stir up some miracle for many of the Democrats on Tuesday. I doubt it.

It looks like the balance of the legislative process is going to shift back to the right- the House and many Governors will likely be Republican when all of this is over. There is still a chance (an outside chance) the Senate may move that way as well. Many of the pundits have speculated that this shift will simply result in a partisan stalemate in Congress we have never experienced before. I suppose you can just add it to the list. We haven’t experienced a lot of this before.

George Will (Conservative columnist from the Washington Post) argues this is the way the Founding Fathers intended things to work; partisanship is natural and the different bodies making up our structure of government were never intended to be bosom buddies. They were intended to provide the checks and balances required to protect our freedoms and the rights and responsibilities outlined in the Constitution. Disagreement is good. Partisanship is simply the result of having political parties with different ideas. He thinks the process is working.

But, I wonder.

I wonder if the Founding Fathers envisioned a legislative process paralyzed by politics when the country needs it most.

There’s enough blame for this to go around to everyone. It's time to fix it.

Yes, the Democratic leadership went too far when developing some of the policies important to its agenda. They didn’t have a choice in some areas- in others they did.

In health care they went too far given the circumstances we were dealing with as a country. They very likely figured they had only one shot at reforming the mess we have today and had to go for all the marbles- and that assumption cost them. The process was ugly and the final product was so complex and undefined almost everyone remains confused about what it is. The responsibility for communicating the “messaging” about the big picture has been assumed by cable news since everyone else has done such a poor job. And, most of the population does not like the content of the messages we’ve been hearing. As expected, the focus on reforming the insurance market and getting everyone covered under some type of coverage has overshadowed the real reform that could save billions of dollars and many lives over time.

While the effort may have been too ambitious for the country at the moment there are still many things included the legislation that make a lot of sense. Unfortunately, we remain focused on all the bad stuff and very few even hear about some of the other positive steps.

Payment reform that rewards value as opposed to volume when setting reimbursement approaches for care delivery is a huge step forward. Coordinating care more effectively between care-givers, improving technology use, enhancing the focus on wellness and prevention as opposed to sickness, and expanding community health initiatives are all critical areas needed to fix what we have. They don’t get much play in the world of politics today but should remain a focus whether in a law or not.

The elections on Tuesday will (once again) shake-up the political make-up of our democracy at all levels. These elections may very well impact whether we can, in fact, be successful in reforming our health care system to protect our economic foundation down the road. I hope and pray that after these elections the two sides can work together toward a common goal of creating the health care system that is accessible and affordable for all citizens whether it’s included in actual law or not. It’s just the right thing to do.

After we digest the results on Tuesday maybe we need to look for an alternative approach. If they can’t do it in Congress, maybe we should ask Jon Stewart and Stephen Colbert to help out.

It seems like they make more sense than anybody these days.

Health Reform- To Repeal or Not To Repeal

2010-10-21T15:10:00.000-07:00

The emotions created by the election rhetoric are moving full-steam ahead. One of the mantras of the Republicans is to “Repeal Obamacare.” The Democrats are scared stiff and refuse to discuss anything that hints toward “bigger government”- thus, they aren’t even bringing up health care reform. Word has it that consumers/citizens are fed up with it anyway and have shut down. Big mistake if that’s what happened. Consumers/citizens need to get involved and need to be informed now more than ever. Not fixing health care (with PPACA or not) will only lead to an economic calamity even worse than the housing/mortgage crisis we’re trying to dig out of today.

So, what do American health care consumers want?

We know we need to fix what we have. The costs are unsustainable, the quality is irregular, the access is spotty, and, quite simply, too many Americans are being hurt (financially and otherwise) by the system we have today.

By all measures, we’re divided in our support of what was produced by Congress earlier in the year (PPACA). It’s safe to say most are not really familiar with the “big picture” with what was produced in the first place. The strategy and purpose of what our country needed to fix was overrun by politics and emotions. The fear of “big government” has become the prominent message as opposed to the proper message of fixing one of the major issues facing us as a nation and protecting the economic foundation of this country.

Most Americans are not familiar with the details of the legislation and have been influenced by the loudest talking points (I would argue that most of our legislators are not all that familiar either). And yet, we hear the message to “repeal Obamacare because that is what the public wants". Is it really what the public wants or is it that the Republicans simply want to stick-it to the Democrats?

Kaiser Family Foundation recently completed an informal analysis of eight major polls completed over the past month asking Americans whether they favored repealing the legislation we have today. They found the results were all over the board ranging from a high of 51% in an NBC News/Wall Street Journal poll, to a low of 26% in the September, 2010 Kaiser Tracking Poll. They determined the results were dependent upon how the questions were worded and where the questions were placed (as we all learned in Marketing Research 101).

A Bloomberg Poll completed in early October found consumers support (>70%) protection for high-risk individuals, eliminating pre-existing condition restrictions of insurance companies, and eliminating the Medicare prescription drug doughnut-hole as part of any reform initiative. They would like to get rid of the tax on employers for “generous” benefit plans and are uncertain of the individual mandate requirement.

There is no doubt that the PPACA is cumbersome, complex, and has been communicated extremely poorly. Many, many items in the law could be improved. We would have hoped the legislative process could fix what doesn’t make sense and keep what does. Unfortunately, with the way we are polarized today that’s not going to happen. This is a war between Republican and Democrat, nothing else.

If the Republicans are going to continue to call for a full repeal of the law (Michelle Bachmann) they had better have an alternative to replace it. They are only contributing to the confusion of the individual consumer by promoting their position today- and we need the consumer/public to be on board of anything is going to work.

One alternative is Republican Representative Paul Ryan’s, “A Roadmap for America’s Future; Version 2.0.” Ironically it includes many of the items already included in the Patient Protection and Affordable Care Act as part of his health care solution- there are parts of the legislation where both sides agree.

I guess even if you agree with it, it just depends from which side of the aisle you are on to determine if “Repeal Obamacare” is part of your mantra or not.

And, it’s a sorry state of affairs for the American people and no wonder we’re confused

A New Report Card For Our Government- Stay After School

2010-10-11T09:40:00.000-07:00

If my kids would have brought home a report card like that reported in a recent Washington Post/Kaiser Foundation/Harvard University Poll evaluating the consumer perspective of the federal government we would have had a nice long chat. Not surprisingly, we don’t think our government is working very well- and the report card reflects it. This poll was conducted between September 22 and October 3, 2010 and included a representative sample of 2,054 adults over the age of 18. We’ve posted the survey results in our library if you want to dig into the numbers further.

Here’s how we graded our government:

The Military= B+

Our Own Representatives in Congress= C

The Federal Court System= C

President Obama= C

Democrats in Congress= C-

Federal Government in General= D+

Republicans in Congress= D+

Not a report card to be proud of (except the Military where I am extremely proud)

This is no surprise. Our economy remains very fragile and the unemployment created as a result of the Recession of 2008 remains too high. This recession hit hard at a very personal level to millions of Americans. The basic question we are struggling with is how much can or should the government be involved to fix the systemic problem we have created.

While we are stuck in polarizing politics (which will get even worse with the upcoming mid-term elections), nearly 80% of Americans feel our government can be run well. However, most feel it is currently dominated by special interests with a lot of money looking out only for themselves as opposed to the good of society in general.

Economists and citizens are statistically split between increasing government spending (50%) and avoiding deficits (46%) as components of the economic strategies necessary to dig out of the mess we are in. This will continue to be debated and studied for years in the future.

Almost all agree we are not getting the value out of the tax dollars we contribute to make our government work.

When asked whether the government actions threaten our personal rights and freedoms we are surprisingly at the same level we were at in 2000- before 9/11. Fifty-two percent of Americans feel the federal government interventions are not a threat to liberty and personal freedoms both in 2000 and in 2010. But, Rush Limbaugh, Sean Hannity, Glenn Beck and others are making inroads arguing otherwise.

Health care continues to be a primary item of uncertainty for most Americans. While they are skittish about the impact health care reform most remain uncertain and confused by the impact the PPACA will have on their lives.

These results are another indication that we have a long ways to go as a country. However, most Americans still believe that by working together and eliminating the self-interests dominating our political processes today we can make it work. Congress has a long road to climb to get Americans on board. It may take a change in the seating arrangement after the November election as part of the process. Either way, they are going to have to stay after school for quite awhile to improve on the grades they have today.

A Pledge to America- Good Political Move; Not the Solution We Need for Health Care

2010-09-27T17:07:00.000-07:00

I can’t remember when politics in this country has been so polarizing. It seems like we’re all pulling in different directions. Thomas Friedman hit it on the head last week when he wrote, “For democracy to be effective and deliver the policies and infrastructure our societies need requires the political center to be focused, united, and energized. That means electing candidates who will do what is right for the country not just for their ideological wing or whoever comes with the biggest bag of money. For democracies to address big problems- and that’s all we have these days- requires a lot of people pulling in the same direction, and that is precisely what we’re lacking.”

All of the name calling, finger pointing, and blaming is not going to solve the big issues we face today. It’s time to pull together and figure out how to pull ourselves out of this mess.

The Republican side came out with their Pledge to America last week. Obviously trying to replicate the success of the Contract with America that was launched by Newt Gingrich in the 90s, the Pledge basically continued the name calling, finger pointing, and blaming that is the standard operating procedure of politics today.

You can't disagree with some of the facts presented in The Pledge. Our government has grown too much and is involved in too many things. The deficit is a huge concern and needs to be addressed. However, the free market (however you want to define it) has also proven that it runs into problems when left on its own. There needs to be a balance. Health care is a prime example.

The Pledge calls for repealing the legislation that is in place today. We do not disagree that the PPACA is confusing, complex, and went too far in some areas. But, that’s what you get when you can’t work together and operate in a partisan manner. That’s how our government operates today. The most recent Kaiser Tracking Poll found over half of the population is confused by the law. Most have not read it and can’t begin to put it into context. Most Americans can only determine their perception of the law by personal experience and by emotions. And remember, most Americans receive the majority of their information about health care reform through cable news- not the most unbiased source in the world.

The Pledge believes PPACA should be repealed and replaced with enacting malpractice reform, allowing consumers to purchase health insurance across state lines, and emphasizing the use of Health Savings Accounts. We’ve heard all of these before. We’re sorry, these will not solve the mess we have with a shortage of primary care physicians, increasing medical technology and pharmaceutical costs, and the tremendous inefficiency in health care delivery we have today. The Pledge does not even address what it would do with Medicare and Social Security- the largest components of the budget and the deficit challenge we are facing.

Repealing PPACA is a nice political talking point as long as American’s remain confused with the broader problems we face in health care. Both sides have done a terrible job of objectively communicating a complex issue to the American people.

If PPACA does end up getting repealed (which it won’t) I hope those who wrote The Pledge can come up with better and appropriate ideas than they have included in this draft. A better idea is to take what we have and work together to make it better- but that ain’t going to happen with the political culture we have today; and that is sad for America.

Our Governor Is Not Going To Play Nice With Health Care

2010-09-08T14:24:00.000-07:00

On August 31, 2010 our Minnesota Governor, Tim Pawlenty signed Health Care Executive Order 10-12; Directing State Departments and Agencies Regarding Discretionary participation in the Federal Health Care Law. This was our governor’s attempt to essentially tell the Patient Protection and Affordable Care Act to take a hike.

Now, our governor is probably running for President and he’s made his views very clear concerning any government involvement in health care- and anything else for that matter. This Executive Order was a political statement more than anything else. You can’t object to legally directing those in our government to use some discretion in requesting and using federal funds- if we don’t need it, don’t take it. That’s not the way government works. The only way to filter spending is to hold someone accountable- Pawlenty is assuming that role and I can’t object to that.

It’s the way he did it that bothers me. Instead of a directive focusing on federal and state fiscal responsibility- he used it as a political statement. Here’s a “fact-check” of the reasons supporting his Executive Order:

1. PPACA was signed on March 23, 2010:

True

2. PPACA is a dramatic attempt to assert federal command and control over this country’s health care system and reduces individual freedom for health care decisions.

PPACA establishes the framework at the federal level, and allows the states to implement as they see fit. Pawlenty is free to participate or not. However, the reason the government set some framework is because the private sector could not or would not do it on its own. Somebody needs to take control of health care spending before it breaks the bank.

3. PPACA is unprecedented federal intrusion into the individual liberty including the mandate to purchase health insurance.

This one would be easy to fix- have the health insurance companies eliminate pre-existing conditions for those who can’t receive coverage today and not require everyone to participate. They won’t do it- and we can’t have it both ways.

4. PPACA is funded by taxes and fees coupled with unrealistic assumptions purported for future cost savings.

This is true, to an extent. The only reason the cost assumptions are "unrealistic" to some is because nobody is willing to give. Hospitals, health plans, consumers, and employers will need to realize the old way is not sustainable. The days of $0 co pays are over, fee schedules will be determined by value, and the technology will be dispersed efficiently instead of on every street corner. If everyone embraces the broader need and sucks it up a little the assumptions may not be all that far off.

5. PPACA increases federal spending at a time when the government debt threatens private sector economic growth.

Yes it does- but if we don’t do something, the unfunded liability of our health care debt could bring our entire economic picture down in the not so distant future. Just advocating for more HSAs, competition across state lines, and malpractice reform is not going to cut it. The problems we have created are much deeper.

6. PPACA includes many demonstration projects intended to speed the transition to federally-controlled health care.

This is just silly. The intent of all of this is to organize care better than it is organized today. Once again, if the private market wanted to do it- it should have by now.

Pawlenty’s Executive order would have been much more palatable if he had just stated that since health care represents over 1/6 of our national economy- and since fiscal responsibility is of paramount importance- all requests for funds will need to be directed and approved by his office.

But, he’s running for President, so I guess he felt he needed to create a buzz. That’s the way we do it nowadays.

Medical Errors and Readmission- We Shouldn't Need A Law To Fix What Shouldn't Be An Issue In The First Place

2010-08-31T06:50:00.000-07:00

We took a little break for awhile. We wanted to regroup as the health care reform shakeout unfolded and to make sure we continued to provide relevant ideas, information, and thoughts through our blog. We’re going to resume our previous direction. We simply want to provide interesting information, resources, and thoughts concerning the broader context of our health care system. We’ll obviously need to include some of the activities, fallout, and progress associated with health care reform- and we want to provide our views from a consumer/patient perspective. Our goal is simple- to improve the dialogue and context of health care between all stakeholders; consumers, providers, employers, health plans, government. We believe an informed health care market can and will make better decisions than one relying heavily on emotions, siloed perspectives, or legislation.

The dollars and costs of our health care system are simply staggering. We all know we spend over $2 trillion in health care. We talk about this number so frequently that the number has, itself, become abstract. To put context of how big a trillion dollars is consider this fact; 1 million seconds is about 11.5 days. 1 billion seconds is about 32 years. 1 trillion seconds is equal to 32,000 years. These are big numbers- our current health care expenses equate to over 64,000 years from this perspective.

So, when we talk about an area that costs our system less than 1% of our annual health care expenses it doesn’t get a whole lot of attention. However, it’s when we start to make a difference in these “smaller” areas that we can start to make a difference on the bigger number. In addition, addressing some of these areas is simply the right thing to do.

The Society of Actuaries recently released a commissioned study completed by Milliman, Inc. concerning the costs of medical errors in our health care system today. (We posted the study in our Library and you can get it by Clicking Here). This study quantified the cost of documentable medical errors using claims data and some pretty conservative methodologies. In 2008, medical errors cost our health care system an estimated $19.5 billion dollars. Over $17.5 billion were direct costs of inpatient, outpatient, and prescriptions. Another $1.1 billion was related to lost productivity (10 million excess days missed from work), and over $1.4 billion to increased death rates (2,500 deaths due to medical errors).

An estimated $15 billion is spent in Medicare for readmissions to hospitals for preventable medical events. In California, over 1/3 of the patients are readmitted to the hospital within a year.

These are very real costs. These are preventable costs. In addition to the financial costs, these events impact the quality of life of every individual accessing our health care system. The Patient Protection and Affordable Care Act (PPACA) included a significant segment of its massive rules to addressing the issue of “readmissions.” In our view, this is an example of where the private market (hospitals, doctors, health plans) should have and could have picked up the ball and addressed the issue on its own. In “the best health care system in the world” you shouldn’t need a law to dictate the rules to fix an issue that shouldn’t be an issue in the first place. Unfortunately, the private market fumbled on this one. Now, we’ve got rules and laws to follow.

Live and learn.

"Reframing" Health Care

2010-06-08T14:04:00.000-07:00

The May/June, 2010 edition of “interactions” includes an interesting article about the way we think about health care. We’ve posted it in our Library at http://www.collaborationhealthcare.com/ and you can grab it here if you want to take a look at it.

The health care industry lives in its own little world. In some ways it is not dissimilar from other industries as it develops its own “culture” and language. Retail, financial services, technology, and many other industries have their own insider cultures, buzzwords, and terminology as well and most of the time they are irrelevant to the individual consumer. But, health care is different. Health care is very personal, very emotional (as we’ve seen), and ultimately touches every individual in one way or another. What is different from most other industries is that every individual interacts with our health care system at some point in their life, sometimes regularly, and many times emotionally.

The recently enacted health care reform legislation sets the framework to try to change the health care culture that has been established over the years. Many health care stakeholders are going to have to look at the system and their role in it very different if they are going to participate in the future. Health care is going to change.

We’re asking consumers to take a different role. We want them to be active participants but the system is really not set up to allow them to do so. The “frames” that exist with the way our health care system is structured today sometimes even prohibits their participation.

