I’ve finally come to understand why the U.S. healthcare system continues to be such a mess, and I have President Dwight Eisenhower to thank.

I’ve been paying close attention to our healthcare system for, I hate to admit, over forty years now. It has been a source of constant frustration and amazement that – year after year, crisis after crisis – our healthcare system doesn’t get “fixed.” Yes, we make some improvements, like ACA, but mostly it continues to muddle along.

Then I learned about President Eisenhower’s approach to problems:

That’s it!  All these smart people, all these years; they didn’t know how to solve the problem that is our healthcare system, so they all took the Eisenhower approach: enlarge the problem.  Let our healthcare system get so bad that not addressing it no longer is possible.

If, indeed, there is such a point.

The actual Eisenhower quote is more nuanced than the above version. It was:

Whenever I run into a problem I can’t solve, I always make it bigger. I can never solve it by trying to make it smaller, but if I make it big enough, I can begin to see the outlines of a solution.

I guess we’re not yet at the point when the outlines of a solution are clear (Bernie Sanders notwithstanding). 

Instead, we’ve been chipping away at the problem, trying to make it smaller. For example:

• Employer-sponsored health insurance tax preference (WWII)
• Hill-Burton Act (1946)
• Medicare/Medicaid (1965)
• Federal HMO Act (1973)
• Stark Physician Self-Referral Law (1989)
• DGRs (1983) & RBRVS (1992)
• CHIP (1997)
• Medicare Modernization Act (2003)
• Affordable Care Act (2010)

I could add a plethora of non-legislative efforts, largely private-sector driven, such as second surgical opinion (1970’s), PPOs (1980’s), centers of excellence (1980’s), disease management (1990’s), value-based purchasing (2000’s), or digital health (2010’s).  Each was well-intentioned, each was expected to make a dent in a problem, and each was subsumed into the maw of our healthcare system.  

But we still pay way more than any developed country for our healthcare system, for health outcomes that put us, at best middle of the pack. Tens of millions of us still lack health insurance, in part because some states refused to expand Medicaid and in part because people still can’t afford/don’t see the value of health insurance, despite subsidies. Health inequities abound, particularly for people of color. 

Yes, some of the best care in the world can be found here, but most people shouldn’t expect to receive it – it takes luck, money, and/or the right location. Our malpractice system penalizes physicians without protecting most victims of malpractice.  “Public health” has at best been ignored (like most other of our infrastructure) and at worse seen as some sort of Communist plot.

One might have thought that a global pandemic would make the problem big enough. We’ve got over 800,000 people dead already, we’ve overwhelmed many of our hospitals, we’ve burned out large numbers of our healthcare workers, we’ve exposed the fragility of our healthcare (and other) supply chains. Yes, we’ve thrown trillions of dollars at the pandemic, yes, our scientists have developed very effective vaccines in record time, but too many people refuse mitigation measures that might finally bring it to an end. 

Yet still the outlines of a solution continue to elude us. It seems there is no health problem so big that we can’t turn into a political issue, not even a pandemic.

Even before the pandemic, we were facing epidemics of chronic diseases, such as diabetes and obesity, as well as gun violence, opioid addiction, and mental health. We know we should address these, we know we could, but mostly we just shake our heads and offer “hopes and prayers.” 

How many Americans will have to go bankrupt from the cost of healthcare they received? How many Americans will have to suffer or die from the care they didn’t receive – or from the care they did receive? How embarrassed are we willing to be about our health disparities? How reluctant do people in other countries have to get about living/visiting here due to the risk of getting caught up in our healthcare system? 

In Gen Z’s lifetimes, much less those of millennials or Baby Boomers, the problems in our healthcare system have grown from huge to unfathomable.  When it comes to healthcare, we’ve let the problem get big enough. It’s been enlarged to the point it is hurting us, our economy, and our futures. 

Yet here we are, still fumbling for solutions.

It’s possible that the pandemic will cause our healthcare system to collapse and force us to take action on fundamental reforms. More likely, due to the valiant efforts of our healthcare professionals, it will survive this too, and the pandemic will just be one more insult added to our injury. 

It’s possible that when health spending reaches 20% of GDP – as it is projected to do by the end of the decade – we’ll decide we’d had enough, but I remember when we thought 10% was the limit. 

It’s possible that we’ll suddenly recognize that, hey, our declining mortality – which is not all due to COVID — is a real problem, but that’s probably too slow and subtle an indicator for us to act.

By now, we shouldn’t just have shadows of solutions. By now, the problem is so big that solutions should be crystal clear to everyone. But they’re not.

We shouldn’t be surprised. We’re very good at kicking the can down the road. We should be very concerned about the national debt, but we add to it blithely. We should be terrified of the impact that climate change is already having and how much worse it will soon be, but addressing it would require us to make too many changes. 

Our infrastructure is aging, brittle, and outdated, but even the recent Infrastructure and Investment Jobs Act is much smaller than it really needed to be. The racial wealth gap is a consequence of shameful historical patterns, yet continues to widen; it is not survivable for a democracy.

We’ve learned only half of Eisenhower’s adage: we’ve got the letting the problem get bigger part down, but we’ve forgotten the part about how/when to come up with solutions.

Where’s Eisenhower when we need him?

Kim is a former emarketing exec at a major Blues plan, editor of the late & lamented Tincture.io, and now regular THCB contributor.

