This morning’s New York Times takes a look at the businesses that operate in the shadow of health care – all of those companies that offer products and services to control or cut spending and improve efficiency in our $2.1 trillion industry. Spending itself is unlikely to drop as baby boomers turn 65 and people live longer. The objective is to be more efficient with the money, and eliminate unnecessary tests and procedures that add little information, don’t improve clinical decision making, and doesn’t improve patient outcome or overall health. Reasonable objectives, I think.
There are many reasons why the industry has not invested in such clear efficiency drivers as preventive care and electronic health records. The problem, as the article points out, is that the entity that benefits from these investments is often not the entity that makes the investment. Preventive care is an interesting situation: if insurance companies paid for preventive services – as did the “real” HMOs of distant memory – they would reap the benefits from a healthier client base. However, these benefits will not show up right away, and the benefits will carry on for many years. In the old days, a Kaiser Health Plan could spend on preventive care because employers and employees stayed with them for year after year. Today, employers will readily change health plans, reducing the return on the investment. Medicare is starting to cover some preventive services, which is a logical move as beneficiaries will be staying with them a long time.
The article highlights the experience of a small primary care group who installed and EHR system. They spent a lot of money, and were able to eliminate e positions and increase the workload. While they claim that the system is costing them money, I would suggest that there are savings in time for physicians, staff and patients that are not being quantified. It’s not a clear financial gain, I grant. Nevertheless, my experience and “gut” feel is that EHR will prove to be a winner. With hospitals, including non-profit hospitals, effectively cleared to assist physicians with acquiring these systems (double check with your tax and legal advisors) the financial investment is more manageable and a clear return on the investment more evident.
Moving beyond EHR, new clinical treatments carry high price tags, but some replace one or more other tests and procedures. Sometimes patient care is improved, sometimes we have to wait and see if there is a difference. But the quest continues for faster, cheaper, less invasive and disruptive tools and procedures. We have seen, and will continue to see, push back from payers who are looking for evidence that the “new, new thing” is more than a pricier “me too”. We have advanced from the 1970s, when HSAs and other regulatory waste obstructed new and highly beneficial new technology such as CT scanners.
Permit me to continue to urge all of you to be working towards faster, cheaper and more effective business practices. This is what will be necessary – in fact, is necessary today – to compete.