VNA CEO

For as long as I can remember (or for as long as I have been paying attention) someone has been describing the health care industry as "in crisis". When I got started, the inevitable "health care as a percent of GDP" slide (back then, they were printed on acetate film and illuminated via bulky overhead projectors) in every industry speech showed that we were approaching 10% and that that was, clearly, unsustainable. Now (using PowerPoint and bulky digital projectors) we decry 17% and still use the term unsustainable. It's been a crisis for a long, long time. For at least 30 years.

Yesterday, the Massachusetts Health Council gathered together eight individuals to share one stage. The topic concerned how the recently passed Federal health care reform law might impact all of us here in Massachusetts. It was a who's who affair. If you were going to choose a spokesperson for each industry segment, whether hospital, physician, community health center, HMO, government... this would have been precisely the group to choose.

I've been witnessing such debates for, well... about 30 years... but yesterday's debate was a bit different. The divergent points of view were more hotly and pointedly made. Though no one actually pointed a finger at anyone else, they may as well have. The physician representative claimed that docs are "the patient defenders" and that administration simplification (translation: reducing the hassle factor heaped upon physicians by the health plans) and runaway malpractice claims (translation: an ever increasing need for defensive medicine required by lawsuit fearing MDs) are the true culprits. The health plan spokesperson pointed out that administration is but 10 to 13 percent of the total medical dollar and that the true savings come from provider-related costs. The hospital voice talked about distinguishing higher quality providers from others while the business person bemoaned the lack of good, reliable data proving that restricted networks (translation: HMO products that cut out some of the big, in town, academic medical centers) save money without cutting quality.

It was a great discussion... but ultimately, it missed the mark by a mile. Everyone understands that health care is expensive. Everyone knows that it is getting more and more expensive. It is tiresome to hear the same frustrated calls for relief, however. We're long on problem definition but far short on problem solving.

In my view, here are some of the top issues:

In America we like choice. We like to gain access to whatever we believe we need. Every time someone suggests that we might need to restrict access, even just a tiny bit, opponents cry foul. They use words like ration and death panel. And then the conversation dies. That happened during the recent health reform debate. As long as we firmly believe that every member of our society deserves access to whatever they (or loved ones) deem necessary, then costs will continue to go up.
Administrative simplification is a good thing. Requiring physicians to be credentialied by every payer in all manners possible is, in fact, wasteful. But ever expanding requirements around fraud prevention, confidentiality and quality reporting all cause administrative complication. We ask the administrative infrastructures of health care organizations to do more and more, yet don't understand why they need to hire people and invest in new systems to accomplish that work.
We're getting older and living longer. Many of us are fortunate enough to get our hips replaced or require second and third rounds of chemotherapy when prior generations never made it that far. We are driving costs upward. R&D in the pharmaceutical industry is being fueled by our strong desire to find newer and better drugs to heal and prolong us. 64 slice CTs do a better diagnostic job in some cases than older technologies, but we want every community hospital to have one of them. Or two. We want more and better... but more and better is expensive.
Expanding access for millions of un/underinsureds costs us money now and saves us money later. Maybe much later. The return on this investment will be hard to prove out and will always be subject to interpretation and political skepticsm. The new Federal law (Patient Protection and Affordable Care Act) is big on Patient Protection but short on Affordable Care. Is that because it was politically expedient for it to be that way? I don't think so. I believe that the short-term protections were widely agreed upon (e.g., eliminating prior condition exclusions and mandating coverage) while the cost control components are more complex and we're just not in agreement on where to go next. Witness yesterday's panel.

It's been a crisis for 30 years. It has only begun to feel like it more recently, however.

After Game Three, when the Yankees socked the Red Sox and it appeared as though the home team's perennial quest to shake off past demons would remain... perennial... we all then witnessed the greatest comeback in history. The Sox went on to win that ALCS and then the World Series and all past demons could be, finally (!), purged and exorcised.

In the late 1970s, two upstarts... one headed by Bill Gates and another by Steve Jobs... initiated the personal computing age. Apple was quickly outflanked by Microsoft, though, and Gates and Co. soared to the industry leadership position, successfully transforming and empowering a new digital era. Apple's prospects dimmed, leading to a departure by Jobs and numerous predictions that the always quirky and sometimes innovative computer-company-named-after-a-fruit would fail. Michael Dell once called for Apple to shut down and return whatever money was left over to shareholders. Mr. Dell now oversees a company merely a tenth of the size of Apple.

Apple's transformation of the computing business began, upon Jobs' return, with the introduction of small, simple to use devices known as iPods (and its accompanying iTunes software and store). Then came the iPhone. The iPad has exploded onto the market. Macs are now powered by Intel processors and are able, essentially out of the box, to run most Windows applications. And what about these guys (I could watch them all day long)?

Well, last Wednesday, Apple surpassed Microsoft in terms of overall market valuation ($222.1 billion to Microsoft's paltry $219.2 billion) and is now just below Exxon in terms of overall US companies.

What a comeback! The greatest of all time.