I remember the first time I told a doctor that I was being trafficked. That experience was also the last time I told a healthcare professional. My psychiatrist in an acute inpatient psychiatric hospital heard my story and told me that trafficking only happens in third-world countries and in movies. While this professional was the most ill-informed I ever encountered, they were not the only healthcare workers that did not have the training they needed to identify me. 

I remember tucking my hospital gown between my legs to hide the bruising on my thighs. I remember explaining away cuts and burns. I remember being encouraged by doctors and nurses to report sexual assaults. I remember a psychiatrist telling me I would never get better, so I should stop seeking help. I remember the look in a nurse’s eyes when she knew something was off but did not know how to intervene.

It was that nurse, the one whose instinct told her that something was wrong, that gave me hope. She saw me. When you’ve been through what I’ve been through, you never forget the first person to really see you. She gave me hope that someone could help me, that someone saw me as a person. She gave me hope that someday my life would be different.

For 20 years I was trafficked for sex by a member of my family, and for 20 years I was discharged into the hands of my trafficker, a seemingly good man who was charismatic and kind to everyone in the office. All the while, I remembered the nurse who saw me, and I held onto hope that there were others like her. 

I have heard story after story that mirrors my own: men, women, and children being trafficked, desperately hoping a healthcare worker would spot the signs but being placed back into the hands of their traffickers. The statistics back our experiences. 

A Loyola University study outlined not only the kind of injuries that those being trafficked experienced but outlined key healthcare touchpoints as well. Physical violence was prevalent, with 92% of survivors reporting being physically assaulted, which included being beaten, kicked, and strangled. As many as 70% of survivors reported physical injuries, with more than 50% of those survivors reporting injuries to the face or head. 

There are many common health issues that may lead someone who is being trafficked to seek medical care. The Department of Health and Human Services reports that many traffickers hire unqualified professionals or wait until the condition is life-threatening before allowing their victims to seek real medical care. These actions can lead to infections, undetected or long untreated illnesses, infectious diseases, and improperly healed breaks or contusions.

Statistics also show that those being trafficked do seek care. The above-mentioned Loyola University study found that as many as 90% of minor human trafficking victims and 50% of adults have contact with medical professionals. Of those who seek care, 68% are seen in the emergency department, but the Department of Health and Human Services reports that only 3% of emergency rooms identified themselves as receiving trafficking training.

It was my experience, combined with the testimony of others and the shocking numbers above that led me into the world of anti-trafficking advocacy. When I was invited to participate in the making of a healthcare training, my answer was a resounding “yes.” This kind of training is imperative to identification and intervention for human trafficking victims.

Healthcare workers themselves reported feeling ill-equipped to spot the signs of trafficking in patients and act effectively, but that didn’t stop them from wanting to learn. It is healthcare professionals like the nurse who saw me that want to learn, and that will make a difference in the lives of those being trafficked. Safe House Project, in collaboration with the Academy of Forensic Nursing, stepped up to bridge the gap between healthcare workers and those being trafficked who desperately need to be identified. They sought to do so by releasing the Healthcare Observations for the Prevention and Eradication of Human Trafficking (H.O.P.E.) Training. 

The H.O.P.E. Training is a survivor-informed, trauma-informed, and patient-centered online training that equips all healthcare workers to identify potential human trafficking victims, offer resources, and intervene in accordance with state mandates and their facility’s policies and procedures.

The H.O.P.E. Training provides healthcare workers with a unique perspective that will allow them to understand human trafficking domestically through real survivor experiences and industry expert analyses. The training is available to both healthcare systems and individual healthcare workers that seek a comprehensive understanding of human trafficking and what they can do to identify and intervene on behalf of their patients. The training is also available for continuing education credits.

This training allows us to break down harmful stereotypes and replace them with facts. This allows for healthcare workers like the psychiatrist I saw, who told me trafficking only happens in third world countries and movies, to better serve their patients through educating themselves. The survivor voice that is elevated throughout the H.O.P.E. training gives real-life examples of stories that break the stereotypes, just as my story broke stereotypes.

For 20 years, I needed a healthcare worker who had taken a training course like the H.O.P.E. Training. But I never forgot the nurse that treated me with compassion, like a person. You can be that healthcare worker for a patient. You can be part of the solution. Take the H.O.P.E. training. Join the fight to eradicate human trafficking. 

For more information, or to sign up to take the H.O.P.E. Training, visit SafeHouseProject.org/healthcare. 

Sarah Beth is a Content Creator and Survivor Leader at Safe House Project

By KIM BELLARD

You know we’re living in the 21^st century when people are 3D printing chicken and cooking it with lasers.  They had me at “3D printing chicken.”  

An article in NPJ Science of Food explains how scientists combined additive manufacturing (a.k.a, 3D printing) of food with “precision laser cooking,” which achieves a “higher degree of spatial and temporal control for food processing than conventional cooking methods.”  And, oh, by the way, the color of the laser matters (e.g., red is best for browning).   

Very nice, but wake me when they get to replicators…which they will.  Meanwhile, other people are 3D printing not just individual houses but entire communities.   It reminds me that we’ve still not quite realized how revolutionary 3D printing can and will be, including for healthcare. 

