Health Care in the Next Curve Transforming a Dysfunctional Industry

Healthcare in the U.S. is a critical juncture. We face a sharp upward rise in the number of people with chronic diseases and disabilities. As demands on our current health system grow, so will costs. But as a society we are approaching the upper limit of how much we are willing (or able) to spend on health care. Health care policy makers know this. That is why major health reform measures are focused on population health and value-based care. These are the so-called second curve objectives. But these initiatives are doomed to failure. We are asking a system to do things that it was not designed to do.

In fact, we don’t have a health care "system" as such. We have a parts bin of disconnected silos. Fragmented delivery systems. Specialized caregivers. Professional groups. Trade associations. All with distinct cultures. Each with their own motivations and agendas.

Our payer and regulatory structures have evolved over the decades in response to political and policy initiatives. However well intentioned (or not), these structures defy logic. They reward and reinforce counter-productive industry behaviors. They pose formidable roadblocks to achieving needed changes.

Current reform initiatives are an implicit recognition that our health model is flawed. The attitude seems to be, "Yes, we know the overall health system is a problem, but we can make failure less severe if we implement these measures." We are at a critical juncture. We can continue to place additional demands on an industry model that has outlived its functional utility. Or we can take more of a clean slate approach and move toward a model that is in keeping with today’s needs.

The outlook is not good if we stay on the current curve. The demands on resources will continue their upward trajectory. The default scenario will be one of rationing and less to invest in new cures and new technologies. The good news is that we are within sight of a future state of health care that can really work. In this future state, we have gotten rid of the artificial barriers to effective and efficient patient care. Physicians and other health professionals work in a coordinated, inter-disciplinary fashion. They have accountability for the whole care cycle. Caregivers have both the flexibility and encouragement to innovate and come up with optimal delivery approaches. And because they are in a risk-reward relationship with payers, they have the incentives to provide true value. Patients feel intimately connected to a system that is focused on their specific needs.

The key to this future state is good old-fashioned market discipline. Other delivery models must either improve or get out of the way. The market will demand cost-efficiencies and won’t tolerate waste. Much of our regulatory structure will be rendered unnecessary. There will be not rewards for poor performance.

This book takes a unique macro-level perspective of clinical, economic, and regulatory problems and possible solutions. It takes an objective and something scathing look at current industry structure: a silo-driven culture and entrenchment that is driven by self-interest; as well as the complicity of government in preserving the status quo through regulations, licensure, payment systems, etc.