The key to using incentives may be to do so with a high enough frequency to create healthy habits. Health Gauge/Flickr, CC BY-SA
With the Tony Abbott government expressing concern about the growing health budget and emphasising personal responsibility, perhaps it’s time to consider some creative ways of curbing what Australia spends on ill health. One solution is to pay people to either get well or avoid becoming unwell in the first instance.
The United Kingdom is already doing this kind of thing with a current trial of giving mothers from disadvantaged suburbs A$340 worth of food vouchers for breastfeeding newborn babies. And from January 1 this year, employers in the United Statescan provide increasingly significant rewards to employees for having better health outcomes, as part of the Affordable Care Act.
But should people really be paid to make healthy choices? Shouldn’t they be motivated to improve their health on their own anyway?
Encouraging right decisions
People don’t do what’s in their best interest in the long term for many reasons. When making decisions we tend to take mental short cuts; we allow the desires and distractions of the moment get in the way of pursuing what’s best.
One such “irrationality” is our tendency to focus on the immediate benefits or costs of a situation while undervaluing future consequences. Known as present bias, this is evident every time you hit the snooze button instead of going for a morning jog.
Researchers have found effective incentive programs can offset present bias by providing rewards that make it more attractive to make the healthy choice in the present.
Research conducted in US workplaces, for instance, found people who were given US$750 to quit smoking were three times more successful than those who weren’t given any incentives. Even after the incentive was removed for six months, there was still a quit rate ratio of 2.6 between the incentive and control groups – 9.4% of the incentive group stayed cigarette-free versus only 3.6% of the control group.
A refined approach
Still, while research on using financial incentives to encourage healthy behaviours is promising, it isn’t as straightforward as doling out cash in exchange for good behaviour.
Standard economic theory posits that the higher the reward, the bigger the impact – but this is only one ingredient to success. Behavioural economics shows that when and how you distribute incentives can determine the success of the program.
Here are a few basic principles to consider. First, small rewards can have a big impact on behaviour if they’re provided frequently and soon after the healthy choice is made. We have found this to be true in the context of weight-loss programs, medication adherence, and even to quit the use of drugs such as cocaine.
Games of chance are an effective way of distributing rewards as research has found people tend to focus on the value of the reward rather than their chance of winning the prize. Many people think that a 0.0001 and a 0.0000001 chance of winning a prize are roughly equivalent even though in reality they are vastly different probabilities.
Finally, people are more influenced by the prospect of losses than by gains. Studies show people put much greater weight on losing something than gaining something of a similar value.
In one weight-loss experiment, for instance, participants were asked to place money into a deposit account. If they didn’t achieve their weight goals, the money would be forfeited, but if they were successful, the initial deposit would be doubled and theirs to keep.
Reluctant to lose their deposits, participants in the deposit group lost over three times more weight than the control group, who were simply weighed each month.
Creating good habits
Incentives are particularly effective at changing one-time behaviours, such as encouraging vaccination or attendance at health screenings. But with increasing rates of obesity and other lifestyle-related diseases, we need to focus on how incentives can be used to achieve habit formation and long-term sustained weight loss.
We know financial incentives can increase gym usage and positively impact weight, waist size and pulse rate, but how to sustain gym use after the incentive is removed? The key may be to use incentives to achieve a high frequency of attendance for long enough to create a healthy habit.
We also need to consider how we can leverage social incentives, such as peer support and recognition, together with new technologies to maximise the impact of incentive-based programs.
Innovative solutions, like paying people to encourage the right health choices, may help to reduce both the health and economic impact of Australia’s growing burden of disease.
“The conscience and intelligent manipulation of the masses is an important element in democratic society. Those who manipulate this unseen mechanism constitute an invisible government that represents the true ruling power of our country. It is they who pull the wires that control the public mind.” Edward Bernaise (Sigmund Freud’s Cousin, Founder of modern PR)
Australian writer Dr Kerryn Higgs has written a book called Collision Course – Endless Growth On A Finite Planet, in which she examines how society’s commitment to growth has marginalized scientific findings on the limit of growth, calling them bogus predictions of imminent doom.
Robyn Williams: Growth or no growth? You may have heard Dick Smith on Breakfasta couple of weeks ago saying that unlimited growth is impossible and we must do something else. But what? There is, of course, a way of improving what we do more efficiently and stopping waste. Peter Newman from Perth gave an example on Late Night Live late last year: If we used trains instead of trucks for freight, it would halve the costs and save many, many lives. We don’t do it because we always do what we’ve always done. Kerryn Higgs, who’s with the University of Tasmania, has just brought out a book called Collision Course – Endless Growth onaFinite Planet, published by MIT Press and she has recently been appointed a Fellow of the International Centre of the Club of Rome.
Kerryn Higgs: I came across The Limits to Growth quite by accident in 1972, just when it was published. It was commissioned by the Club of Rome and written by a team of researchers at MIT, led by Donella and Dennis Meadows. The book changed the way I thought about Nature, people, history, everything. It persuaded me that physics matters, and that the idea of ever-expanding economic growth is a delusion. Up to then, I was a mainstream humanities person, history being my main discipline, and writing my passion. I did grow up in the countryside and loved the natural world, but I had no real intuition of an impending environmental crisis. And here was this little book suggesting that if we carried on with our exponential expansion, our system would collapse at some point in the middle of the 21st century.
Although galloping economic growth already seemed normal to most younger people living in the developed world in 1972, the growth that took off after WW2 was not normal. It is absolutely unprecedented in all of history. Nothing like it has ever occurred before: large and rapidly growing populations, accelerating industrialisation, expanding production of every kind. All new. The Meadows team found that we could avoid collapse if we slowed down the physical expansion of the economy. But this would mean two very difficult changes— slowing human population growth and slowing the entire cycle of physical production from material extraction through to the disposal of waste. The book was persuasive to me and I expected its message to have an impact on human affairs. But as the years rolled by, it seemed there was very little—and then, even less. In fact, I gradually became aware that most people thought “the Club of Rome got it wrong” and scorned the book as an ignorant tract from “doomsters”, an especially common view among economists. I want to point out, though, that recent research from Melbourne University’s Graham Turner, shows that the Meadows team did not get it wrong. Their projections for what would happen if we carried on business as usual tally almost exactly with what has actually occurred in the 40 years since 1972.