The New York Times profiled the creation of a village in Mexico using “an 11-foot-tall three-dimensional printer.”  The project, being built by New Story, a nonprofit organization focused on providing affordable housing solutions, Échale, a Mexican social housing production company, and Icon, a construction technology company, is building 500 homes.  Each home takes about 24 hours to build; 200 have already been built.

Here’s a video of the process:

No one knows how durable the houses will be over time, but they’ve already withstood a 7.4 magnitude earthquake, something that would have been appreciated, for example, in Haiti.  Most importantly, they’re providing homes for people who might have otherwise been homeless or living in sub-standard conditions.

Brett Hagler, New Story’s chief executive and co-founder, told The Times: “We know that being able to build more quickly, without sacrificing quality, is something that we have to make huge leaps on if we’re going to even make a dent on the issue of housing in our lifetime.”  

“We’re really looking at the biggest opportunities to have both impact and efficiency gains,” New Story co-founder Alexandria Lafci added.  “There is a very significant gain in speed that you get with 3-D printing, without sacrificing quality.”

There are 3D-printed housing projects all over the world, including Austin (TX), Rancho Mirage (CA), and Tallahassee (FL).   The Tallahassee developers boasted: “Make no mistake, these houses are not your average test models. The finished product is far superior in strength, durability, and efficiency.”   

Faster, cheaper, more durable – what’s not to like?

Canada’s first 3D printed house, the so-called Fibonacci House, features curved walls, just because the builders could.  “So now, architectural features that are exciting or adding aesthetics can be done for virtually no cost comparison,” said Ian Cornishin, president of the company that built it.

Here’s their video:

That company, Twente Additive Manufacturing, is now teaming up with non-profit World Housing to build a 3D printed community called Sakura Place.  World Housing’s Don McQuaid says: “Our belief is that technology is going to be the solution for homelessness, and we believe that everyone deserves a home.” 

The Ruler of Dubai is such a big fan that he has decreed that 25% of all construction – not just houses – are to be constructed by 3D printing technology by 2030, “to promote Dubai as a regional and global hub for the use of 3D printing technologies.”  

It’s a new world for construction.  Housing expert Brad Hudson noted: “The housing industry hasn’t changed its overall methods of building homes in the past 50 years.  Innovations like 3D and modular construction will start to gain popularity.”  

So it will be for healthcare.  I’ve written before about the 3D printing of prescription drugs, which offers the intriguing, if not scary, possibility of printing your own meds at home, but that’s just one example of how healthcare is starting to realize 3D printing’s potential.

Scientists at the Israel Institute of Technology have 3D printed a blood vessel network, to support implanted tissue, something that had not been achieved through conventional approaches.  The researchers believe it “is a versatile and adaptable technique that may cement a new path toward fully lab-grown patient-specific tissues.”  

Here’s their video:

We’re not yet at the point of 3D printing human organs for transplants, but we’re close, and in the meantime, we are 3D printing prosthetics.   The NIH says:

3D-printable prosthetics are changing the face of medicine, as engineers and physicians are able to develop prosthetics that are fully customized to the wearer. Consumer 3D printing is leading to an even bigger revolution: “DIY” assistive devices that can be printed by virtually anyone, anywhere.

Imagine that world.  

Some experts think the 3D printing market for healthcare is already a billion-dollar market and will be a $6 billion one by 2030, which seems like not nearly enough.  Where is healthcare’s Ruler of Dubai, demanding 25% of healthcare construction (or manufacturing) using 3D printing by 2030?

3D printing helped lessen the shortage of personal protective equipment (PPE) during the pandemic when demand skyrocketed at the same time supply chains cratered, but not fast enough and not in enough quantity.  Supply chains are again teetering,  but if healthcare organizations have scaled up their 3D printing capabilities to prepare for shortages, I missed it. 

——-

There are really two types of thinking we need to be practicing here. One is what are the things we are doing now that could be done at least as well using 3D printing?  It’s like building houses using 3D printing; they’re not reinventing houses, but they are reinventing how they’re built, in hopes of a faster, cheaper way.  Ideally, it could lead to more affordable houses, and perhaps make a big dent in homelessness.  

E.g., in healthcare, more affordable, better fitting prostheses are made much faster.  

The second is what are the things we can’t do now that could be done with 3D printing?  The work in human organs, tissues, or blood vessels fall into this category, but shouldn’t be the limit of the category.   

It’s easy enough to see how 3D printing may be one of the things that helps us address the problem of homelessness/affordable housing.  How can it similarly help us address the problem of people lacking access to health care/affordable health care?  

By KIM BELLARD

I can’t believe I’ve gone this long without knowing about Gall’s Law (thanks to @niquola for tweeting it!).  For those of you similarly unaware, John Gall was a pediatrician who, seemingly in his spare time, wrote Systemantics: How Systems Work and Especially How They Fail in 1975.  His “law,” contained therein, is:

Have you ever heard of anything that applied so perfectly to our healthcare system? 

As anyone who has been reading my prior articles may know, I’m a big believer in simple.  I’ve advocated that healthcare’s billing and paperwork should be much simpler, that “less is more” when it comes to design,  that healthcare should first do simple better but, above all,  that healthcare should stop doing stupid things.  I’ve equated the ever-increasing intricacies of our healthcare system to the epicycles that kept getting added to the Ptolemaic theory in a desperate attempt to justify it. 

