Crossing the creepy line – big data in health

Hospitals and insurers need to be mindful about crossing the “creepiness line” on how much to pry into their patients’ lives with big data.

http://www.bloomberg.com/news/2014-06-26/hospitals-soon-see-donuts-to-cigarette-charges-for-health.html

Your Doctor Knows You’re Killing Yourself. The Data Brokers Told Her

Photographer: Evan Sung/Bloomberg

Photographer: Pat LaCroix

Photographer: David Paul Morris/Bloomberg

A cupcake eater in San Francisco.

Photographer: Matthew Staver/Bloomberg

A cigarette smoker in Denver.

Photographer: Tim Boyle/Getty Images

A customer at a convenience store in Des Plaines, Illinois.

You may soon get a call from your doctor if you’ve let your gym membership lapse, made a habit of picking up candy bars at the check-out counter or begin shopping at plus-sized stores.

That’s because some hospitals are starting to use detailed consumer data to create profiles on current and potential patients to identify those most likely to get sick, so the hospitals can intervene before they do.

Information compiled by data brokers from public records and credit card transactions can reveal where a person shops, the food they buy, and whether they smoke. The largest hospital chain in the Carolinas is plugging data for 2 million people into algorithms designed to identify high-risk patients, while Pennsylvania’s biggest system uses household and demographic data. Patients and their advocates, meanwhile, say they’re concerned that big data’s expansion into medical care will hurt the doctor-patient relationship and threaten privacy.

Related:

“It is one thing to have a number I can call if I have a problem or question, it is another thing to get unsolicited phone calls. I don’t like that,” said Jorjanne Murry, an accountant in Charlotte, North Carolina, who has Type 1 diabetes. “I think it is intrusive.”

Acxiom Corp. (ACXM) and LexisNexis are two of the largest data brokers who collect such information on individuals. Acxiom says their data is supposed to be used only for marketing, not for medical purposes or to be included in medical records. LexisNexis said it doesn’t sell consumer information to health insurers for the purposes of identifying patients at risk.

Bigger Picture

Much of the information on consumer spending may seem irrelevant for a hospital or doctor, but it can provide a bigger picture beyond the brief glimpse that doctors get during an office visit or through lab results, said Michael Dulin, chief clinical officer for analytics and outcomes at Carolinas HealthCare System.

Carolinas HealthCare System operates the largest group of medical centers in North Carolina andSouth Carolina, with more than 900 care centers, including hospitals, nursing homes, doctors’ offices and surgical centers. The health system is placing its data, which include purchases a patient has made using a credit card or store loyalty card, into predictive models that give a risk score to patients.

Special Report: Putting Patient Privacy at Risk

Within the next two years, Dulin plans for that score to be regularly passed to doctors and nurses who can reach out to high-risk patients to suggest interventions before patients fall ill.

Buying Cigarettes

For a patient with asthma, the hospital would be able to score how likely they are to arrive at the emergency room by looking at whether they’ve refilled their asthma medication at the pharmacy, been buying cigarettes at the grocery store and live in an area with a high pollen count, Dulin said.

The system may also score the probability of someone having a heart attack by considering factors such as the type of foods they buy and if they have a gym membership, he said.

“What we are looking to find are people before they end up in trouble,” said Dulin, who is also a practicing physician. “The idea is to use big data and predictive models to think about population health and drill down to the individual levels to find someone running into trouble that we can reach out to and try to help out.”

While the hospital can share a patient’s risk assessment with their doctor, they aren’t allowed to disclose details of the data, such as specific transactions by an individual, under the hospital’s contract with its data provider. Dulin declined to name the data provider.

Greater Detail

If the early steps are successful, though, Dulin said he would like to renegotiate to get the data provider to share more specific details on patient spending with doctors.

“The data is already used to market to people to get them to do things that might not always be in the best interest of the consumer, we are looking to apply this for something good,” Dulin said.

While all information would be bound by doctor-patient confidentiality, he said he’s aware some people may be uncomfortable with data going to doctors and hospitals. For these people, the system is considering an opt-out mechanism that will keep their data private, Dulin said.