But while scientists from Rachel Carson onwards sounded alarm about numerous problems associated with growth, this was not the case in our governments, bureaucracies, and in public debate, where economic growth was gradually being entrenched as the central objective of collective human effort. This really puzzled me.
How come the Club of Rome got such a terrible press?
How did scientists lose credibility? When I was young, science was almost a god. A few decades later, scientists were being flippantly brushed aside.
How did economists displace scientists as the crucial policy advisors and the architects of public debate, setting the criteria for policy decisions?
How did economic growth become accepted as the only solution to virtually all social problems—unemployment, debt and even the environmental damage growth was causing?
And how did ever-increasing income and consumption become the meaning of life, at least for us in the rich world? It was not the meaning of life when I was young.
Answering these questions took me back through human history. A few developments were especially decisive.
Around 1900, the modern corporation emerged. Over just a decade or two, many of the current transnationals came into being in the US (with names like Coca Cola, Alcoa and DuPont). International Harvester amalgamated 85% of US farm machinery into one corporation in just a few years. Adam Smith’s free enterprise economy was being transformed into something very different. A process of perpetual consolidation followed and by now, frighteningly few corporations control the majority of world trade and revenue, giving them colossal power. The new corporations of the early 20thcentury banded together into industry associations and business councils like the immensely influential US Chamber of Commerce, which was formed out of local chambers from across the country in 1912. These organisations exploited the newly emerging Public Relations industry, launching a barrage of private enterprise propaganda, uninterrupted for more than a century, and still very healthy today. Peabody coal, for example, recently signed up one of the world’s PR giants, Burson-Marsteller, for a PR campaign to convince leaders that coal is the solution to poverty.
Back in 1910 universal suffrage threatened the customary dominance of the business classes, and PR was an excellent solution. If workers were going to vote, they’d need the right advice. No-one expressed it better than Edward Bernays, Freud’s nephew, who is credited with founding the PR industry. Bernays was candid:
The conscious and intelligent manipulation of the… masses is an important element in democratic society (he wrote). Those who manipulate this unseen mechanism … constitute an invisible government which is the true ruling power of our country… It is they who pull the wires which control the public mind.
PR became an essential tool for business to consolidate its power right through the century, culminating in the 1970s project to “litter the world with free market think tanks”. By 2013, there were nearly 7,000 of these, all over the world; the vast majority were conservative, free market advocates, many on the libertarian fringe, and financed by big business. They cultivate a studied appearance of independence, though one think tank vice-president came clean. “There is no such thing as a disinterested think tanker,” he said. “Somebody always builds the tank, and it’s usually not Santa Claus or the Tooth Fairy.” Funding think tanks is always about “shaping and reshaping the climate of public opinion”.
Nonetheless, the claim to independence has been so successful that most think tanks have tax-free charity status and their staff constantly feature in the media as if they were independent and peer-reviewed experts.
Another decisive development was the “bigger pie” strategy. Straight after World War 2, governments took on a new role of fostering growth. The emphasis increasingly fell on baking a bigger pie, so the slices could get bigger but the pie would not have to be divided up any more equitably. Growth could function as an alternative to fairness. Thorny problems like world poverty were designated growth problems and leaders in the decolonising world often embraced a growth-oriented version of development, a version that rarely helped their poor majorities. Growth allowed the privileged to maintain and even extend their opulence, while professing to be saving the world from poverty. It’s frequently claimed that growth is lifting millions out of poverty. But, apart from China, this is not really the case. China has indeed decreased the numbers of its extreme poor, though this has been achieved with disastrous environmental decline and increasing inequality.
Meanwhile, progress is patchy elsewhere. After 70 years of economic growth, with the world economy now 8 to 10 times bigger than it was in 1950, there are still 2 and a half billion people living on less than $2 a day, more than a third of the people on earth, and about the same number as in 1981. Growth has not been shared. Underlying the popularity of growth, there’s a great clash of values between mainstream economics and the physical sciences.
Economists see the human economy as the primary system—odd when you consider that the planet’s been here for about 4.6 billion years, and life for something like 3.8 billion. The human era is less than a whisker on this timescale, but for economists Nature is just the extractive sector of their primary system, the economy. For scientists and ecological economists, the primary system is the planet – and it’s self-evidently finite. The human economy with its immense material extraction and vast waste, exists entirely within the earth system. Self-evident as these boundaries might seem, they remain invisible or contested in mainstream economics and are of little concern to politicians or citizens in most countries. Hardly a news bulletin goes by without stories of growth expected, growth threatened, or growth achieved. Growth is the watchword of both major parties here and around the world and remains the accepted solution to poverty, pollution and debt.
And yet, however necessary growth is to our current economic arrangements, and however desirable from the point of view of our expectations of material well-being and comfort, it’s hardly a practical aim if it’s based on a misperception of reality.
While we assume that a high and increasing level of material consumption is normal and desirable, we ignore the peculiarity of our times and the encroaching threats to us and our planet.
We are well into dangerous territory in three areas:
Firstly, species are going extinct 100 to 1000 times faster than the background rate.
Secondly, the nitrogen cycle is completely disrupted. In nature, nitrogen is largely inert in our atmosphere. Today, mainly through making fertiliser, nitrogen is flooding through our rivers, groundwater and continental shelves, fuelling algal blooms that lead to dead zones and fish kills.
And thirdly we are on the way to a very hot planet. Unless we change rapidly in the extremely near future, we risk an increase of 4 degrees Centigrade by 2100. So far, an increase of less than 1 degree is melting the West Antarctic icesheet, glaciers nearly everywhere and even the massive Greenland icecap.
Meanwhile, the rate of carbon dioxide and methane emissions continues to rise. In fact, right through the decade it took to write my book, I was staggered as these emissions defied all protocols and agreements, and rose faster and faster every year, setting a new record in 2013. Four degrees may be a bridge too far, and yet our culture is cheerfully crossing it.
I started out as a student of human history and ended up studying the intersection between human history and natural history. Humans have had local effects for thousands of years but on a global scale, the collision is new. Humans were a flea on the face of the earth for most of our history andit’s probably true to say this is the very first time one species—ours—has taken over the entire planetary system for its own sole use. In human-focused terms, this may seem perfectly reasonable. In planetary terms, it’s weird and completely impractical.
While our best agricultural land, last remnants of white box woodland and the Great Barrier Reef are put at risk for the extraction of gas and coal, which we should aim to stop burning anyway if we want a liveable world, it seems that only citizen revolt is left to counter it.