In the article “Reframing Health to Embrace Design of Our Own Well-Being,” the authors argue for a need to change the design principles, or frames, that exist in health care today. As we’ve stated repeatedly over the past several years- we need to change the way we look at it.

If we want to really get consumers involved, we need to change the frames that exist today. The authors state, “We debate how to be more efficient and reduce cost rather than radically increase effectiveness and eliminate causes.” A radical change in thinking is going to be required.

Our current system has evolved over the years resulting in what we have today. In the 1900’s the system was focused on monitoring and preventing transferable diseases through immunizations. This part was very successful. Later, the system evolved to focus on eliminating or minimizing acute diseases. It’s been expensive, but it has worked well overall as well.

Now, we’re addressing a population abundant with chronic disease significantly influenced by the culture and lifestyles we lead. The health care focus is now on prevention and wellness. The frame needs to change again. The authors believe well-being and self-management require their own frames. The acute care frame, while still important, cannot address prevention, well-being, and consumer engagement as will be required in the new health care world.

The acute care frame that exists today is trying to accommodate, but it just won’t get there. The article quotes social epidemiologist Leonard Syme who states, “We need to pay attention to the things that people care about, and stop being such experts about our risk factors.” (the acute care frame). We need to get consumers more engaged in a collaborative role in their health and well-being and actively participate when they are healthy as well as when they are sick and need access to the acute care frame. The authors contend, “Health is a means to a goal- one of the things that supports the quality of our everyday life.”

In the self-management and well-being frame health care professionals become coaches and mentors, consumers become the decision-makers and collaborators. Data and information is abundant for the individual to track their progress when setting goals both when they are sick and when they are healthy. And, consumers have simple ways to navigate their options and use health care professionals for advice and insight as well as receiving directions and treatment plans when they are required.

Creating a new well-being/self-management frame will require a total change of the financial structure and payment methods for health professionals. Instead of being paid for services, they are paid for keeping the population healthy.

The traditional “healthcare frame” as we know it today does need to change. We just wonder of the system itself can make the radical changes that will be required to introduce a new frame; one that focuses on the well-being and self-management of the individual consumer.

Health Care Reform- Cable News Has A Role

2010-06-03T07:34:00.000-07:00

The Kaiser Family Foundation's May Tracking Poll results of consumers might be an indication that emotions are starting to stabilize a little since the health care legislation was enacted a few months ago. The public may be a little less confused, but a solid minority (44%)still remains uncertain with how the legislation is going to impact them personally.

While the general framework of a system redesign may be in place, the health care system is now waiting for the rules to be written to define exactly how all of this is going to work. The country has moved on to other things for now. It’s now up to the health care system to execute whatever rules are written- and hope it all works. Business strategies for all stakeholders are already changing as a result.

While the intense emotions that we witnessed over the past year may not be visible, you can bet they are still there. Health care reform remains a very partisan social issue. Those that supported the reform structure ultimately enacted still do- just not as intense as in the past. Those who have been against the approach still are- and are just as intense in their disapproval as before. This divide will become visible again if any surprises occur. And, you can be sure there will be some surprises along the way.

The rumors and myths of the legislation continue to fly around to further confuse the general public. Recently, a mass e-mail was sent stating that the new legislation required employers to start including the health care contributions they make on the W-2 of each employee- and this contribution would be included as taxable income thus, increasing the taxes for all who receive employer contributions for their health care benefits. The e-mail called for a “call to arms” to all recipients to reject this tax increase and pass it on. The first part of the author’s contention is true- the second part is not. However, the message created quite the stir in the internet world. Such is the world of instant communication with the internet- whether the information is accurate or not.

Kaiser’s May Poll shows most consumers access family and friends, cable TV (Fox, CNN, MSNBC), and the broadcast networks most frequently to obtain their information about health care reform. Cable TV received the highest weighting when determining the “primary” source of health reform information. The slant used by these venues has a significant impact on the consumer’s perceptions of health care reform and ultimately on their desire to engage in the system. Cable news could be a tremendous asset to help consumers become more engaged by sharing fair and accurate information and helping consumers understand, or they could be a tremendous obstacle. Only time will tell what the result will be.

The country has moved on to some of the many other pressing problems we face. Even though the emotions of health care reform may have subsided for the moment, we can’t forget that fixing our health care mess is a very key component to fixing our economy. Engaged consumers are a critical part of the solution. We need to provide them with the tools and information they need to make the informed decisions and become a part of the solution, not drive them further apart.

Prometheus- A Titan In Payment Reform?

2010-05-13T10:07:00.000-07:00

One of the basic lessons you learn in Economics 101 is the fact that price is always a function of supply and demand. At least it should be. But, as we’ve seen, that doesn’t always apply to health care. Health care pricing has turned into a convoluted mess of cost shifting and political negotiations with little relationship to supply and demand. The ultimate result- those that deliver the care usually receive less “per unit” and total costs to the system continue to go up.

The Patient Protection and Affordability Act sets minimum standards for what health plans (or other payers) are required to pay in “medical costs” and what they may retain in “administrative costs.” This will ultimately drive the setting of prices set with employers and consumers. A study of literature by the Deloitte Center for Health Solutions found health plan administrative costs ranged from 9% to 41%. Obviously, there is no set definition of what is included as an administrative cost from a health plan perspective. You can expect the pricing manipulations to continue as the PPAA rolls out.

One thing is clear- how our health care system reimburses care providers needs to change if we’re going to get a handle on the costs. Until it changes, those responsible for the financing of health care (the health plans, the government, and payers) are going to continue to focus on obtaining lower per unit costs for services or eliminating them altogether if there is no evidence that the service works. This process will ultimately impact the quality of care received from the patient.

We’re starting to see some movement to changing the fee-for-service/volume-driven payment system we have today. The American Board of Internal Medicine (ABIM) Foundation recently put forward some guiding principles designed to “produce a health care system that reflects societal values more accurately than do those inherent in existing payment methodologies.” Almost everyone agrees on the need to change the financing and payment for health care services.

We’re seeing pay-for-performance methods, episode-based payment models, accountable care organizations, and medical homes as the new financing ideas for health care delivery. There are already many derivations off of the main ideas (baskets of care, etc.) Each idea has strengths and weaknesses but none have proven to be the “silver bullet” that will encompass all aspects of care delivery, reasonably reimburse providers, and assure quality care and manage the costs of delivery.

The Robert Wood Johnson Foundation has put a lot of money into the Prometheus Payment System to explore new payment models in care delivery (go to www.prometheuspayment.org). Prometheus (Provider Payment Reform for Outcomes, Margins, Evidence, Transparency, Hassle-reduction, Excellence, Understanding, and Sustainability) is an episode-based payment structure. The idea is to determine a total budget for all providers involved in treating a particular episode of care. Prometheus has developed 21 Evidence-Informed Case Rates (ECR) that establishes a comprehensive budget within which a payer or multiple providers negotiate their price to provide all of the care for a specific patient for a specific condition.

In its payment algorithms, Prometheus also establishes a budget amount for Potentially Avoidable Complications (PAC) that have been identified in specific cases as the “deficiencies in care that cause harm to the patient yet might have been avoided with more proactive care.” The Prometheus data indicate up to 40% of every dollar spent on chronic conditions are a result of PAC. If PACs are avoided, the providers keep the money.

We've included a study on our web site providing more details of the Prometheus model as it applies to primary care and medical homes.

The Prometheus model is currently being tested in four markets with expansion planned in the future.

Prometheus obviously had to stretch quite a bit to make an acronym for what it intends to do. However, the definition of Prometheus (defiantly creative) seems to define the intentions best.

We need more defiantly creative ideas introduced that can change the way health care thinks and begin to fix the mess we continue to face today.

Be Well

Social Determinents of Health- How We Live Influences Our Health

2010-05-04T20:17:00.000-07:00

Several months ago a doctor and I were discussing the challenges facing us in health care today. I have always been a big believer in the concept of “integrative healthcare” and the need to expand our definition of health as a society to fix the mess we’ve created. From a purely business and consumer perspective I had always wondered how we can expect to change the trajectory of increasing costs when all we are talking about is fixing the end-result (the diseases). My arguments didn’t go very far inside the system. The system is still focused on only addressing the end-result.

Yes, the system has created the idea of health coaching and health promotion but it’s all still very clinical from my perspective. Health care has not embraced them as critical elements to the solution. The incentives are in treatment- not in the other stuff. We’re identifying risks, then trying to get people enrolled in specific programs to address the risks. We’ve had moderate success. The new reform legislation includes rules and initiatives focused on prevention, health promotion, and community health but they remain a separate world from the developments in technology, telemedicine, pharmaceuticals, and all the rest that are more part of our “standard” sickness system. We have not yet integrated our culture and social well-being into the equation. We’re talking about it- but we have a long way to go.

The doctor turned me on to the work of Sir Michael Marmot. Professor Marmot is a professor of epidemiology at University College London. His work looks at the social aspects that can have a dramatic influence on the health of any population. His conclusions: the social (cultural) factors we encounter each day can influence how healthy or how “sick” we are. We’ve posted the World Health Organization’s Social Determinants of Health (of which Professor Marmot was a contributor) on our web site. You can get it by clicking here.

This report looked at nine different social influence's that have a dramatic impact on the health of a population. These included:

*Stress- which is largely influenced by the socioeconomic status and self-perception of an individual

*Early Life- which includes how we set the foundation and example for our children early in life.

*Social Exclusion- which evaluates the social connectedness we have in our lives

*Work- looking at the relationships and satisfaction in our work

*Unemployment- evaluating the effects our professional lives have on our health, and especially when a person is out of work

*Social Support- the culture of support and guidance available to a population

*Addiction- the impact drugs, alcohol, and tobacco have on health and well-being

*Food- The nutritional make-up of our lives

*Transport- which essentially equates to getting out of the cars and exercising by walking and looking at other means of transportation.

These factors have a dramatic influence on the health of any population. Employers are making some progress individually but the engagement rate of consumers in the “risk based” models being introduced today remain relatively low. Some of the social factors identified by the WHO report are dealt with indirectly but are certainly not part of the overall platform that is evolving in the health care system we have today.

Our culture is stressed, 71% are not enamored with their work, our unemployment rate is high, we’re overweight and don’t exercise, and the social support available is being reduced simply due to the economy. We are not a healthy population.

It’s time we start building these social factors into what we traditionally define as “health care.” Until we do, all the medical homes, baskets of care, and other new ideas in the world aren’t going to make a difference to the costs we will pay if we just keep getting sicker.

A Broader Definition of Health

2010-04-28T11:45:00.000-07:00

Eva Makvoort was 25 when she died. Eva Makvoort created a blog to communicate with her friends and growing community of followers as she struggled with the ravages of cystic fibrosis. It’s a beautiful blog and you can go to it by clicking here. You could tell that despite her physical challenges she loved life, appreciated each moment, and would give anything for a clear and unobstructed breath of fresh air.

We wrote about Randy Pausch in our July, 2008 Newsletter. He was the Carnegie Mellon professor who created a huge following with his talk to students at the university that resulted in his book “The Last Lecture.” Randy Pausch’s message to others was to always, fearlessly, pursue your dreams. He gave this lecture knowing his cancer was terminal and he died in 2007 not long after his book was published. Despite the physical challenges, the other aspects of his life remained strong. He maintained a positive perspective of life to the end.

These two individuals are examples of the idea that “health” is a much broader term than traditionally used in health care today. While we’re used to the diagnosis, prognosis, prescriptions, interventions, and measurement of the physical aspects of health we really don’t dive into all of the other areas of life that have an impact our overall health and well being as a standard part of the health care delivery process. The emotional health, spiritual health, intellectual health, and social health of a person can dramatically influence the way a person maintains when the physical health breaks down. They may also have some influence in determining what ultimately results to the physical health as well. We need to start paying more attention to these aspects in our definition of health as we change the paradigm in health care delivery from sickness to health.

The CDC’s latest report on the U.S. National Health and Nutrition Survey indicates almost half of US adults now have risk factors contributing to heart disease. We all know the obesity statistics. A study to be released in the Archives of Internal Medicine found that the lifestyle habits of a study population in Britain cut longevity by 12 years. We all know the simple lifestyle decisions made each day are contributing to the enormous costs of the care needed today and the care that will be needed tomorrow.

Reed Tuckson, M.D. of the UnitedHealth Foundation put it this way, “Unless there is urgent action across our society, our already burdened care system will be swamped by a tsunami of cost and demands from preventable chronic disease.” Our system simply can’t afford the lifestyles our society has embraced.

While Eva Makvoort’s and Randy Pausch’s physical health failed, the other aspects of their lives remained strong giving them the best quality of life they could achieve given the circumstances. Their physical options were limited.

But, most have a choice and have the opportunity to make the decisions we all know are necessary to improve both health and quality of life. We just need to make the commitment and do it and provide the support and resources along the way to help make it happen. While the physical health may remain the “standard marker” for defining a healthy person we’ll need to consider the emotional, social, spiritual, and intellectual aspects of health as well. They are all related.

One of Eva’s followers wrote, “I felt so selfish when I stumbled across your [LiveJournal] on here, because I’ve been smoking cigarettes for yours, taking my lungs for granted. You’ve helped me quit the worst habit I’ve ever had.”

Sometimes it just may take appreciating what you have to get started.

Checklists and Decision Trees

2010-04-20T12:12:00.000-07:00

According to a study by PriceWaterhouse Coopers over $1 trillion of the $2.2 trillion we spend on health care in this country is wasted. While the definitions of waste in the study are pretty broad- defensive medicine, treating for lifestyle conditions, etc.; the point is made. There is a significant amount of waste in the system we have today.

Health care consumers and providers of care have pushed-back significantly when attempting to introduce protocols or decision making tools in the process. The thought being you cannot reduce something as complex as health care to a series of algorithms.

Two books provide some indication that the emphasis on standardized decision making in health care will not go away. The research cited, in-fact, provides credibility that by using simple decision making methodologies outcomes may improve, may cost less, and provides more transparency to varous stakeholders throughout the system.

The Checklist Manifesto, by Harvard surgeon and New Yorker staff writer Atul Gawande, M.D. introduces the simple idea of using “checklists” as part of the care delivery process. His premise is simple- no matter how much of an expert you may be, you can always improve your outcome with well designed checklists to guide you through the key steps of any complex procedure. Click here to go to Gawande's web site- he's got some cool checklists already developed.

While Gawande believes his checklist idea is applicable for many other areas of life, his experience in the health care field lends credibility to his argument for designing simple methods to assist in the decision making process resulting in better outcomes and lower costs over time.

Thomas Goetz, a journalist and Executive Editor of Wired Magazine presents a different approach- but this time for health care consumers.

His book, The Decision Tree: Taking Control of Your Health in the New Era of Personalized Medicine introduces a methodology to assist individuals in making health care decisions. Much like Gawande argues in The Checklist Manifesto, Goetz recognizes the decisions we make today are much more complex than ever before. Health care consumers are usually left to their own devices to acquire the information they need to make decisions concerning their health and are at the mercy of the health care system when confronted with it. The Decision Tree presents a method and device for individuals to formalize health care decisions and externalize the choices made in their health and health care they typically make without thinking. The studies he cites confirm the fact that those individuals who actively participate in the decision making process are more engaged, and achieve better results. Click here to go to the Decision Tree web site. Take a look at the video to get a better idea of the concept.

Our health care system has been fighting the battle of “protocols” and processes for many years. While one side recognizes the possibilities for improved efficiency the other side views them as barriers that obstruct the delivery of care and the relationship with the patient. Consumers are accessing and becoming overwhelmed with a growing body of research and information (both good and bad) from which to base their decisions- and have not always been welcomed when trying to participate in the decision making process.

With such a significant amount of money being wasted in our health care system the need to at least set a framework for making decisions by all stakeholders will only increase. Gawande and Goetz provide some food for thought with some simple ideas to consider with the support behind them to show that outcomes will improve, engagement will increase, and costs will go down.

They are certainly worth a good discussion at the water cooler.

OpenNotes and Medical Record Transparency

2010-04-06T14:42:00.000-07:00

If there is one group of stakeholders totally confused by the health care system we have, it’s the individual consumer. The consumers don’t understand the legal jargon included in most health plan Certificates of Coverage (COC), they don’t understand how to navigate around the primary care/specialty care maze we send them through, and they don’t understand how the pricing and financial structure works. I’m not saying consumers are ignorant. They simply have not been provided the information they need to participate effectively. Our health care system has been very good at keeping information in silos. Consumers have had to rely on other sources to try to get the information they require to make the decisions they need to make. We can safely assume this lack of “transparency” impacts efficiency, cost, compliance, and possibly the outcomes associated with particular medical events.

The Journal of General Internal Medicine recently published an article highlighting the fact that consumers want full access to all their records and are willing to make some privacy concessions in the interest of making their medical records completely transparent. Consumers want more information than they are being provided today.

Through a $1.2 million grant from the Robert Wood Johnson Foundation and with the participation of 75-130 primary care physicians connected to Beth Israel Deaconess Medical Center in Boston, Geisinger Health System in Danville, Pa, and Harborview Medical Center in Seattle, a project is underway to answer a basic question: Can improving communication with the patient lead to better health care outcomes?

The answer seems obvious.

Through the OpenNotes project http://www.myopennotes.org/, health care providers will be using processes to provide patients with access to their primary care physician’s visit notes through an electronic medical record. While EMRs traditionally include such things as lab results, biometrics, and medication lists the office notes themselves are traditionally not accessible to the patient. This project is designed to determine if the office notes themselves can be repositioned to be “for the patient, instead of about the patient.”