‘Feels Creepy’

“You have to have a relationship, it just can’t be a phone call from someone saying ‘do this’ or it just feels creepy,” he said. “The data itself doesn’t tell you the story of the person, you have to use it to find a way to connect with that person.”

Murry, the diabetes patient from Charlotte, said she already gets calls from her health insurer to try to discuss her daily habits. She usually ignores them, she said. She doesn’t see what her doctors can learn from her spending practices that they can’t find out from her quarterly visits.

“Most of these things you can find out just by looking at the patient and seeing if they are overweight or asking them if they exercise and discussing that with them,” Murry said. “I think it is a waste of time.”

While the patients may gain from the strategy, hospitals also have a growing financial stake in knowing more about the people they care for.

Under the Patient Protection and Affordable Care Act, known as Obamacare, hospital pay is becoming increasingly linked to quality metrics rather than the traditional fee-for-service model where hospitals were paid based on their numbers of tests or procedures.

Hospital Fines

As a result, the U.S. has begun levying fines against hospitals that have too many patients readmitted within a month, and rewarding hospitals that do well on a benchmark of clinical outcomes and patient surveys.

University of Pittsburgh Medical Center, which operates more than 20 hospitals in Pennsylvania and a health insurance plan, is using demographic and household information to try to improve patients’ health. It says it doesn’t have spending details or information from credit card transactions on individuals.

The UPMC Insurance Services Division, the health system’s insurance provider, has acquired demographic and household data, such as whether someone owns a car and how many people live in their home, on more than 2 million of its members to make predictions about which individuals are most likely to use the emergency room or an urgent care center, said Pamela Peele, the system’s chief analytics officer.

Emergency Rooms

Studies show that people with no children in the home who make less than $50,000 a year are more likely to use the emergency room, rather than a private doctor, Peele said.

UPMC wants to make sure those patients have access to a primary care physician or nurse practitioner they can contact before heading to the ER, Peele said. UPMC may also be interested in patients who don’t own a car, which could indicate they’ll have trouble getting routine, preventable care, she said.

Being able to predict which patients are likely to get sick or end up at the emergency room has become particularly valuable for hospitals that also insure their patients, a new phenomenon that’s growing in popularity. UPMC, which offers this option, would be able to save money by keeping patients out of the emergency room.

Obamacare prevents insurers from denying coverage because of pre-existing conditions or charging patients more based on their health status, meaning the data can’t be used to raise rates or drop policies.

New Model

“The traditional rating and underwriting has gone away with health-care reform,” said Robert Booz, an analyst at the technology research and consulting firm Gartner Inc. (IT) “What they are trying to do is proactive care management where we know you are a patient at risk for diabetes so even before the symptoms show up we are going to try to intervene.”

Hospitals and insurers need to be mindful about crossing the “creepiness line” on how much to pry into their patients’ lives with big data, he said. It could also interfere with the doctor-patient relationship.

The strategy “is very paternalistic toward individuals, inclined to see human beings as simply the sum of data points about them,” Irina Raicu, director of the Internet ethics program at the Markkula Center for Applied Ethics at Santa Clara University, said in a telephone interview.

To contact the reporters on this story: Shannon Pettypiece in New York atspettypiece@bloomberg.net; Jordan Robertson in San Francisco atjrobertson40@bloomberg.net

To contact the editors responsible for this story: Reg Gale at rgale5@bloomberg.net Andrew Pollack

New Yorker: Good medicine, it seems, does not always feel good.

This is weird… it’s like doctors are calling themselves out as hucksters? Unable to manage conflicts of interest? Human?? In which case, they can stop carrying on as if they’re something superior.

http://www.newyorker.com/online/blogs/elements/2013/07/when-doctors-tell-patients-what-they-dont-want-to-hear.html

JULY 23, 2013

WHEN DOCTORS TELL PATIENTS WHAT THEY DON’T WANT TO HEAR

Mindy-580.jpeg

There’s an episode of “The Mindy Project,” Mindy Kaling’s comedy about the life of an obstetrician, that begins in the office of an attractive ob-gyn, Dr. Reed. He sits, beaming, in front of his pregnant patient and her husband. He wears a crown of jewels they have given him, and they exchange pleasantries until the inevitable moment arrives: they need to address the patient’s health. She is obese, and her weight poses many risks to the fetus.