Let’s hope we succeed.
The ground of our being is at stake.
Robyn Williams: Kerryn Higgs. She’s with the University of Tasmania and her book, published by MIT Press, is called Collision Course – Endless Growth on a FinitePlanet.Kerryn has recently been appointed a Fellow of the International Centre of the Club of Rome. Next week I shall introduce the proud Professor who’s just moved into that crumpled brown paper bag designed by Frank Gehry for the University of Technology, Sydney: Roy Green on innovation in Australia and what’s not right.
Guests
Dr Kerryn Higgs
Writer
University Associate
University of Tasmania
Fellow of the International Centre of the Club of Rome
Publications
Title
Collision Course – Endless Growth On A Finite Planet
Thanks Kerryn for outlining the problem and much of its genesis. I find it interesting and frustrating that the obvious solution to our predicament is not mentioned.
If we have a citizens revolt, and I believe that we will eventually come to that, what direction would this revolt take society? Call me old fashioned but I was rather hoping that human intellect could come to a better solution than amorphous revolt against the status quo.
As we look around at existing resource constrained parts of our planet, there are already many visions of that citizens revolt already underway. In the Middle East, in North Africa, Rwanda, in eastern Europe and recently even on our doorstep in The Solomon Islands overpopulation, lack of water and unequal distribution of wealth has led to civil unrest and war, often cloaked in ethnic or religious garb to disguise its true cause.
The solution is already in our hands and its called family planning or contraception if you like.
It is clear that humanity will not be able to avert expansion of societal collapse which has already shown its early phase, while its population numbers keep rising by 80 million pa. Yet there is an unmet desire by women and men to plan and reduce fertility rates. Why are we not providing free choice to those who want this? Why do we continue to promote high birthrates?
Within a decade, population growth rates could be significantly reduced and begin a necessary decline towards a more sustainable level.
But who, apart from Kelvin Thompson is leading the charge? Perhaps more people should know of www.populationparty.org.au?
Gillard and Burke made sure that Labor’s 2011 ‘Sustainable Population Strategy’ contained little factual information and studiously avoided all these pressing questions.
For another generation I fear, the opportunity was lost for a serious national debate about Australia’s rigid postwar policy of sustained high population growth.
An interesting talk Kerryn. As to the “why” of the current obsession with economic growth, the fault is in us. While, as individuals, we pretend to rationality, humans, as a group, do not act in this way. As the products of evolution by natural selection, we act to maximise reproduction – and pity the person who tries to argue against that! For males, greater wealth gives us more access to females. For females, greater wealth gives higher social status and more probable survival of children.
The fact is that we NEED to believe in economic growth because, without that, we are forced to face up to the falsity of what I call “The Big Lie” – namely that we can all improve our lives / get rich. I wrote an essay on this a few years ago:
When people are young they can be idealistic and believe that they can change the world. But that would require that the world be a rational place.
When people are older and more cynical like me they realise that human irrationality is a surging tide against which nothing can stand. It will wash over the world and then retreat. All radically new biological innovations thrown up by Nature are like this. Just like a newly evolved microorganism sweeps through a host population wreaking destruction until it – and the host – evolve to commensality, so the new and incredibly adaptable human species will do the same, although how many thousands of years that will take is unknown.
In the meantime, those of us who understand the inevitability of this process can find some small amount of solace by attempting to change things in our local community to enhance the survival of our own children, friends, neighbours and communities. At the local level, the rational part of one human can sometimes make a difference. And there is no sense in getting depressed about the inevitable.
Teams building analytics technology for healthcare organizations find themselves jointly holding intellectual property and equity in new arrangements not seen before in healthcare.
Extrapreneurial energy turns intrapreneurial analytics initiatives into companies in which healthcare enterprises retain some equity, remain customers, and benefit other healthcare enterprises who wish to purchase analytics technology and services.
Involves a definitive ten-year agreement valued at more than $100 million, to combine technologies, some of which Allina developed since becoming the first customer of Health Catalyst technology in 2008.
“We have a lot of confidence in our partner in Health Catalyst. Eighty percent of that [$100 million] is standard, but 20% of it is at risk, based on how we perform on key indicators, like how well the tools perform, for example, on reducing readmissions or unnecessary admissions for people who can spend nights in their own bed.
Wheeler says use of Health Catalyst technology has permitted Allina clinicians to significantly reduce readmissions, elective inductions of labor, time required to diagnose breast concerns, and sepsis rates.
Scott Mace, for HealthLeaders Media , January 20, 2015
Teams building analytics technology for healthcare organizations find themselves jointly holding intellectual property and equity in new arrangements not seen before in healthcare.
Follow the money, they say. It’s not always easy. “Terms of the transaction were not disclosed” is the common coin of many a deal. But despite this, some deals are harbingers of bigger things.
To make my point, I will appropriate a word: extrapreneur. It’s a word that you won’t find in most dictionaries. In 1992, the American Heritage Dictionary defined intrapreneur as “a person within a large corporation who takes direct responsibility for turning an idea into a profitable finished product through assertive risk-taking and innovation.”
So what’s an extrapreneur? One suggestion from England: Someone who shares information among organizations that they wouldn’t share among themselves.
That’s a good place to start when trying to understand what is occurring at Cleveland Clinic, Geisinger Health System, and, most recently, Allina Health, where teams building analytics technology for healthcare organizations find themselves jointly holding intellectual property and equity in new arrangements not seen before in healthcare.
Extrapreneurial energy turns intrapreneurial analytics initiatives into companies in which healthcare enterprises retain some equity, remain customers, and benefit other healthcare enterprises who wish to purchase analytics technology and services.
The term extrapreneurial also reminds me of extranets, the early e-commerce concept that extended intranets (internal TCP/IP-based corporate networks) to business partners as supply chains started being built when the World Wide Web was young.
In 2009, Cleveland Clinic’s extrapreneurial initiative spawned Explorys, an analytics platform which now counts numerous large healthcare systems among its clients. Yet, for quite some time, Explorys remained located on the Cleveland Clinic campus. And Cleveland Clinic remains an investor.
Geisinger created xG Health “to bring Geisinger’s expertise in healthcare delivery transformation to organizations nationwide,” according to xG’s Web site. xG describes itself as the primary provider of Geisinger’s health performance improvement intellectual property.
