When we look back at contemporary health systems 50 years from now, we will consider them to be an technologically indulgent folly of grand proportions, driven by an imperative to deliver more and more complex care in order to justify higher and higher costs.

In a fee-for-service context, elaborate technologies justify higher costs. An elective angiogram costs $25,000. If this had to be paid by individuals, there would be no interest in conducting them with the frequency that they are performed today.

Perhaps this is why Singapore, with its health savings accounts with health costing around 4% of GDP (achieving the same high outcomes of Australia), lacks the excesses of more universal health systems?

The use of bariatric surgery for obesity is perhaps the most egregious example of this phenomenon. A AU$20,000 – 30,000 procedure is now introducing moral hazard that will undermine attempts to introduce behavioural and lifestyle change i.e. “Why bother changing my lifestyle when I can simply get a lap band to fix me later?”

Pharmaceutical companies are also using this play book with the introduction of their new, highly-specialised, so-called “biologics” to the market, particularly in the cancer area. They are often protein based and extremely difficult to manufacture, but are also very targeted. Funders are responding to this threat with value-based payment schemes where by the drug company only gets paid if the treatment succeeds.

Current health market settings establish this perverse incentive. Moves to value/outcomes-based care will remedy these perversities, providing incentives for activities that reduce care costs. In such an environment, the cheapest interventions also become the most profitable.

Home delivered broccoli instead of lap-bands.

CBT SMS’s instead of SSRIs and psychotherapy.

A rapid learning health system instead of a profit yearning sickness market.