If it is a tax, call it a tax

Turning back now to the dueling health care bills pending in the state legislature here in Massachusetts, there is one thing on which the two houses agree:  It is all right to impose new taxes on the industry in the name of decreasing costs.

Huh?

You heard it right.

The language is dense, but here is what I read.  (Apologies in advance if I have gotten any of this wrong.)

The Senate bill establishes the “Health System Benefit Surcharge,” which assesses payors $40,000,000 annually for 5 years.  Half goes to a Prevention and Wellness Trust Fund and half goes to an eHealth Trust Fund.  This annual assessment would expire on July 1, 2017.  (Section 104 of the bill.)

The House bill establishes a one-time assessment on (a) hospitals and ambulatory surgical centers of 0.1% of total medical spending in 2011 and (b) payors at 0.2% of total medical spending in calendar year 2011.  With total medical spending of about $66 billion, the provider assessment is estimated to raise $66,000,000 and the payor assessment $132,000,000.  Providers are prohibited from seeking rate increases, and payors premium increases, to pay for the assessment.  (Section 46 of the bill.)

Is it right to do this?  If the Legislature feels an appropriation is in the public interest, it has a very old and established way to authorize one.  Take the money out of general revenues, using its taxing authority and a progressively collected broad-based tax.  Hiding a tax as a surcharge on the industry is rife with problems of equity and also a problem in that the public is given the impression that it is getting something for nothing.

The House provides "any hospital system with less than $1 billion in total net assets and more than 50% of revenues from public payers shall be exempt from this assessment."  I don't know who that leaves covered and who it leaves exempted.  Shouldn't such a tax be proportional, though, to the highly disparate level of rates collected by the different providers from insurers, rather than being based on some net asset determination?  If the assessment is not collected with that historical pattern in mind, it just aggravates that disparity.

On the payor tax, who can be against assessing insurance companies, especially if the money must be taken out of reserves, which have grown this year?   It is not normally my place to protect insurance companies from confiscation, but I believe that this year's growth in reserves comes mainly from a poor-economy-induced reduction in utilization of health care services, not from a structural change in the population's need for medical treatment.  To the extent that we expect insurance companies to bear actuarial risk, some level of long-term reserves is appropriate.  So, the Legislature would just be skimming off money that would be needed in future years, when the regular cycle of medical usage returns -- and it will return, because that is based on the underlying demographics of the population.

Now, reserves should be reduced if an insurance company has transferred substantial amounts of risk to providers, like in the capitated Alternative Quality Contract.  But even then, let's refund those moneys directly to consumers rather than appropriating them for a legislatively determined use.  Otherwise, we are imposing a non-progressive form of taxation on businesses and individuals.

To be clear, my quarrel is not necessarily with the uses proposed by the legislators for these funds.  My quarrel is inventing collection regimes that are not transparent to the population and that may aggravate over time the financial problems of segments of the industries on whom the taxes will be imposed.  And that will do so in a manner than will tend to exacerbate trends already found to be inimical to a properly functioning system of health care finance.

Whose judgment do you trust?

I think it is a shame that editorial writers don't identify themselves in the major newspapers.  If they did, we could address questions to them personally.  Here is one that I would ask the author of a recent editorial who was writing about the dueling health care bills in the Massachusetts legislature.

You say that "the House bill is marred by regulatory overreach" because it contains a provision that "would create a new, quasi-independent authority, the Division of Health Care Cost and Quality, and vest it with broad power to set health care standards, investigate rates charged by hospitals or physician groups, and demand corrective action when it deems those rates unjustified. It could also assess a so-called luxury tax when providers’ rates are more than 20 percent above the statewide average."

You say that the "plan includes a problematic, blunt-instrument regulatory thrust. The luxury tax, for example, leaves much to the judgment of the new quasi-independent authority, which would assess whether a price premium of 20 percent above the state average was justified by quality or uniqueness."

Let's see, the current pricing regime is characterized by secret negotiations between the dominant insurance company and the dominant provider group, whose "judgment" has led to persistent and pervasive over-pricing of that system's services.  This has imposed a tax on Massachusetts employers and individuals, in an amount that I would conservatively estimate as $200 million a year.  Whose judgment would you rather have in place?

By the way, there are lots of ways to have a regulatory regime in place that is not overly obtrusive.  We need to think about those because we can't just hope the problem away.  My view is that there should be a rebuttable presumption that rates should be equal, unless the insurer can demonstrate to a rate-setting body that a differential is warranted.  This is different from normal public utility rate-setting or what existed before in the insurance world, but it would offer independent oversight over parties that clearly are not interested in solving the problem.

Oh, and if you think equal rates for equal service are somehow off base, please understand that, across the country and within Massachusetts, Medicare pays hospitals and doctors in that fashion (with appropriate adjustments for teaching residents, cost of living, and the like.)  If that works for over 30% of health care costs, why not for the rest?

What do we get for our money?

Is there a useful way to compare what it costs to be served by different hospitals?  Well, the Medicare agency (CMS) is trying to do that, as a first step in rewarding more efficient hospitals and penalizing less efficient ones. 

A recent story on Kaiser Health News summarized the data.  CMS presented the numbers for “average hospital spending per patient,” how much the federal program spends for the average patient admitted at a specific hospital. This measure includes all payments to doctors, hospitals or other facilities for services provided to a patient during the three days before the hospital stay, during the stay, and during the 30 days after discharge from the hospital.  To create more accurate comparisons, Medicare adjusted its figures to take into account the health and diagnosis of patients and other factors.  The national median was $17,988 for the period from May 15, 2010, through Feb 14, 2011.