Launched in 2013 with $40 million of financing from venture capital partner Oak Investment Partners, and located in Columbia, Maryland, xG is not far from Geisinger’s Pennsylvania base of operations.
Allina and Health Catalyst Then, on January 6, Allina Health joined the extrapreneurial ranks. A few terms of the agreement are intriguing the entire analytics industry. Allina took an undisclosed stake in analytics firm Health Catalyst.
Health Catalyst had just come off an impressive year, having raised $41 million in funding in January 2014, and convening a conference of its own rapidly-growing healthcare system analysts last fall in Salt Lake City, where the company is located.
But back to those interesting terms between Allina and Health Catalyst. It’s a definitive ten-year agreement valued at more than $100 million, to combine technologies, some of which Allina developed since becoming the first customer of Health Catalyst technology in 2008.
Once a year, a governing committee of the Allina / Health Catalyst partnership will identify a prioritized list of improvement projects, each designed to provide measurable care improvement and financial value to Allina. As the partnership achieves each goal, both partners will share in the benefits of that success.
The deal also means that Allina is outsourcing its data warehousing, analytics, performance improvement technology, content, and personnel to Health Catalyst to accelerate advances. Beginning this month, in phases, Allina employees working in these areas—some 60 in all—will become onsite Health Catalyst team members.
When you have a partnership of this magnitude, extrapreneurial forces also allow each partner to remain agile rather than locked into an arrangement that has the possibility of souring due to the changing vicissitudes of technology and healthcare.
The $100 million represents the cost of what the staff and tools were costing Allina, says Penny Wheeler, MD, president and CEO of Allina Health, a $3.7 billion not-for-profit organization whose more than 90 clinics, 12 hospitals, and related healthcare services provide care for nearly 1 million people across Minnesota and western Wisconsin.
Use the Best Tool “We weren’t falling back on hope as a strategy,” Wheeler says. “We have a lot of confidence in our partner in Health Catalyst. Eighty percent of that [$100 million] is standard, but 20% of it is at risk, based on how we perform on key indicators, like how well the tools perform, for example, on reducing readmissions or unnecessary admissions for people who can spend nights in their own bed.
Wheeler says use of Health Catalyst technology has permitted Allina clinicians to significantly reduce readmissions, elective inductions of labor, time required to diagnose breast concerns, and sepsis rates.
“Our agreement with Health Catalyst says that if we find a better tool out there, we can use it,” she says. “So, for example, if [Epic analytics software] Cogito excels at the capabilities that we work with, then we use that,” she says.
“So it’s more about what can you use the best to improve care than any exclusivity. That just speaks to the confidence level we both have in our ability to partner and make things better, despite what else is out in the market.
“I’m pretty confident that we’re going to have a ten-year agreement and beyond,” Wheeler says.
“The margins in healthcare right now are so razor-thin, and that’s pretty apparent at Allina, given some of their recent financials. But they want to be able to create a little bit of a for-profit business around this core competency they’ve built in terms of managing their clinical performance with IT, which is what’s going on here,” notes Judy Hanover, research director of provider IT transformation at IDC Health Insights.
In the era of extrapreneurs, it’s all part of doing business.
Scott Mace is senior technology editor at HealthLeaders Media.
Apps, Other Tools Help Doctors, Insurers Measure Psychological Well-Being
By
JOSEPH WALKER
HUNTERSVILLE, N.C.—Toward the end of Janisse Flowers’s pregnancy, a nurse at her gynecologist’s office asked her to download an iPhone app that would track how often she text messaged with friends, how long she talked on the phone and how far she traveled each day.
The app was part of an effort by Ms. Flowers’s health-care provider to test whether smartphone data could help detect symptoms of postpartum depression, an underdiagnosed condition affecting women after they give birth. The app’s developer, San Francisco-based…
In an earlier article, I discussed a study suggesting salespeople would be more persuasive if they relied more on visuals than words. Here we’ll talk about what’s perhaps the most likely point in the selling process where salespeople say too much – and trigger the price bully that lurks in every buyer’s heart.
Courting is a little like sales, right? Imagine you’re a guy who’s been dating a woman for some time and you decide to propose. You want to close the deal. So you buy her a ring and take her to a nice restaurant. As you hand her the ring, you lay out, like bullet points, the five reasons you’re the guy for her.
What she wants is for you to let the ring, and the sincerity expressed in your misty eyes, do the talking. Laying out your value proposition at this point seems like desperation, or doubt. She’s thinking, “After all that courting, why does he think he needs to convince me? Or is he not convinced himself?”
How many times have you seen salespeople, just before a close, try to justify their price by revisiting the key benefits of their product or service? How many times have you succumbed to that urge yourself?
It’s a bad selling tactic. The research suggests you will trigger the same reaction in your prospect that our hapless Romeo triggered in his Juliet.
Justifying your price seems like common sense. If you’re going to ask someone to do something, how could it be a bad idea to remind them of the reasons? There’s actually a landmark study out there that seems to give credence to the idea. Unfortunately, most people completely misread its conclusions.
The study, called “The Mindlessness of Ostensibly Thoughtful Action,” was conducted in 1978. It observed how people waiting in line to use a copier responded when somebody at the back of the line tried to cut ahead. When the person simply asked to go first, 60% agreed. When the person said, “May I use the Xerox machine because I have to make a copy?” 93% said yes – even though the “reason” itself made no sense.
Based on this study, salespeople are often advised that there’s some mechanism in the human psyche that responds to reasons, and that enumerating them will improve close rates.
Problem is, there was a second part to that study. In Part 2 the researchers raised the stakes. They had the line-cutter say, for example, “I need to make 20 copies; can I go first?” Predictably, fewer people said yes, only 24%. When the line-cutter tried again, adding a bogus reason why he had to make 20 copies, the reason had no effect.
So that study showed that reasons work when the stakes are low but provide no benefit when they’re high, which they usually are in selling situations.
A more recent study showed that giving reasons not only doesn’t help, it actually hurts salespeople. Researchers analyzed two negotiations over the price of an apartment. With buyer Group 1, the sellers presented a price, then added justifications, pointing out that the building had an elevator and was in a desirable neighborhood. With buyer Group 2, they simply named the price and remained silent.
Buyer Group 2 didn’t bargain as hard and agreed to a higher price. Why? The researchers said the justifications made buyers in Group 1 feel they were being pushed into a corner, and that the seller was trying to do their thinking for them. And here’s what’s really interesting: The Group 1 buyers responded to justifications by coming up with reasons why the apartment wasn’t so great. “Yeah, that’s all true, but parking is a pain and there aren’t enough washing machines.”