Few would disagree that the U.S. healthcare system is complex.  Healthcare systems in general have evolved towards more complex, but the U.S. system takes complexity to extremes, with its thousands of payors, its powerful pharma/medical device industry, and its highly concentrated hospital markets (including ownership of physician practices), among other things. 

Simple isn’t always better, of course.  Life is complicated and so is our health, but, come on: how many people can explain why PBMs exist, what their heath insurance plan actually covers, how their health care bill was arrived at, or why we spend so much time in the healthcare system just waiting?  Literally no one understands our healthcare system.

It shouldn’t be that way.  It doesn’t have to be that way.  But it is.

Some pundits argue we don’t even have “a system” but, rather, thousand or even millions of smaller health-related markets that co-exist but don’t really work together.  For anyone who doubts that, try to explain the presence of workers compensation healthcare or why dental is at best a separate form of coverage (last I looked, the mouth was part of the body).  Try to explain why child care is most definitely not part of healthcare but home care is – depending, of course, on whether it is “custodial” or not.   Silos abound.

It could be argued that healthcare started with a simple system that “worked.”  Some are nostalgic for the days when people saw their family doctor, paid their doctor, and that was it.  It doesn’t get much simpler than that.  Of course, those doctors couldn’t really do all that much for their patients and didn’t really get paid all that much, so to say that it “worked” for either party is debatable. 

Many reform advocates propose what they see as a simple solution – Medicare For All!  Having everyone with the same coverage could lessen some administrative burdens, but no one who has been covered by Medicare, nor treated patients with Medicare, would describe Medicare as either a simple system nor one that “works.”  Medicare For All would have to be radically different from the Medicare program we know now, and that would seem to risk Gall’s “inverse proposition.”

We need, to use Dr. Gall’s words, a “working simple system.”

The trouble is, I’m not sure I can imagine what that is.  Group practice HMOs were supposed to be one, but that experiment has not gone the way it was forecast to.  More recently, new entrants like Oscar Health or Iora Health were going to reinvent health insurance, but, as it turns out, not so much. 

Health system integration/consolidation was supposed to make care more effective and efficient, but it turns out that is a false promise.  Companies like TelaDoc and AmWell have been preaching telehealth for a couple decades now, and the world has awoken to its potential, but it keeps tripping over the complexities of the non-digital parts of our healthcare system.  

One of the barriers to developing a working simple system in healthcare is lack of agreement on which of healthcare’s many problems to focus on.  Is it lack of universal coverage, or excessive costs?  Is it our poor health behaviors?  Is it how health prices are so radically different between payors?  Is it how we continue to tolerate our intolerable health inequities?  Is it our lack of data interoperability?  

For me, though, the core problem that needs to be addressed is this: we don’t really know what “quality” is – not only whether care has been delivered “correctly” but whether the treatment was even likely to be effective (e.g., look at NNT or any number of studies on unnecessary procedures). 

“Quality” in healthcare is like what Supreme Court Justice Potter Stewart said about pornography: he can’t define it “but I know it when I see it.”  Unfortunately, in healthcare, we don’t even know it when we see it.  Without actual evidence, we all think our doctors are the “best” and our faith in even fringe remedies is enduring (how many supplements do you take?).   

Oh, we have lots of quality measures.  We spend lots of money collecting them, and even make some of them available to the general public.  But we’re kidding ourselves if we think that any of these various measures actually measure quality, or that consumers understand, much less really use, them. 

As consumers/patients, we’re not demanding better measures, and, as healthcare professionals/institutions, we’re more worried about increasing our malpractice exposure than in figuring what we’re doing “right” and who is doing it better.  Shame on all of us.

Job #1 of our healthcare system should be to find a simple working system for measuring quality for something important – a condition, a treatment, a procedure.  Something accurate, easy to measure, and easy to understand.  Get agreement on it, and use that to drive decisions about what to pay how much for that part of healthcare.  Then iterate.

I’m not saying this is going to be easy—it’s not – but I am saying that if we don’t do this, then all the brainpower we’re using on other problems in healthcare is, essentially, wasted.   

Our healthcare system is broken.  It’s way too complex yet way too ineffective at every level.  As Dr. Gall urged us, we have to start over, and starting with a simple working system for measuring quality seems like as good a place as any.

Kim is a former emarketing exec at a major Blues plan, editor of the late & lamented Tincture.io, and now regular THCB contributor.

By MIKE MAGEE

Health care needs its heroes.

I came to that conclusion this week through a roundabout route.

First I read Maureen Dowd’s interview entitled “Dara Khosrowshahi, Dad of Silicon Valley”, in which she, with some affection, gives the reader a look behind the scenes at the personal life of the current Uber CEO. At one point, Dowd shares her conversation with Dara’s 20-year-old daughter, Chloe, a Brown student, who wants us to know her father was a seriously good dad. In support of this belief, she reports that “When she was little, her father – a fan of Joseph Campbell…would concoct children’s stories set in faraway kingdoms…”

This, of course, forced me to acknowledge that I didn’t know who Joseph Campbell was. Bill Moyers came to the rescue. His June 21, 1988 interview titled “Joseph Campbell and the Power of Myth — ‘The Hero’s Adventure’”, begins with a clip from Star Wars where Darth Vader says to Luke, “Join me, and I will complete your training.” And Luke replies, “I’ll never join you!” Darth Vader then laments, “If you only knew the power of the dark side.” Moyers asked Campbell to comment.