There are some huge outliers in other parts of the country.  Some places in Texas, California, and Pennsylvania had figures more than 50% above this national median.  In general, Massachusetts hospitals did much better than those, but were almost uniformly above the median.  For example, Worcester’s St. Vincent Hospital and UMass Memorial Medical Center stood respectively at $18,168 and $19,067, or 1% and 6% above the median.  The major academic medical centers in Boston had similar figures, just slightly above the median.  Interesting, there was not a difference between the large centers and smaller community hospitals like Harrington Memorial in Southbridge and Healthalliance in Leominster (3% and 2%, respectively).  Even hospitals that are acknowledged leaders in clinical resource management and efficiency, like Cooley Dickinson in Northampton, do not vary from the state pattern. 

The question before us is:  Do these numbers tell us anything?

I think the answer is that they give hints as to trends and potential problems, but not much more.  Certainly, if my hospital were graded as being 25% or 50% above the median, I would want to know why and what I could do about it.  But for the great bulk of hospitals hanging around the mid-point, there just isn’t enough information to know whether I have a problem or should be relieved.

KHN quotes Elliott Fisher, the respected researcher from Dartmouth, who questioned how anyone could use this information:

 "As a hospital administrator I would go, how does this help me?" he said. "We just don’t know whether a lot of specialists are running through the hospital doing everything they can to every patient who is horizontal, or whether they're discharging every patient to a rehab facility. Those are two very different causes of high costs."

If we want see if there is a relationship between cost and quality, the problem is confounded by the fact that when CMS compiles information about the quality of care delivered in hospitals, it does so in a manner that is likewise less than useful.  By the time CMS publishes quality data, it is two or three years old.  How it could possibly correlate cost data that is 1-2 years old with quality data that is 2-3 years old presents an interesting computational problem.

By the way, CMS obviously has both cost and quality data that is more current.  After all, the agency pays hospitals virtually every day of the year based on claims that are filed almost in real time.  Those claims, in turn, are based on actual patient records that contain important measures of quality.  And yet there is something about the administrative process behind these billing and clinical records that makes it impossible to release them on a current basis.

Recently, my friend e-Patient Dave decided to test the health care marketplace.  He had a basil cell carcinoma, a small skin cancer, and he wanted to shop around and get the best price for removing it.  He has an insurance policy with a large deductible, so this is money out of his own pocket.  So Dave issued a request for proposals and sent it to a bunch of hospitals and doctors in his area.

Last week, Dave reported on his findings and his approach.  Among other things, he discovered that there is a low-cost solution to his problem that appears to have similar clinical outcomes to the higher cost procedure.  He also found a doctor who was interested in engaging with him as a partner in the care decisions.  In the end, Dave expects to spend 1/3 to 1/6 of the alternative as a result of shopping around.

But most of us don’t have the time, inclination, or patience to go through Dave’s buying process.  And we don’t feel we need to because most of us also don’t directly incur the types of costs outlined in the CMS report.  But that doesn’t mean society is not paying the freight for our lack of choice.  I hope someday that we will have real-time cost and quality data so we can become more effective health care consumers.

Ask: What's the business case and the clinical case?

I was engaged in consulting in the environmental field in the 1990s, and there was a land rush level of interest in producing new smokestack-based technology that could achieve dramatic reductions in power plant emissions.  The theory offered by entrepreneurs at the time was that, if we can invent a gizmo that will result in a thousand-fold reduction in emissions, the EPA will force all power plants to use it, and we will make a fortune.

I can't think of any of those companies that now exist.  Why?  Well, even if the technology was sound, it was often a technology in search of a solution. The science of environmentally caused disease did not exist to prove that a reduction of, say, parts per million to parts per billion would mean anything in terms of public health.  The idea that a regulatory agency would demand adoption of such a technology as "best available control technology" was naive.  And, even if the agency sought to do so, it would take years of scientific evaluation and rule-makings to cause it to occur.  None of the start-ups was well capitalized enough to wait.

I see similar things happening in the health care field.  Well meaning and intelligent engineers are coming up with interesting gizmos in the hope that their features will be so persuasive that hospitals will either buy them on their own or they will become the "standard of care" enforced by regulators or accreditation bodies.

One such genre of devices is remote patient monitors.  Perhaps inspired by the Dr. Bones McCoy on Star Trek, several companies have designed prototypes or more advanced machines that provide remote monitoring of patients' vital signs without electronic connections to the patients themselves.  Their hope is that hospitals will employ these continuous input collecting devices to take the place of the periodic evaluations carried out by nurses or other health care professionals.

While I am impressed by the technical prowess of those involved in these devices, I have wondered aloud to some colleagues as to whether there was a business or clinical case to be made for them.  Two of my most sophisticated and thoughtful correspondents answered.  The first said:

I'm not a fan of increasing the amount of monitoring using extra equipment.  It's a technical "fix" for a cultural/professional problem -- not having the time/focus/skill to know a patient well and to recognize when a patient is telling you or showing you that something is going wrong.  

I am unaware of any scientific literature that clearly demonstrates additional monitoring such as this adds value to the patient in terms of improving outcome.  But we love to add technical monitoring as a substitute for skilled personnel at the bedside. What has been proven to be of value is the implementation of a structured graduated response by a team of clinical experts that is triggered by early identification of something going wrong. We should be investing in the implementation of early warning systems combined with accountability across the professions for recognizing and responding. We should also be investing in releasing time to care (aka "the productive ward" or "transforming care at the bedside"),  freeing up our nurses' time and energy so they can do what they want and should be doing -- assessing and interacting with their patients, so that they can recognize and call for help when patients develop signs of impending doom. 