The researchers described this pushback as a psychological reflex to regain control, which is the most powerful insight in this study. Justifications are perceived by the buyer as an attempt to take control. Just stating your price and remaining silent leaves the buyer in control. For whatever reason, buyers who feel they’re in control are less likely to undermine your value proposition and demand a lower price.
All that said, there is of course an appropriate time to lay out your value proposition – early in your discussions as you’re conducting discovery and mapping your product or service to customer needs. Just don’t do it late in the sales cycle when you’re negotiating price.
As hard as it may seem, you’ll get a higher price if you just say, “Here’s what it costs,” and then shut up.
You might want to go easy on the misty eyes though.
Thanks for joining us on “bottom line.” tell me what your company does.
What is digital therapeutics?
Digital therapeutics is the idea that medicine in the past was conducted in a face-to-face setting.
On the web and social and mobile on the way we can create digital expenses is allowing us to be done digitally.
We take proven lifestyle and behavioral medicine interventions from face-to-face to digital.
That is what we do.
This could help me — well, i don’t smoke, but if i did, it could help me quit and eat healthier, which i don’t do.
Is that the idea — lose weight, quit smoking?
Matt, we can help you with that, and if you want a free pass to our program, let me know . our program helps people with high risk of type two diabetes lose weight and make lifestyle changes over the course of 16 weeks and it is conducted entirely digitally.
I use my iphone or ipad and this will actually work?
Is that the case?
That is the idea.
It can help people proven at risk for type two.
If you help them in a high-tech fashion, our program is digital, a small group environment, where you are paired with others like you and you see how others are doing and we get android and iphone apps and we have a whole bunch of things to make you successful.
Every time i want a delicious cherry coke at lunch, you suggest something that won’t give me diabetes?
The idea is that that moment you want that delicious cherry coke, you think of your health coach and your groups going on with you and maybe you will get a water instead of something better for you.
Very smart man , mark andreessen, is a big backer of you guys.
What is the future of this company?
What does he see there as far as growth is concerned?
You know, i think the interesting bit is what is happening from the company landscape is that you get folks like me with tech and health care backgrounds will bring companies.
I studied neuroscience and i worked at google for a well and went to harvard medical school.
My passion has always been tech plus health care.
I think andreessen horowitz saw a consumer grade, rich product and experience, but to an enterprise customer set with a unique business well behind it that got them excited and that is what led them to pull the trigger on the deal.
$23 million?
What’s next?
Next for us is working with customers.
We have an innovative business model and that we only charge our employer and health plan customers if we are successful with members . because of that model, we have had a lot of demand coming in and it is just scale, scale, scale.
You sold me with harvard med school and you are a neuroscientist with an nba paper you have competition out there — but you’d have competition out there.
What are the barriers?
We do have competition.
The biggest barrier is for entrepreneurs and companies like myself is figuring out health care.
It is incredibly complex.
But so far, so good.
We want competition.
This is a space where there is a lot of people at me.
One third of the adult population has prediabetes, the latest stats from the cdc.
Let’s have a lot of people take a bite.
I wonder about results.
How can you prove that your programs give people the results they want in order to pay money up front and center for your courses — sign up for your courses?
The first is in the world of behavioral medicine.
There are a lot of published studies that show you what you need to achieve from the results standpoint, and then because of the element in our program like the digital scale, the cell phone chip, we can determine if people are successful and show the results in a very transparent and authentic way to our enterprise partners.
Diabetes is obviously a huge and growing problem.
I am certainly at risk for it.
But the weight loss thing is where i guess you will make the big money.
Type 2 diabetes is correlated to being overweight but it is not the only thing good genetics comes into play as well.
As a country, if we are to avoid the stats the cdc put out, 40% of adults of finding out at some point in their life that they are thank you, there needs to be weight loss and lifestyle intervention programs.
I’m just saying that if your marketing materials show that i lost 10 pounds in weeks with this outcome everyone will sign up.
It’s fascinating, what happens when we work with a self-interested employer is that employees who go through a program and become successful rave about it and tell their colleagues and they get colleagues to sign up.
Which surgeon you get matters — a lot. But how do we know who the good ones are?
“You can think of surgery as not really that different than golf.” Peter Scardino is the chief of surgery at Memorial Sloan Kettering Cancer Center (MSK). He has performed more than 4,000 open radical prostatectomies. “Very good athletes and intelligent people can be wildly different in their ability to drive or chip or putt. I think the same thing’s true in the operating room.”
The difference is that golfers keep score. Andrew Vickers, a biostatistician at MSK, would hear cancer surgeons at the hospital having heated debates about, say, how often they took out a patient’s whole kidney versus just a part of it. “Wait a minute,” he remembers thinking. “Don’t you know this?”
“How come they didn’t know this already?”
In the summer of 2009, he and Scardino teamed up to begin work on a software project, called Amplio (from the Latin for “to improve”), to give surgeons detailed feedback about their performance. The program—still in its early stages but already starting to be shared with other hospitals — started with a simple premise: the only way a surgeon is going to get better is if he knows where he stands.
Vickers likes to put it this way. His brother-in-law is a bond salesman, and you can ask him, How’d you do last week?, and he’ll tell you not just his own numbers, but the numbers for his whole group.
Why should it be any different when lives are in the balance?
Andrew Vickers
The central technique of Amplio, using outcome data to determine which surgeons were more successful, and why, takes on a powerful taboo. Perhaps the longest-standing impediment to research into surgical outcomes — the reason that surgeons, unlike bond salesmen (or pilots or athletes), are so much in the dark about their own performance — are the surgeons themselves.
“Surgeons basically deeply believe that if I’m a well-trained surgeon, if I’ve gone through a good residency program, a fellowship program, and I’m board-certified, I can do an operation just as well as you can,” Scardino says. “And the difference between our results is really because I’m willing to take on the challenging patients.”
It is, maybe, a vestige of the old myth that anyone ordained to cut into healthy flesh is thereby made a minor god. It’s the belief that there are no differences in skill, and that even if there were differences, surgery is so complicated and multifaceted, and so much determined by the patient you happen to be operating on, that no one would ever be able to tell.
