Michael Porter has written an article in NEJM presenting his views on health care reform., calling it "Towards a Value Based System". As we have argued elsewhere the use of the vague term "value", never defined by Porter, may sound good but he owes the reader at some point a definition. It is lacking.
It is worth a brief analysis since he is the oft proclaimed guru of strategic thinking from the renowned Harvard Business School, the place which brought our economy the minds that got us where we are now.
He begins by saying:
"True reform will require both moving toward universal insurance coverage and restructuring the care delivery system."
The issue of universal coverage is a critical point as we have been arguing for over twenty years. Allowing individuals to opt out is really allowing individuals a free ride. We no longer permit that in auto insurance, at least in most states so why do so in health insurance. So, point well taken. He then poses the following:
"How can we achieve universal coverage in a way that will support, rather than impede, a fundamental reorientation of the delivery system around value for patients?"
Porter first lays out what he believes the six principles of an ideal health care system should be:
"First, we must change the nature of health insurance competition. Insurers, whether private or public, should prosper only if they improve their subscribers’ health."
This is a wonderful goal but first one must ask how this is measured and second what is the responsibility of the patient, consumer. If you cannot stop someone from smoking, from obesity, just look at some in the White House, failure to address a condition before it becomes deadly, and the failure to maintain hypertension to a reasonable level, then what can a physician do. No matter how Porter tries he fails to define this and fails to incorporate the patient as a truly controlling agent.
"Second, we must keep employers in the insurance system."
On this I really believe his is far from seeing a new way. The employers create pools which may be low cost to them and the result is that it shifts the costs to those who are in smaller pools or individuals. My argument has been the auto insurance market. If I purchased my plan through say Verizon as compare through my own way, then the Verizon plan would be cheaper than mine and in fact the costs the insurer would be burdened within the Verizon contract would shift to me as a sole purchaser! Does Porter not understand the economics of the process? Only if everyone bought their own insurances, sans pooling, would there be a level playing field. The whole employer based system was an artifact to get around a Government wage cap in the 1940s, it was a system born of Government control and now Porter glorifies it a sine qua non. How pathetic!
"Third, we need to address the unfair burden on people who have no access to employer-based coverage, who therefore face higher premiums and greater difficulty securing coverage…"
Yes, indeed, that is just what was argued above. Why do they face higher premiums, because these poor people are subsidizing the large pools and those without? The risk pools are the same, the same statistics. Pooling people does not change risk if universal coverage is required.
"Fourth, to make individual insurance affordable, we need large statewide or multistate insurance pools, like the Massachusetts Health Insurance Connector, to spread risk and enable contracting for coverage and premiums equivalent to or better than those of the largest employer-based plans."
The Federal pools or State pools are required only if we were to keep the employer subsidized pools!
"(Sixth) …, once a value-based insurance market has been established, everyone must be required to purchase health insurance so that younger and healthier people cannot opt out."
Well universal is universal…so why repeat it.
Porter then describes what must be changed about the current system. He starts with a preface:
"The current delivery system is not organized around value for patients, which is why incremental reforms have not lived up to expectations….In order to achieve a value based delivery system, we need to follow a series of mutually reinforcing steps."
The problem with the Porter pitch is that he nowhere ever defines "value". It is like quality and all the other HBS catch phrases. We all want quality, we all want value, but they are all too often in the eye of the beholder. Porter then lays out his six points for improving health care. They are as follows:
"First, measurement and dissemination of health outcomes should become mandatory for every provider and every medical condition."
We agree. Today we measure diagnosis and procedure. The problem is how we define an outcome for a chronic disease. It would be great to have an outcome. In most cases it is that things just do not get worse. Take Hashimoto's thyroiditis. What is the outcome, management? When is the outcome measured? The list goes on.
"Second, we need to radically reexamine how to organize the delivery of prevention, wellness, screening, and routine health maintenance services."
I agree and that is why we have to do two things. Introduce the classic public health system as was common here in the US before health insurance became so prevalent and institute taxes to control demand by taxing bad behavior, such as tobacco and carbs.
"Third, we need to reorganize care delivery around medical conditions."