Its also all about creating a just culture and safety culture where everyone is supported and able to call for help whenever they need to. That means patients, families, nurses, respiratory therapists, and housekeepers.

So I wouldn't be going to my hospital asking for them to purchase this system.

The second agreed and expanded on the topic:

I have met with a bunch of these companies over the years … there are a few technologies that are promised to provide noncontact or low-contact vital sign monitoring.  One might be based on radar, another that’s ultrasound, and another goes under the bed and senses vibration.  I suspect the forces of “more technology is better” will inevitably win, but I agree that at this point there’s no data supporting the need for additional monitoring in the general hospital population.  Our work and others have shown that organizing the clinical monitoring and response to decompensation can reduce that rate of unexpected inpatient mortality to really low levels, so the cost-benefit of additional reductions is going to be hard to show in any case.  Certainly I haven’t advocated for more technology based on existing data.

On the other hand, the absence of evidence isn’t the evidence of absence. I do think there’s a particularly missing ability to reliably monitor respiratory rate in most non-ICU, non-OR settings. And it is pretty clear that respiratory rate is both extraordinarily predictive of bad things happening, and very frequently ignored in general care settings.  So, I think it would be a testable hypothesis (and reasonable to actually test) that, among a general med/surg population, heart rate, heart rate variability, and respiratory rate monitoring, coupled with integrated “early warning” algorithms coupled with a defined, graded, and systematic clinical response (an effector arm for the detection) might be of demonstrable benefit.  Or it might be a long run for a short slide.

Shepherding good radio

I love good radio, and I was reminded the other day of a series entitled 11 Central Ave produced by Susan Shepherd a few years ago.  It was called a radio comic strip, and it was excellent.


Listen to this episode about Anneliese, Nat and Christine's seventeen year old daughter, who is on her way to graduating from high school.  Her mother has some plans for how she can get into the right college.

While 11 Central Ave is no longer in production, I know we can count on Susan -- who has worked at Living on Earth and World Vision Report -- to produce something engaging in the near future.  I'm looking forward to her next chapter.

Focused on results and not recognition

Corbin Klett is a recent graduate of Georgia Tech.  He gave this commencement speech, which I highly recommend.  Some excerpts:

We will be the hero generation -- We will reclaim and rebuild institutions; we will rise up with social activism, collective competence, civic engagement, and servant leadership; our main contributions will be revitalizing communities and advancing technology; we may be the next great generation.

Speaking of his classmates, he noted,

What I like about is how they are so focused on results and not on recognition.  They don't so care so much about success as they do significance.  While most people do their work in order to finish it, these people do their work in order to change the world.

Quoting a Georgia Tech coach, he implored:

Give it 100%, every play of the game, because you don't know what the the big plays are until they are over.

Health Affairs Documents Market Power

As they consider current bills, Massachusetts legislators might want to get a copy of this article from Health Affairs.

The Growing Power Of Some Providers To Win Steep Payment Increases From Insurers Suggests Policy Remedies May Be Needed

Abstract

In the constant attention paid to what drives health care costs, only recently has scrutiny been applied to the power that some health care providers, particularly dominant hospital systems, wield to negotiate higher payment rates from insurers. Interviews in twelve US communities indicated that so-called must-have hospital systems and large physician groups—providers that health plans must include in their networks so that they are attractive to employers and consumers—can exert considerable market power to obtain steep payment rates from insurers. Other factors, such as offering an important, unique service or access in a particular geographic area, can contribute to provider leverage as well. Even in markets with dominant health plans, insurers generally have not been aggressive in constraining rate increases, perhaps because the insurers can simply pass along the costs to employers and their workers. Although government intervention—through rate setting or antitrust enforcement—has its place, our findings suggest a range of market and regulatory approaches should be examined in any attempt to address the consequences of growing provider market clout.

Not "routine" any more

Here is a note from the Director of Preoperative Evaluation of the MA Eye and Ear Infirmary that is indicative of some of the thoughtful work that is going on about whether all tests routinely given in hospitals are necessary:

Dear Colleagues,

After reviewing a number of studies on the subject of preoperative testing, most experts no longer recommend performing "routine" lab (CBC & Chemistries) & EKG on all adult patients undergoing surgery. (1,2,3) 

Instead it is recommended to only perform targeted preoperative tests to help manage existing medical conditions, or before specific surgical procedures, when the results of testing are likely to alter perioperative management. Performing "routine" lab & EKGs on all patients has not been shown to improve patient outcomes." Routine" testing increases costs, results in a large number of abnormal (but rarely clinically significant) results that frequently necessitate performing additional tests, increases perioperative delays and patient anxiety.

As a result of these recommendations, our Anesthesia Department modified and has been using since 2010 (updated in 2011) our requirements for lab work to reflect these recommendations.

Recently our MEEI Medical Evaluation Center (MEC) has also modified their requirements for preoperative for lab and EKG for patients being evaluated in the MEC. The only distinction between the attached Anesthesia and MEC requirements, is that the MEC is now obtaining (in addition to the Anesthesia requirements) EKGs for patients with a history of hypertension, and for patients age 60 or greater undergoing ophthalmic surgery.

If you wish to obtain additional lab tests for a patient being evaluated in the MEC, please complete and fax the attached MEEI Lab Requisition form to the MEC. Please include on the form the date of the patient's MEC appointment. If the MEC appointment is rescheduled please inform the MEC so that the lab requisition can be moved to the new date.  It will be the responsibility of the ordering physician to check the results of any additional tests ordered. 

Thank you very much for your assistance with these issues. Please feel free to contact me or the MEC staff if you have questions or comments about these issues.

Sincerely,

Joe

Joseph Bayes M.D.