JOSEPH CAMPBELL: He (Darth Vader) isn’t thinking, or living in terms of humanity, he’s living in terms of a system. And this is the threat to our lives; we all face it, we all operate in our society in relation to a system. Now, is the system going to eat you up and relieve you of your humanity, or are you going to be able to use the system to human purposes.

BILL MOYERS: So perhaps the hero lurks in each one of us, when we don’t know it.

By then, I was aware that Joseph Campbell, who died in 1987 at the age 83, was a professor of literature and comparative mythology at Sarah Lawrence College. His famous 1949 book,  “The Hero With a Thousand Faces” made the case that, despite varying cultures and religions, the hero’s story of departure, initiation, and return, is remarkably consistent and defines “the hero’s quest.” His knowledge of this quest gained him a large following that included George Lucas who was a close friend and has said that Star Wars was largely influenced by Campbell’s scholarship.

Whether health care or technology, unfettered capitalism is more than adept at breeding predatory systems that beg for redemption.  Author Emily Chang spoke to this predilection in her 2018 book, “Brotopia”, describing Silicon Valley types as “secretive, orgiastic, and dark.” Dara Kharowshaki’s  CEO predecessor at Uber, Travis Kalanick, was labeled one of the worst. When Dara took over, New York Times technology expert, Mike Issac asked in 2019, “Can this rational, charming chief without the edge, ego, or cult following of wacky founders succeed in today’s insane economy?”

But Dara’s journey across and within Uber seems to be guided by his inner “Joseph Campbell.” Departure, Initiation, Return. He appears to be mid-stream in challenging his own system. Not naming Mark Zuckerberg, he mused, “I think, just like Uber, some of them grew up too fast and some of them didn’t take responsibility for their power and I think now they’re being called to reckon… I think the age of ‘I built a platform, I’m not responsible,’ that time is over. And now the question is, what does the responsibility look like? Defining it and putting guard rails around it, I think that’s a healthy thing.”

Health care if anything is more complex than Silicon Valley. Deeply segmented but fundamentally opaque and collusive, the Medical Industrial Complex controls 1/5 of the economy with power literally over life and death decision-making. With its share of heroes – from everyday doctors and nurses to unassuming scientists birthing “just-in-time” cures – the system also has bred some first-class villains of the likes of Arthur Sackler, Martin Shkreli, and Elizabeth Holmes.

Health care, for all its pure and idealized mythology, has descended into the belly of the capitalist beast. Its vaulted training institutions have captured and bred many of our nation’s finest, only to trap them in a compromised and conflicted “Initiation” phase, from which they never “Return.” As Dara told Dowd, “sometimes the system ‘works too well’: I think capitalism has its claws in our democratic societies in ways that has allowed it to overly optimize for its benefit.” 

Health Care needs to be certain that its young and developing heroes, who depart from their civilian lives, to be initiated into a life of service and sacrifice, are not captured by “the dark side.”

Those who train doctors and nurses and health professionals, who lead research and discovery, who administer health care institutions, need to understand the fundamental challenge in “the hero’s quest.” As Joseph Campbell stated, “Is the system going to eat you up and relieve you of your humanity, or are you going to be able to use the system to human purposes?”

Mike Magee, MD is a Medical Historian and Health Economist and author of “Code Blue: Inside the Medical Industrial Complex.“

Episode 11 of “The THCB Gang” was live-streamed on Thursday, May 27th and you can see it again below

Joining me were three regulars, patient safety expert Michael Millenson (MLMillenson), writer Kim Bellard (@kimbbellard), health futurist Ian Morrison (@seccurve), and two new guests: digital health investment banker Steven Wardell (@StevenWardell) and MD turned physician leadership coach Maggi Cary (@MargaretCaryMD)! The conversation was heavy on telemedicine and value based care, and their impact on the stock-market, the economy and the health care system–all in a week when we went over 100,000 deaths from COVID-19.

If you’d rather listen, the “audio only” version is preserved as a weekly podcast available on our iTunes & Spotify channels — Matthew Holt

In 1807, in an effort to spite the British and French for shipping interference (and forced recruitment of American citizens into military service), the United States Congress passed an Embargo Act, effectively shutting down trade with these two countries. Britain and France quickly found other trading partners; the US, then limited in our capacity to sell products outside our borders, was left with a devastated economy and a gaping hole in our face. It took only weeks before Congress passed a loophole; they repealed the act within 15 months of its passing. It was a great lesson in unintended consequences.

Today, ignoring history, both Republicans and Democrats seem to spar continuously around healthcare: whether the message is about tearing down the Affordable Care Act or about some version of Medicare (For-All, For Whoever Wants It, For America, or For Better or Worse), both parties are terribly wrong.

Assuming the social imperative for healthcare is to eliminate preventable morbidity and disability (and associated costs) and improve (or sustain) quality of health of all our citizens (in order to help as many of them as possible remain productive, contributing members of society), another approach to ‘universal care” would be to flip the figure/ground relationship for our current efforts: instead of developing better payment systems, let’s develop and commit to a universal clinical operating framework that ensures that every member of society has the same opportunity to optimize their health status.

“Centralizing” the methodology around a universal model for how we plan for care, and allocate resources to ensure care plan goal achievement, would be far more valuable to society than centralizing the sources of funds to pay for care, because then we’d know what we’re paying for.