Not all providers are enthralled with the idea. Some believe that providing access to the notes only adds to the possibility for misinterpretation and miscommunication. They believe the office notes are clinical and cannot be useful to the average consumer.

This argument highlights one of the more significant problems in health care- everybody is talking in different languages.

The OpenNotes project hopes to address the following:

1. Create a more transparent and democratic health care environment
2. Enhance patient-doctor communication
3. Improve the accuracy of provider notes- ultimately reducing the possibility for litigation
4. Increase shared decision-making and improve patient satisfaction
5. Help patients and families become more actively involved in follow-up and compliance
6. Improve patient recall after a visit.

The goals are admirable and the intent of the project is certainly heading in the right direction for the consumer and patient. Sometimes I just wonder if we need $1.2 million and a 12-month research project to do what we know is the right thing anyway.

Be Well

Will Wellness Incentives Work In Health Care?

2010-04-01T13:25:00.000-07:00

Last year the average incentive paid to participants in an employer-sponsored wellness program was a little over $300 a year. Some employers paid a lot more- one paid $4,000 to employees just to complete an HRA- and some less, but the overall average increased over the previous year.

A lot of dollars are being thrown at employees to get them involved. Why is it that still only 11% of the employees actually are?

Daniel Pink’s new book “Drive; The Surprising Truth About What Motivates Us” provides an interesting perspective.

Pink delivers his argument from a historical perspective and simply comes to the conclusion that the way individuals were motivated in the past no longer applies today. He describes the historical way we have tried to motivate individuals as Motivation 2.0. Motivation 2.0 assumed “the way to improve performance, increase productivity, and encourage excellence is to reward the good and punish the bad.” It was the old carrot and stick model.

The carrot and stick model worked fine when the actions you were trying to change were repetitive and measurable and there was no consideration of external forces influencing an individual. If you produced more widgets, you were paid more. If you didn’t meet your quota, you might not have the job for much longer. The measurements were simple.

Pink argues that our culture no longer works that way. The dynamics of the workplace and the characteristics of our demographics are dramatically changing. He believes that we are moving toward Motivation 3.0. Motivation 3.0 “concerns itself less with the external rewards to which an activity leads and more with the inherent satisfaction of the activity itself.” Individuals don’t always respond to the carrot and the stick approach any more.

Individuals are looking for more in their lives (including their work) than they ever have before. Pink believes motivation to take action at any level is based upon an individual’s desire for three things: 1. Autonomy- the desire to direct our own lives; 2. Mastery- the urge to get better and better at something that matters; and 3. Purpose- the yearning to do what we do in the service of something larger than ourselves

Focusing on material incentives (money and gifts) may sometimes work to achieve short-term results but will probably not work to achieve the real goal of engagement and active participation. Actually, Pink cites examples where the carrot and stick approach worked in reverse. In health care, engagement and participation of the individual consumer is crucial. We can’t get much lower engagement than where we already are.

Getting employees engaged in this new health care world will require more than a carrot and stick approach. It will require creating the culture around the individual that meets their personal requirements of feeling they are in control of their lives (autonomy), continually improving their health because they know it matters (mastery), and participating because they know its not just about themselves (service).

Pink writes, “In our offices and our classrooms we have way too much compliance and way too little engagement. The former gets you through the day, but only the latter will get you through the night.”

If we can move to Motivation 3.0 in health care maybe we’ll have more than 11% of the individuals engaged in sponsored programs and we won’t have to pay $4,000 to get someone to complete an HRA.

Be Well.

Reform- Going Forward

2010-03-23T13:08:00.000-07:00

The way health care is delivered and financed in this country is going to change as a result of the legislation passed in the House last Sunday and signed into law today. We now have the opportunity to listen to the analysis of what it all means, the stories behind how it happened, and predictions of the consequences. In reality, no one has a clue.

What we do know is the approach that we are going to use to reform the health care system is very expensive, administratively complex, and has an unknown level of support from the stakeholders who are going to be needed to put it all into place. We know that millions of new customers (“customers” is the buzz-word) will be injected into the system. Health plans – in the private sector- see this as an opportunity. Aetna’s and United HealthGroup’s stock prices are up 80% and 60% respectively over the past twelve months. While health plans were made the “poster-child” of the debate, most are doing just fine, thank-you. We also know that with this influx of new customers there may likely be an increased demand placed on the system itself. Some don’t think this will cause any additional stress on an already strained system (primary care and hospitals)- we think it will.

We have all learned more about the parliamentary rules that are part of our legislative process through this debate than we would care to know. We have learned more about how Congress really works through this debate than we would care to know. And, we are likely to see and learn more new and interesting things as the efforts to stop the legislation continue to unfold.

We agree that more individuals will now be a part of the health care system than ever before and that is good. But, we believe that the ultimate costs are going to be much, much, more than projected (Medicare blew-through its projections in less than two years). While those supporting the legislation are touting the CBO numbers, quite frankly, we think the assumptions are optimistic at-best. And assuming the best is risky for our economy right now.

No matter which side you are on, Sunday’s vote and today’s enactment were historic events for this country. Whether you agree or disagree with the legislation itself we at least have a foundation to use to plan our business approaches for the future. This foundation will certainly change, but at least we have a footprint to follow.

The path we were on was unsustainable. The process we went through was quite ugly. I hope the path we’ve chosen doesn’t break-the-bank before it fixes the problems that need to be fixed. Time will tell.

We're Creating A Herd of Unhappy Elephants

2010-03-19T06:58:00.000-07:00

The Institute for Healthcare Improvement (IHI) produces some interesting webinars on some “non-traditional” topics that can be applied to health care. You can listen to their programs by going to www.ihi.org and then going to the WIHI section on the site. Look in the Archive section for past programs.

Yesterday, IHI had Chip Heath, the Stanford professor who, along with his brother Dan, a Harvard MBA, produced the bestselling business book “Made to Stick.” Made to Stick discusses why some ideas seem to create lives of their own, and others die a quick death in both business and in our lives.

Their new book, “Switch- How to Change When Change Is Hard” discusses why it is so hard for us to change even when we know that change is the right thing to do.

Everything in our lives is changing right now whether we like it or not. The fundamental way we interact as a society is changing as technology, globalization, and the foundation of how our economy operates sets the stage for continued change in the future.

Our health care system is changing and is going to change even more when whatever comes out of Congress starts to become reality. While these external forces may dictate the changes we will need to make we don’t always go along willingly even though we know change is necessary.

In Switch, the Health brothers use the metaphor of The Rider, The Elephant, and the Path to visually describe why change is hard and why many good ideas fall to the wayside because we didn’t understand that we need to address both the intellectual and emotional aspects of making changes when they need to occur.

“The Rider” is our intellectual side. The Rider is our rational thoughts and all of the statistics, research, PowerPoint presentations, academics, etc. that knows changing the way our health care system operates is the right thing to do. We all know the way our health care is financed and delivered today is unsustainable for the future. In all of the research we’ve seen 75%-80% of Americans believe we need to reform the system.

“The Elephant” is our emotional side, and, as you visualize the metaphor, the more powerful of the two. The Elephant is more comfortable just plodding along in its comfort-zone but can be motivated and directed by The Rider if handled appropriately. The Elephant in health care can be seen with the reactions in the Town Hall meetings last summer, the Tea Party movement, and the response to what is taking place in Congress today. The Elephant in health care is being directed by the whip instead of following the direction of The Rider by the light tug of the reigns.

“The Path” recognizes the need to create the right environment to create lasting change. Here, the Health boys utilize the ideas of Stanford professor Lee Ross stating “people have a tendency to ignore the situational forces that shape other people”. You need to clear The Path to create real change. The Path for change in health care is being cleared by Congress since the free-market has not been able to get it done. It’s not a pretty path and certainly has many potholes, but it’s the path we have today.

As we look at our healthcare system The Elephant is reluctantly traveling down a bumpy path. The Rider is furiously using the whip to make The Elephant obey. When Congress passes the reform legislation that is on the table we don’t know if more obstacles will be thrown on the path or if obstacles will be cleared. We don’t know if The Elephant will finally follow the direction of The Rider or will rear on its hind legs, throw The Rider off and run back into the jungle.

But, we do know that lasting change using the approaches in place today will be difficult and ugly. Using the whip as the way to implement health care reform is going to create a herd of unhappy Elephants.

Employee Wellness?

2010-03-11T07:03:00.000-08:00

No matter what final result transpires from the health care reform debacle, the process has already cost the health care system the last sliver of a valuable asset that is going to be required to make it all work- trust. Now, I’m not saying that there has ever been much trust in the system we have today. But, the process we have just witnessed drained whatever remaining trust there may have been.

Consider some of the numbers:

Only 40% of us trust hospitals as a source of healthcare information.

Most of us rely on our physicians for trusted health information, but over half look to other sources to make health decisions

Over half of us think since “managed care” was introduced in the 70’s, it is a bad thing that sacrifices quality of care for profits (and I am sure with the Administration’s current tirade against insurance companies this number is going to plummet further. We do not trust insurance companies).

Just 21% of us believe the federal government enjoys the consent/trust of the governed. According to Rasmussen Reports, Congressional job disapproval jumped 10% from just last month to over 71%.

Over 80% believe Congress is more interested in their own careers rather than serving the people.

Only 1/3 of us trust or have confidence in the employers we work for.

And, these are the groups we’re going to rely on to get us “engaged” and “actively participate” in our health and the health care system?

I don’t think it’s going to happen unless something changes dramatically.

When you think about it, if you break down all of the complexities we have created in health care you are dealing with four basic groups: the consumers- who receive the care when needed; the providers- deliver the care and help the population stay healthy; the intermediaries- process the transactions and coordinate the finances; and the government- to oversee the social interests of the system (and in the current cases of Medicare, Medicaid, etc. to act as an intermediary).

Yes, there are also employers, medical devices, pharmaceuticals, and thousands of sub-segments that are all part of the system as well, but they can be placed into one of the four basic categories above. Let’s keep it simple.

In our utopian world, these four segments are equally important and rely on a significant amount of trust between each other to optimize opportunities and maximize results individually and collectively. Consumers are engaged, and providers, intermediaries, and the government work together to support and organize care delivery.

That is not what is happening.

We all know these numbers as well:

80% of the costs are chronic, and well over half of these costs are related to the lifestyles we lead- they could be avoided:

Nearly 40% of us participate in no leisure-time physical activity

Only 12% exercise at least 5 times per week

60% are overweight

Well over half are stressed

Employers and health plans (in the intermediary segment) are offering more wellness-related programs and “wellness” (in a broad governmental sense) is at least being discussed as part of reform legislation. Despite all of this, according to Forrester Research only 11% of employees are engaged in any wellness activity offered through an employer. Some of us are trying to stay healthy on our own, but most of us are not.

Consumers (those creating the costs) do not trust the system we have. We don’t trust the intermediaries and we don’t trust the government. We will trust our providers some of the time but that is about it.

The government can enact all of the legislation that it wants. Employers and health plans can throw all of the new wellness gimmicks they can think of to try to “incent” us to do the right things. But, until the system (intermediaries, providers, and government) starts to regain the trust it has lost, it is just not going to happen. We will be looking elsewhere for health and wellness support, if we look at all. In the meantime, health care continues to get more expensive.

In his book, “The Trust Crisis in Health Care”, Harvard professor David Shore, PhD. states, “Trust, in short, is the bedrock- the very foundation- of healthcare.”

If that is the case, we are on very shaky footing with the foundation we have created today.

Changing the Health Care Paradigm

2010-03-04T06:53:00.000-08:00

The health care system lives in its own little world. It has its list of acronyms and if you ever get a group of health care organizations or health care professionals sitting together in a room they start to talk in a language most of us can’t even begin to understand. They talk about HIPAA, HMO, PPO, HRA, comparative effectiveness, medical homes, EMR, PHI, FFS, FEHBP, MedPAC, and the list goes on. Those in the health care industry seem to understand the terms, some in government make it sound like they understand the terms, and the rest of us have no clue.

Therein is the problem.

We have made this patchwork health care system so confusing and so complex that most of us feel helpless to do anything about it. We have delegated the responsibility for fixing the mess we have to those who understand it- those that created the mess in the first place. We’ve created a Paradigm of Paralysis in health care.

We don’t need to be paralyzed. We can do something about it. We simply need to start to change the paradigm.

In late 2008-2009 Towers Watson and the National Business Group on Health completed a survey of 489 large and small companies throughout the country. They were wondering if anybody was having any success in managing health care costs within their companies.

What they found was not surprising. The best performing organizations (those that experienced less than the 6% average health care cost increase experienced by employers) were taking a broad approach, a strategic approach, to invest in programs and tactics to address the challenges facing their employees and their organizations.

These organizations didn’t just throw-out a health risk assessment to their employees and call it a day. These organizations created the culture, the strategies, the tactics, and provided the investment in resources to make a difference. They didn’t buy-in to the paralysis complex- they took action and changed the paradigm.

We all need to break through the Paradigm of Paralysis and realize we can make a difference- and understand that it’s not the government or the health plans that will ultimately solve the problems we have.

In a recent edition of the Employee Benefit News, Contributing Editor Michael Puck, SPHR compared the psychological barriers we have created in health care to the barriers that existed in the 1950’s with regard to running a sub-four-minute mile. Back then, we all knew it just couldn’t be done. Within 3 years of Roger Bannister breaking the sub-four minute barriers, over 30 other runners accomplished the same thing. The barrier wasn’t physiological, it was psychological.

We need to change the psychological paradigm in health care.

Puck outlines 4 basic components we all need to embrace to break through the Paradigm of Paralysis that exists in health care today:

Commitment- we need to define the vision and mission and gather the will-power to make it happen.

Culture- we need to create and support the environment we will need to accomplish our goals.

Structures- we need to organize the fragmented delivery processes we have today into a system we can understand and provide the results we expect

Resources- we need to effectively provide the resources necessary to accomplish the goals in a fiscally responsible manner.

While those in the health care industry and the government can continue to debate and discuss solutions to our health care crisis they are only contributing to the Paradigm of Paralysis we have today. Those innovative providers, consumers, employers, and entrepreneurs that don’t buy-in to it can do something about it, because they have the commitment to make it happen.

The Paradigm of Paralysis in health care is psychological for most but can be changed. Just look at what Roger Bannister started.

President's Proposal- Intro to Reconciliation

2010-02-23T05:34:00.000-08:00

I had hoped to get away from the whole health care reform discussion for a little while. Quite frankly, I was growing tired of it. But, we have one more “event” to get through before we know which direction health care may be heading. Even after this so-called “summit meeting” on Thursday, we still may not know. I’ll make another post anyway.

I have to admit, when this process started out over a year ago, I was skeptical but still optimistic that we could come to a bi-partisan solution to the cost crisis we’re facing in this industry. When HR 3200 was introduced I became leery. When the Town Halls hit I became frustrated. When the Christmas Eve vote occurred in the Senate I was ticked-off. Like most Americans, I’m simply tired of the politics, and tired of the “protecting the turf of the self-interests” mentality that exists in health care. I’m not nearly as optimistic of the final outcome today.

After reading and summarizing the 1000+ pages of HR 3200 last July, reading the 11 page “President’s Proposal” was a snap; almost too much of a snap.

For a president who gives himself low marks for not explaining health care reform better to the average citizen- he didn’t raise his grade with this. (You can grab it by clicking here). It took me awhile to figure out what it even said.

Here’s my understanding.

In a nutshell, the President’s Proposal is reconciling some of the numbers between the Senate and House bills, pushing some dates around to accommodate some existing agreements, and adding some of the fraud and abuse initiatives requested by the Republicans to come up with a “bi-partisan” document.

The President’s Proposal eliminates the “Nebraska Absolution” and expands Medicaid Funding to all states and tries to address the need to reform the Medicare payment approach which contributes to the escalating costs. And, to continue with its grandstanding against the insurance industry (which is legitimate to a point), his proposal creates another government agency (the Health Insurance Rate Authority) to deal with health insurance pricing (in response to Anthem California’s recent request for a 30%+ rate increase for individual policyholders).

As I was reading it I was wondering what all of this is going to cost and the size of the bureaucracy that would be required to pull it off. I’ve said all along that the perfect free-market does not work in health care because of the way we’ve evolved. The government has to play a role no matter what we do. I understand that. But, there needs to be a balance. This is just too much government- and too much expense.

As the White House said when it introduced this thing, this is just the “starting point” for the discussion on Thursday. But, I have no idea how any real debate is going to occur since none of the major issues of disagreement were addressed.

A Kaiser Foundation Poll completed a couple of weeks ago found 38% of Americans would be “happy or relieved” if Congress ended up doing nothing on health care reform. About 58% would be “disappointed or angry”.

I still believe too much good work from both sides was accomplished over the past year to walk away and do nothing. All of the proposals (Republican and Democrat/free-market and organized-market) have components that could be put together to make a dramatic impact on the trajectory we find ourselves on today. Unfortunately, the legislative make-up we have in place doesn’t see it that way.

I see “reconciliation” on the horizon. And, I’ll be one of the 58% disappointed or angry citizens if that happens- even it means something was accomplished.

Medicare Advantage- A Free Market Example?

2010-02-17T10:12:00.000-08:00

A lot of the debate that has been raging about health care reform can be boiled down to a basic principle: how much of our health care system should be guided by the principles of a free-market; and how much should be guided by a more organized and controlled method? Some call the “organized and controlled” socialized medicine, I wouldn’t go that far.

The evolution of our Medicare Advantage program for seniors may provide some insight into which approach may work the best.