Director of Preoperative Evaluation

Department of Anesthesia

MEEI

1. Practice Advisory for Preanesthesia Evaluation: An Updated Report by the American Society of Anesthesiologists Task Force on Preanesthesia Evaluation. http://journals.lww.com/anesthesiology/Fulltext/2012/03000/Practice_Advisory_for_Preanesthesia_Evaluation__An.12.aspx
2. Hepner DL. The role of testing in the preoperative evaluation. Hepner DL. http://www.ccjm.org/content/76/Suppl_4/S22.abstract?related-urls=yes&legid=ccjm;76/Suppl_4/S22
3. Fleischer LA et al. ACC/AHA 2007 Guidelines on Perioperative Cardiovascular Evaluation and Care for Noncardiac Surgery. Page 1983. http://circ.ahajournals.org/content/116/17/1971.full

Can we learn from the auto industry?

System Approach to Prevent Safety and Quality Problems in Modern Automobiles

MIT SDM Systems Thinking Webinar Series

Qi Van Eikema Hommes, PhD

Research Associate and Lecturer, MIT Engineering Systems Division

Date: May 14, 2012

Time: Noon - 1 p.m., EDT

Open to all

Register

About the Presentation 

Today’s automobiles are characterized by complex Cyber Physical Systems (CPS), where numerous embedded devices are networked to control physical hardware components. These systems are software intensive, and typically developed by globally distributed large multidisciplinary teams. Many such systems already experienced quality and safety problems that could not be traced back to component failures. One such example is the recent Toyota Unintended Acceleration case.

In this webinar, Dr. Hommes will address the recently published ISO 26262 Functional Safety for Road Vehicle, the industry’s first attempt at providing safety assurance for the complex automotive electronic systems. It is a positive first step, and a number of areas can be improved by taking on a more systems approach. A system theoretic hazard analysis method, developed by Professor Leveson at MIT, is applied to the Adaptive Cruise Control system design, illustrating one of the directions to improve the safety and quality of future automobiles.

About the Series

The MIT System Design and Management Program Systems Thinking Webinar Series features research conducted by SDM faculty, alumni, students, and industry partners. The series is designed to disseminate information on how to employ systems thinking to address engineering, management, and socio-political components of complex challenges.

Having Your Own Say

I am struck by how much innovation in the health care field in the United States comes from the heartland, rather than from the coasts.  Those living near the oceans like to think of themselves as the leaders in medical research and education, but the real advances in the actual delivery of care more often seem to come from the Midwest.  It is striking, too, that people in that region don’t wait for or expect state or local government to set forth a path.  They don’t blame the system or require changes in reimbursement policy or practices to be be made or mandated before they act to make life better for patients and families.  Perhaps advances in this region occur because of a greater sense of communitarianism, combined with much lower levels of academic arrogance.  Whatever the reason, good stuff is happening “out there,” and we need to take note of it.

An excellent example is set forth in the book, Having Your Own Say, edited by Bernard J. Hammes, director of Medical Humanities and Respecting Choices at Gundersen Lutheran Health System.  If I were to simplify the theme of the book, it is that advanced directives (ADs) are insufficient when it comes to end-of-life planning.  Drawing on the experience of the GLHS and other places, the book demonstrates the importance of an ongoing process for advance care planning (ACP).

Hammes notes that while ADs and similar mechanisms “have created important tools for documentation, by themselves they do not fully resolve the real, tragic moral dilemmas faced by so many families.”  The folks in La Crosse, Wisconsin, therefore developed “a more comprehensive model to help individuals and families create personal health plans for these morally complex healthcare decisions.”  He explains further that this view led to the creation of a new role, an ACP facilitator, based on the following philosophy:

The focus on knowing patients as people means that assisting them in care planning starts not with legal documents or forms but, rather, with interactions and conversations.  It means in investing in interactions where persons can better understand what choices the need to consider; thoughtfully reflecting on those choices in light of their views, values, and relationships; and, finally, discussing these ideas and plans with those whom they most love.  It also means undertaking these conversations in a way and at a pace acceptable to the persons.

A key point is that conversations do not occur only once.  They are revisited as life goes on and circumstances change.  That alone is a significant difference from how most people employ ADs.

The book provides a thorough description of the GLHS approach and also offers examples of similar models from other places.  I won’t summarize those here, but I will include excerpts from the portion of the book in which we hear from family members.  These are moving and validate the path taken in La Crosse.  Here is a comment from Jeff Loken, reflecting on the death of his parents:

It is so important to plan ahead.  If the time comes when you need to make a decision for your loved one, you do not want to be guessing.  ...[A]s my parents’ wishes changed, we modified their advanced directives.

Even more important than the document, though, is the conversation that surrounds it. To me, the conversation is critical.  You cannot just hand someone a document.  You need to talk about it, explain your thoughts, and have a dialogue.

Greg Loomis, who helped his father deal with kidney failure, agreed:

The conversation [with the ACP facilitator] was eye-opening for me.  With a third-party present, I learned things I never knew about my dad -- not only his wishes for healthcare but also things about his career and how he raised his children.

There is an important point raised in the book:

[H]ealthcare institutions and the news media love to tell stories of new technological breakthroughs and medical miracles....  Here we have identified an unexpected but important new “breakthrough” in medicine.  This breakthrough is not a new drug or test or treatment; it is a new way to organize our care of patients with advance illness so that they can live as well as possible for as long as possible in the way of their own choosing.  The “miracle” is that this new care depends more on human interaction and coordination than on technology and science.  The wonder is that it costs less to deliver but is actually better.

