Healthcare Spring

Thanks to the New York Times for its continuing, excellent reporting on exploitative pricing in the American healthcare system as exemplified by Elizabeth Rosenthal’s article, “American Way of Birth, Costliest in the World.”  But, healthcare is not alone.   All industries have taken a turn for the worse in sticking it to customers in a variety of ways including extra fees whenever they can get away with it, data mining to manipulate buying habits, advertising chicanery, “self-service” to deflect costs and aggravation, lack of transparency, and more.  This is all done in the name of “optimizing revenue enhancement” to improve business outcomes.

The paradox in healthcare is that while healthcare is a profitable industry, ranking 14^th among the top 35 industries, its outcomes are the worst of its peer wealthy countries and its efficiency is the worst of any industry.  Healthcare is also different in that it is not selling laundry detergent, airline tickets, or car loans.  It is selling a solution to a basic human need based on the belief that without your health you have nothing.

Another paradox is that healthcare uses science more than any other industry to understand the causes of diseases and treatments.  But when it gets to the business side of delivering on the research in hospitals and doctors’ offices, people have just over a 50/50 chance of getting the right care at the right time. 

We have known how to fix these seemingly intractable problems for a long time, e.g. with global payments based on outcomes.  But markets cannot be depended on to do the right thing for society and governments are shackled from doing more largely because of special interests.  What are other alternatives?

One obvious solution would be for healthcare businesses to recognize the upside opportunity to distinguish themselves in the market by filling the void and actually producing exceptional outcomes at a fair cost.   Could a company differentiate itself if it demonstrated that its members experience better health and outcomes than the competition?  Statements like “Our health plan members live 5 years longer” or “Our heart attack patients live longer with a better well-being” should get some traction in the marketplace.  This would be substantially more creditable and honest than paid advertisements for “America’s Best Doctors”.  Healthcare companies have the data.  Why don’t they use it for this purpose?  I suspect that they cannot show the difference in outcomes to their advantage.

A second possible solution would be for government to step in and correct market inefficiencies and abuses.  Obamacare was a solid step in the right direction.  Much more is needed.  But, this Congress will not allow any more action on healthcare or seemingly anything else for that matter.

A third is to recognize the customer as more than something to be exploited.  After cutting costs following the Great Recession, many companies say they understand that the route to profitability is by growing the top line by understanding and serving the customer and actually having a relationship with them rather than selling them things through mass, impersonal, customization.  So far, this appears to be more of a marketing campaign than a true actualization of the appreciation of the customer.  Mahatma Ghandi talked about customers in a very respectful way, “We are not doing him a favor by serving him.  He is doing us a favor by giving us an opportunity to do so.”

Absent any action by the healthcare industry or by government, what is needed is a “Healthcare Spring”.  People need to stand up and revolt against an “oppressive regime” that robs them of wage increases (eaten up on healthcare insurance), does not produce on its purpose and promise to improve health, and does it all in an authoritative way that lacks transparency and citizen input.  They need to say “no” to the covert collection of their personal data which is used to manipulate rather than to heal.  And they need to recognize their own contributions to the pricing wars by acknowledging their own behavior to aggressively shop on price (for most products) and to demand more and more useless health care because “it is better to be safe than sorry”.  With the Healthcare Spring comes the reality that people need to step out of the shadows and engage in the co-production of their own health and make trade-offs that are right for them, their communities, and the Nation.