I really do not know what world he is speaking of. If I see a primary physician I do so for my annual needs or possibly a chronic condition. If I have the gene for melanoma then I should see a qualified dermatologist. My primary physician no matter how qualified will not be able to deal with this one. I see an ophthalmologist for my glaucoma, and gynecologists about whatever problems a woman may have. I do not expect my primary physician to deal with ovarian cysts! Nor do I expect my primary physician to read the MRI on a hip replacement! The system is organized in this manner today and it generally works smoothly!
"Fourth, we need a reimbursement system that aligns everyone’s interests around improving value for patients."
Here Porter supports Bundled Payments. We have argued extensively against this concept. It removes patient choice, it institutionalizes the archaic hospital centric system and disenfranchises the entry of new and innovative genetic medical applications and it sustains the dramatic and inefficient overheads that hospital brings to the table. On this point Porter appears to be totally clueless. Perhaps he should consider at least talking to real physicians instead of the ivy tower types who develop policy.
"Fifth, we must expect and require providers to compete for patients, based on value at the medical- condition level, both within and across state borders."
Again I have no idea what value means but this happens today with informed patients. Yes indeed some patients select a physician from the yellow pages, some by referral and a very few seek out the best for their specific problem.
"Sixth, electronic medical records will enable value improvement, but only if they support integrated care and outcome measurement."
We have discussed this at length. Yes electronic medical records will change things, slowly. If it were possible I would say they should occur instantly. However they will time manufacturing systems which took twenty five years.
"Finally, consumers must become much more involved in their health and health care. Unless patients comply with care and take responsibility for their health, even the best doctor or team will fail."
I agree and I have argued this from the demand perspective. The problem is that as a physician you can tell your patient time and time again to stop smoking cigarettes or take off those seventy pounds but only one in a hundred will comply. Consumers, aka patients, are often in denial as to their health and tend to deal with the problem if and only if it becomes a crisis. Type 2 Diabetes becomes a concern when the foot is removed. The typical patient after twenty years on metformin, sulfonylureas and then insulin and years of cajoling by the physician then wonders why they are having a failing kidney, or the smoker why they have small cell carcinoma and the like. Getting patients to take responsibility is difficult unless motivated by some exogenous acts such as a tax.
It is worth a brief analysis since he is the oft proclaimed guru of strategic thinking from the renowned Harvard Business School, the place which brought our economy the minds that got us where we are now.
He begins by saying:
"True reform will require both moving toward universal insurance coverage and restructuring the care delivery system."
The issue of universal coverage is a critical point as we have been arguing for over twenty years. Allowing individuals to opt out is really allowing individuals a free ride. We no longer permit that in auto insurance, at least in most states so why do so in health insurance. So, point well taken. He then poses the following:
"How can we achieve universal coverage in a way that will support, rather than impede, a fundamental reorientation of the delivery system around value for patients?"
Porter first lays out what he believes the six principles of an ideal health care system should be:
"First, we must change the nature of health insurance competition. Insurers, whether private or public, should prosper only if they improve their subscribers’ health."
This is a wonderful goal but first one must ask how this is measured and second what is the responsibility of the patient, consumer. If you cannot stop someone from smoking, from obesity, just look at some in the White House, failure to address a condition before it becomes deadly, and the failure to maintain hypertension to a reasonable level, then what can a physician do. No matter how Porter tries he fails to define this and fails to incorporate the patient as a truly controlling agent.
"Second, we must keep employers in the insurance system."
On this I really believe his is far from seeing a new way. The employers create pools which may be low cost to them and the result is that it shifts the costs to those who are in smaller pools or individuals. My argument has been the auto insurance market. If I purchased my plan through say Verizon as compare through my own way, then the Verizon plan would be cheaper than mine and in fact the costs the insurer would be burdened within the Verizon contract would shift to me as a sole purchaser! Does Porter not understand the economics of the process? Only if everyone bought their own insurances, sans pooling, would there be a level playing field. The whole employer based system was an artifact to get around a Government wage cap in the 1940s, it was a system born of Government control and now Porter glorifies it a sine qua non. How pathetic!
"Third, we need to address the unfair burden on people who have no access to employer-based coverage, who therefore face higher premiums and greater difficulty securing coverage…"
Yes, indeed, that is just what was argued above. Why do they face higher premiums, because these poor people are subsidizing the large pools and those without? The risk pools are the same, the same statistics. Pooling people does not change risk if universal coverage is required.