Here’s the real lesson.  If we view things in this manner, any place in the world can do it.  It does not depend on new government policy.  It does not depend on a change in payment methodology.  It does not depend on accreditation rules and regulations.  The power to make these kind of change resides in the people who have been given the privilege and responsibility of running our health care institutions.

In short, the necessary condition for this kind of approach to be adopted is the support of executive and governance leaders.  That leadership often is based on a remarkably simple set of values, tied to a clear sense of institutional purpose.

As noted by Gundersen Lutheran CEO Jeff Thompson:

Why we pressed down this path has everything to do with the well-being of patients, families, and the health professionals who care for them. It is to preemptively answer the question, “What would your parent, your spouse, your loved one want in this situation?”  The purpose is to avoid anyone needing to say, “We wish we knew.”

Vying bills in the MA Legislature

All eyes in Massachusetts are on the dueling bills produced by the House of Representatives and the Senate with regard to health care cost control and related matters.  As usual, WBUR's CommonHealth blog is on the case and offers a good summary of the differences.  A previous column described the House bill in more detail.

The Legislature faces some tough balancing acts here in Massachusetts, where one in six jobs is in the health care sector, and where the state is viewed as a cauldron of innovation in medical research.  There is always a push and a pull between government intervention and market-based solutions.  John McDonough, former state representative and former head of Health Care for All, recognized these pressures in a recent blog post, and urged the Legislature to expand efforts in prevention, wellness, and public health, some of the underlying factors of cost increases in the health arena.  It looks like the Senate took him up on that proposition.

After action by both branches, the bills will move to conference committee to iron out the differences.  The Governor will certainly sign whatever product is produced, as just too much work has been done on this for him to veto the bill -- even though both bills are substantially different from the approaches he first laid out months ago.

As an uninvolved observer, I see evidence of more behind-the-scenes influence by the Attorney General in the House version.  Her office has been relentless in pointing out that a major driver of costs in the state's health care environment is the lack of an effective marketplace, where the presence of size-based and geography-based monopolies has resulted in huge disparities in payment rates from insurers.  She has offered rigorous and data-driven reports that document this pattern.  The House bill explicitly attacks this, knowing that the sector participants cannot and will not solve it.

After all, this is the elephant in the room that the dominant provider group and the dominant insurer hope would be ignored.  They have engaged in a persistent campaign of misstating the obvious and hoping that the Legislature would take a bye on the issue, with the former even spending money on ad campaigns to offer the appearance of progress, while spending hundreds of millions that will ensure decades of higher fixed costs.

The insurer offers an unproven hope that a change in rate design will undo its actions.  We can't blame it for wanting to shift risk to providers.  After all, as an insurance company, it surely understands risk and how to assign it to other entities.  But for the state to adopt as gospel an unproven economic theory is clearly premature. That should especially be the case in that this company's actions over time have reduced its credibility:  First, it overpaid the early adopters of global payments. Secondly, at least in one major instance, its global payment contract was retroactive. If the purpose of global payments is to give a price signal to providers for how they’re going to behave, how can that effectively be done after the fact, when the medical services have already been provided? Finally, and most egregiously, it recently gave higher than average rate increases to the dominant provider group in the state; notwithstanding the fact that this provider group already had rates that were substantially above average.

At a time like this, it is worth heeding the words of Dr. Robert Galvin, warning us to be wary of the potential for further market concentration that can result from a change in payment methodologies that depends for its success on reducing customer choice.  It is also time to recognize that the participants in the health care sector cannot and will not solve the structural problems of market power on their own.

Saskatchewan sets out to redesign primary care

I remain exceptionally impressed with the Province of Saskatchewan in Canada.  The government and health care leaders continue to take steps to transform care for the 1 million people in this jurisdiction.

The latest step is to invest $3.6 million in primary health care innovation.   Here are excepts from the press statement:

"Our government is committed to the transformation of primary health care to better meet the needs of the patients, communities and health care providers," Health Minister Don McMorris said. "Our aim is a primary health care system that is sustainable, offers a superior patient experience and ensures better access to services as the foundation of our health system."

The funding announced today will support all Regional Health Authorities to improve access to primary health care providers and services and engage with partners and communities. Funding will also be allocated for designing and implementing innovative models of primary health care delivery in eight sites. 

The framework is a road map to a patient centred, community designed, team delivered approach to primary health care in the province. The framework will help to guide health regions, health providers and communities to work together to design primary health care services most suitable for their area.

The spirit of innovation is strong in this portion of the Canadian prairies and mountains, as is the desire to set an example of transformation for the entire country.  This will be worth watching.

Heavy thoughts

A weighty kerfluffle arose and then quickly disappeared in Victoria, Texas. As reported in Becker's Hospital Review, Citizens Medical Center instituted a ban on hiring people with body mass indices (BMIs) of 35 or higher.  According to the Texas Tribune, the hospital stated that an employee’s physique “should fit with a representational image or specific mental projection of the job of a healthcare professional,” including an appearance “free from distraction” for hospital patients.  (The image to the left is from the Tribune.)

Shortly later Becker's reported that the folks at Citizens had second thoughts, announcing they would rescind the ban. This may have been the result of pressure from the Obesity Action Coalition.

I'd like to say something thoughtful about all this, but I am mainly perplexed.  How did this rise to the level of a hospital policy in the first place?

Return to Fair Oaks

Long-time readers of this blog will be pleased to see this update of a post from three years ago, in which I posted a picture of a young boy making his first appearance in the annual Fair Oaks, CA, Chicken Run.  Well, that little boy is now 7-1/2 and is just as adorable.  He's a faster runner, too, but as yet has not caught the costumed adult in the chicken costume who paces the racers.  Maybe next year!

