Health Care in the Next Curve: Transforming a Dysfunctional Industry

Contents Foreword .............................................................................. xi Preface ................................................................................. xv Author ................................................................................ xix SECTION I INDUSTRY DYSFUNCTION: ITS ROOT CAUSES AND EFFECTS 1 Its Not the Future We Used to Have ........................3 The Old Future ................................................................... 4 The Curves of Health Care ................................................. 6 The Root Causes of Industry Dysfunction ......................... 7 The Economic Human and the Next Curve .....................10 Fast Forward: A New Future .............................................12 This Book: A Look Ahead .................................................13 References ..........................................................................15 2 Health Cares Perfect Storm ...................................17 The Gathering Forces ........................................................18 Whats Wrong with This Picture? .......................................20 Costs on an Upward Trajectory .........................................22 Heading toward a Spending Ceiling .................................23 Is Rationing the Default Scenario? .....................................24 References ..........................................................................25 3 What Happened to Health Insurance? ...................27 A Perfectly Dysfunctional Model ...................................... 28 Affordable Access: Still No Fix ..........................................30 Mandates Mean Fewer Products, Higher Prices ................32 Employer Health Plans: Not What Theyre Cracked Up to Be .............................................................................33 Medicare Trouble Ahead ....................................................36 Medicaid Also Facing an Uncertain Future .......................38 One Size Doesnt Fit All .....................................................39 References ..........................................................................40 4 Follow the Money: A Broken Payment Model .........41 Why Not "Food Insurance?" ..............................................42 Fee-for-Service an Incentive for Utilization ...................... 44 Impact on Care Coordination ............................................45 A Recipe for Waste, Fraud, and Abuse ............................. 46 Moving toward Value ........................................................ 48 Problems Measuring Value ................................................51 References ..........................................................................53 5 Silos, Everywhere ..................................................55 Automobiles Get Pretty Good Health Care ...................56 Wheres the "System" in Health Care? ...............................58 The Problems of Service Fragmentation ...........................60 Information Silos: Part of the Problem ..............................62 Geographic Silos, Too ....................................................... 64 Population Health: More Teamwork Needed ................... 64 Silo Culture Part of the Industrys DNA ............................65 References ..........................................................................69 6 The Real Costs of Regulation ...............................71 The Perils of Regulatory Overreach ..................................72 The Computer Will See You Now .....................................73 The Price of Regulating Prices...........................................76 Certificate of Need a CON Job ..........................................78 More Regulation, Less Innovation .................................... 80 Frozen in Time ...................................................................82 Tort Reform, a Critical Need ..............................................83 The Real Costs of Regulation ........................................... 84 References ..........................................................................85 7 Wheres the Competition? .....................................87 Competition and Value ..................................................... 88 More Government, Less Competition ................................89 Independent Physicians: An Endangered Species ............92 Eroding Competition in the Insurance Market .................93 Conflicting Market Signals .................................................94 Narrow Networks, Narrower Choices .............................. 96 Consumers Caught in the Middle ......................................97 References ..........................................................................97 8 Why Government Health Care Isnt the Answer .....99 "Its the Government: They Know Best." .....................100 Medicare for None? ..........................................................103 Single Payer Means Higher Costs ....................................106 Rationing Is an Inevitable Outcome ................................108 Impacts on Education, Research, and Innovation ..........109 Administrative Costs Arent Necessarily Lower ............... 110 Single Payer Very PopularUntil People Understand What It Is ...................................................... 111 Americans Dont Do Socialism Very Well ....................... 114 References ........................................................................ 115 9 Market Disruptors and Transformers .................. 117 Big Data and a New World of Precision Medicine ......... 