While Federal mandates may smell to some like limits on personal liberty, more than 70% of American healthcare expenses are already not paid by patients themselves; 20% are subsidized by employers and 50% (or more in the case of citizens over age 65, families with children at risk and adults with special needs) are paid out of Federal and State government coffers. This means we are paying for each other’s care right now, and will continue to do so in one way or another.

When the ACA was passed, one of the elements of that seemed most offensive to critics was its most prominent feature: Essential Health Benefits. Yet, it is the “essential health benefits” feature that holds the greatest promise to help manage health spending. Here are a few of the common critical questions that were asked:

Why should I pay for maternity and newborn care if we’re done having children?

First, your insurance premiums don’t really pay for your expenses; they are put into a pool that is used for all its “members”. Some pay more than they use, some pay less; others contribute so that there is a chunk of money available to them in case of disaster.

So, here’s the thing: sick newborns, whether the result of nature or nurture, require extensive, expensive resources, special supports and services in school and can have lifelong disabilities. However, many of these problems are easily preventable through good prenatal and newborn care. While the disabled baby may not be yours, it could be your neighbors, or drain resources from your town fire department or your grandchild’s school system budget.

So, while you may see a small reduction in your insurance premium by being able to “opt-out’ of maternity and newborn care, you are going to pay anyway, and pay far more than the additional cost of that premium.

Why should I pay for preventive and wellness services I don’t want?

Whether through Federal or state tax dollars, or contributions to non-profit hospitals, we all pay for late stage cancers, heart attacks and strokes, depression, anemia and vaccine-preventable infections such as the flu or pneumonia. “Essential health benefits” reduce many of those late-stage and catastrophic costs, freeing up money for law enforcement, community services and better roads.

Eliminating essential health benefits may result in a short-term premium savings, but the economic consequences are substantial, especially as our society ages; the ACA resulted in an increase of 8,400 diagnoses of early-stage colorectal cancer among US seniors in the period 2011–13, saving hundreds of millions of your tax dollars which would have been required for late stage treatment.

Since we’re already paying a share of the costs of our fellow citizen’s medical problems, I want to make sure that my money is being spent well, or at least not spent unnecessarily. I can’t support the freedom to delay the diagnosis of colon cancer, acquire bacterial pneumonia, or go blind from diabetes or glaucoma; I can think of a few other things I would like my taxes spent on other than a completely preventable stroke and the subsequent physical and neurological consequences. These conditions put limits on freedom that go well beyond anything imposed by the ACA.

Improving the health of Americans is not really about coverage, but about increasing the use of preventive, wellness and chronic disease management services that were part of the essential health benefits. This is where the real, big league, benefits lie; but first we need to make up for lost time (and care) for millions of people with under-managed chronic illness. Only then will the overall cost of maintaining our health will go down; and, even they don’t, we will all just be healthier and live longer.

Essential health benefits should not be viewed as an imposition, but a means to assure that our communities and our country has a better quality of health, which improves workforce productivity and economic vitality. Putting our lives at risk to defend our freedom is a fundamental aspect of American life, but this is not the same as letting people have the freedom to put their own lives at risk when the consequences, and their associated economic and social costs to us all, are completely preventable.

Steven Merahn, MD is a physician executive with experience in health policy, clinical operations and patient experience management. He is the Managing Director of Thinkwell Health and recently founded Union In Action, a non-profit focused on behavioral health integration.

This post originally appeared on Tincture here.

By BRIAN KLEPPER, PhD

How will the drive to health care value affect health care’s structure? We tend to assume that the health care structure we’re become accustomed to is the one we’ll always have, but that’s probably far from the truth. If we pull levers that incentivize the right care at the right time, it’s likely that many of the problems we think we’re stuck with, like overtreatment and a lack of accountability, will disappear.

A large part of getting the right results is making sure that health care vendors have the right incentives. All forms of reimbursement carry incentives, so it’s important to align them, to choose payment structures that work for patients and purchasers as well as providers. Fee-for-service sends exactly the wrong message, because it encourages unnecessary utilization, paying for each component service independent of whether its necessary and independent of the outcomes. Compare US treatment patterns to those in other industrialized nations and you’ll find ours are generally bloated with procedures that have become part of practice not because they’re clinically necessary but simply because they’re billable.

By contrast, value-based arrangements are really about purchasers demanding that health care vendors deliver better health outcomes and/or lower cost than what they’ve experienced under fee-for-service reimbursement, and the payment structure often asks the vendor to put his money where his mouth is, at least where performance claims are concerned. In a market that’s still overwhelmingly dominated by fee-for-service arrangements, one way for a vendor to get noticed is to financially guarantee performance. Integrated Musculoskeletal Care, a musculoskeletal management firm based in Florida, guarantees a 25% reduction in musculoskeletal spend on the patients they touch. This typically translates to a 4%-5% reduction in total health plan spend, just by contracting with this vendor, a compelling offer in an environment that makes it hard for upstarts to get market traction.

But the real power of possible payment reforms become clear when one considers how it might affect utilization, cost, and workforce patterns in medical domains that have been particularly out of control. Think about spine surgery, where good data exist to argue that half or more of procedures are unnecessary or inappropriate. What would happen if, in addition to tying payment to health outcomes, reimbursement for spine surgeries suddenly was no longer fee-for-service, but a capitated rate, meaning that a limit was imposed on funds that could be devoted to it?