Trying to address and manage the costs of our Medicare program has been on the table for quite awhile. In 1997 the Medicare Choice program was put in place as a mechanism to wrap “managed care” into the benefits received by Medicare beneficiaries. This was largely funded by the government and used individual health plan contracts to deliver the health care services to the population. So, this was a combination of a free-market/government approach.

As funding for services from the government deteriorated over the next five years, nearly half of the Medicare Choice programs cancelled their contracts leaving over 1.5 Medicare beneficiaries scrambling to find replacement coverage. The free-market delivery combined and government funding combination wasn’t working very well.

In 2003, Medicare Choice was changed to Medicare Advantage and included increased funding from the federal government and a slightly different structure to deliver services to the Medicare population. These programs increased participation significantly as health plans and private market players jumped at the opportunity to grab some of this new revenue. These private market players did very well. But, it came with a cost.

Some organizations utilized aggressive marketing and compensation arrangements to take advantage of Medicare beneficiaries to gain enrollment. The free-market crossed the line. In 2008, new marketing and compensation rules were put in place to protect the individual consumer.

Today, there are over 2,300 Medicare Advantage plans available to Medicare beneficiaries. More than 10 million people (1 in 4 on Medicare) are enrolled in a Medicare Advantage Plan. On average, individuals are able to select from 30 different plans in addition to Medicare- and some have an option of over 70 plans.

These programs all offer different benefits, out-of-pocket limits, copayments, deductibles, and premium costs creating a monumental task for the individual consumer to figure out which program is best for them. And the costs of these programs continued to increase (opposite of what should happen in a free-market). In 2010, enrollees of the Medicare Advantage Prescription Drug Program will face, on average, a 32% increase in their premiums.

So, while a true free-market is the desire of our country, we have already proven a true free-market simply does not exist in health care. There are too many external factors at play. And while a variety of options may look nice, too many options only confuse the consumer and disrupt the operation of the market.

University of California-Berkley Nobel Prize winning economist Daniel McFadden puts it this way, “If consumers are up to this task, then their choices will ensure that the plans, and insurers, that succeed in the market are the ones that meet their needs. However, if many are confused or confounded, the market will not get the signals it needs to work satisfactorily.”

Too many consumers are confused and confounded today. The market is getting the wrong signals.

Click Here to grab Kaiser Foundation’s Write-up on the Medicare Advantage benefits structure for 2010

So- Which Way Do We Want It?

2010-02-10T13:16:00.000-08:00

The February 9, 2010 Wall Street Journal reported that United HealthGroup recently began sending doctors individualized assessments for their treatment of breast, lung, and colorectal cancer patients. The reports seemed to indicate that while breast cancer patients received care that met with most professional protocols, patients with lung and colorectal cancer did not.

Treating cancer patients is one of the largest cost-drivers in our health care system today. Employers will confirm that one or two cancer patient in their entire population can result in significant increases to the health insurance rates for everyone. That’s the problem with the system we have today.

The United HealthGroup initiative confirmed what many of us had already surmised- a lot of the prescriptions and processes used in cancer treatment may or may not be of benefit to the patient, and they cost a lot of money.

Health plans and health systems are spending a lot of time and resources to determine what works best for treating particular conditions. They’ve been doing it for years. Most health plans are including “pay-for-performance” components to try to incent the delivery system to follow protocols, engage in electronic technologies, and improve the care delivery of the patient. Comparative effectiveness is alive and well in the health plan system. Those that deliver the care don’t like it- but it’s the way they get paid today.

A few months ago the U.S. Preventive Service Task Force produced their own results concerning the use of mammograms for breast cancer detection in females. This body was established in 1984 of independent private sector experts in prevention and primary care delivery. When they produced their results indicating it is really statistically necessary for an annual mammogram beginning at the age of 50 instead of 40 a huge hue and cry was raised from the masses as an example of government’s intrusion into our health, our health care, and our way of life. This was the perfect example of “Death Panel Health Care” with the politicians.

In order to get a handle on the costs of this uncontrolled system we have today we need to know what works, what doesn’t work, and what works sometimes. We also need to know what it costs. Call it comparative effectiveness, protocols, evidence-based, or whatever you want there are simply too many options, technologies, and pharmaceuticals, to continue the path we’re on today. The system needs some guidance and direction.

The health plans are already providing most of the direction. The system as a whole needs to decide whether it needs some other options to consider as well. And we need to quit complaining when results are published that don’t necessarily agree with the way things have always been.

The way things have been is what got us into this mess in the first place

A Letter to President Obama and Congress

2010-02-02T07:44:00.000-08:00

January 29, 2010

Dear President Obama and Congress,

I watched your State of the Union address last Wednesday evening. It may have been one of your best performances. As one of the many pundits commented afterward, it was a “smart speech”.

You are correct in your assumption that a “deficit of trust” exists with the American people. Your approval ratings should give you a pretty clear indication of what we think. The responses and continued partisanship we heard from both sides of the aisle after the speech are pretty good indications that while the message you delivered may have been appropriate, passionate, and delivered with eloquence, the way our legislative interaction occurs is going to remain the same. The deficit of trust is not going to go away any time soon. I was disappointed in that.

Over three years ago we became a military family. This wasn’t by our choice, but like so many others, by the decision of our son to serve our country in the United States Marines. We are preparing for our third deployment- this time to Afghanistan (after Iraq).

While this wasn’t our choice, we accepted the role we have to play as a family and as a country to support both him and all who are serving to protect our country and our freedoms. We are grateful and appreciative every time our citizens come together to show their appreciation for their service and sacrifice; and they do it a lot. America is a great country. It is a passionate country. And, it can come together to support and defend the ideas and the people it believes in.

We’ve learned a great deal over our three-plus years of deployments, sacrifice, and anxiousness. We’ve learned that while we are confronting a very dangerous enemy on the field of battle they are also working diligently behind-the-scenes to destroy the structure and spirit of the American way of life. The attempted bombing on Christmas Eve was another wake-up call for the American people; the enemy is still there. We need to remember that Al Qaeda never said that the way they will defeat us is through military efforts. They intend to do it by destroying the soul of the American spirit in whatever manner they can. And, they are very creative.

I certainly agree that your speech addressed the topics most concerning our citizens today; the economy and jobs. This was smart. While you may not agree on the approach to address them, I believe there is agreement on both sides that something must be done to put people back to work and get the economy moving again.

I would only also ask you to remember that all of the arguments, disagreements, and partisanship you continue to exhibit only contribute to the efforts of our common enemy. Terrorism doesn’t only exist on the battlefields of Iraq or Afghanistan. Terrorism doesn’t only exist with the bombings and spectacular events created by this enemy. Terrorism also exists by destroying the common vision and soul of our country. Jobs, health care reform, the economy, energy policies, and all the rest don’t mean a thing if our enemy succeeds in accomplishing its goal of destroying the unity of the American spirit.

Please work together. Don’t let them win.

Sincerely,

A Military Father

The Public Is Educated In Health Care 101

2010-01-26T19:39:00.000-08:00

The Kaiser Family Foundation puts together some interesting work that can help keep a perspective of the reality of what is going on in this industry. The politics, the complexity, and the individual self-interests have made this all very confusing to the average citizen. Over the past 10 months they’ve been given a lesson in Health Care 101 whether they wanted to take the class or not.

Here’s Where We Stand Today:

Kaiser’s January Health Tracking Poll finds 54% of the American public feeling that addressing health care reform remains an important part of addressing the broader needs of our economy. The message is very clear that something needs to be done to correct the trajectory we are on today. On the other hand, 39% feel we need to address other things first. Everyone is concerned with the impact anything we do will have on the deficit. Overall we’re concerned about the up-front costs that will be required to make it work and we don’t have a clue of what the real costs will be.

While the need exists, there is no strong support for any of the current proposals being considered by Congress. Getting to where we are today has been ugly. I wouldn’t imagine there is any great sense of trust in the final product that has been produced as a result of this process. Interestingly, 42% of the public supports the current proposals being considered and 41% oppose them. But, it’s the intensity of the support or opposition that makes it interesting. Those that oppose it really oppose it, and those that support only “somewhat” support it. The strength of the support is still at risk and vulnerable to individual issues.

Most (42%) still feel the country will be better-off by pursuing the current alternatives but patience is wearing thin. A growing number (37%) feels our country will be worse off if we continue down this path. If the pattern continues it won’t be long before the percentage of people feeling our country will be worse off will pass the others. That will make for some interesting political discussions.

When you consider that between the House and Senate Bills you are dealing with over 3,000 pages of legal jargon it is no wonder that the average citizen does not have a good idea of what is included in the legislation. I wonder of our Congress really knows what is included in the 3,000 pages (sorry, that’s another post). While the public wants to be educated, it is still very vulnerable to the talking points of particular points of view and the public (fortunately or unfortunately) hears and somtimes believes those who yell the loudest.

The Kaiser study found that the most widely recognized provisions (those identified as included as a component of the legislation) were those that were “touted by both supporters and by opponents”. We have a signficant education opportunity as we move the public to Health Care 202 (the next level). Let’s just hope we don’t make it as ugly as Health Care 101.

It’s an interesting study and well worth the time spent reviewing it. After the elections in Massuchsetts last week we’re all still wondering the direction health care reform will take. But at least as of today the public still knows we need it, they just don’t necessarily like the proposals that are out there today. Hopefully, we’ll now take the time to regroup and listen to them a little more closely as we move forward.

I'm Just Ticked

2010-01-19T09:56:00.000-08:00

Ok, I’ll tell you from the start this post is going to be biased. I’m ticked.

In Massachusetts, the special election to fill Senator Ted Kennedy’s seat is on the line. We’ll know the outcome later tonight (maybe- it’s going to be close) and it will be the start of a whole new ballgame. Ironically, the outcome of health reform (Senator Kennedy’s passion) as well as the broader Democratic agenda that has been laid-out in front of us is also on the line.

Democrats are scrambling and planning for the worse, Republicans are lining-up to prepare their own strategy to put a halt to the direction the Democrats have been taking. While I am not a Massachusetts resident- I would hope our goal would be to focus on putting the right person in this leadership role- regardless of the political ramifications (and I know I’m dreaming here).

We’ve been critical of both the approach and structure of the health reform direction since the House put out its version last August. We’ve been more critical with the strategy and direction of both the Obama Administration and the Senate as they focused more on a Christmas Time-Line than doing what is right. And, we’re even more skeptical of all of the side deals that are being cut to move this thing through.

We have said all along that our health care system is in dire need of reform. The Republican approach (if there is one) is too light, and the Democratic approach is too heavy. Neither side is addressing the fundamental structural problems that need to be addressed immediately to prevent us from moving into what Jim Collins calls “Stage 5 Decline”- capitulation and death. The system we have today simply hurts too many, is too expensive, and has been built by patch-working various ideas together over the years.

Our Congressional leaders need to be leaders and not followers of the special interests and lobbyists. That’s what got us into this problem in the first place. They need to be knowledgeable of the real issues- especially when lives are on the line. And, they need to remember health care is not the only thing on the minds of the voters across this country.

Massachusetts Democratic candidate Martha Coakley commented on Monday that we should be planning an exit strategy for Afghanistan because “there are no more terrorists there”. She said they all left Afghanistan and went elsewhere. As a citizen whose son is heading to Afghanistan to battle the terrorists and reads the casualty listing on the DOD site daily, I was simply appalled.

If this is an example of the base-line knowledge of the people we want to be leading the country we are in a sorry state. It’s time we put people in place that can connect with the American people- and not put people in Washington to simply fulfill someone else’s political agenda. As Mark Twain said, “Patriotism is supporting your country all the time, and your Government when it deserves it.” The Government doesn’t deserve it right now- for either party.

Republican, Scott Brown would get my vote on this one. And, Democrats have better start trying to figure it out how to deal with the fallout either way.

EMR/PHR/EHR- We're Good At Confusng People

2010-01-12T08:50:00.000-08:00

As part of the American Recovery and Reinvestment Act of 2009 the government included a sizeable chunk-of-change to try to get the health care industry caught up in the world of technology. We all know that with the fragmented system we have today, tests are duplicated, many still rely on paper, and many times the communication and coordination between the patient and the multiple care teams they may access is hindered. Some organizations (Kaiser Permanente, Mayo, Allina Health Systems to name a few) have already made great progress simply due to the delivery structure they use. Most still have a long ways to go.

So, the Department of Health and Human Services produced another monstrosity of a document outlining the “meaningful use” criteria that will be considered to qualify for the billions of dollars eligible for payment if providers (hospitals/physicians/etc.) initiate information technology (IT) in their delivery. These criteria are open for comment with final rules due sometime early in 2010. Doctors and hospitals are already concerned with the “burden” these rules would place on their organizations. Technology companies are encouraged with finally having a roadmap they can follow (See our Blog of April 26, 2009). You can read the document by clicking here.

The goals outlined in the document are admirable; “to improve the quality of health care, such as by promoting the coordination of health care and improving continuity of health care amonth health care providers, by reducing medical errors, by improving population health, by reducing health disparities, by reducing chronic disease, and by advancing research and education.”

But, once again health care is confusing people with its definitions. We’ve also posted a 2006 white paper by HiMSS Analytics providing a pretty decent description of the difference between an Electronic Medical Record and an Electronic/Personal Health Record:
Electronic Medical Record- Clinical data depository, clinical decision support, controlled medical vocabulary, order entry, pharmacy and clinical documentation applications.

Electronic Health Record/Personal Health Record- A subset of the EMR. Owned by the patient- includes patient input and access that spans episodes of care across multiple delivery organizations.

While the DHHS meaningful use criteria reflects an EMR (by the definition above)- they are calling it an EHR. While consumers may have access to the EMR as it is described, they don’t control it. While we certainly need to improve the interface and technology in health care today- the consumer needs to be a part of it- not a victim of it.

Many consumers are already exploring other options to organize and track their health care information. Google Health, Microsoft HealthVault, Mayo, Revolution Health, and others are already providing consumers with software and technology to begin to interact more effectively with the system we have today.

As the delivery system moves forward in improving its communication and coordination by improving its technology- let’s not (once again) leave the consumer to be on the receiving-end of the experience. Let’s also get our definitions straight and make certain we all stay on the same page.

As we know, health care is good at confusing people- even amongst ourselves.

2010-01-05T11:11:00.000-08:00

CMS just announced that the spending growth rate in health care slowed to its lowest level in 50 years. Health care spending in 2008 increased 4.4% to $2.3 trillion and now represents 16.2% of our GDP- up from 15.9% in 2007. Health care spending continued to outpace the spending in the rest of our economy.

About 10 years ago the government set some goals for our country to achieve to improve the overall health of our population. Healthy People 2010 goals were built off of the Healthy People platform established over 20 years ago to set some benchmarks and measure the health and wellness of our country. How’d we do?

We’re fatter, we eat more salt and fat (not less), more have high blood pressure, and we have more children with unhealthy tooth decay.

To be fair, we did improve in lowering cancer rates, increasing smoking regulations, reducing work-injuries, and improving childhood vaccinations.

We hit 24% of the goals established in 2000, and are expecting slightly less for 2010.

At the same time, the University of Michigan recently completed a study showing that the growth in the obesity rate in this country is snuffing out the “wellness benefits” gained from the decine in the use of tobacco. We smoke less, but we’re fatter.

Bancprutcies soared in 2009 increasing over 32%. While many were related to the housing market, a substantial number can be expected to be in some way related to medical expenses.

I’m now looking over the 700 pages of “Meaningful Use” rules that will direct the implementation of Electronic Medical Records for physicians, the Genetic Information Non-Discrimination Act (GINA) that will impact the development of wellness plans for employers and their employees, and anticipating the barrage of rules that will come out of health reform, and I wonder where all of this is leading? Is innovation that can improve the health care experience for the individual (and ultimately result in lower costs) dead?

We can do better than what we’re doing today.

The individual consumer is the key and our health care system just isn’t connecting. The rules of the game that are being established aren’t making it any easier.

Health care organizations are going to need to go out of their way to connect, really connect, with the individual. They will need to understand that most will trust their doctor, but not much else. The processes we have in place are confusing and sometimes frightening. We really need to work hard to keep the individual in mind- and not just focus on meeting regulations and completing transactions. We need to create relationships.

Consumers need to step-up-to-the-plate big time. They need to be informed of the workings of this system, and not become victims of it. They need to take responsibility for their health and take care of themselves. Our lifestyles create over 50% of our problems in the first place.

So, as we look over the landscape of health care reform, we’re going to focus on doing what is right for the individual. We’ll continue in our efforts to “educate the consumer” and help organizations create the “trust” that is going to be needed to connect with the individual.

Health is personal- Eat right, exercise, get plenty of rest, and keep the stress down; It’s not difficult. Creating the social context around these ideas to engage the individual is the challenge. And, health plans and the government aren’t the right messengers right now.

It's The Consumer, Stupid!!

2009-12-30T08:27:00.000-08:00

All is quiet on the health care reform front- for a little while. Things will heat up again when Congress returns from the break and we’ll likely have some type of health reform signed by the President over the next several months.

We all know something needs to change in the way we finance and deliver health care in our country. In some respects we’re thankful Obama made it an issue. It needed to be an issue. But, we are disappointed with the product, the result.

The 2000+ page Senate Bill and the 1000+ page House Bill are loaded with pilot programs, regulations, and requirements. The infrastructure that will be required to put this all in place will be huge. And, most estimates don’t even predict a break in the costs we will be paying for health care in the coming years. Employers will pay more, consumers will pay more, and government will pay more. Those providing care will receive less. And, insurance, pharma, and medical device companies will all contribute to the kitty to offset some of it. It’s not that complicated.