118 The Patient Is in ...............................................................120 A Fusion of Segments ......................................................122 Employers/Health Care ................................................123 Big Pharma/Insurance/Health Care ............................125 Providers/Health Plans .................................................126 Providers/Suppliers .......................................................126 Is the Community Hospital Becoming Obsolete? ...........126 Collective Consciousness and an Empowered Market ......129 References ........................................................................130 SECTION II HEALTH CARE IN THE NEXT CURVE: A ROADMAP TO INDUSTRY TRANSFORMATION 10 Destinations of the Next Curve ...........................135 Access, Choice, and Value ...............................................136 Access ...........................................................................136 Choice ...........................................................................137 Value .............................................................................138 A Roadmap to Industry Transformation ..........................139 11 First, the Safety Nets ...........................................143 Facing the Realities of Safety Net Needs .........................144 I-1 Provide Universal Catastrophic Coverage .............. 145 I-2 Put Invisible Reinsurance Safety Nets in Place for Those with Pre-Existing Conditions ......................146 I-3 Assure Guaranteed Issue, but with Incentives for Continuous Coverage .............................................148 I-4 Overhaul Medicaid: Make It a True Safety Net for the Chronically Ill and Disabled, and a Transitional Program for the Able-Bodied ............... 149 I-5 Restructure Medicare to Ensure Long-Term Solvency ........................................................................ 152 I-6 Give Military Veterans Choices, Too ...................... 155 References ........................................................................ 156 12 Insurance and Choice, Once Again ...................... 157 Restoring the Concept of Insurance ................................ 158 II-1 Promote the Growth of Consumer-Directed Health Plans and Health Savings Accounts ................. 158 II-2 Get Rid of the Employer Tax Exclusion; Give Employees Options ......................................................160 II-3 Repeal Anti-Trust Exemptions; Energize Competition in the Insurance Market ..........................162 II-4 Eliminate Regulations That Standardize Insurance Product Design ............................................162 II-5 Revise IRS Rules to Make Preventive and Health Maintenance Care Pre-Deductible ...................164 II-6 Promote Interstate Insurance "Regulatory Competition" and Sales ................................................165 13 From Production to Value .................................... 167 Value in the Next Curve ..................................................168 III-1 Complete the Transition to Value-Based Payment Methodologies ...............................................169 III-2 Make the Patient-Centered Medical Home the Standard for Primary Care ........................................... 170 III-3 Apply Bundled Payment Approaches to Chronic Diseases and Conditions ................................ 171 III-4 Design Multi-Provider Payment Methodologies to Support Inter-Disciplinary Care ............................... 172 III-5 Pay Providers for High-Value Services and for Virtual Care .................................................................. 172 III-6 Make the Shift to Transparent, Market-Based Reference Pricing .......................................................... 173 References ........................................................................ 175 14 No More Silos: Patient-Centered Care in the Next Curve ...........................................................177 A Team of Teams ............................................................. 178 IV-1 Target High-Risk Patient Populations for Early-Stage Intervention ............................................... 179 IV-2 Organize and Coordinate Health Services Delivery Around the Patient ........................................181 Develop Coordinated Disease Management Centers ......................................................................182 Integrate Behavioral and Social Services into the Coordinated Disease Management Center Model .....184 Align Addiction Treatment with Medical Care ........185 Develop Specialized Acute Care Units for Elderly Patients .........................................................186 Manage Post-Acute Care Transitions and Processes ............................................................... 186 IV-3 Rationalize Delivery Platforms for Optimal Access, Effectiveness, and Efficiency ...........................188 IV-4 Make the Home the New Health Care Center ....190 IV-5 Remove the Barriers to IT Interoperability .........192 IV-6 Track the Measures That Matter ..........................193 References ........................................................................194 15 Less Regulation, Better Health Care ....................195 Putting the Economic Human to Work ...........................196 V-1 Get Rid of the Laws That Restrict Competition .......197 V-2 Remove Barriers to Market Pricing ...................... 200 V-3 Eliminate Restrictions That Discourage Care Integration; Repeal the Stark Law ...............................201 V-4 Change Laws to Make Drugs More Available, Less Expensive .............................................................203 Remove the Artificial Protective Barriers to Market Competition ..................................................203 Streamline the Approval Processes for Generic Drugs ..........................................................204 Enact "Right-to-Try" Legislation for Terminally Ill Patients .................................................................205 V-5 Modify Rules in Order to Ease the Administrative Burden on Physicians ..........................206 V-6 Reform Medical Malpractice Laws ........................207 References ........................................................................209 16 Positioning Strategies for the New Future ..........211 A New Market Ecosystem ................................................212 Consumers Will Define Value ......................................... 214 Category 1: The Routine Stuff ...................................... 215 Category 2: Disease- and Condition-Related Care ......216 Category 3: Health and WellnessEngaged Partnership ................................................................... 217 Positioning for the Next Curve ........................................ 219 Unleashing the Spirit of Health Care...............................222 Appendix: How We Got HereA Brief History of Health Care in the U.S. ...............................................225 Index 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