They are still building the Pyramids

This story in the Washington Post about the new addition to Johns Hopkins Hospital leaves me with an unpleasant feeling.  While I enjoy and treasure architectural innovation and excellence, the lack of any information about the cost implications of this sculpture is troubling. Maybe they don't have to worry about such things in Maryland, where payment rates are controlled by a state rate-setting commission, but I doubt it.

 Here in Boston, we have seen similar examples of this edifice complex -- often followed shortly thereafter by unpersuasive claims -- based on slippery numbers -- that the owners are engaged in intensive efforts at cost-cutting.

Why publishers are being disintermediated

Here are two recent stories that help demonstrate why traditional publishers are being left behind and left out.

A few weeks ago, the managing director at a book publishing company called to say they would be interested in republishing my book Goal Play!  They said they were really impressed with it and the reception it was getting in the marketplace.  They indicated, though, that they would want to change the focus of the book, perhaps change the title, and likely redesign the cover.  In addition, they offered royalties that were well less than 20% of what I receive from self-publishing the book.  They emphasized that they would still expect me to continue to handle most of the publicity and marketing for the book.

No thanks.

More recently, an intermediary informed me that a major metropolitan newspaper had expressed interest in reprinting my most recent blog post as an op-ed.  I replied, "Sure, if we can keep the meaning within their editorial requirements.  I usually don't do op-eds any more because newspapers often edit things without permission, and they also attach headlines that are not on point, so I'd like to be sure that I have final rights on whatever is to be printed."

The response from an editorial page editor at the newspaper:  "No, we have to edit stuff sometimes and run our own headlines. We have to do that to get out 14 pages a week. It would be chaos if we didn't reserve that right."

No thanks.

Can you now understand why traditional publishers are being disintermediated by the electronic media?  Their view that they must control all aspects of what they publish is a throw-back to an earlier era.  The publishers do not appear to understand how to live, thrive, and participate in the democratization of the marketplace that has resulted from social media.  While they can still bring value to that marketplace, they run the risk of squashing creativity and market entry by new authors, maybe because of their undue concern that they -- rather than the authors -- will be judged by what is published.  Golly, they remind me of doctors and hospitals who refuse to engage in a partnership with patients and families in the design and delivery of care!

The Great Experiment

If you read only one book about state and federal health care policy, it should be The Great Experiment: The States, the Feds and Your Healthcare.  Published by the Boston-based Pioneer Institute, it is the most articulate and rigorous presentation of issues that I have seen, a stark contrast from many papers, articles, and speeches that slide by as “informed debate” in Massachusetts and across the country.  I learned more about health care policy from this book than from anything else I have read in the last decade.

While the book is constructed as a number of chapters by experts in field, it has a consistent voice and and is highly readable.  There is an engaging explanation by Jennifer Heldt Powell of the politics and substance of how the Massachusetts health care reform bill came into being; and there is also a data-rich analysis by Amy Lischko and Josh Archambault of how it is working.  But the book is quick to point out that what has happened in Massachusetts is unlikely to be an appropriate model for the nation.  Indeed, a strong theme of the book can be drawn from that conclusion:  State specific experiments in health care reform, guided by general federal principles, will be more successful over time than a single national approach that is likely to get things wrong for the whole country.

Liberal readers may shy away from this book, for the Pioneer Institute has a reputation of being a conservative think tank and advocacy group.  I suggest you judge the content on its own merits rather than applying political biases to the question of whether or not you should read the book.

With exhaustive and thoughtful arguments, the authors argue that the national health care legislation should be modified.  Notably, the book does not just take potshots at the federal law.  The authors offer specific policy alternatives that are natural extensions of the existing mix of employer self-insurance, employer purchased insurance, individual non-group policies, government provided coverage through Medicare and Medicaid, and, of course, the uninsured.  They recognize the traditional state role in many of these matters but also concede that a federal presence is necessary.

Here is an excerpt from James Capretta’s concluding chapter:

The key federal and sate actions that will advance affordable insurance and high-quality care include the following:

Convert the federal tax preference for employer-paid premiums into a refundable tax credit; this initiative should start with workers in small firms and individuals who are not in stable medium or large employer-based plans today;

Establish a federal-state partnership to protect those with pre-existing conditions, which takes the form of state administered high-risk pools financed by the federal government; and

Reform the significant portion of the Medicaid program covering the non-elderly poor, allowing states to integrate these program participants into the same insurance arrangements which cover other working age Americans.

I don’t have the space here to give the rationale for these prescriptions, but let me focus on one area.  The discussion I found most persuasive was the argument made by Tom Miller that the individual mandate contained in the new federal law is not the most effective way of guaranteeing coverage for all.  He summarizes, “Solving the problem of covering Americans with pre-existing conditions does not require a massive transformation of America’s health care system.”  He explains how the problem of adverse selection -- the rationale given for the individual mandate -- can otherwise be accommodated for.  He also notes that the mandate, as constructed, will fail in that it “charges a much smaller penalty to almost everyone who fails to comply . . . than their far greater cost to purchase qualified insurance coverage [with the result that] too many young and healthy people will still choose to stay out of the system . . . particularly when the [law] will allow them to enroll later as needed, without any additional restrictions on their access to coverage.”

Read the text for yourself and see if you are persuaded.  If the conclusion is correct, by the way, it could have implications regarding the legal basis for inclusion of this mandate at the federal level, which is currently being reviewed by the Supreme Court.