There are some good ideas in both bills. They aren’t all bad. But, the good ideas are overshadowed by the bureaucracy that will need to be created to implement them. It’s really quite sad. We hope it works, but we have very serious doubts.

And, through all of the debate we continue to neglect one of the primary reasons we have such an expensive “sickness-based” system in the first place- we live unhealthy lives. We live like we want to live, and expect the health care system to fix us when things go wrong. As Archelle Georgiou M.D of Fox News. so accurately put it, we have delegated our health to the health care system.

As part of the Healthy People initiative the CDC determined that approximately 50 percent of premature mortality in this country is directly related to individual lifestyle and behavior, about 20 percent is related to environmental factors, an additional 20 percent is directly related to one’s inherited genetic profile, and only about 10 percent is related to inadequate access to medical care.

Both bills include segments on health and wellness and everyone agrees that creating a healthier culture is a key to confronting the fact that 80% of our health care costs are being spent on chronic conditions- many created by the lifestyles we lead. We continue to focus our efforts only on the physical health of the individual- and nowhere do we talk about the emotional, spiritual, intellectual, or social health aspects that contribute to the physical aspects of our health.

Employers are trying to make health, wellness, and prevention part of their health care strategies- but they have a trust issue to overcome with their employees. The government “education campaigns and web sites” are a good idea but not many folks don’t have a lot of trust in the government right now either. Health plans are trying to do the same- and they have an even bigger trust issue to overcome.

It’s when a trusted resource is created for the individual consumer to guide and support a healthy lifestyle in all aspects of life that true health care reform will occur. This resource must be separate from but subtly linked-to the confusing, mistrusted system we have today. Real health care reform will occur when the individual consumer is involved.

We just don’t see this as part of the direction we’re heading today.

Meeting a Christmas Deadline

2009-12-21T09:21:00.000-08:00

As we expected, the Senate moved forward with hitting their self-imposed “Christmas Deadline” to passing their own version of health care reform legislation. Some pretty interesting “sweet deals” were cut to get to the 60 votes Harry Reid needed to prevent a Republican filibuster. Now, they have to reconcile this legislation with what was passed in the House in order to send a final bill to the President for signature. That’s going to be interesting.

CBO released its own estimates of the financial impact of this legislation a few days ago. We’re going to be hearing about the $132 billion in net deficit reduction that will result from this legislation for momentum from the politicians to move this thing forward and justifying their actions. While the CBO is allegedly non-partisan, we just have a difficult time reconciling the numbers with reality.

We’ve also posted CBO’s correction to the letter that softens the savings impact estimated in the original letter for the 2020-2030 time-period. We don’t hold much confidence in estimates 20 years out anyway- but we’re sure the Republicans will likely jump on the error for some political leverage.

Here’s our take on some of the points of the Senate legislation based upon what we’re reading from the original CBO letter:

1. Net deficit reduction of $132 billion between 2010 and 2019 (sounds good- but we still question the reconciliation with reality)

2. The deficit will actually increase in 2010 because the legislation won’t really kick in until later. (If this occurs- this will be a major talking-point for the Republicans in the 2010 elections)

3. Health care premiums for employers and individuals will continue to increase in 2010 and the legislation actually won’t have significant impact on health insurance premiums throughout the 2010-2019 period. Even though federal tax credits may be available, they won’t do much for the employer or individual consumer in assuring that we are really doing something to address rising costs when they continue to increase. (This is another talking-point for the Republicans in 2010)

4. Most of the savings will come from the provider side and hospitals and physicians they will take a significant hit. We certainly agree that to deal with costs you have to go to the source but continuing to focus on fee-for-service savings when a new reimbursement model is needed for real reform is simply a mistake. (Providers- be ready)

5. The CBO didn’t include the “discretionary costs” of the IRS and HHS that will be required to put this in place. They currently estimate between $10 billion and $20 billion will be required, which would take the net deficit reduction down to between $122 billion and $112 billion if the numbers hold. (We think it will be more- and the IRS and HHS need to go to Congress to get this funding- which will be tough)

6. The unfunded mandates required for state and local governments are huge with this. The federal government will help for a time, but state and local governments are going to have to eventually pony-up to assist with Medicaid and SCHIP financing (with the exception of Nebraska); Hopefully, our economy is going to be at a better place when the state financing requirements kick in.

7. The public option idea is now replace by an “OPM Managed Exchange” that will be administered by 2 national or multi-state insurance plans- one which must be non-profit. (We’ll be relying on the same stakeholders Congress has vilified to now provide coverage through an exchange- an interesting turn-of-events).

As we have said from the beginning, we absolutely support the need for reforming our existing health care system. We just believe it should occur first by re-organizing care delivery as opposed to reforming the insurance/financing method. We have enough examples to know that covering everyone without reforming delivery only results in higher costs. And, costs are increased, and citizens are being hurt by the delivery system that is in place today.

We encourage all citizens to become much more informed with what is taking place. Our views are only our views and intended to provide a perspective to consider. The American people need to become informed about how this system works as they will be dealing with the results.

Regardless of the outcome, this is a historic time for health care. It’s just unfortunate we’re relying on legislation to make the changes we need. There are some good things included in the bills presented to help the average citizen but we had hoped the market would make the changes on its own. It didn’t, and now we have to deal with it at a different level.

Merry Christmas

It Had Better Work

2009-12-15T20:53:00.000-08:00

Within the next couple of weeks something is going to come out of Congress regarding health care reform. We still don’t know what it will look like, as most of this is now behind closed doors negotiating specific details to solidify the vote. We know this may be democracy at work but can’t believe our Founding Fathers would support the idea of passing a major piece of social and economic legislation to meet a deadline. The approach is simply wrong for our country.

Despite all of the numbers being thrown around by CBO and the others, we really have no idea of what the ultimate costs of this endeavor will be. Unless things changed behind the closed doors, we find it hard to reconcile how this approach will “change the cost curve” we are experiencing in health care today. We just don’t see it.

According to Gallup, Congressional approval remains at an all-time low. If this legislation passes and still includes the hefty price tag we think it does, American’s will be looking for results. They aren’t a patient lot right now. If citizens (especially the independent voters) don’t see some improvement in the health care numbers or results early in the year, many Democrats may be looking for consulting and speaking gigs after they are replaced in next year’s mid-term elections. From a political perspective, getting on board behind this legislation is a huge risk.

There has never been a public strong public mandate to pass legislation this year. There has been a strong public mandate to fix what we’ve got but we expect it to be done right.

Gallup’s November 30th poll indicated that currently 49% are against the legislation while 44% are for it. A recent ABC/Washington Post poll indicated that 53% feel we will pay more individually, 55% feel we will pay more nationally, and 50% feel the quality of care would be better if we just kept the way things are today. These numbers don’t resemble anything close to a mandate.

Senator Harry Reid said on Monday, “I’m confident that by next week we will be on our way toward final passage of a bill that saves lives, saves money, and saves Medicare.”

He’d better be right. If he’s wrong he’ll be doing something else this time next year. And, so will many others in his party.

Some Reform Comments; December 8, 2009

2009-12-08T08:15:00.000-08:00

We didn’t intend for this blog to be all about health care reform, but it is so fascinating to watch and follow we’re going to keep posting periodic updates. This is a historic time for our health care system and in our opinion putting a legislative solution in place still has a ways to go.

It sounds like Congress is trying to “water-down” the whole public option debate by introducing an approach similar to the Federal Employees Health Benefits Program (FEHBP) offered to federal employees. The Office of Personnel Management (OPM) would be involved for oversight- but a government-run/Medicare-like approach wouldn’t be part of the picture. This seems to have traction for some of the more moderate legislators on both sides- but those on the far left may not be as receptive. The details of how this would all work is still pretty sketchy but would be delivered through insurance exchanges of private non-profit organizations. We'll need to see more of the details before formulating an opinion.

The big issue of the day surrounds the topic of abortion. This topic may very-well determine whether health care reform legislation becomes a reality. The majority is dealing with a very fragile and fragmented constituency and the outcome of this high-profile topic could very well tip the momentum of reforming the system one way or another.

We spent some time reviewing the CBO’s estimates of the impact on insurance premiums of the Senate Bill (3590) as it is currently written. We remain skeptical of the impact this legislation will have on the primary issue facing health care today- the costs.

Kaiser Family Foundation recently determined that the average annual premium for individuals with single and family coverage was $4,800 and $13,000 respectively in 2009. According to the CBO estimates, these prices would increase to $7,300 and $20,000 under the legislation- roughly a 9% increase each year. This is the same increase (or a little higher) employers have been experiencing over the past 10 years. We really don't understand the benefit of the legislation related to moderating health care costs as it is laid out today.

As we have said numerous times in the past, the focus should be on efficiency, integration, consumer engagement, and cost-management in order to reform health care. Putting all the emphasis on reforming the insurance marketplace may address access, but doesn't do much for the costs (sounds like the Massachusetts experience).

Despite the goal of presenting legislation to the President before the end of the year- Congress still has a long ways to go. And, unfortunately they continue to focus on the wrong things. And, most consumers tend to agree right now.

We wish they would listen.

Do Over !!!!

2009-11-24T07:23:00.000-08:00

We’ve obviously been asked about our reaction to the procedural vote that took place on Saturday to allow debate and discussion to proceed for HR 3590. In a nutshell- we’re very concerned.

We’ve tried to remain bi-partisan throughout the process. We’ve been slightly biased as we’re more “in the center” than the proposals submitted by either side. We’ve always supported a more organized system (probably through a light intervention of government simply due to the make-up of the existing system) and one focused more on organized delivery and efficiciency. We’ve recognized the unfair reality of the current system that leaves a significant portion of our population with limited or no access to care but always felt that issue can be addressed as the delivery system itself becomes more efficient. The heavy involvement of government and the focus on covering everyone out of the shoot (insurance reform) as the primary goal just doesn’t make sense.

The talking points were clear as we watched the debate unfold on Saturday. Democrats were demonizing the insurance industry and were doing all of this to protect the poor consumer and Republicans were appalled with the size of the legislative monstrosity that was sitting on the table in front of them. While we certainly understand being critical of the lack of consumer focus of our health care industry, as consumers, we leaned more toward the Republican side on this one.

If you don’t want to read all 2074 pages of HR 3590 you can get a pretty good idea of the content and implications by reading CBO’s scoring of it. You can get it by going to the Resource Library on our site, or by clicking here. CBO’s letter is another “caution flag” for us considering all of the qualifications they had to use to come up with the numbers. There was certainly some creative accounting involved and we think the numbers provided are all on the low side. Remember, Medicare blew out its budget within the first two years after it was enacted in the mid-60s.

We seriously question the ability to our country to finance such a massive piece of social legislation without further adding to our national debt (despite the numbers provided by the CBO). We seriously question the feasibility of setting up co-ops or public option alternatives to be competitive in an already fragmented market (these folks have obviously never been in negotiating sessions between health plans and providers). And, we question the ability of establishing a government-based infrastructure to address the real issues of prevention, wellness, care coordination, efficiency, and patient-centered care.

In a previous posting we recommended Obama and the legislative process slow down and do this right. We can only reiterate that here but don’t think it’s going to happen. You can read a letter sent to Obama from Newt Gingerich and a host of others that reflects our views by clicking here. Unfortunately, the Democrats are now more focused on a deadline of getting this done before the end of the year as opposed to doing it right. The Republican votes are already lined up no matter what takes place in the debate over the next few weeks. Once again, it’s going to be the Blue Dog Democrats who will determine the outcome.

Our economy is still on the precipice and our unemployment rate remains high. We have two wars that need to be appropriately funded to protect the men and women who are sacrificing their lives to protect our freedoms. These should be the priorities of focus and deserve the appropriate financial resources. We will reiterate- “government-light” not “government-run”.
We wish someone would call a “do over” on this one

Health Care Reform- Continues To Focus On The Wrong Issues

2009-11-16T09:24:00.000-08:00

It’s looking more likely that we will have some type of health care reform legislation enacted in our country. It’s also looking more likely that the legislation that will be enacted- will not address the fundamental issues facing our health care system. Politics wins.

A new poll conducted by Stanford University with the Robert Wood Johnson Foundation found that 43 percent of Americans oppose the health care plans being discussed in Congress while 41 percent are in support. 15 percent remain neutral or undecided.

These numbers have remained relatively consistent over the past month but the opponents have stronger feelings on the issue than do supporters. Seniors justifiably remain more skeptical than the younger generations.

Americans are worried about the fine print included in the health care overhaul. With the House Bill (3962) weighing-in at 1990 pages, who can blame them. You would have thought that the House would have learned from the Clinton Reform effort of the 90’s that coming out with a monstrosity of legal jargon that the average citizen is not going to comprehend is going to lead to skepticism of its content. But, the Democrats have the numbers on their side (at least in theory) that could tip the discussion their way anyway. That’s what we’re afraid of.

Unfortunately, the reform discussions continue to focus on the wrong things. The primary focus continues to be centered on “providing health care for the uninsured", when the focus should be about reorganizing care delivery, improving communication and consumer awareness, coordinating care more effectively, improving system efficiency, and developing new payment methods to assure a quality health care system is available to all citizens.

One of the frightening facts of the recent poll finds that consumers are afraid of the increases in their current costs because “people in poor health who’d been shut out of the insurance pool would now be included, and they would get the medical care they could not access before”. These individuals need to realize somebody is already paying with the system we have today- and it’s more expensive than if all individuals had access earlier in the game rather than waiting for an emergency.

Instead of focusing on “insurance reform” (public option, mandates, etc.) we need to focus on changing the current trajectory of health care costs for individuals who already have health care coverage. There is more than enough waste in our current system to provide for those not “insured” by developing a more organized and collaborative structure than we have today. There is no reason why people in poor health in our country should be shut out from access to appropriate medical care. This is inexcusable. We need to address both.

We just believe the current reform models being discussed in Congress are going about it the wrong way.

What Is Our Definition of our Health Care System?

2009-11-06T11:35:00.000-08:00

Carl Bialik posted an interesting article in the Wall Street Journal a few weeks ago. Grab it Here If You Want. The article, “Ill- Conceived Ranking Makes for Unhealthy Debate” discussed the flaws in the data used by the World Health Organization nearly a decade ago to come up with the infamous “37th in the world” ranking we’re all familiar with. I actually think he got his title backward, it should read “Ill-Conceived Ranking Makes for Healthy Debate.”

One of the primary objectives of the World Health Organization when they released the study was to “stimulate debate and focus on health systems” as opposed to just focus on individual components. The data and methodologies weren’t perfect, but it provided a benchmark. We all knew we could do better particularly when the cost is added to the formula. No matter what the final ranking actually may be we all know we can do better than we’re doing today. And, we’re talking about it so it achieved its original purpose.

But, that wasn’t the issue that caught my attention.

When explaining the decline in the country’s ranking in child mortality and life expectancy since 2000 the article stated, “But some researchers say that factors beyond the control of the health-care system are to blame, such as dietary habits.”

And, Alan Garber, an economist and professor of medicine at Stanford University closes the article by saying, “We might get more bang for the buck by setting aside some of our health-care money to support novel approaches to improve nutrition, education, exercise, or public safety.”

Until we all get on the same in our definitions the health care system will continue to struggle. In our view, nutrition, education, and exercise (and many others) are not “novel approaches”, but fundamental participants in the health care system that is evolving. And, dietary habits should be included in any research as they are critical in evaluating the whole-person and determining the approaches or strategies to improve the health of an individual.

We obviously define “health-care” different than others.

As long the majority continues to define health care as the “diagnosis-focused insurance financed” system we have today (as indicated in this article) instead of including health, wellness, and lifestyle as critical components; we might end up even lower than 37th- no matter what flaws may be in the data.

Independent Voters Will Make The Difference in Health Care Reform- And Everything Else

2009-10-26T12:37:00.000-07:00

Independent voters (those independent of political affiliation of the two major parties) have always been a part of our political landscape. Both political parties target the “independents” during election cycles as the only way to assure victory because neither one can seem to acquire the numbers they need on their own.

From all of the talk in Washington, you would think health care reform is all about Republicans or Democrats- it’s not. It’s what the independents want that will make the real difference. For the first time in a long time, independent voters outnumber those affiliated with either major political party.

The Pew Research Center provides an interesting visual of the history of individual affiliation with our political parties over the past 70 years. You can link to it by clicking here.

Starting back with Franklin Roosevelt in 1939, independent voters made up 18% of the electorate. At that time, Democrats made up 41% while Republicans were at 35%.

As we all know, party affiliations change with the times. Democratic affiliation peaked at 51% in 1964 after the Kennedy assassination and Republicans dropped pretty substantially to 25%. Independent voters increased to 23%.

Since that time, the affiliations of both major political parties have continued to erode. With the exception of a brief spurt during the Reagan years, the Republican Party has had a tough time solidifying a base. Democrats have not had much more success.

Beginning in 1991, under Bush I, the Republicans, Democrats, and independents have all been competing as equals in addressing the needs of the American people. And, in 2009, independent voters now make up 36% of the electorate, Democrats have 35%, and Republicans 23%.

So as we continue on with all of the partisan politics that’s taking place in Washington regarding reforming our health care system, both parties better realize it’s not those that are affiliated with them that will be their staunchest advocates or most vocal critics. It will not be a Democratic or Republican agenda that will make a difference. It’s the independent voter that will have the biggest impact. Congress (both sides) had better listen.

And, from what we’re seeing, we can expect the independent ranks to grow even larger in the future. Because we don't think that they really are.