Vickers said to me that after several years of hearing this, he became so frustrated that he sat down with his ten-year-old daughter and conducted a little experiment. He searched YouTube for “radical prostatectomy” and found two clips, one from a highly respected surgeon and one from a surgeon who was rumored to be less skilled. He showed his daughter a 15second clip of each and asked, “Which one is better?”
“That one,” she replied right away.
When Vickers asked her why, “She looked at me, like, can’t you tell the difference? You can just see.”
Would you want to be cut by this surgeon?Or this one?
A remarkable paper published last year in the New England Journal of Medicine showed that maybe Vickers’s daughter was onto something.
In the study, run by John Birkmeyer, a surgeon who at the time was at the University of Michigan, bariatric surgeons were recruited from around the state of Michigan to submit videos of themselves doing a gastric bypass operation. The videos were sent to another pool of bariatric surgeons to be given a series of 1-to-5 rating on factors such as “respect for tissue,” “time and motion,” “economy of movement” and “flow of operation.”
The study’s key finding was that not only could you reliably determine a surgeon’s skill by watching them on video — skill was nowhere near as nebulous as had been assumed — but that those ratings were highly correlated with outcomes: “As compared with patients treated by surgeons with high skill ratings, patients treated by surgeons with low skill ratings were at least twice as likely to die, have complications, undergo reoperation, and be readmitted after hospital discharge,” Birkmeyer and his colleagues wrote in the paper.
You can actually watch a couple of these videos yourself [see above]. Along with the overall study results, Birkmeyer published two short clips: one from a highly rated surgeon and one from a low-rated surgeon. The difference is astonishing.
You see the higher-rated surgeon first. It’s what you always imagined surgery might look like. The robot hands move with purpose — quick, deliberate strokes. There’s no wasted motion. When they grip or sew or staple tissue, it’s with a mix of command and gentle respect. The surgeon seems to know exactly what to do next. The way they’ve set things up makes it feel roomy in there, and tidy.
Watching the lower-rated surgeon, by contrast, is like watching the hidden camera footage of a nanny hitting your kid: it looks like abuse. The surgeon’s view is all muddled, they’re groping aimlessly at flesh, desperate to find purchase somewhere, or an orientation, as if their instruments are being thrashed around in the undertow of the patient’s guts. It’s like watching middle schoolers play soccer: the game seems to make no sense, to have no plot or direction or purpose or boundary. It’s not, in other words, like, “This one’s hands are a bit shaky,” it’s more like, “Does this one have any clue what they’re doing?”
It’s funny: in other disciplines we reserve the word “surgical” for feats that took a special poise, a kind of deftness under pressure. But the thing we maybe forget is that not all surgery is worthy of the name.
Vickers is best known for showing exactly how much variety there is, plotting, in 2007, the so-called “learning curve” for surgery: a graph that tracks, on one axis, the number of cases a surgeon has under his belt, and on the other, his recurrence rates (the rate at which his patients’ cancer comes back).
As surgeons get more experience, their patients do better. This “learning curve” shows patients’ 5 year cancer-free rates rise with procedure volume.
He showed that in incidents of prostate cancer that haven’t spread beyond the prostate — so-called ‘organ-confined’ cases — the recurrence rates for a novice surgeon were 10 to 15%. For an experienced surgeon, they were less than 1%. With recurrence rates so low for the most experienced surgeons, Vickers was able to conclude that in organ-confined cancer cases, the onlyreason a patient would recur is “because the surgeon screwed up.”
There’s a large literature, going back to a famous paper in 1979, finding that hospitals with higher volumes of a given surgical procedure have better outcomes. In the ’79 study it was reported that for some kinds of surgery, hospitals that saw 200 or more cases per year had death rates that were 25% to 41% lower than hospitals with lower volumes. If every case were treated at a high-volume hospital, you would avoid more than a third of the deaths associated with the procedure.
But what wasn’t clear was why higher volumes led to better outcomes. And for decades, researchers penned more than 300 studies restating the same basic relationship, without getting any closer to explaining it. Did low-volume hospitals end up with the riskiest patients? Did high-volume hospitals have fancier equipment? Or better operating room teams? A better overall staff? An editorial as late as 2003 summarized the literature with the title, “The Volume–Outcome Conundrum.”
A 2003 paper by Birkmeyer, “Surgeon volume and operative mortality in the United States,” was the first to offer definitive evidence that the biggest factor determining the outcome of many surgical procedures — the hidden element that explained most of the variation among hospitals — was the procedure volume not of the hospital, but of the individual surgeons.
“In general I don’t think anyone was surprised that there was a learning curve,” Vickers says. “I think they were surprised at what a big difference it made.” Surprised, maybe, but not moved to action. “You may think that everyone would drop what they were doing,” he says, “and try and work out what it is that some surgeons are doing that the other ones aren’t… But things move a lot more slowly than that.”
Tired of waiting, Vickers started sharing some initial ideas with Scardino about the program that would become Amplio. It would give surgeons detailed feedback about their performance. It would show you not just your own results, but the results for everyone in your service. If another surgeon was doing particularly well, you could find out what accounted for the difference; if your own numbers dropped, you’d know to make an adjustment. Vickers explains that they wanted to “stop doing studies showing surgeons had different outcomes.”
“Let’s do something about it,” he told Scardino.
Dr. Scardino
The first time I heard about Amplio was on the third floor of the Chrysler Building, in a room they called the Innovation Lab — the very room you’d point to if the Martians ever asked you what a 125-year old bureaucracy looks like. As I arrived, the receptionist was trying to straighten up a small mess of papers, post-its, cookies, and coffee stirrers. “The last crowd had a wild time,” she said. Every surface in the room was gray or off-white, the color of questionable eggs. It smelled like hospital-grade hand soap.
The people who filed in, though, and introduced themselves to each other (this was a summit of sorts, a “Collaboration Meeting” where different research groups from around MSK shared their works in progress) looked straight out of a well-funded biotech startup. There was a Fulbright scholar; a double-major in biology and philosophy; a couple of epidemiologists; a mathematician; a master’s in biostats and predictive analytics. There were Harvards, Cals, and Columbias, bright-eyed and sharply dressed.
Vickers was one of the speakers. He’s in his forties but he looks younger, less like an academic than a seasoned ski instructor, a consequence, maybe, of the long wavy hair, or the well-worn smile lines around his eyes, or this expression he has that’s like a mix of relaxed and impish. He leans back when he talks, and he talks well, and you get the sense that he knows he talks well. He’s British, from north London, educated first at Cambridge and then, for his PhD in clinical medicine, at Oxford.