• Fewer surgeries would likely take place because there would be little or no financial benefit in doing unnecessary procedures,  plus any inability to show a positive impact on health outcomes in questionable cases. 
• Spine surgeons’ caseloads would drop and incomes would fall. Some spine surgeons would retire or transition to other specialties.
• The spine surgery market might quickly become very competitive. In an effort to win volume, spine clinics would quantify and then market their health outcomes and pricing, particularly to health plans and primary care practices seeking , preferred surgical providers.
• Spine surgeons would become far more interested in approaches that consistently deliver better health outcomes and/or lower costs. Evidence-based medicine would find a much more receptive audience and treatments that have data showing they work would gain a following much more quickly than they do now. Non-operative treatments would become much more mainstream.
• Spine surgery organizations with excellent performance would grow at the expense of their competitors and the variability of health outcomes would diminish. Centers of excellence would become much better established.
• In general, costs of spinal surgeries would drop, possibly precipitously, and health outcomes would blossom.

Imagine the implications if similar payment reforms were implemented across all health care, impacting other niches with excessive utilization and cost, like cancer care and cardiovascular medicine. The workloads, numbers of physicians, and revenue base within each specialty would be reshaped, each one finding a new level.

In general, health care professionals who have become comfortable over the past several decades will find the new financial normal less to their liking than before. The winners here would be patients, purchasers, and primary care physicians who will benefit from market-based pricing and a greater reliance on true evidence-based care.

If risk-based arrangements get traction in ERISA health plans as they have in Medicare Advantage and Managed Medicaid, a health care market will take shape and strengthen. The kinds of changes I’ve described above will be increasingly prevalent. The question is whether employers and unions will finally insist that we pay for results rather than for activity.

Brian Klepper is a health care analyst and the EVP of the Validation Institute.

I have a piece up at National Review in which I reflect upon Don Berwick’s controversial tenure as Administrator of the Centers for Medicare and Medicaid Services, the 800-billion-dollar federal agency that dominates the American health-care landscape. Despite White House rhetoric to the contrary, I write, Berwick “wasn’t done in by Republican intransigence. He was done in by presidential cowardice. And therein lies a microcosm of everything that’s been wrong with Obamacare.”

The thing to understand about Don Berwick is that there are really two Don Berwicks. There’s the Don Berwick who, through the Institute for Healthcare Improvement, has focused on apolitical aspects of health delivery reform. Here’s what I wrote about Berwick in April 2010:

First, the good. Berwick is a serious and credible health-care analyst. In his capacities both as a Harvard professor and as founder and CEO of a Cambridge-based think-tank called the Institute for Healthcare Improvement, he has written extensively about health-care policy in all of the leading scholarly journals. His focus, in most of these writings, is on the quality and efficiency of health care: things like avoiding medical errors and unnecessary spending. He was granted an honorary knighthood by Queen Elizabeth for his role in shaping Tony Blair’s (mostly futile) attempts to modernize Britain’s National Health Service.

While he was a big supporter of Obamacare, Sir Donald acknowledges its core failing; in an October lecture, he said, “Health-care reform without attention to the nature and nurture of health care as a system is doomed. It will at best simply feed the beast, pouring precious resources into the overdevelopment of parts and never attending to the whole — that is, care as our patients, their families, and their communities experience it.” Indeed, if you put Berwick in a room with a leading market-oriented health-care analyst, the two would find broad areas of agreement as to where our health-care system fails patients.

“But [those experts] would diverge on the most important questions of all,” I noted: “can and should, the state provide quality health care for all? Can enlightened, public-minded experts effectively manage one-sixth of the U.S. economy?” Here, it is not an exaggeration to say that Berwick’s views are difficult to distinguish from those of the central-planning advocates from old Cold War capitals. “You plan the supply; you aim a bit low,” Berwick once explained. “Historically, you prefer slightly too little of a technology or service to much too much; and then you search for care bottlenecks, and try to relieve them.”

But when Berwick was consulting for Britain’s National Health Service, he was unsurprisingly unsuccessful in centrally calibrating supply and demand. Technocratic health-care whack-a-mole has never worked, and it won’t work now. Most importantly, its main success is in denying British subjects the care they need and want.

There is probably no health-care system in the developed world today that would have delighted the old Soviets more than the British National Health Service. The state owns the insurance system; it owns the hospitals; it owns the clinics. People who try to seek health care outside the system are ruthlessly cut off. The “darkness of private enterprise,” as Berwick memorably described it, is hard to find in the NHS, which is why Berwick admires it so much.

It is, assuredly, comforting for Obamacare’s advocates to declare that Berwick was done in by partisan Republican squabbling. But the fact is that it was the White House that decided not to let Berwick go up to the Senate for a confirmation hearing, a hearing that Republicans were looking forward to. This was a blatant attempt by the President to avoid a proper, public debate between Berwick’s philosophy and that of his Senatorial critics. Perhaps Berwick would have won that debate in the eyes of the public. Thanks to the President, we’ll never know.

UPDATE: Ben Domenech has useful things to say about the two Berwicks:

There is an important distinction here between the good and the bad of technocracy. Berwick’s career until roughly a decade ago was primarily focused on the need for better information about health and procedures—advancing information-sharing and creating more knowledge for doctors to utilize in pursuing the best outcomes. This is hardly a vile or morally problematic pursuit! Indeed, many on the right support gathering this information and sharing it with doctors with the speed of modern technology.