Consumers Value Health Care Different Than Health Care Values Health Care

2009-10-20T05:36:00.000-07:00

I had the opportunity to speak at Life University’s homecoming over the weekend. Many thanks go out to the folks at Life, and particularly Dr. Stephen Bolles for making it a really enjoyable experience.

My topic was centered on “delivering value” in health care, not from a clinical standpoint or a health plan standpoint, but from a consumer perspective. We haven’t heard much about the consumer’s perspective of what they are searching for in the health care debate (except through the emotional interaction of the Town Hall meetings over the past few months). I'ts about time we started to listen.

I felt it was important for the audience at Life University (clinicians) understood the brutal realities of the health care market they are part of. We all know the numbers, we spend too much, our results aren’t what they need to be, and there is a very real possibility that the whole financial model could crash if we don’t do something about it. Consumers don’t trust the health plans, they don’t trust their employers, and they certainly don’t trust those in Washington making the decisions to “reform” the system we have today (I’ve written enough on my views on what’s going on with the whole reform fiasco). Due to the lack of trust, consumers get a lot of their information today via the internet. Eighty-eight percent of them validate the information they receive on the internet with their health care providers. Eighty-eight percent of those people then validate the validation they received from their health care provider with family and friends. Health care information is a social phenomenon.

The definition of “value” in health care from a consumer perspective (from the outside) has a very unique context around it. Value from a consumer’s perspective is something they can trust, is personally relevant to them, delivers the results they expect, and can help them navigate through the mess we have today when they need to navigate through the mess. Value is very personal when looking at it from the consumer’s eyes.

The definition of value for those inside health care is totally different. Value is based on outcomes and cost. Value is about following the right protocol or the right formula in delivering care. The value of health care is transactional- not personal. And, as we all know, our health care system has become a system based on a series of transactions- not relationships.

My argument has been that until we start to recognize and appreciate the definition of value from a consumer perspective, we’re never going to get them involved. They will continue to be merely participants aimlessly following the confusing rules and processes we have laid out for them. Yes, they might be “nudged” along by incentives (another transaction) to get them to do the right thing- but they are not going to engage and do the things we will need them to do to be truly engaged and active participants in their health and in the health care system itself until a relationship is established. We have a long ways to go.

Our health care system has become a fragmented array of individual self-interests focused very narrowly on individual points of view. To really reform our system will require a change in perspective for many of the individual self-interests to work in a more focused and integrated manner than they ever have before. And, while not discarding the health care system’s definition of value, they will need to focus much more on the definition of value from the perspective of those receiving care. Patients are not a transaction- they are a person.

Did anyone really hear my message at Life? I don’t know, but it felt good getting it out there for others to think about.

State Health System Performance- Confirming What We Already Know

2009-10-08T12:58:00.000-07:00

The Commonwealth Fund just released its state scorecard on health system performance. We posted it on our site under the “Health Systems” section in our library at http://www.collaborationhealthcare.com/ or you can grab it by clicking here.

The study looked at a number of indicators to determine its rankings of the states. In 2009, Vermont, Hawaii, Iowa, Minnesota, and Maine/New Hampshire came out on the top and Florida, Louisiana, Nevada, Texas, Arkansas, Oklahoma, and Mississippi came out on the bottom.

The main message once again pointed to the significant variation between the states that continues to exist in access to care, quality, costs, and outcomes for individuals. Even those states at the top of the list had some room for improvement.

Perhaps most striking is the amount of dollars that could be saved in the system we have today simply by organizing care more effectively and dealing the costs associated with the unhealthy lifestyles of our population:

$5 billion for unnecessary re-admission to hospitals or nursing homes

$37 billion “outlier” Medicare costs

$193 billion for tobacco-related health care costs

$147 billion for obesity

So as we continue to move through the health care reform debate, we’ll continue to argue that the issue is not whether we have a public option, or co-ops, or whatever else we want to throw in there. The issue is not making the health plans, the doctors, or the hospitals the “bad guys”. The issue is how this system is organized and how care is delivered and paid-for in the system we have today. Until we deal with the fundamentals, the rest is simply irrelevant.

The Commonwealth Study only reinforced what we already know. I just hope we do something about it.

A Local Conversation for Integrative Health

2009-09-24T08:21:00.000-07:00

We were pleased to take part in an event the other day hosted by Northwestern Health Sciences University and co-sponsored by the University of Minnesota's Center for Spirituality and Healing, School of Nursing, and LifeScience Alley. The theme; Integrative Health: Implications for Patients and Purchasers was designed to be a "local conversation about healthcare reform".

The event was well represented by many of the key health care stakeholders throughout the Twin Cities area and was indicative of the interest the market (or at least some key stakeholders) is beginning to show for integrative health care approaches and the role it can and should play in the new system that is evolving. The attendance was also indicative of the need for more of these types of discussions to share ideas, collaborate, and simply provide a venue to let everyone know what is going on in a changing world.

Mary Jo Kreitzer, PhD, RN (Director, Center of Spirituality and Healing) summarized the evolution of integrative health care from the beginning to where it is today. She pointed out that integrative health care has moved from "alternative" to a position to where it can and should play a much more integral role in health care delivery.

Charles Sawyer, DC (Sr. VP, Northwestern Health Sciences University) reviewed the escalating health care cost statistics we are all so familiar with today.

Patrick Geraghty (President and CEO of Blue Cross and Blue Shield of Minnesota) discussed the changing culture of his health plan from being a "health insurer" to a "health company" in response to the changing market expectations and demands.

Carolyn Pare (CEO of the Buyers Health Care Action Group) outlined the expectations of the employers in the new health care market and their interest in "value" not just new gimmicks or "stuff".

Frank Cerra, MD, (Dean of the Medical School at the University of Minnesota) discussed the changing roles of the providers, and emphasized that real health care reform needs to come from the providers and those delivering care.

When you reflect on the total context of these individual discussions it is very clear that the health care market is already changing. Relationships are changing and many of the delivery models that exist today won't be around a few years from now. Integrative health care with a "whole person focus" has a wonderful opportunity to play a much, much, larger role in health care delivery than it does today. We just need to develop the innovative approaches and the business models to make sure it happens.

The time is right.

Do We Need to Reform The Cost of Health Care? You Do The Math

2009-09-16T07:54:00.000-07:00

The Kaiser Family Foundation and the Health Research and Educational Trust published its 2009 Employer Health Benefits Survey. We posted it on our site you can get it by clicking here.

For those who are questioning any need for reforming the cost structure of our health care system- let’s just do a little math exercise:

In 2009, the average cost for family coverage increased to $13,375 for family and $4,824 for single coverage. As a reference the average cost for family coverage was $5,700 in 1999. The cost increase from 2008 to 2009 was relatively stable for single coverage, and family coverage increased a modest 5%. But, keep in mind these pricing changes are likely softened by the increased cost-shifting to individuals through higher co-pays and deductibles- we pay more, the health plan pays less.

Employers continue to pick up most of the tab by contributing 74% of the cost for family coverage- we pay $3,477.50 and the employer pays $9,897.50.

The study then provided some other background information comparing 2008 to 2009:

Individuals with deductibles over $1000 increased from 18% to 22%

21% of the employers increased co-pays or reduced benefits

15% of the employers increased the contribution requirements of employees

60% offered benefits in 2009 (compared to 66% in 1999). Only 46% of small businesses offered benefits in 2009 compared to 56% in 1999.

I believe we can safely assume that if things don’t change more of the costs of health care will continue to be shifted to the individual (through high-deductibles, copays, benefit cuts, or increased contributions) or the benefits will simply be dropped because they are too expensive.

The study then projects that if things don’t change and the cost of family coverage increases 8.7% over the next decade (as it has in the past), the cost of family coverage will exceed $30,000 per year. Assuming the same contribution levels between employee and employer, this means individual families will need to double-down what they are paying today for their health care benefits (to $7,800 per year) and employers will need to kick-in over $22,000 per family.

Eighty-percent may be satisfied with the health care coverage they have today. But, we wonder if the same people will be as satisfied when all these projections become a reality.

You do the math.

Opportunities for Complementary and Alternative Medicine (CAM)

2009-09-08T11:47:00.001-07:00

In the 1990s, Dr. David Eisenberg and collegues at Harvard created a little stir in the health care discussion when they published the results of several studies regarding the use of (and estimations of the dollars spent on) “Complementary and Alternative Medicine” (CAM) by consumers. The definitions of the services included in “CAM” for the study were a little loose- (not taught in traditional medical schools) and some of the categorization may have been a little confusing but the bottom-line was very real: Over $27 billion was estimated to have been spent on CAM services, most of it was cash, and most medical doctors were unaware of the use of these services.

The $27 billion number caught the attention of the insurance industry. Since most of these CAM services were outside the traditional benefit structure of a health plan, the insurance providers began to try to figure out ways to capture some of the dollars. Affinity networks were all the rage for awhile as insurance payers simply developed networks as a “value-add” to a health plan member. They would provide access to CAM providers to members at a discount from normal charges and collect an administrative fee for coordinating the efforts and providing the access to their members. Very little was done to actually integrate these services further into any health care plan for an individual patient. In the 90s, creating a “health and wellness culture” in health care was still an altruistic vision to most insurance payers (still is to some); they remained focused on managing illness and paying claims. Offering CAM networks was a product decision by the marketers, not a clinical one.

No doubt, some progress has been made since 1997 but the health care system we have today still has a long way to go to integrate the services included in the CAM definition, into a clinical delivery structure that focuses not only on improving the physical health, but the quality of life of each individual.

The Department of Health and Human Services, Centers for Disease Control and Prevention recently published some updated numbers which shows there continues to be a strong demand for CAM services.

The study, “Costs of Complementary and Alternative Medicine (CAM) and Frequency of Visits to CAM Practitioners: United States, 2007” estimates that nearly $34 billion was spent out-of-pocket by consumers for a variety of CAM products and services in 2007. The vast majority of this cost ($22b) was for “self-care purchases i.e. products, classes, and materials; and nearly $12 billion was spent on practitioner visits.

The methodologies between Eisenberg’s approach in the 90s and the approach used in this updated study are so drastically different you have to take some of the comparative conclusions made with a tad of skeptisicsm. We all know that developing consistent definitions and comparisons in health care has not been one of the industry’s strengths.

Nonetheless, this updated study projects an even larger expenditure for CAM services than Eisenberg estimated in 1997. This continued growth creates opportunities for CAM products and services to play a more visible role in the health care system that is evolving.

This study shows that individuals continue to seek more holistically focused (and yet safe) methods to address health issues, and more important, look to these services to maintain their health and quality of life.

As the health care system gravitates toward health, wellness, and quality of life even more, we hope the clinicians (and not the marketers) take the steps necessary to integrate appropriate access to CAM services and make them an even more important component of health care delivery in the future.

Town Halls, Emotions, and Doing Nothing

2009-08-27T17:19:00.000-07:00

Well, we've certainly made it interesting again. The health care debate has moved out of the realm of practicality, and right to the emotional. Any discussion or debate about changing the health care system is inevitably going to have some emotional charge to it. But, as we've said in previous posts- the emotions are now driving the decision-making, instead of doing what is right.

So far, over $57 million has been spent on ads both for and against health care reform. As expected, and as good advertising is supposed to do, some of them went right to the gut. And, also as expected, some cross-the-line to achieve what they intend to achieve; to scare the public. The advertising buzz-words of "Death Panel", "Pulling the Plug on Grandma", and "Rationing" have hit the mark with the general public (whether true or not) creating the scenes we've seen at the Town Hall meetings. And, quite honestly, those defending the ideas have not done a very good job in defending them.

The Center for Responsive Politics indicates just 5 health-care related organizations dumped another $8 million into the lobbying effort in 2008 to influence (or nudge) the legislative process. In 2006, the combined spending for health care lobbyists was the largest of any of the industry segments spending almost $200 million. We're sure that's going to double at least for 2009.

The result- We have an angry public, a partisan country, and a health care system that continues to deteriorate financially.

We honestly don't know what is going to happen with reforming our health care system. Public support has deteriorated, the economic outlook (deficit) has not surprisingly deterioriated, and we have a partisan divide in this country that has grown bigger instead of smaller. As we've said in the past, Obama has lost control of the message and the process.

We're hearing from one side that reform may not happen at all. We're hearing from the other side that they may start to use the legacy of Senator Kennedy as the platform to revive the public support for health care reform. We'll know more when Congress returns next week. From what we've seen so far, it's not going to be pretty.

It's pretty obvious that the structure of the current legislation (HR 3200) is not where the country wants to go. But, as we said in our HR 3200 Cheat Sheet, the legislation does address most of the structural challenges facing the health care system today. We're hoping the Senate can come up with some bi-partisan compromise that makes sense and starts to address the challenges facing our system and ultimately the challenges facing our country.

We need a solution that maintains the individual liberties our country is founded on and still protects the economic foundation of the country for all. We're on the wrong trajectory today. Quite frankly, I'm tired of hearing "we have the best health care system in the world and should just leave it alone." We may have the best health care- but we absolutely do not have the best health care system. Doing nothing is really not an option- we've got to strike a balance.

We need to remember (and the real message should be): This isn't about where we are today- this is for our children and our grandchildren- they are the ones that will be really paying the bill.

Let's Not Blow It

2009-08-14T08:23:00.000-07:00

Last March we wrote a newsletter outlining 6 things we felt President Obama would need to master in order to move our country toward real health care reform. Back then he was positioned pretty well. He’s gone downhill since then.

We closed the March newsletter with the comment, “He’ll need to execute flawlessly with his team to make it happen, and he’ll need to maintain the public support to come up with a plan that balances our individual freedoms with the social responsibility that is expected in our country today.” He hasn’t delivered on this one.

It’s obvious that Obama’s health care discussion is in shambles. We’ve read the House Bill and can’t agree with it (you can see our summary by clicking here). It was too expensive, complex, and confusing in our view (especially regarding the Public Option). There was a logic behind it that made some sense and there were some ideas included that are worthwhile to explore further in the context of what is needed to fix some of the structural problems existing in the system today.

When we reviewed the language we based our interpretations on our views of the challenges facing our system from our years of working in it. We did not interpret “Death Review Committees” the same as “Comparative Effectiveness Research”. We did not interpret “Encouraging Euthanasia” the same as “Advance Care Planning”. But, it’s obvious that these other interpretations and messages have hit home (despite whether they reflect the intent) and HR 3200 is not the direction the country wants to go).

We’re in the process of reviewing the “most visible” Senate bill (Kennedy Bill) so we’ll post our summary on it when we’re finished.

So, what’s the strategy going to be?

In absence of some Divine Intervention to consolidate whatever comes out of the Senate with the House bill that meets the needs of everyone, we’re going to need to (as much as I hate saying it)- slow down. Politics and the loss of public support have won this round. Ramming through a health care reform package that is not at least perceived as somewhat bi-partisan and is not supported by the American people would be political suicide for those doing or supporting the ramming. We’re certain that taking this kind of action in the hostile environment we have will also minimize the chances of success. We need to succeed on this for our country- the right way.

We need to step back, take a breath, take a look at what we have, and determine where we go from here. While deadlines are good, they shouldn’t be met at the sacrifice of achieving the overall goal. But, we also shouldn’t put this on the back-burner again. The health of our economy is going to depend on this.

The Democratic Party is now in “defense mode” and the Republicans have a wonderful opportunity to present other options. But, I honestly haven’t heard what the Republican solution would be. I’ve heard a lot of talk of MSA’s, tax credits, more competition, free market, etc. being thrown around as components- but these ideas are not going to correct the structural changes that currently exist in the system we have today. If someone has the Republican “plan” out there it needs to be more visible.

It’s already ugly and, unfortunately, will probably get uglier before we’re all done unless something changes. As we had hoped would occur from the beginning, both sides need to reach across the aisle to develop a solution that respects the principles maintained by the other and produces the result that is right for the American people for now and for the future.

We’ll say it again, “He’ll need to execute flawlessly with his team to make it happen, and he’ll need to maintain the public support to come up with a plan that balances our individual freedoms with the social responsibility that is expected in our country today."

Health Care Reform- A Classic Marketing Challenge

2009-08-05T07:00:00.000-07:00

Let's say you are in your basic Marketing 101 Course and your instructor gives you the following statistics and scenarios:

1. 70% of the market feels your product (widgets) needs to have a major product overhaul with how it is produced. The market feels that sometimes it's a pain to buy your widget when they need it, it's confusing to use on occasion, and is starting to think your widget costs too much. But, in reality it really doesn't know for sure because in most cases somebody else is paying for it.

2. 80% are generally satisfied with the widget(s) they have purchased or have used over the years.

3. And, you (as the maker of widgets), have more than enough information to acknowledge that the way you produce and deliver your widgets today is not sustainable under your current business model and you know that you are going to have to pass more of the expenses on to your customers (the 80% that is satisfied) in order to survive; the 80% number is going to decline over time.

What do you do?

The items above provide a pretty basic view of what we're dealing with in health care. A new CNN/Opinion Research Corp. poll of Americans provided the statistics for #1 and #2; we added #3 as a pretty safe assumption.

The "marketing answer" on how to spin your position is going to depend on which side of the debate you are on.

For those who feel the health care debate is a "non-issue" and only requires some minor adjustments, you're strategy is going to be focused on relying on the "80% Satisfied" as your foundation. Why try to reform something that 80% of the market is satisfied with? Why go to all of the expense of revamping when your customers are satisfied. They like the widgets they have. You might try to keep Items #1 and #3 in the background. You'll have to acknowledge they exist to some extent, but most customers like what they have so we won't rock the boat.