Jeffrey Flier, Dean of Harvard Medical School, offers a preface to the book.  He hearkens back to a November 2009 Wall Street Journal op-ed in which he argued that a successful effort to fix the health care system “would require an accurate diagnose of the elements that produced the problems” and that those who crafted the federal law “failed almost entirely to make that diagnosis, with the consequence being a failure to produce an effective remedy.”  I recall that many politically correct Cantabrigians were appalled by Jeff’s article at the time.  But The Great Experiment provides support for his proposition. Whether you like that view or not, you will be a better informed participant in the US and state health care debates if you read this book.

"You can unleash this horsepower!"

Among the great hospital leaders in America, Jeffrey Thompson, CEO of the Gundersen Lutheran Health System in Wisconsin, stands out for going beyond achieving marvelous results in patient quality and safety.  Jeff's commitment that his system will not accept mediocrity shows up in other arenas as well.  He and his board have adopted a corporate strategic plan that sets a goal of being "the best regionally and nationally on environmental stewardship and accountability."

This is outlined in a recent keynote speech he gave at CleanMed 2012 in Denver.  Jeff pointed that hospitals have a large impact on the environment and on public health because of their use of electricity.  Noting that his system alone produces 500,000 pounds annually of airborne particulates tied to its electricity consumption, he concluded that reducing that impact can and should be tied into the culture of a health care institution.  He asserted, "We are going to be responsible to members of the community.  We are going to be transparent, and we are going to act to fix things."

Inaction on this front, in the view of the people at Gundersen Lutheran, is not acceptable. "It is not enough to be good people.  What you tolerate, you support.  We have to lead this.  We can't leave it to someone else."

His speech then summarizes the many steps taken by his system to reduce energy use and to employ renewable resources.  Beyond the social mission, he makes a clear business case for this, in terms of return on investment, generating savings and cash well beyond that of virtually all other uses of funds.

Jeff also points out that this is a mission that will resonate with the staff in hospitals.  "There is no more powerful asset that you have than an engaged, fired-up staff."  The staff feel pride in being environmentally sound, for innovating ahead of the norm, and for not settling for mediocrity.  "You can unleash the horsepower!" he notes with enthusiasm.

My readers will notice a parallel with assertions I have made on this blog about the need to improve the quality and safety of hospitals, about the power of front-line driven process improvement, and about the essential nature of transparency in how an organization holds itself accountable to its own standards of excellence.  What you may not know is that, well before diving into health care, my career was in the energy and environment field, and so I can testify that the actions brought about by Jeff's leadership and his team are exemplary.  Indeed, again, "this little place out on the prairie" sets a standard for the nation.

Patients needed for DiabetesMine Challenge

Amy Tenderich writes with this news:

Innovation and patient-centered design are the driving forces behind the wildly successful DiabetesMine Design Challenge, but this year we’re shaking things up! We've just launched a new Patient Voices Contest in which e-Patients and hands-on caregivers can voice their concerns about diabetes device design directly to the Powers That Be!

The prizes for 10 winners of this exciting new contest are: 

• an all-expense-paid
  trip to the 2012 DiabetesMine Innovation Summit at Stanford University
  in Palo, CA (taking place Nov 16, 2012)

AND ….

• a brand-spanking new iBGStar
  from Sanofi-Aventis, the first-ever plug-in glucose meter for the
  iPhone and iTouch!

To enter, patients and caregivers simply submit a 2-3 minute video describing what they would like to see from diabetes device makers, and what issues they have with the current technology.

The 10 winners selected will attend this year’s DiabetesMine Innovation Summit as "delegates" from the diabetes community. They’ll have the opportunity to share their ideas and concerns with Pharma R&D, product designers, mobile health experts, investors, gaming experts, regulatory folks and other stakeholders.

The deadline for entries is June 12, 2012.

Watch this video for more (click here if you cannot see the video).

 

UK Health Foundation offers grants

Do you have a smart idea that could benefit from Health Foundation support?

Is there someone in your organisation that could shine at this challenge?

The Health Foundation’s flagship improvement programme, Shine, is opening for a third round of funding applications. We’ve got over £1 million available to support up to 18 innovative healthcare teams. Shine is now open for applications, until Tuesday 17 July 2012. You can find out more at: www.health.org.uk/shine.  

We all want the best health service and we all have ideas about how to improve it, but good ideas only become good practice when there’s an opportunity to develop, test and gather evidence to support them. We’re looking for examples of smart ideas from across the health service that could improve healthcare and the ability to put together an innovative trial to develop and test that idea.

Each year Shine sets a different challenge for the UK health service. The Shine 2012 challenge is to find new approaches to delivering healthcare that aim to achieve one of the following:

·         supporting patients to be active partners in their own care

·         improving patient safety

·         improving quality while reducing costs

Benefits

·         The Health Foundation will provide investment of up to £75,000 per project over a 15 month period and the resources to test and evaluate your idea. We will also provide the resources to ensure that successful innovations have a platform for national recognition and will promote the most effective innovations to policy makers and NHS leaders.

·         For organizations: Stimulation of ideas and activity amongst clinical and operational staff leading to the development of new healthcare delivery approaches and processes, as opposed to the traditional top-down approaches.

·         For individuals and teams: The opportunity to put your smart ideas into practice, development of your quality improvement, research and implementation skills, and showing that innovative improvements are possible.

Interested?
If you are interested in Shine:

• please visit our website www.health.org.uk/shine to access all relevant documentation including a self-assessment tool to help you discover if your idea has the potential to Shine
• join our information call at 2-4pm on 21 June 2012 to hear more about the Shine programme and ask questions.
• apply by 12 noon on Tuesday 17 July 2012.

A technology in search of a purpose?

From Yahoo comes this story of a new approach to cell phones: 

Futurists predict that we'll one day have gadgets like cell phones as part of our bodies. Designer Bryan Cera asks "Why wait?" Cera has designed a literal phone handset that you wear like a glove.

