Blog Home

«
»

HEALTH REFORM: Reinventing The Wheel



October 12th, 2006

The American health care systems perform impressively, producing what they are designed to deliver: cost inflation, inefficiency, and inequity. At regular intervals, local pundits declare that the outcomes of the incentive structures in the constituent parts of the systems are unacceptable, usually emphasising that “the nation cannot afford to spend 16 percent of GDP on health care” [2-week free access]. Such “insights” ignore the fact that inflation is a consequence of the systems’ perverse incentives and that improved control of expenditure inflation would oblige physicians, nurses, hospitals, and the pharmaceutical industry to moderate their lifestyles.


Michael Porter, a management guru at Harvard, along with colleague Elizabeth Olmsted Teisberg, has now decided to switch his attention to the health care industry, no doubt in part because he has recognised that it is big and remunerative. The extent to which the lessons of Enron and the “successes” of other capitalist enterprises can inform health care policy can and should be debated carefully.

Any cure for the malaise of U.S. health care, or the British NHS to which Porter has also offered his vision of a New Jerusalem, is dependent on diagnostic skills and the evidence base for the treatments offered. Like many gurus before him, Porter makes an adequate job of the diagnostics, offering insights very reminiscent of the Jackson Hole proposals over a decade ago.[1]

However when he gets to cures, there is nothing new to break the logjam of inertia and self-interest that stabilizes the inefficiency of the health care system, be it public or private.[2] He rightly indicates that the industry needs a measure of value added and that instead of focusing on cost and activity, it is necessary to measure patient-reported outcomes — i.e., measures of whether patients feel better. Such a conclusion is welcome but ignores the forces that have prevented the use of outcome measures in health care for centuries. Another Bostonian, Ernest Codman, suggested systematic management for Massachusetts General Hospital — in particular, plans for evaluating the competence of surgeons in the early twentieth century — and, as a consequence of the unpopularity of his proposals, he lost his staff privileges in 1914.

Insurers and Governments Fixated on Failure

The RAND Insurance Experiment [2-week free access] produced a generic health profile, Short Form 36. Work in Europe has produced a generic health index, EQ5D. These have been translated into dozens of languages and used in thousands of clinical trials. But with physicians and policy makers fixated with the measurement and management of failure (e.g. mortality), these measures of success have been ignored by insurers and governments alike as a means of measuring success and of bringing to account those providers failing to make their customers “better,” in terms of physical and mental functioning.

Porter’s lack of specificity about the outcome measures needed to improve the performance of the U.S. health care systems, and his glib reliance on “competition” to institute change, flies in the face of international evidence: Nowhere has any public or private institution managed to curb the excesses of powerful providers more interested in their wallets than demonstrably improving patients’ health. Porter adds little new to the debate, but he is a welcome and potentially powerful addition to the chorus advocating change.

Sources

1. P.M. Ellwood, A.C. Enthoven, and L. Etheredge, “The Jackson Hole Initiatives for a Twenty-First Century American Health Care System,” Health Economics 1, no. 3 (1992): 149-168.

2. A. Maynard, ed., The Public-Private Mix for Health: Plus ça Change; Plus c’Est la Meme Chose (Oxford and Seattle: Nuffield Trust and Radcliffe Publishing, 2005).

For more on the Jackson Hole proposal ideas of health care competition, see: “Why Managed Care Has Failed to Contain Costs” and “`Responsible Choices:’ The Jackson Hole Group Plan for Health Reform.”

Up Next: Gail Wilensky

Email This Post Email This Post Print This Post Print This Post

 to the #1 source of health policy research.

2 Trackbacks for “HEALTH REFORM: Reinventing The Wheel”

  1. Porter/Teisberg JAMA Article: Out-of-the-box or out-of touch? - e-CareManagement - Chronic Disease Management • Technology • Strategy • Issues and Trends
    March 26th, 2007 at 6:14 pm
  2. INSTAHEALTH Market » Archive » Reinventing The Wheel
    October 12th, 2006 at 4:37 pm

4 Responses to “HEALTH REFORM: Reinventing The Wheel”

  1. Don McCanne, MD Says:

    Regular readers of the [Physicians for a National Health Program] Quote of the Day will know that I am not a fan of Porter and Teisberg’s concepts. An excerpt from an earlier comment of mine: “Imagine a system in which care is delivered based on teams, without geographical limitations, organized around medical conditions, competing with other teams organized around the same conditions. Imagine your community hospital and its specialists providing care for a very limited list of medical conditions selected on the basis of providing better outcomes and lower prices. Your community hospital may very well lack a team that is dedicated to your particular problem, requiring you to travel to the next county, or maybe the next state, for care. Then allegedly to create transparency in pricing, you receive a single bill that totally obscures any understanding as to where your payment goes. You really have to read the book to understand the extent to which this line of reasoning is carried.”