For those who feel a total revamp of our system is required, you'll be focusing on Items #1 and #3. You'll have to acknowledge item #2 but the main message is going to point to all of the flaws in the system of today, probably some bad guys to pin it on, and trying to get some of the "80% Satisfied" to move in your direction.

The marketing effort of the health care debate is about to take off. The "Harry and Louise" initiative in the 90's proved that marketing can have a dramatic influence in the public policy debate of health care. And, we've all seen from the political ads of the past how far some are willing to go to get their point across, truthful or not. Whether we acknowledge it or not, the basic consumer still does not fully understand how this system works and is looking for information. The general public will be very vulnerable to the marketing messages that are created over the next few months.

We've got our views on where we think this should end up. But, we've been following it daily and studying and evaluating all of the options on the table. We believe we have come to an "informed conclusion" on health care reform based upon our views of the relevant information and research. We will listen, but won't be as vulnerable to the marketing strategies that are about to be launched from both sides.

Let's hope that the messages that are about to hit the airwaves are informative, truthful, and present all of the facts so individuals can make their own "informed conclusion" on health care reform. We hope the outcome doesn't once again boil down to who has the most money or can scare the audience the best. We hope the messages focus on the real health care issues facing our country to help the market understand and comprehend the realities we're facing.

This is too important an issue to only focus on "spin". We can't forget the substance behind the ideas.

The Economic Realities of Health Care

2009-07-28T08:35:00.000-07:00

Adam Smith is credited as being the father of economics. He introduced the idea of the "invisible hand" where (as his thinking went) people pursuing individual self-interests simultaneously served the interest of society. He also introduced the initial thoughts related to "perfect competition" which has provided the basis for our own free-market thinking today. Perfect competition, however, had several key components required before a real free-market existed. These components included: 1. No single participant can influence prices, 2. a free-flow of information exists among all market participants, 3. There are no barriers to entering a market, and 4. There are a large number of buyers and sellers.

As our health care debate continues, and despite our preference for free-market approaches, it is fairly apparent that our health care economy isn't operating by any "invisible hand" and doesn't include any of the components of "perfect competition" so some level of intervention is likely needed. The level of that intervention is at the center of the debate today and the key is going to be striking the right balance between the two. This idea has been the centerpiece of the Collaborative Health Care System principles we established three years ago.

A study completed on behalf of the American Medical Association found that out of 314 metropolitan markets across the country, 94% are controlled by one or two health insurance companies, or fewer. In 15 states, one insurer has 50% or more of the entire market. While the insurance industry questions the methodology used in this study, other studies have supported the fact that limited competition exists in most markets for the delivery of health insurance services. And, as the consolidation of the health care market continues, these numbers will likely continue to increase. That's the reality.

On the other side, a 2006 study of hospital systems found that one or two hospitals controlled the market in 88% of the nation's largest metropolitan areas. When you have dominant carriers going up against dominant delivery systems, it's no wonder we have a difficult time in coming up with a "free-market" pricing structure that benefits the system as a whole. We're lacking the invisible hand.

We honestly don't know if a "public option" is the answer. Those supporting this approach are using the idea of introducing more competition into the marketplace as the reasoning behind it. We question whether a government injected solution is the right approach.

Once again, it's all about the message. It's not about whether we have a public option included or not. The real issue is about the need to change the basic economics of a system that desparately needs to change. Monopolies dealing with monopolies just don't work. So, if we're going to strive more closely toward a free-market, perfect competition approach, the free-market supporters had better come up with a better solution than what is being thrown around today.

We haven't heard it so far.

Health Care Reform- Public Opinion Is Changing

2009-07-20T07:33:00.000-07:00

A new Washington Post/ABC Poll shows that public opinion on the health care reform debate is starting to change. The public's approval of Obama's efforts has dropped from 57% in April, to 49% today. Disapproval has increased from 29% to 44% during the same time period. Most of the change is the result of the change of view of the independents who make up a significant portion of our electorate today.

We now expect the "p.r. machines" on both sides to start to work to try to influence the numbers- just like in the 90's. And, it's quite sad. It is very likely that whoever comes up with the best marketing gimmicks (whether truthful or not) will get their way.

We understand that this is all part of the democratic process. We welcome the dialogue and debate that should occur between ideas to come up with a compromise solution that is best for our country. We too are concerned with the deficits that are being built-up that will be left to our children, our grandchildren, and our great-grandchildren to get us out of the mess we are in today. But, we are even more concerned with remaining with the "status-quo". The numbers speak for themselves- reforming the way health care is delivered in our country is key to our economic stability in the future.

A recent Harvard University study found that in 2007 over 60% of the bankruptcies in our country were in some way related to medical/health care issues. Numerous studies predict the out-of-pocket costs paid by individuals will continue to increase and at some point will become unaffordable. Savings built during a lifetime of participating in the work-force are being wiped-out by a single medical event. Employers will continue to struggle with the costs of healthcare as they continue to be a significant competitive disadvantage when competing in a global marketplace.

The public needs to understand that health care reform isn't about whether we have a "public plan" option or not. In many respects, it's not about the "uninsured". The public needs to understand that the model we have today will very likely lead to economic disaster in the future. The public needs to understand that we are already rationing care with the system we have. The public needs to understand that the system we have today is simply not sustainable for the future. And, the public needs to understand that there are less costly options to really reforming our health care system than some of the options being promoted today simply due to politics.

It is wonderful that public opinion carries the weight that it does in the democracy that we have. We only hope that the public is provided the truthful information it needs to be able to make an informed opinion in the first place.

At this point in the debate, we don't think it does.

Health Care Reform- Keeping The Big Picture In Mind

2009-07-11T08:30:00.000-07:00

Last March we published a newsletter outlining our “Obama Score” of where health care reform stood from a public policy perspective. In it, we highlighted the 6 basic principles that are going to be required to make meaningful (not incremental) changes to our health care system. Obama had done relatively well up to that point and he still carried significant public support as his Administration was still new. But we had some important “wild cards” that needed to be addressed before we felt true health care reform would become a reality.

Now, we’re at the really messy part of the process. Since March, things have moved along quickly and we are glad to see that health care reform has remained near the top of the domestic agenda. But, as expected, the other significant issues our country faces have now become part of the debate and the public support, while still there, is tenuous now that we put the dollars with the ideas. In our view, the primary principle we were concerned about in March (Mastering the Legislative Process) has become weaker instead of stronger. This single principle has killed most initiatives before, and we hope Congress (and the private markets) can come up with solutions that are good for the country as a whole, and not just continue to protect self-interests as has occurred so many times before.

We’ve posted a side-by-side comparison on our site of 11 of the major initiatives currently making their way through the health care reform debate. This was put together by the Kaiser Family Foundation and you can grab it here if you want to look at it. This will likely be changing quite frequently but we believe everyone should have a basic understanding about what is being discussed with the best information available.

Unfortunately, the public perception of health care reform has become centered on whether we have a “public option” included or not. While this is an important delivery component, the average consumer should also understand the broader need for transforming the way health care is delivered in our country before making any judgements. For those that have health care coverage, and for those that do not, we need to understand and accept that the way our health care delivery is structured is not sustainable, especially when significant numbers of our population (Baby Boomers) begin to access the model we have today.

Payment reform, transparency, administrative efficiency, clinical effectiveness, wellness/prevention, and care integration are also critical elements that need to be understood and considered by the public before making any judgments.

Whether we realize it or not, the health care market is already changing. The reform outcome will certainly have an impact on the speed in which it changes, but all stakeholders (health plans, providers, and consumers) will need to appreciate these changes for participation in the future.

We believe that access to care high-quality health care for all Americans is a critical factor of the final solution and is part of what our country stands for. We just hope the real transformation we need isn’t derailed due to the politics or economic philosophies that have proven not to apply in the health care market we have created. And, let’s make sure the general public has a good understanding of all aspects of what the debate is all about in the first place- not just what we want them to hear.

Health Care Cooperatives- We're Missing the Point

2009-06-29T11:58:00.000-07:00

We shouldn't have been surprised.

The primary focus of the health care debate is now centered on what level of government involvement is justified to deliver health care in our country. It's the same debate we've been having for the past 100 years.

While the lines-in-the-sand are now very visible, Senator Kent Conrad, D. ND; Chair of the Senate Budget Committee threw out a new idea to try "bridge the gap"(chasm) that has evolved between the two sides of the health care public policy debate. His effort was obviously a compromise in an attempt to make certain the reform efforts continue to move forward.

On the one side we have those in support of a "public option" that is supposedly built on the principles of improving availability, improving quality and efficiency, and challenging provider consolidation (read driving down prices). On the other hand we have those that feel any (and I mean any) involvement by the government is on the road to single payer/socialized medicine.

Neither side is willing to move- and we believe both sides could use some real bi-partisan compromise in their positions.

Conrad's idea is based on the concept that instead of a national public option, states could set up independent "cooperatives"; non-profit entities owned by their members to deliver health care services to the community or population. The idea was based on his personal experience with cooperatives in his home state of North Dakota, and was one idea submitted to bridge the gap that exists today. It's generated a lot of discussion in the political camps- and Chuck Grassley (R, Ia) has indicated some intrigue with the idea as a public option is out of the question and a show-stopper from his perspective.

Unfortunately, we're missing the point again. Our health care system is in the mess it is in because of the way it is organized and paid-for. It has evolved into a fragmented mess and until there is some level of organization and collaboration between doctors, hospitals, health plans, and yes, our political leaders, its going to continue to be a fragmented mess that costs a lot of money.

There are many economic arguments against introducing 50 new health care cooperatives into a landscape that is already fragmented. There are many social arguments against introducing a broad-based public option into the health care market. And, there are many more economic and social arguments against leaving the system alone and let it continue to operate the way it is today.

The debate should not deteriorate (as it has done before) into health plans vs. the world, doctors vs. the world, or government vs. everyone else. We cannot let this deteriorate into a public relations message with the winner being whoever has the most money- or screams the loudest. This is a social issue that needs to be resolved for the good of our economy and the legacies we will leave our children. The discussion should be about what is best for the American people. And, the outcome should a solution- not a compromise based upon political strategies.

Get with it guys and gals. You may only have one shot at this. Let's do it right.

Risk Segments and Funding Alignment- A Requirement for Reform

2009-06-24T07:13:00.001-07:00

When the whole health insurance idea was introduced in the 1930's the concept was pretty simple. The idea was to insure employees and protect them from the expenses of catastrophic health events. Even though the use of the term "insurance" in its purest definition was still a stretch- the primary focus was to protect individuals from the generally predictable hospital and doctor events existing in the population. Our reimbursement methods and funding (premiums and benefit design) were established and have evolved based on these original principles.

McKinsey recently issued a really interesting study showing how the risk categories in our population have changed over the years (primarily in the last 20 years) and how our methods to pay for the care and design benefits to represent these new risk categories have not changed at all. We've posted the study on our site- and you can grab it by clicking here.

This study indicates that today over 60% of our health care costs are now not even related to the categories for which our health care system was originally designed. In addition, over 30% of our costs are directly related to the management of chronic conditions (of which a significant portion is directly related to the lifestyles we lead).

In order for us to really reform our health care system we'll also need to look "outside of the box" to design reimbursement structures that represent the risk categories that have developed (and are very real) over the years. More importantly- benefit structures for individuals should be redesigned to reflect the needs of these new categories which will ultimately benefit our overall health care model. Consumer Directed Health Plans (high-deductibles/savings accounts) were a start, but they merely shifted the costs to the individual with some tax benefit. We really need to start to look at redefining benefit structures themselves to represent the needs of the population and to provide the incentive people need to take care of themselves in the first place.

Merely adjusting copays and deductibles will not work any more. Our health care population has changed to much and the cost is too great. It's time we get current.

It's No Wonder Physican Offices Can Be Cranky

2009-06-15T11:19:00.001-07:00

There's been quite a bit of talk about the inefficiencies of our existing health care system- here's another example.

We all know the route many of us take as patients- we go to the doctor (sometimes we have our health insurance cards, sometimes we don't). We have no clue what our benefits are. If we don't get fixed immediately (we're impatient) we go somewhere else. For those with chronic conditions, we may have to run from one specialist to another, filling out the same forms, and repeating the process all over again. We don't worry about all of the "administrative details", that's the doctor's office problem. We'll just complain when we don't understand the bill.

[I may be a little critical on the "consumer/patient" here- but, unfortunately, it's reality. It's another part of the system that needs to be addressed- consumer understanding/education]

So, what does all of this cost the doctor's office to wade through the mess and hold our hands to deal with "health insurance"? Not surprisingly, a lot.

The May issue of Health Affairs included an interesting article summarizing a study that tried to answer the question of "what does it cost for physicians to interact with health plans today?" You can take a look at the entire article on our site by clicking here.

The study estimates our current process costs our system between $20-$30 billion dollars per year. Each physician/practice deals with over 10 very different and individual "health care programs" and spends on average 3 weeks per year trying to manage the rules of each program. Clerical staffs average almost 40 hours per week (one full-time person) simply to coordinate billings, authorizations, credentialing, and claims. And RN/MA/LPN resources eat up over 9 hours per week trying to navigate through the multiple arrangements. You can probably multiply these numbers further when you include mental health, chiropractic, physical therapy, and some of the other care providers that weren't included in this study.

That's a lot of money- and it is a confusing and frustrating process for everyone involved.

"Technology" is already entering the picture and starting to automate some of these provider/health plan interactions. That's where a lot of our projected savings are going to come from and its the right direction to go. But, getting the technology in place is going to take time.

By simply looking at the numbers, it would seem to us that moving toward some common definition of benefits, formularies, care management protocols, claims processes, and prices between all of the private payers would have the potential of saving a ton of money and reallocate the time currently being spent on "administration" to "care for the patient".

It's pretty obvious that whatever final reform structure we take- we have got to figure a way to organize the mess of programs that are currently out there. It will be better for the payers, the providers, the consumers, and the health care system as a whole.

And, those that are delivering the care to us are likely to be a lot less cranky.

Doctors and Hospitals Join In; AHIP Day 3

2009-06-05T13:25:00.000-07:00

Today, the President of the American Medical Association and the President/CEO of a major Los Angeles hospital participated in the primary (annual) meeting of the health plans from across the country. I guarantee you, a year ago these groups wouldn't have been part of the dialogue here. It shows how things have changed.

I think I heard the word "collaboration" today more than I've ever heard it before- and in the right way. And, I heard the dialogue and discussion between diverse stakeholders much more "honest" than I've ever heard before. The fact that the doctors, the hospitals, and the health plans are even talking together shows how far things have come. We aren't at the "hugs and kisses" stage yet- but the fact that its even happening recognizes that there is some common ground that can be built upon to come as close to a win/win outcome as we can. This is what we've been talking about since we created Collaboration Health Care three years ago. It can happen, and it can be done.

This group, (and three others) sent a letter to President Obama last week and we posted it on the resource page of our site http://www.collaborationhealthcare.com/. This letter was an attempt to provide more color and detail behind strategies that would be used to support their collective committment to "bend the cost curve" in health care spending in a collaborative process. There is no doubt that we still have a ways to go- but stakeholders are recognizing that we need to break down the silos that have evolved over the years to make this work. Those that aren't willing to collaborate and dialogue are going to be left behind. It just requires a little different perspective and a little different thinking than we're used to. (And, yes I recognize I was a little skeptical when this group originally announced their committment a few weeks ago- see previous blog- but, after listening to their rationale today- I believe the intent is more sincere than I gave credit for)

We also heard quite a bit about the "Massachusetts Experiment" today. Suffice it to say, it's not going real well in Massachusetts. But, once again, I hoped we've learned something from it. We've proven the fact, once again, that if you don't address cost and access at the same time when you are designing a delivery model- it's going to break the bank (same thing we did with Medicare).

-----

So, the AHIP conference of 2009 is over. In summary, I'd say the attendance was about the same as in the past (maybe slightly lower), smaller (but still respectable) number of exhibitors, and a little more somber mood. We all heard some very dramatic statistics and predictions about what could happen if we don't do something- and urgently. The time for talking about it is over- too much is at stake. I think everyone at the conference would agree. And, I actually think all of the stakeholders are beginning to understand that they can't do it themselves. I don't have the answer about how much should be controlled by a "government function" and how much should be placed in the free-market. We know that too much of the controlled function is not what this country is all about and too much of the free-market just doesn't work in a multi-segmented health care structure. As we said back in 2006, it's a combination between the two. We've just got to keep talking to each other to capitalize on the commonalities and reach the right combination.

In the world of health care- this is an historic event.

We're In For Some Change; AHIP Conference Day 2

2009-06-04T20:21:00.000-07:00

Greetings from San Diego. The sessions today carried-over from my comments yesterday. If I had to summarize the key messages they would be that some type of health care reform is coming- and we've got to get our country healthier than it is today in order for us to make anything work. The two key issues that will be the focus of the entire debate is access and cost and you'll be hearing about these two issues throughout the debate that is about to begin.

The primary discussion around health care reform centered on whether we need to have a "public option" included in the system we have today. This idea was at the center of the "health insurance exchange" concept Obama used during his campaign. Naturally, the health care industry today would rather keep the public option out. But, those in favor of it argue that this option will fill the gaps for those that don't have coverage today, and inject more competition in geographic areas that have little or no competition in the current market. (Rumor has it that Max Baucus sent a letter to President Obama today telling him the "public option" would be included in his proposal).

Former governors Jeb Bush, Howard Dean, and John Kitzhaber started the day specifically talking about the need for a public option in the health care reform agenda. Bush was against it, Dean was for it, and Kitzhaber made the most sense to me with his recommendation of scrapping the system we have today in total- and starting over. I just don't think that his option is politically feasible. But, he made some interesting and fascinating points to support his case that I hope people listen to as this process evolves.

