Healthcare Costs are Sick

While the much-maligned Affordable Care Act is the best we’ve got towards universal healthcare in the United States, it was designed with self-serving flaws and has generated other macro-failures along the way. The U.S. Supreme Court, for example, will decide if the statute disallows direct access to a subsidized federal healthcare exchange in the absence of a state-provided exchange, one possible reading of the law. In the meantime, a host of GOP presidential candidates continue to run on a platform for the complete repeal of the law. Too many politicians are creaming “socialism” as if that word were determinative. The ACA is no more socialist than universal free primary and secondary education, a basic hallmark of every developed nation in the world.

There are tons of folks who hate “Obamacare” – the handy word for the Affordable Care Act (ACA) – but totally support the benefits of the law; they just hate anything “Obama” as a simplistic kneejerk reaction. Indeed, as Washington State GOP Congresswoman, Cathy McMorris recently discovered when she asked her constituents to provide her with tangible “horror stories” on Facebook about Obamacare, that those who have benefited from the ACA or know people who have, instead flooded that Website with a tsunami of favorable reviews that totally drowned out dissenting voices.

Back in 2010, when the ACA was passed, lobbyists from private insurance carriers decimated any chance that the government itself would become the primary provider – a la Medicare – of benefits under the ACA. They were desperately afraid that a government agency would be too competitive and force them to cut costs in what is far and away the most expensive healthcare system on earth, 60% more costly than the second most expensive such system in the world (Switzerland). Likewise, big pharma – which charges American consumers vastly more on average than consumers anywhere else in the developed and developing world – made sure that under the false mantra of “quality control,” Americans could not, under the ACA, fill their prescriptions at much lower prices from such untrustworthycountries like Canada or the England.

While every piece of game-changing legislation in the last century has been amended repeatedly to correct what have been unanticipated problems in such statutes (from income tax to Medicare and Social Security), the ACA sits with a Congress that is dedicated to total repeal or nothing. The obvious problems remain unfixed, even as an increasing number of Americans have become totally reliant on the ACA. Indeed, if the Supreme Court rules against providing federally subsidized healthcare directly where state exchanges do not exist, there is no real back-up plan to cover the millions of people who would lose coverage as a result.

Aside from technical issues and unanticipated fixes, the ACA’s biggest flaw remains the outrageously high cost of American medical care, so dramatically higher than that of any other country in the world. We’ve protected private insurance carriers and private pharmaceutical companies, but consumers seem to be left out in the cost-spiral cold. Some experts believe that the entire method that average Americans rely upon to access healthcare when they are covered may be part of the problem. It’s pretty obvious that if you do not treat serious medical issues or potential issues properly in the earliest stages of medical problems, those same problems will probably get substantially worse and exponentially more expensive to treat as time progresses.

When fear or ignorance prevents patients from taking their medications or prevents them from coming in to see their physician to review a medical problem, the longer-term costs usually will multiply far beyond what they would have otherwise been had the problems been dealt with earlier. Further, the waiting time in emergency rooms or doctors’ offices or simply getting to the care offices, often necessitating taking time away from work or childcare/senior-care responsibilities, can be an additional deterrent (per the above picture).  As “managed care” requirements (cost limitations which impact how much time a physician can, on average, actually spend with a patient) reduce a doctor’s ability to do much more than a hasty analysis coupled with a prescription, longer-terms costs can skyrocket. The old “ounce of prevention” catchphrase.

Under a new program at Iora Primary Care in Seattle, patients are encouraged to engage in detailed conversations with a “healthcare coach” and their physician by means of a conference call. Fear of needles, medications with pills too hard to swallow, circumstances that affect taking medication that patients were not even asked when prescriptions were given, the effectiveness of treatment, how medications are ingested or supplied, new symptoms, etc. are all open for discussion, and the calls are not limited to short conversations; as much time as necessary is the mandate.

“This misalignment of financial incentives is a huge problem for patients, who often can’t get the care they need. But it’s also a big economic problem. The United States has the costliest health care system in the world, even as many patients suffer from preventable illnesses and die younger than their peers in other countries. The system is so full of inefficiencies that Americans are often sicker even as everyone — patients, insurers, the government — ends up spending more money on care.

“Iora thinks it may be able to solve both problems and make money doing so. Its business model is meant to keep patients … out of the hospital by improving service while earning a dividend on the expensive care it was able to avoid… [There are] five [care centers] that Iora Health opened in just a few months last year. The company now has 140 employees in 11 practices, and it plans to open at least 10 more in 2015. It just raised $28 million in its third round of venture capital financing to help it expand. The ultimate goal is hundreds of practices across the country, a kind of Starbucks for health care. (The company recruited one executive whose last job was opening Au Bon Pain franchises.)

“Dr. Rushika Fernandopulle, who is one of the company’s founders and serves as its chief executive, said: ‘Building one good practice is mildly interesting, because a few people have done that. But how do you scale that across the country? That’s much harder.’… There is plenty of innovation in health care delivery, and Dr. Fernandopulle is far from the only physician who thinks he has a better idea about how to keep patients healthier for less money.

“But his idea is intriguing because it offers the possibility of mass replication of quality care, which might affect the way medicine is practiced beyond his company. Few health care innovators now expand beyond their original location. A team of Stanford researchers recently looked around the country to find what they considered to be the very best primary care practices: All 11 had either one location or just a handful of sites.” New York Times, March 28^th.

Treating patients as customers, adding good solid customer service to the requirements of any healthcare plan, seems to be a requisite for maximizing the quality of healthcare while reducing the overall costs. The issue, as the above NY Times article points out, is scalability. In turn, scalability would seem to rest on training programs and published case studies on how to make this system work. We spend too much time on software metrics, technical proficiency in finding and treating medical ailments and not remotely enough time on figuring out how healthcare can be made more efficient from the users’ perspective. But as the above program illustrates, we really can no longer avoid changing that perspective. It’s just one step in what should be to reduce American healthcare costs while increasing the resulting quality.

I’m Peter Dekom, and we better begin taking all of these humanizing but  cost-controlling steps in our medical system or understand that we will price healthcare entire out of the realm of affordability.