    “The American health care systems perform impressively, producing what they are designed to deliver: cost inflation, inefficiency, and inequity.” This first line in Alan Maynard’s comment leads us to our bottom line. The United States needs a new design that would address cost inflation, inefficiency, and inequity. The first step would be to establish an equitable, efficient national health insurance program that could begin to tackle the rapidly rising costs of health care. That won’t be easy, but it’s impossible under the status quo.

  2. SteveBeller Says:

    Neil Gardner wrote: “Could you maybe elaborate on how you see successful evidenced-based diagnosis and treatment ever really being measured and incorporated to a meaningful level in a healthcare system?”

    This may help answer the question: On our WellnessWiki, we addressed the issue of improving care quality with evidence-based practice guidelines , along with 18 other tactics for dealing with our healthcare crisis. I welcome any feedback!

  3. LFBaltrucki Says:

    I would just like to follow up on the comment that Neil Gardner has made.

    (I am a pathologist, who like many of my peers in the US, is actively involved in cancer diagnosis on a daily basis).

    Someone very close to me was just recently diagnosed with bladder cancer, which after my review of all the available data, appears to have been detected somewhere in the mid-stage of the disease’s natural history. ) The clinical implications of late vs. early detection of this disease can be quite significant, and in older adults it frequently turns out to be their life limiting disease, (depending on the presence or absence of other significant diseases).

    This individual “felt fine” throughout the early stages of her disease. In fact, she had been quite pleased with the care that her physician (board-certified in internal medicine) had been giving to her, (for other comparatively minor conditions).

    There may indeed be a place for patient reports about “feeling better” in the overall scheme of measuring “value” and oucomes, but we must be cautious to define precisely the circumstances where this type of reporting might be used such that it provides reliable and relevant information.

    Perhaps younger patients as a group will provide us with more useful information, but older patients still tend to “trust their doctors’ judgment” and they also tend to evaluate their doctor’s performance based on subjective criteria that are related more to the physician’s interpersonal skills, rather than his or her actual clinical expertise.

    If the patient that I am telling you about had a relatively inexpensive urinalysis test at any point over the four year period that her internist had been taking care of her, there is a very high probability that small numbers of red blood cells would have been detected in her urine and this would have led to detection of her bladder cancer at an earlier stage.

    Every 4th year medical student knows that bladder cancer is in the differential diagnosis of “painless microscopic hematuria”. I also have no doubt that there are practice guidlines that have been issued by various professional organizations concerning the performance of a screening urinalysis as part of a complete annual medical examination.

    The reality is that many patients don’t know anything about these guidelines.

    Another paniful reality is, that (unlike the situation with the Joint Commission and Hospitals)
    there does not appear to be any mechanism in the US to hold clinical practitioners accountable for following professional guidelines or performance standards in the office practice setting, (other than litigation).

  4. Neil Gardner Says:

    He rightly indicates that the industry needs a measure of value added and that instead of focusing on cost and activity, it is necessary to measure patient-reported outcomes — i.e., measures of whether patients feel better.

    Prof Maynard, I like your thinking and agree with much of your criticism of the current healthcare system. However, concerning the above quote from your writings, I have got to wonder if patient reports of feeling better are any more reliable than hearsay in regard to real evidenced-based data about actually being better. Especially in a third party payment arrangement, getting a message every other day is bound to make one feel better, but is that evidence of successful treatment of a real disease condition?

    Could you maybe elaborate on how you see successful evidenced-based diagnosis and treatment ever really being measured and incorporated to a meaningful level in a healthcare system??

Leave a Reply

Comment moderation is in use. Please do not submit your comment twice -- it will appear shortly.

Authors: Click here to submit a post.