For crushing observations on the state of health care in the U.S., February was a banner month. We had Clayton Christensen and colleagues predicting the failure of Accountable Care, saying: “The Affordable Care Act’s updated versions of HMOs are based on flawed assumptions about doctor and patient behavior.” Clayton Christensen, a Harvard professor and author of The Innovator’s Dilemma, is considered a giant in the field of innovation thinking. In his book, The Innovator’s Prescription, Christensen points out that applying technology into old business models has only raised costs. Persons familiar with Professor Christensen’s diagnostic record are reluctant to dismiss his conclusions.
Time Magazine devoted an entire issue to chronicle abusive hospital billing practices, a scorching litany of over-charging based on the price-gouging “Chargemaster” list of billable items behind which, it seems to Time Magazine, that there is no logic other than excess profit, and ironically the rule both in for-profit and in not-for-profit systems. That these articles generated national conversation in weeks following the “Fiscal Cliff” and during the impending “Sequester,” indicates pervasive disgust with health care costs that bubbles up during Everyman’s conversations about the weather, the Final Four or the resignation of a Pope.
The two articles have more in common than being critiques of this or that feature of a dysfunctional health care system. They go to the heart of culture change and in particular to behavior. Christensen makes three points. The success of an accountable care organization (ACO) relies on changing physician behavior, relies on changing patient behavior---primarily by enlisting “patient engagement”---and relies on yielding significant cash savings. I personally disagree with Christensen that physician behavior cannot be redirected positively, especially given the greater number of physicians who are now employed by, and report to CEOs of each ACO system; improvement may be slow, but physicians respond to data that confirms progress. It is more difficult to disagree when Christensen points to Congressional Budget Office estimates that predict that 32 advanced ACOs achieving their full desired impact produce savings over the next five years of only $1.1 billion, an amount that is insignificant against the total annual Medicare budget of $468 billion. Finally, there is the essential matter of patient behavior. Christensen notes that the 1990s model of HMO left consumers a bad taste because of the visible gatekeeper that limited their choices. ACOs are launched against this background, and they remain, he says “on the hook for patients who don’t comply with recommended treatment or lifestyle changes.” For example, the Northern ACO is responsible for the behavior of a patient who may spend half the year in Florida, receiving care there. “In other words, ACOs hold caregivers accountable without requiring patient accountability. How can this work?” Christensen asks.
Time Magazine presents those of us who work in health care with a list of allegations many of which we can confirm from our own experience. Patients who read the article, nod in agreement---what does it mean to receive notice of charges for a surgery totaling $154,000 on a piece of paper that says: “this is not a bill?” What does it mean that a patient cannot get an accurate estimate of costs prior to receiving care? What does it do to physician behavior when their knowledge of pricing is limited to hospital charges and not informed by the true costs of what they order? What does it say when even the hospital has no accurate computation of its own costs? It does not help that much of this behavior was initiated and is sustained by the insurance system itself, that patients are responsible for too little of their insured bill or are perhaps able to rely on Medicaid or charitable care. In the new world of ACOs, under the Affordable Care Act and state-by-state, gaps in coverage are certain, and there will be no better cost visibility and scant reason to believe that patients will be engaged in cost control and designs for their own care. In fact insurance exchanges in a system that may no longer provide subsidies for charitable care may leave inner-city hospitals reliant on Medicaid deeply in the red if they choose to continue to provide charity care.
If ACOs are to succeed, Christensen says, innovation will require greater systematic disruption: more use of walk in clinics, extensive use of technical applications such as “tele-health” remote care, greater use of nurse practitioners and care extenders and changes in regulations. In fact, many of those things are waiting to happen, and many have been introduced that are gaining traction. What is less assured is patient engagement.
Patient engagement requires that the patient sit at the table on equal footing, communicating digitally with physicians, hospitals, insurers, laboratories and pharmacies. Meaningful use regulations anticipate this by requiring that this technology be present to enable patient PHRs to communicate using standard formats, secure networks and mobile devices. This anticipates linking the patient to more than a patient portal tethered to a particular hospital or clinic practice; such portals, little better than business cards, limit or even prevent useful patient interaction. Patient engagement using digital devices, and logically the patients’ own personal health record, allow the level of interaction that serves the purpose of chronic disease management---without recourse to an emergency room visit and in avoidance of hospital admission. Obviously, this creates significant savings but it also produces better health outcomes, and does so using fewer personnel and existing technology: the PHR, a secure network, mobile devices, portal connections, and even portable clinics. A real-life clinic program, of this type, over the past five years has leveraged the difference between the $21,000 average cost of a single hospital admission for a diabetic patient against the annual cost of a digitally enabled clinic of $1500 per patient to produce cash savings and better control of diabetic symptoms. It works in theory, and it works in the field.
The same use of digital technology works to provide useful cost clarity for physicians using tablet technology, when ordering tests and medications. A Southeastern, U.S., hospital system, using carefully computed true costs accessible from the physicians’ tablets, displays to doctors the actual cost of tests, medicines and devices as each item is ordered, producing a running total and a comparison to higher billed costs. This affects physician and patient behavior. For example using the example of a knee injury, if the true cost of an MRI is $280, obtaining the study prior to ordering 6 weeks of physical therapy may be less expensive. The $1800 Chargemaster cost of the MRI can serve to cause the physician to avoid ordering imaging and to impose a cautious, prolonged waiting period when, had he sooner known the knee disruption would require surgical repair, he would have deferred physical therapy, in this case more costly than the MRI, to the appropriate time. Physicians and patients cannot engage in partnering for efficient care when a Robin Hood-like system of internal cross-subsidies confuse the true costs of care for both physician and patient. The physician’s tablet is linked to the patient’s PHR to receive orders, to explain medications, to display images and to accommodate patient education materials. The combined use provides an accurate transfer of information, and it adds less than two minutes to a patient visit and saves numerous phone calls for both. The PHR-stored information is available to the referring physician as well as to patient-selected family members however distant.
It is this combined use of technology, embracing patient engagement to facilitate efficient visits, to manage chronic disease, and to allow for care at a distance that will fuel the kinds of innovation encouraged by Professor Christensen and his colleagues. In many hospitals, the EHR exists primarily to deliver coding for the purpose of maximizing billing, in addition of course to the more generic functions of data base searching and document management. Additionally, the EHR provider often disallows connectivity even to secure software applications, “apps” from outside the walled-garden of the single source supplier. This restriction not only drives higher pricing, that of the $100 million dollar hospital EHR, but also stifles innovation of the type needed for ACOs to prosper. The public, media, elected officials and business interests have taken dead aim at health care as it now exists. It is only by engaging with patients that caregivers can endure to guide health care. A quote from The Leopard, a novel chronicling the battles to unify Sicily with Italy, is appropriate: “If things are to remain the way they are, everything must change.”
Blogger's Note: I've taken a few years off from blogging. During that hiatus, I've retired from active ENT practice and continued working in health care software and, in particular, patient engagement. Thank you for reading. Bill Cast, M.D. www.nomoreclipboard.com