Jacob Hacker (Professor of Political Science at the University of California at Berkley), Gail Wilensky (Economist and Senior Fellow at Project HOPE- and on the Board of United HealthGroup), and Len Nichols (Director for the New America Foundation) continued the debate later on in the day. Hacker was a strong supporter of the public option (and wrote the White Paper the Obama Administration is using to support the idea), Wilensky was against, and Nichols was uncommitted- he just wants to make sure reform happens this time around.

By the end of the day, I was concerned that most of the political debate is being centered around the need for a public option as opposed to the other key issues we need to address (some of which were presented by Deloitte yesterday). The focus on value, consumer engagement, payment reform, and IT infrastructure seemed like side-bars as opposed to key components of a reform strategy.

The other key message today is another topic we've talked about for many years- our culture is unhealthy and something needs to be done to begin to change it. We all know the statistics- 70% of all of our costs are related to chronic conditions- and with the aging of the Baby Boomers it's only going to increase. And, of these costs; 40% are related to lifestyle, 15% are related to socio-economic factors, 5% are related to the environment, 30% are related to biological factors, and only 10% are related to actual medical costs.

So, when you put it all together what we're talking about is a need to begin to create a healthier population- and then reforming the payment and delivery structure that surrounds it. It's certainly easier said than done.

Regardless of what side you are on, each and every discussion today supported the fact that the system we have today is morally and economically unsustainable. The real possibility exists of our country defaulting on our debt obligations because of the costs of our health care system. A substantial (not incremental) reform strategy is required this time- we don't have a choice. The debate is about to heat-up and (as I said yesterday) providers, health plans, consumers, and legislatures had better be ready. We're in for a whole new ball game.

What Health Plans Are Thinking; AHIP Conference; Day 1

2009-06-03T19:02:00.000-07:00

It's amazing what a difference a year makes. When I was at this conference last year, health care reform was discussed, but most political commentators didn't think much would happen- there was interest- but not a lot of passion.

In June of last year we were talking about gas prices, then the banks started to fail, then it was the economy. But, in January of this year, the OMB made a statement that has remained at the center of where we are today- we cannot fix the economy unless we fix health care.

An interesting statistic- of the significant debt we are now assuming with the new budget- $35 trillion of that debt is Medicare- if we don't fix Medicare- we're hosed. We can't fix the economy if we don't fix health care. Finally, we're bringing the two together.

So, it's going to be an interesting conference to hear what the health plans are thinking right now. I have a feeling most of it is going to be about health care reform. The tone I'm picking up (and it's only the first day so I could be wrong)- is that health plans aren't as sure of themselves as they were in years past. Health plans were the drivers in the past, now they are the passengers.

I attended a seminar put on by Deloitte Touche which was absolutely fascinating that I think is going to set the stage for the next two days. Within the next two weeks we're going to start seeing all of the proposals being developed by Congress and then the "discussion" will really begin. There are 5 major Republican proposals being developed, and 5-15 Democratic proposals. But, the consensus of the group----- something will be enacted this year (Obama wants to have it signed by Thanksgiving). What a difference a year makes.

Deloitte's model of health care reform includes 4 basic components all developed sequentially. First is establishing a solid health information technology structure that we don't have today. Second is focusing more intently on comparative effectiveness and evidence-based service delivery, third is coordinating care, and fourth is consumerism. All of these components are being discussed- but I wonder if we're going to have the time to sequentially execute as opposed to combining some of the components. The group estimated 6-10 years to put this model in place. I don't think we have that much time.

The exhibit hall seemed much smaller this year. I've used the size of the exhibit hall as a gauge of the "health of health care" in the past. I remember when the halls at this conference were immense with huge displays by some of the vendors. I didn't see that today- but I'll spend more time there tomorrow.

So, it's going to be an interesting few days here. Bottom-line- the health care marketplace is going to change and health plans, providers, employers, and consumers had better be ready.

Until tomorrow from San Diego

Value In Health Care- Can It Be Defined?

2009-05-27T10:48:00.000-07:00

The marketing concept of "value" is being thrown around a lot in health care today. In the traditional sense, value is simply the difference between the real or perceived benefits one receives compared to the cost. When the cost exceeds the benefit- there is no value. It's really pretty simple.

Our health care system has had a tough time defining its "value proposition" in many areas. And, as we compare our health care costs with some of the basic statistics used to measure our results and the benefits we receive- we may determine we have a questionable value proposition indeed.

A new study by CVS Caremark determined that "reducing health care costs" is the number one measure of success for employers when facing the ongoing challenges of providing health care benefits to employees. It's not limiting the amount of increase (like we heard about a few weeks ago), it's reducing health care costs.

Employers are looking at all options to get a handle on the health care cost crisis. They are looking at ways to determine the value they receive from all of the dollars that they spend. And, it hasn't been an easy road because the concept of "value" while always implied, has never been a focal point of our current system.

The concept of "evidence-based benefit plans" or "value based benefits" are new methods health plans and employers are attempting to use to incent individuals to comply with care management plans or utilize the right providers. Quite simply, the concept is designed to reduce any financial barriers (through reduced copayments) for patients to access the care that has proven to be the most beneficial.

The University of Michigan initiated a study in 2006 to determine if the removal of financial barriers to patients would result in an uptick in adherence to care management plans and a more efficient use of resources for diabetic patients. This was really the first effort to measure the impact a change in the benefit structure could have on the utlization patterns, outcomes, costs, and the value gained for this high-risk population. While the results are not final, we would hope the study would help the health care industry to define the "value" these targeted services provide for the system and for the individual patient/consumer.

Dan Ariely (Professor of Behavioral Economics at MIT) wrote a fascinating book on how we (as individuals) make our decisions based upon sometimes irrational behavior. Yes, money has some influence to incent us in one way or another, but there are other "predictably irrational" influences at hand. As our health care system stuggles to determine its value, let's hope that the financial benefit designs are not the only methods we use to get people to do the right things.

It's about education, open communication, and transparency- when all three of these come together, we will have a better sense of value for our health care system- and for ourselves.

Promise or Politics?

2009-05-11T18:38:00.000-07:00

It's amazing who you can bring together when you all have a common purpose. Our belief in the potential for collaboration in health care has been restored.

Today the strangest of bedfellows delivered a letter to President Obama endorsing a common position of "reducing the rate of growth in health care by 1.5% per year over the next 10 years". The American Medical Association, American Hospital Association, Pharmaceutical Research and Manufacturers of America, America's Health Insurance Plans, and the Service Employees International Union, all enemies at one time or another in the past, are now the best of friends and endorsing a common idea to help achieve health care reform in our country. The group received some great p.r. from many sides and are now positioned as "solid supporters of the health reform effort". Nobody wants to be the bad guy on this one.

Now, we don't want to be critical of a sincere effort. But, this one looks more like public relations and political positioning than a justified effort. But, we'll give it the benefit of the doubt for now. We'll look more at the details.

The organizations intend to achieve their goal by simplifying administrative costs, making hospitals more efficient, reducing hospitalizations, managing chronic diseases more effectively, and improving health-care information technology. Aren't these the things we should be doing anyway with the system we have? We really don't understand what's going to be different. Maybe its in the details and we're missing it.

While the potential savings being talked about is significant ($2 trillion over 10 years), we need to keep in mind that what is being proposed is only a reduction in the rate of increase that is expected- not any real reductions. Even optimistically, our health care expenses will increase to 18% of GDP by 2019 compared to the 16% we're at today. We don't understand how this is going to solve our issue. But, again, maybe its in the details and we're missing it.

But wait, there are no details- it's only a concept.

Don't get us wrong. These organizations are all going to be required to take part in any major reform efforts and it is a huge deal that they came together to write a letter like this in the first place. But, we have a hunch that (especially with the status of our economy) we're going to require more- much more than was presented today. Hopefully, it's a message that will remain intact when the tough decisions have to be made.

It was a great political move to get out in front on this one. But, as Len Nichols, Director of the New American Foundation is quoted as saying- "The heavy lifting is still on how to write down how to make it happen". And, it's when the heavy lifting starts, that the true colors start to show- especially in health care.

The organizations need to move beyond concept- and get to heavy lifting if they are going to stay out front. We've had enough of the concept stuff.

Technology is Good- But, It Needs To Work

2009-04-26T20:07:00.000-07:00

I was in a hospital last year to be with my father-in-law when I noticed something that seemed a little unusual to me. The doctors had nurses following them around with a laptop mounted on a wheeled cart. They were entering information as the doctors dictated and moved from patient to patient. The process looked awkward and actually looked a little silly to me- but what did I know?

I asked a nurse what was going on, and she said it was the hospitals initiative to improve efficiency and to get more of their processes automated and electronic. It still seemed foolish to me to use high-price staff to follow a doctor around simply for data entry, but I assumed there was more to it than I was aware of.

I guess not. The hospital discontinued the idea a few weeks later.

The May 4 issue of Business Week has an interesting article about the coming boom in the technology side of health care that is anticipated due to the pressure the industry will be under from a number of stakeholders to get more efficient.

The article, "The Dubious Promise of Digital Medicine" mainly talks about some of the horror stories and the expenses hospitals and providers have already incurred when trying to match incompatible processes and business models to standardized technology. It's already been expensive and in some cases has been dangerous.

There is no doubt that the health care system needs to get better organized and have the systems in place to be able to communicate more effectively than it does today. But, we're afraid that all of the money that's being thrown at the cause is clouding the intent of what it's all about in the first place.

Why don't we start with those delivering the care and the patient when designing and developing these systems? Once again, the fragmented system we have today has resulted in an onslaught of technology development- with very few concepts able to cross-communicate with other stakeholders. And, cross-communication is going to be required. We're designing systems from a "corporate perspective" rather than a "health care perspective". We need to start building these things with an idea of what is good for the patient- as opposed to simply focusing only on the bottom-line.

Newt Gingerich (who created the Center for Health Transformation) stated, "Some of the vendors are more aware of the potential for dramatic change. Others are so busy trying to make this quarter's sales goal that they're not doing much strategic thinking."

We have an opportunity to do some great things in transforming the communication methods in our health care system today. Let's hope that we don't lose sight of the fact it is still the relationship and communication between the patient and provider that will have the biggest influence in facilitating the changes we need to make- and let's hope we don't take "cookbook medicine" to a new level and sacrifice quality- for the sake of "this quarter's sales goals".

Rough Day On the Hill For UHG

2009-03-31T19:36:00.000-07:00

From the sounds of it, things weren't all that friendly when Steve Hemsley and Andy Slavitt (CEO of UHG and CEO of Ingenix) met with a Senate Committee on Commerce, Sciences, and Transportation today. This was to discuss Ingenix's alleged establishment of arbritrarily low "out-of-network prices" used by the insurance industry to pay claims; to the detriment of the consumer.

Actually, Hemsley and Slavitt had some really important things to say to the Committee (if you want to read their testimony go here). But, it didn't sound like anyone listened very well. To give you an indication, Senator Claire McCaskill of Missouri stated at one point, "We need to be vigilant and stay on you like white on rice." Doesn't sound like a trusting partnership is forming here.

But, on this one I have to sympathize with United.

Getting a handle on health care fees (the old Usual, Customary, and Reasonable determination) has always been a chore in the system we've set up. Hemsley states in his testimony that our model is challenged "when the costs of a routine, identical medical procedure can vary widely within the same geographic region between private and public insurance, such as Medicare". Something needed to be set up- and United happened to capitalize on the opportunity. You can't blame them for developing something the system needed on a broad scale. (Now- the potential for a conflict-of-interest because of the way UHG is corporately structured may be another story).

The Committee failed to understand that establishing higher UCR non-par fees only shifts the dollars back to the employer in the system we have today. It sounds like they are saying that since the consumer doesn't have to pay- nobody will. That's not the way it works. It's another example of shifting the responsibility- as opposed to addressing inherent problems in the system itself.

Slavitt commented, "Trusted, accurate data and information technology comprise one of the keys to modernizing the health care system, particularly when combined with national quality standards and properly aligned incentives."

We couldn't agree more- and that should be the real message; but, sadly, we don't think Senator McCaskill and others got it.

Watching the Sunday Talk Shows- It's Depressing

2009-03-23T11:00:00.000-07:00

When I get the time, I like to scan the different Sunday talk shows to keep a fresh perspective of the views of our politicians and commentators and keep updated on the status of our country- strictly from a media perspective (I know it's a bias view- but entertaining at least). Last week, (not surprisingly) it was all about the AIG bonuses and the general status of our economy. I was intrigued with the force of the disagreement existing between our political parties about how best to address these challenges and the many other challenges we are facing. Both sides are entrenched in their views- and the criticism on all sides flowed freely. I didn't see a lot of bi-partisan collaboration.

As I watched the different shows, I began to wonder- "If all of this political capital is being spent on these critical items that need to be addressed now- how are we ever going to make the changes to our health care system that need to be made?" There may not be any political capital left- on either side.

We don't need incremental change now- we need a major overhaul in our reimbursement

structure, our focus, our perspective, and the fundamental way our system operates. As we've stated in the principles of our Collaborative Health Care system- it's going to require a bi-partisan combination of public and market initiatives to make it work. From what I have been reading and witnessed on Sunday, it ain't going to happen.

In a September, 2008 essay in Business Week, Louis Gerstner (retired chairman and CEO of IBM) suggested that "the processes of government are broken, preventing us from taking responsible action". He further contends "the U.S. is better at patching problems than fixing them." The collapse of our banking system, housing, and credit markets, is a perfect example; many folks knew the way the markets were operating was unsustainable. We just didn't listen or do anything about it.

David Walker, CEO of the Peter G. Peterson Foundation highlights the issue at hand in the title of his article in Fortune, "Call This A Crisis? Just Wait." He's talking about Social Security and health care. He states, "at the heart of these problems is our leaders' collective failure to act in the face of known challenges. Our country has veered from its founding principles, which held to individual responsibility and accountability today in order to create more opportunity tomorrow. When our constitution was written, the concepts of thrift and prudence were no less at the center of the American spirit than liberty and justice."

The health care crisis is out there. We're coping with it now, but there will be a day of reckoning in the years ahead. Whether we like it or not- health care is as important to our economic security, as revitalizing the credit markets. It's just not at crisis stage yet. From what I'm seeing now- I don't see a lot of promise for a major reform effort coming from the government structures that are established today. Quite frankly, I'm tired of the talk and rhetoric. We need to look for alternative ways to get the message across that we can't wait and hope that all of the other stakeholders- employers, consumers, health plans, and providers can come together with a solution. We don't have a lot of time.

Maybe I should stop watching the Sunday talk shows.

Can Health Care Change It's Thinking?

2009-03-03T14:35:00.000-08:00

Our goal at CHCI has always been to help organizations change the way they think about health care. Whether we like it or not, we've evolved into a "sickness-based" system comprised of many independent stakeholders that is not organized or coordinated toward any common goal. The result is an extremely expensive health care system that doesn't produce the outcomes or results we would expect for the dollars we are spending. In order to really reform or change our system- we first need to start changing the way we think. We need to change our perspective.

We've been in a few meetings with organizations over the past few weeks that really pointed out to us that it's the "thinking" that needs to change first- then we can start to be truly innovative and creative in making the changes we need to make. Many organizations seem more comfortable with throwing more tactics at the problem, but feel they must fit these tactics in the context of the way things exist today- as opposed to changing the market dynamics themselves. We're being incremental about our approach to fixing our health care challenge- as opposed to being bold and creating a whole new health care paradigm.

The familiar Albert Einstein quote comes to mind, " The significant problems we face cannot be solved at the same level of thinking we were at when we created them". Addressing the challenges we face with our health care system is a significant problem- all stakeholders involved will need to change our level of thinking if we're going to fix it.

2009-01-12T07:48:00.001-08:00

Greetings to all.

When we started the journey with Collaboration Health Care, Inc. in 2006 we set out with some pretty ambitious goals. At the beginning, we established our vision for the "perfect" health care system. It was a system that balanced individual accountability and private initiatives with broader "governmental" goals. We realized the perfect system was going to need a combination of them both.

From our 40+ years of working in the system- we witnessed the development of the "silos" that had been created. Collaboration was limited- as everyone was looking out for their individual self-interests. We saw the different stakeholders "retrench and defend" when interacting with each other- instead of reaching out to "collaborate" and seek solutions that would be a win/win for all. Too often- our health care delivery system utilizes win/lose strategies.

We also recognized the "rigidity and structure" that was imposed on creativity within the delivery system- as stakeholders tended to view initiatives from a very limited perspective. Really good ideas that would benefit the broader system don't go very far if they don't meet the specific objectives of one stakeholder group. We lived through that one.

We also saw the importance of the individual- the consumer- that is left out of the equation until the end. With 80% of our costs related to lifestyle behaviors of our society- doesn't it make sense to get these individuals involved-- on a true grass-roots level?

The amazing thing is that all of the pieces are here. They just don't work together effectively.

So- our idea was to help facilitate collaboration, relationships, communication and pull creativity together to look for win/win solutions. We wanted to see if we could move portions of the delivery system into a creative mode- instead of the defensive mode that characterizes health care today.

We have a new Administration that will likely be approaching health care from a different perspective. Health care is now an economic issue- not just a social issue anymore.

What are your thoughts? What are your ideas to help collaborate, and bring the people and organizations together to help us organize the mess we have today?

We have no doubt that we can do it. We just need to get organized to make it happen.