I have been reading The
Innovator’s Prescription, an interesting analysis of
health care delivery by the guru of “disruptive
technology”.
Clay Christensen and two medical colleagues, Jerry Grossman and
Jason Hwang, have written an insightful book about contemporary
health care that both explains the roots of its burgeoning costs and
prescribes a re-structuring to achieve future improvements in
quality and cost. Many of the detailed ideas presented in the
book are not novel, in that they have been explored or suggested by
others. These include integrated health maintenance organizations,
specialty clinics and hospitals, medical tourism, nurse-practitioner
staffed clinics in retail stores, personal health records, and
health savings accounts. Nevertheless, the integration of
these ideas makes this one of the few “management” books that I have
really enjoyed and found thought-provoking.
Christensen’s focus is on the business models behind health care
delivery, and the book makes a powerful argument that the ways in
which large institutions (including government) today have
integrated health care does not match the actual jobs to be done for
patients. The book argues that there are fundamentally three
important tasks in health care:
Precise diagnosis, which turns a complex presentation of
symptoms and traits into a definitive analysis of what is wrong
with the patient,
Short-term therapy, whether medical or surgical, that fixes
what is wrong, and
Long-term management of chronic conditions.
The crucial factor in the rest of this argument is that scientific
developments in health care will really enable the creation of
precise diagnostic tests. These in turn will enable more easily
focused selection of treatments that are much more likely to be
effective, and are more easily provided by people with more focused
and less extensive training than today’s doctors.
So far, this analysis mirrors many explanations of health care
delivery. Next, however, the authors argue that the business models
appropriate to each of these tasks are quite distinct, and that
attempts to perform all three in places like general hospitals
increases the complexity and overhead of management, and thus leads
to exorbitant costs. They argue instead for the following
models:
When precise diagnosis can be achieved, it must be
technologically supported so that self-contained and relatively
inexpensive blood analyzers, imaging systems, or even genetic
tests can be applied in an office practice or even nursing
clinic. Only when such methods are not (yet) available for
difficult diseases do we need the intuitive diagnostic skills of
the fictional Dr. House and the vast and varied facilities of
the general hospital to support him. The authors liken these
practices to those of business consulting firms, and suggest
that they must continue to operate, as most medicine does today,
as fee-for-service shops.
Once a precise diagnosis is achieved, then treatment for most
cases can be quite routine. In fact, many studies now suggest
that well-practiced routine care achieves better results, fewer
complications, and lower costs than more ad hoc
approaches. This then enables specialty clinics that focus
on just a small number (sometimes one) procedure essentially to
guarantee results, leading to a fee-for-outcome model. Some such
practices already exist, doing only coronary artery stents, or
hernia repairs, or hip replacements.
As acute health care has become more effective in saving us
from death due to sudden illnesses, we tend to live on with an
accumulating burden of chronic disease that requires ongoing
management. This is in fact not done very well by
occasional doctors’ visits, and the book argues that a more
inclusive, network based approach such as the one pioneered by
Patients Like Me is most appropriate. The appropriate
business model for such activities is based on membership fees,
advertising, and the value of pooled information.
There are a few places in the book where I find myself unable to
accept the authors’ arguments. They take a very purely free
enterprise oriented approach in most of their thinking. Thus, they
allow themselves to approve of direct to consumer advertising by
pharmaceutical companies, which in my view is a highly distorted,
self-serving, and abused form of decision making.
They also put a lot of faith in an insurance system that relies on
catastrophic health insurance for truly unusual and very expensive
episodes of needed care, combined with health saving accounts (HSA)
as a way to couple people’s financial motivations with their health
care priorities. Although this may serve a rational ideal, I
suspect that it will fail to assure coverage to the poor and
vulnerable. A more general version of the current “donut hole”
in Medical Part D drug coverage would be an essential feature of
their plan, requiring patients to pay “full freight” for services
that exceed their HSA but don’t yet reach the high floor of their
catastrophic insurance. We know that people avoid filling
their prescriptions even when faced with modest co-pays, and the
authors themselves argue in a different part of the book that
chronically ill patients often defer taking actions that would
almost certainly benefit their care in the long term if those
actions are inconvenient or costly. Yet the book’s argument
for HSA’s relies on patients’ adopting rational short-term behavior
in service of their long-term financial interest—just what they have
shown does not seem to work. The authors also say little about
how this will help the truly poor, beyond vague hopes that care can
become cheaper so that they could afford it out of
government-subsidized health savings accounts.
Despite its deficiencies, I think this is an important book, and
points in interesting directions for significant changes in health
care delivery.
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