My question is, "Why would we want to do this?"  But perhaps I am a Luddite and am missing the next great phase in human technological interfaces.

Here's the video (click here if you cannot view it):

Bears and other hazards of texting while walking

Jet Blue has been showing this great video from the New York Times, in which Casey Neistat explores the hazards of text messaging while walking in New York City.



But Casey missed a major hazard of such texting, the possibility of running into a bear.  Look here, courtesy of KTLA television.

Click here if you cannot see the videos.

Eliza shines, helped by Fluffer-nutter sandwiches

As I have mentioned on this blog, I often have a chance to visit with health care-related companies in the region and get a sense of how new technologies are being applied in this field.  My favorite among all of them is Eliza Corporation, which uses voice recognition technology and sophisticated data analysis and management to deliver and receive relevant information to and from people (i.e., patients, families, and consumers) for a variety of clients throughout the country.  It is a truly impressive organization.

But, as you know, it is the people who are the most important resource, even for high technology service organizations.  In that regard, from the top leadership to people throughout the company, Eliza shines.  So I was really pleased when I was invited to present at a "lunch and learn" session today.  Meeting over a lunch of extremely healthy (!) Fluffer-nutter sandwiches,  I gave a summary of the leadership lessons from my new book.

This generated several excellent questions and observations about how to introduce the philosophy of process improvement into an organization and the role of leadership in modeling the behavior necessary to encourage front-line driven change.  We also explored how to avoid and undo work-arounds that are created by task-driven professionals who find that the complexity of a company or hospital presents obstacles to carrying out daily work.  Finally, we spent a lot of time discussing mistakes and errors, and how to use them in a productive way.   The key is to employ a just culture that allows those who have erred -- and the rest of the firm -- to move on, learn from the experience, and make systemic changes that reduce the chance of such errors in the future.

Text me, quick

One of the main advantages of electronic textual communications is its potential asynchronicity.  The recipients of your messages do not have to read them upon arrival, and you, too, can choose when to check up on the messages you have received.  This allows each person to meld the receipt and transmittal of messages into his or her daily schedule, to be dealt with at convenient times.  It enables one, too, to think through a message you have received, perhaps reading it several times, so your response can be more meaningful.

A sad reflection of our times is that you have read the previous paragraph and are probably saying, “Not so.”  Society has already evolved to expect that you will be online all the time.  You have become but a vessel collecting the rainfall of text as it arrives, always poised to answer promptly.  If you do not answer a message quickly enough, you will be pestered by a follow-up note wondering if you received the first one.  As I have watched traffic over the last ten years, the half-life of that sequence has shrunk by two orders of magnitude:  In 2002, it was not uncommon to expect a response within a day.  In 2012, the expectation is often 10 minutes.

What a burden we have thus created for ourselves.  A tool that could have enhanced our lives rebounds to remove control.  A tool that could have enabled us to organize our days more fruitfully acts instead to impair time management.

Is there some compensation for this change?  Has the ease of using social media helped draw us together?  While I am a strong proponent and active user of social media, I cannot be blind to the fact that it serves to isolate as well as connect.  You just have to watch teenagers walking down the street together, texting other friends, to get a sense of this dichotomy.  Even easy-to-use old-fashioned email is the source of many misunderstandings and often stands in the way of face-to-face conversations that might be more productive, efficient, and engaging.  This is especially the case in email exchanges that comprise serial messages back on forth on the same topic.

I once knew a dean at university who was enamored of the idea that she could send a long email to the president of the school, receive an equally thoughtful one in reply, respond with another of her own, get another one back, and so on.  One day, unsatisfied with the result of one such exchange, she was mentioning her correspondence to a colleague who said, “Why don’t you go and talk with him?”  It was easy enough to do so, in that he had an open door policy.  Nonetheless, she answered with shock, saying, “Do you think he would have the time to do that?”  She missed the point that she and the president had spent hours on the subject in the course of their written correspondence, failing to communicate sufficiently well to reach an agreement.  Sure enough, a ten-minute meeting in person ironed out the misunderstandings.

There is an experiment that I wanted to try in my hospital, but I left the job before doing so.  I offer it to you for consideration: Designate Monday as an email-free, texting-free day (except for matters of clinical necessity.)  Spend this first day of each week talking with your colleagues in person or on the telephone.  Even then, minimize use of the telephone:  Get up and walk down the corridor or downstairs to the next floor whenever you can.

Some of you are already saying that you will “never get your work done” if you adopt this approach.  But I have a theory about this.  I think you will actually get more work done.  I think you will eliminate a large number of misunderstandings and re-work.  I think you will learn about problems in the making and help avoid them.

Most importantly, I think you will also be reminded how much you like your fellow workers and enjoy their company.

Try it, and let me know how it goes.  You can text me, tweet me, or comment here on the blog or on Facebook.  :)

Leadership training at Boston University

Kathy Kram, Shipley Professor in Management at the Boston University School of Management, teaches an MBA course on leadership as part of the school's concentration in leadership and organizational transformation.  She invited me to address the last session of the semester tonight.

As is my practice, I am including here pictures of a few of the students who made particularly interesting points or who asked incisive questions.  We explored the nature of the learning cycle for individuals and groups and how empathy on the part of the leader is a valuable attribute. We pursued the concept of a just culture, in which mistakes do not lead to blame and punishment, but instead form the basis for engaging in root cause analyses that can lead to systemic improvements.

Finally, we discussed the implementation of philosophies like Lean that can enable an organization to engage in continuous process improvement.  We reviewed what role subordinates in an organization can play when the senior management sas yet to adopt a Lean philosophy.