The first big task with Amplio, he said, was to get the data. In order for surgeons to improve, they have to know how well they’re doing. In order to know how well they’re doing, they have to know how well their patients are doing. And this turns out to be trickier than you’d think. You need an apparatus that not only keeps meticulous records, but keeps them consistently, and throughout the entire life cycle of the patient.
That is, you need data on the patient before the operation: How old are they? What medications are they allergic to? Have they been in surgery before? You need data on what happened during the operation: where’d you make your incisions? how much blood was lost? how long did it take?
And finally, you need data on what happened to the patient after the operation — in some cases years after. In many hospitals, followup is sporadic at best. So before the Amplio team did anything fancy, they had to devise a better way to collect data from patients. They had to do stuff like find out whether it was better to give the patient a survey before or after a consultation with their surgeon? And what kinds of questions worked best? And who were they supposed to hand the iPad to when they were done?
Only when all these questions were answered, and a stream of regular data was being saved for every procedure, could Amplio start presenting something for surgeons to use.
A screen in Amplio shows how a surgeon’s patients are doing against their colleagues’
After years of setup, Amplio now is in a state where it can begin to affect procedures. The way it works is that a surgeon logs into a screen that shows where they stand on a series of plots. On each plot there’s a single red dot sitting amid some blue dots. The red dot shows your outcomes; the blue dots show the outcomes for each of the other surgeons in your group.
You can slice and dice different things you’re interested in to make different kinds of plots. One plot might show the average amount of blood lost during the operation against the average length of the hospital stay after it. Another plot might show a prostate patient’s recurrence rates against his continence or erectile function.
There’s something powerful about having outcomes graphed so starkly. Vickers says that there was a surgeon who saw that they were so far into the wrong corner of that plot — patients weren’t recovering well, and the cancer was coming back — that they decided to stop doing the procedure. The men spared poor outcomes by this decision will never know that Amplio saved them.
It’s like an analytics dashboard, or a leaderboard, or a report card, or… well, it’s like a lot of things that have existed in a lot of other fields for a long time. And it kind of makes you wonder, why has it taken so long for a tool like this to come to surgeons?
The answer is that Amplio has cleverly avoided the pitfalls of some previous efforts. For instance, in 1989, New York state began publicly reporting the mortality rates of cardiovascular surgeons. Because the data was “risk-adjusted”—an unfavorable outcome would be considered less bad, or not counted at all, if the patient was at risk to begin with — surgeons started pretending their patients were a lot worse off than they were. In some cases, they avoided patients who looked like goners. “The sickest patients weren’t being treated,” Vickers says. One investigation into why mortality in New York had dropped for a certain procedure, the coronary artery bypass graft, concluded that it was just because New York hospitals were sending the highest-risk patients to Ohio.
Vickers wanted to resist such gaming. But the answer is not to quit adjusting for patient risk. After all, if a given report says that your patients have 60% fewer complications than mine, does that mean that you’re a 60% better surgeon? It depends on the patients we see. It turns out that maybe the best way to prevent gaming is just to keep the results confidential. That sounds counter to a patient’s interests, but it’s been shown that patients actually make little use of objective outcomes data when it’s available, that in fact they’re much more likely to choose a surgeon or hospital based on reputation or raw proximity.
With Amplio, since patients, and the hospital, and even your boss are blinded from knowing whose results belong to whom, there’s no incentive to fudge risk factors or insist that a risk factor’s weight be changed, unless you think it’s actually good for the analysis.
That’s why Amplio’s interface for slicing and dicing the data in multiple ways matters, too. Feedback systems in the past that have given surgeons a single-dimensional report — say, they only track recurrence rates — have failed by creating a perverse incentive to optimize along just that one dimension, at the expense of all the others. Another reminder that feedback is, like surgery itself, fraught with complication: if you do it wrong, it can be worse than useless.
Every member of the Amplio team I spoke to stressed this point over and over again, that the system had been painstakingly built from the “bottom up” — tuned via detailed conversations with surgeons (“Are you accounting for BMI? What if we change the definition of blood loss?”) — so that the numbers it reported would be accurate, and risk-adjusted, and multidimensional, and credible. Because only then would they be actionable.
Karim Touijer, a surgeon at MSK who has used Amplio, explains the system’s chief benefit is the fact that you can vividly see how you’re doing, and that someone else is doing better. “When you set a standard,” he says, “the majority of people will improve or meet that standard. You tend to shrink the outliers. If I’m an outlier, if my performance leaves something to be desired, then I can go to my colleagues and say what is it that you’re doing to get these results?” Touijer sees this as the gradual standardization of surgery: you find the best performers, figure out what makes them good, and spread the word. He said that already within his group, because the conversations are more tied to outcomes, they’re talking about technique in a more objective way.
In fact, he says, as a result of Amplio he and his team have devised the first randomized clinical trial that is solely dedicated to surgical maneuvers.
Touijer specializes in the radical prostatectomy, considered one of the most complex and delicate operations in all of surgical practice. The procedure — in which a patient’s cancerous prostate is entirely removed — is highly sensitive to an individual surgeon’s skill. The reason is that the cancer ends up being very close to the nerves that control sexual and urinary function. It’s an operation unlike, say, kidney cancer, where you can easily go widely around the cancer. If you operate too far around the prostate, you could easily damage the rectum, the bladder, the nerves responsible for erection, or the sphincter responsible for urinary control. “It turns out that radical prostatectomy is very, very intimately influenced by surgical technique,” Touijer says. “One millimeter on one side or less than a millimeter on the other can change the outcome.”
Option B in the first A/B test for surgery: “A second bite is taken deeply into the fascia of the lateral pelvic fascia”
There’s a moment during the procedure where the surgeon has to decide whether to make a particular stitch. Some surgeons do it, some don’t; we don’t yet know which way is better. In the randomized trial, if the surgeon doesn’t have a compelling reason to pick one of the two alternatives, he lets the computer decide randomly for him. With enough patients, it should be possible to isolate the effect of that one decision, and to find out whether the extra stitch leads to better outcomes. The beauty is, since the outcomes data was already being tracked, and the patients were already going to have the surgery, the trial costs almost nothing.