The problem comes when government steps in, and such information is used as a mandate sledgehammer to enforce central planning and rationing and against innovation and patient-directed care. The technocratic approach goes too far when it presumes that bureaucrats can process this data better than doctors, and that top-down management is the best (and indeed only) way to achieve the desired outcome. We see this fight regularly in the context of the Dartmouth Atlas. http://vlt.tc/sq The danger comes not from this more benign and even laudable pursuit of knowledge and measurement of success, but rather what comes when such immoral arithmetic becomes the top-down enforced mandates of unelected boards and faceless councils. The government overrules the doctor, and the patient is left with bad and worse choices—or a choice that comes too late to save their life. The much maligned Independent Payment Advisory Board by law cannot have a practicing physician serve on it—it is by definition rule by the faceless technocrats.

UPDATE 2: Tevi Troy, who served in the Bush Administration as HHS Deputy Secretary, has some insightful points on the Berwick bungle in response to an editorial from the New York Times. He notes, for example, that Obama could have nominated Berwick during the period in which he had 60 votes in the Senate, but chose not to:

The 18-month delay meant that the Obama administration missed the window in which they had a 60-vote Senate majority that could have confirmed him. Furthermore, the Senate had not even scheduled a hearing on Berwick before the Obama administration recess-appointed him, irking the Democratic chairman of the Finance Committee, Max Baucus. At that time, Berwick had not even completed all of the necessary paperwork for Senate confirmation, and a Senate source has informed me that he still has not completed all of his paperwork. Regardless, once the Obama administration recess-appointed Berwick without a hearing, Berwick’s chances of ever getting confirmed plummeted.

Avik Roy is a health care analyst at Monness, Crespi, Hardt & Co., and writes on health care policy for Forbes at his blog, The Apothecary where this post first appeared. You can follow him on Twitter at @aviksaroy.

Call it the Scott Walkering of America.

Even though tax revenues are finally rising faster than expenses, governors across the nation are recommending more austerity in the budgets they’re presenting to state legislatures this year, the latest survey from the National Governors Association shows.

For the fiscal year beginning July 1, governors are recommending a 2.2 percent increase to $683 billion in general revenue fund spending. That’s down from the 3.3 percent increase in state spending in 2012. Revenue, meanwhile, is projected to rise four percent during the coming fiscal year.

“The public sector has even more uncertainty at this time than the private sector,” said Dan Crippen, executive director of the NGA and former head of the Congressional Budget Office. Citing the looming Supreme Court decision on health care reform, the uncertain levels of federal aid from the “fiscal cliff” negotiations, and talk of tax reform that could cut tax expenditures that benefit state and local governments, “it’s pretty hard for states to plan,” he said.

One of the biggest drivers of state uncertainty is the future of Medicaid. Even without reform, millions of Americans turned to the program for health care after losing jobs during the recession. The downturn and slow recovery caused state Medicaid budgets to soar 23 percent in 2010 and 20 percent in 2011.The Obama administration’s 2009 stimulus program covered most of those early costs. But after the Republicans took over the House in 2011, they cut aid that helped states cope with soaring Medicaid budgets, which now account for nearly a quarter of all state spending.On the bright side, the rapid increases in Medicaid appear to be over (nearly all of the increased coverage under the Affordable Care Act, which doesn’t go into effect until 2014, will be picked up by the federal government). State officials projected their Medicaid budgets will rise only four percent next year.

“States have undertaken numerous actions to contain Medicaid costs, including reducing provider payments, cutting prescription drug benefits, limiting benefits, reforming delivery systems, expanding managed care and enhancing program integrity efforts,” Crippen said. “These efforts alone, however, cannot stop the growth of Medicaid.”

The latest round of state belt-tightening comes after a year of modest recovery in state spending, the survey showed. The 3.3 percent increase in the current fiscal year allowed a number of states to rebuild their rainy day funds.

States like Alaska, Texas, West Virginia and North Dakota that benefit from taxes on the natural resource extraction were especially fortunate. North Dakota recently proposed eliminating its property taxes, while Alaska and Texas budgets soared 27.3 percent and 13.4 percent, respectively this year. Next year, however, both states are projecting large declines in their state budgets because of lower taxes from falling oil prices.

Some of the states hardest hit by the recession are finally seeing an end to the deep cuts. California, for instance, after decreasing its state budget 5.5 percent this year, is projecting a 7 percent increase next year. Michigan’s state budget grew 9 percent this year – the auto industry was an early beneficiary of the Obama stimulus plan – and is projecting another 2 percent increase in state spending next year.

Even states hammered by the real estate crash have finally hit bottom. The governor of Florida, for instance, which cut its budget by 1.7 percent this year, is seeking a 5.9 percent increase in state spending for 2013. Nevada, whose state budget declined by 10 percent in 2012, is expected modest growth in state spending next year.

“Governors are very cautious fiscally and I believe prudent to be providing a cushion to be prepared for rather tepid growth,” said Scott Pattison, executive director of the National Association of State Budget Officers.

Merrill Goozner has been writing about economics and health care for many years. The former chief economics correspondent for the Chicago Tribune, Merrill has written for a long list of publications including the New York Times, The American Prospect, The Washington Post and The Fiscal Times. You can read more pieces by him at GoozNews.