"Fourth, to make individual insurance affordable, we need large statewide or multistate insurance pools, like the Massachusetts Health Insurance Connector, to spread risk and enable contracting for coverage and premiums equivalent to or better than those of the largest employer-based plans."
The Federal pools or State pools are required only if we were to keep the employer subsidized pools!
"Fifth, income-based subsidies will be needed to help lower-income people buy insurance."
Obviously! But what of those who are here illegally. What does universal mean and who is really NOT covered? Is it the 20 million illegal aliens of the 40 million uninsured? How is this problem solved?
Obviously! But what of those who are here illegally. What does universal mean and who is really NOT covered? Is it the 20 million illegal aliens of the 40 million uninsured? How is this problem solved?
"(Sixth) …, once a value-based insurance market has been established, everyone must be required to purchase health insurance so that younger and healthier people cannot opt out."
Well universal is universal…so why repeat it.
Porter then describes what must be changed about the current system. He starts with a preface:
"The current delivery system is not organized around value for patients, which is why incremental reforms have not lived up to expectations….In order to achieve a value based delivery system, we need to follow a series of mutually reinforcing steps."
The problem with the Porter pitch is that he nowhere ever defines "value". It is like quality and all the other HBS catch phrases. We all want quality, we all want value, but they are all too often in the eye of the beholder. Porter then lays out his six points for improving health care. They are as follows:
"First, measurement and dissemination of health outcomes should become mandatory for every provider and every medical condition."
We agree. Today we measure diagnosis and procedure. The problem is how we define an outcome for a chronic disease. It would be great to have an outcome. In most cases it is that things just do not get worse. Take Hashimoto's thyroiditis. What is the outcome, management? When is the outcome measured? The list goes on.
"Second, we need to radically reexamine how to organize the delivery of prevention, wellness, screening, and routine health maintenance services."
I agree and that is why we have to do two things. Introduce the classic public health system as was common here in the US before health insurance became so prevalent and institute taxes to control demand by taxing bad behavior, such as tobacco and carbs.
"Third, we need to reorganize care delivery around medical conditions."
I really do not know what world he is speaking of. If I see a primary physician I do so for my annual needs or possibly a chronic condition. If I have the gene for melanoma then I should see a qualified dermatologist. My primary physician no matter how qualified will not be able to deal with this one. I see an ophthalmologist for my glaucoma, and gynecologists about whatever problems a woman may have. I do not expect my primary physician to deal with ovarian cysts! Nor do I expect my primary physician to read the MRI on a hip replacement! The system is organized in this manner today and it generally works smoothly!
"Fourth, we need a reimbursement system that aligns everyone’s interests around improving value for patients."
Here Porter supports Bundled Payments. We have argued extensively against this concept. It removes patient choice, it institutionalizes the archaic hospital centric system and disenfranchises the entry of new and innovative genetic medical applications and it sustains the dramatic and inefficient overheads that hospital brings to the table. On this point Porter appears to be totally clueless. Perhaps he should consider at least talking to real physicians instead of the ivy tower types who develop policy.
"Fifth, we must expect and require providers to compete for patients, based on value at the medical- condition level, both within and across state borders."
Again I have no idea what value means but this happens today with informed patients. Yes indeed some patients select a physician from the yellow pages, some by referral and a very few seek out the best for their specific problem.
"Sixth, electronic medical records will enable value improvement, but only if they support integrated care and outcome measurement."
We have discussed this at length. Yes electronic medical records will change things, slowly. If it were possible I would say they should occur instantly. However they will time manufacturing systems which took twenty five years.
"Finally, consumers must become much more involved in their health and health care. Unless patients comply with care and take responsibility for their health, even the best doctor or team will fail."
I agree and I have argued this from the demand perspective. The problem is that as a physician you can tell your patient time and time again to stop smoking cigarettes or take off those seventy pounds but only one in a hundred will comply. Consumers, aka patients, are often in denial as to their health and tend to deal with the problem if and only if it becomes a crisis. Type 2 Diabetes becomes a concern when the foot is removed. The typical patient after twenty years on metformin, sulfonylureas and then insulin and years of cajoling by the physician then wonders why they are having a failing kidney, or the smoker why they have small cell carcinoma and the like. Getting patients to take responsibility is difficult unless motivated by some exogenous acts such as a tax.
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