If you’ve worked on the web, this model of rapid, cheap experimentation probably sounds familiar: what Touijer is describing is the first A/B test for surgery. As it turns out this particular test didn’t yield significant results. But several other tests are in the works, and some may improve some specific surgical techniques—improving the odds for all patients.
In Better, Atul Gawande argues that when we think of improving medicine, we always imagine making new advances, discovering the gene responsible for a disease, and so on — and forget that we can simply take what we already know how to do, and figure out how to do it better. In a word, iterate.
“But to do that,” Scardino says, “we have to measure it, we have to know what the results are.”
Scardino describes how when laparascopy was first becoming an option for radical prostatectomy, there was a lot of hype. “The company and many doctors who were doing it immediately claimed that it was safer, had better results, was more likely to cure the cancer and less likely to have permanent urinary or sexual problems.” But, he says, the data to support it were weak, and biased. “We could see in Amplio early on that as people started doing robotic surgery, the results were clearly worse.” It took time for them to hit par with the traditional open procedure; it took time for them to get better.
After a pilot among prostate surgeons, Amplio spread quickly to other services within MSK, including for kidney cancer, bladder cancer and colorectal cancer. Vickers’s team has been working with other hospitals — including Columbia in New York, the Barbara Ann Karmanos Cancer Institute in Michigan, and the MD Anderson Cancer Center in Texas — to slowly begin integrating with their systems. But it’s still early days: even within their own hospital, surgeons were wary of Amplio. It took many conversations, and assurances, to convince them that the data were being collected for their benefit — not to “name and shame” bad performers.
We know what happens when performance feedback goes awry — similar efforts to “grade” American schoolteachers, for instance, have perhaps generated more controversy than results. To do performance feedback well requires patience, and tact, and an earnest imperative to improve everyone’s results, not just to find the negative outliers. But Vickers believes that enough surgeons have signed on that the taboo has been broken at MSK. And results are bound to flow from that.
It’s all about trust. Remember the Birkmeyer study that compared surgeons using videos? It was only possible because Birkmeyer had built up relationships by way of a previous outcomes experiment in Michigan that meticulously protected data. “That’s a question that we get really frequently,” Birkmeyer told me when we spoke about the paper. “How on earth did we ever pull that study off?” The key, he says, is that years of research with these surgeons had slowly built goodwill. When it came time to make a big ask, “the surgeons were at a place where they could trust that we weren’t gonna screw them.”
Amplio will no doubt have to be able to say the same thing, if it’s to spread beyond the country’s best research cancer centers into the average regional hospital.
In 1914, a surgeon at Mass General got so fed up with the administration, and their refusal to measure outcomes, that he created his own private hospital, “the End Result Hospital,” where detailed records were to be kept of every patient’s “end results.” He published the first five years of his hospital’s cases in a book that became one of the founding documents of evidence-based medicine.
“The Idea is so simple as to seem childlike,” he wrote, “but we find it ignored in all Charitable Hospitals, and very largely in Private Hospitals. It is simply to follow the natural series of questions which any one asks in an individual case: What was the matter? Did they find it out beforehand? Did the patient get entirely well? If not — why not? Was it the fault of the surgeon, the disease, or the patient? What can we do to prevent similar failures in the future?”
It might finally be time for that simple, “childlike” concept to reach fruition. It’s like Vickers said to me one night in early November, as we were discussing Amplio, “Having been in health research for twenty years, there’s always that great quote of Martin Luther King: The arc of history is long, but it bends towards justice.”
Comments (3)
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Peter Strachan :
12 Feb 2015 6:57:48pm
Thanks Kerryn for outlining the problem and much of its genesis. I find it interesting and frustrating that the obvious solution to our predicament is not mentioned.
If we have a citizens revolt, and I believe that we will eventually come to that, what direction would this revolt take society? Call me old fashioned but I was rather hoping that human intellect could come to a better solution than amorphous revolt against the status quo.
As we look around at existing resource constrained parts of our planet, there are already many visions of that citizens revolt already underway. In the Middle East, in North Africa, Rwanda, in eastern Europe and recently even on our doorstep in The Solomon Islands overpopulation, lack of water and unequal distribution of wealth has led to civil unrest and war, often cloaked in ethnic or religious garb to disguise its true cause.
The solution is already in our hands and its called family planning or contraception if you like.
It is clear that humanity will not be able to avert expansion of societal collapse which has already shown its early phase, while its population numbers keep rising by 80 million pa. Yet there is an unmet desire by women and men to plan and reduce fertility rates. Why are we not providing free choice to those who want this? Why do we continue to promote high birthrates?
Within a decade, population growth rates could be significantly reduced and begin a necessary decline towards a more sustainable level.
But who, apart from Kelvin Thompson is leading the charge? Perhaps more people should know of www.populationparty.org.au?
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Stephen S :
14 Feb 2015 9:43:10am
Gillard and Burke made sure that Labor’s 2011 ‘Sustainable Population Strategy’ contained little factual information and studiously avoided all these pressing questions.
For another generation I fear, the opportunity was lost for a serious national debate about Australia’s rigid postwar policy of sustained high population growth.
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Michael Lardelli :
14 Feb 2015 3:05:22pm
An interesting talk Kerryn. As to the “why” of the current obsession with economic growth, the fault is in us. While, as individuals, we pretend to rationality, humans, as a group, do not act in this way. As the products of evolution by natural selection, we act to maximise reproduction – and pity the person who tries to argue against that! For males, greater wealth gives us more access to females. For females, greater wealth gives higher social status and more probable survival of children.
The fact is that we NEED to believe in economic growth because, without that, we are forced to face up to the falsity of what I call “The Big Lie” – namely that we can all improve our lives / get rich. I wrote an essay on this a few years ago:
http://www.onlineopinion.com.au/view.asp?article=13487&page=0
When people are young they can be idealistic and believe that they can change the world. But that would require that the world be a rational place.
When people are older and more cynical like me they realise that human irrationality is a surging tide against which nothing can stand. It will wash over the world and then retreat. All radically new biological innovations thrown up by Nature are like this. Just like a newly evolved microorganism sweeps through a host population wreaking destruction until it – and the host – evolve to commensality, so the new and incredibly adaptable human species will do the same, although how many thousands of years that will take is unknown.
In the meantime, those of us who understand the inevitability of this process can find some small amount of solace by attempting to change things in our local community to enhance the survival of our own children, friends, neighbours and communities. At the local level, the rational part of one human can sometimes make a difference. And there is no sense in getting depressed about the inevitable.