Unwilling to jeopardize the affection of his “favorite patient,” Dr. Reed instead summons the brazen and socially inept Dr. Mindy to do his dirty work. True to form, by the end of the scene, Mindy has offended the patient, which escalates into a shouting match until the patient tells Mindy that she’s the one who needs to lose some weight. Reed emerges, halo intact.

Though the scene marks a bad day for Mindy, I think it also heralds what could turn out to be a bad era for American medicine. Beyond the comedic exaggerations lies an age-old tension: Will our patients still like us if we tell them things they don’t want to hear? The challenge of communicating unpleasant, possibly profoundly upsetting information to patients is timeless. What has changed, however, is that physicians are now being judged, and compensated, based upon their ability to do it.

In October, 2012, Medicare débuted a new hospital-payment system, known as Value-Based Purchasing, which ties a portion of hospital reimbursement to scores on a host of quality measures; thirty per cent of the hospital’s score is based on patient satisfaction. New York City’s public hospitals recently decided to follow suit, taking the incentive scheme one step further: physicians’ salaries will be directly linked to patients’ outcomes, including their satisfaction. Other outpatient practices across the country have also started to base physician pay partly on satisfaction scores, a trend that is expected to grow.

But in a country that spends more per capita on health than any other, with results that remain mediocre in comparison, can we really expect that a nation of more satisfied patients will be a healthier nation over all?

Many insist that we can. One of the leading arguments for pay based on satisfaction, as described in a recent Wall Street Journal article titled “The Talking Cure for Health Care,” is that these incentives will improve patient-doctor communication, which will in turn lead to better health. As the article notes, “Doctors are rude. Doctors don’t listen. Doctors have no time. Doctors don’t explain things in terms patients understand.”

Few object to these generalizations. We’ve all had insensitive doctors who have left us confused and scared. I’m a physician, and I often find myself rushing, interrupting, and overwhelming patients with information. But if the path from good communication to better health is through a better understanding of risk factors and disease, then medicine poses a paradox: how much we understand tends to be inversely related to how well we think physicians have communicated.

Consider, for example, a recent study among patients with chronic kidney disease: the more knowledge patients had about their illness, the less satisfied they were with their doctors’ communication. Another study’s title asks, “How does feeling informed relate to being informed?” The answer: it doesn’t. The investigators surveyed over twenty-five hundred patients about decisions they had made in the previous two years, and found no over-all relationship between how informed patients felt and what they actually knew.

The disconnect between patients’ understanding of disease and their satisfaction with physicians is particularly pronounced for care at the end of life. In a recent study published in the New England Journal of Medicine, oncologists studied patients’ expectations of chemotherapy options. For these patients, with either end-stage colon or lung cancer, chemotherapy may provide some help, but it can also be toxic, and definitely doesn’t provide a cure. Doctors know this, but do patients?

In the study, sixty-nine per cent of patients with lung cancer, and eighty-one per cent of patients with colon cancer, did not understand that chemotherapy was not curative. This finding reminds that we have much to learn about how to communicate medical information to our patients. But it is the second finding that suggests why paying based on patient satisfaction isn’t the way to get us there: the more people understood about the grim nature of their prognosis, the less they liked their physicians.

Understanding that there is no cure for your disease is entirely different from understanding why you need to take a blood-pressure medication. Since I suspect that a bit of denial is precisely what allows the dying to live—see the response of a young, pregnant woman to the news that she has incurable lung cancer in Atul Gawande’s “Letting Go” for a beautiful example—I tend to be more concerned with how to keep people from getting sick in the first place.

And this gets us back to the Mindy problem. Sure, there are nice ways of saying, “You need to lose weight, stop smoking, and take this medication that certainly won’t make you feel better but might very well leave you tired and depressed.” But sometimes there aren’t, and it can be tough to separate how we feel about the message from how we feel about the messenger.

I used to be an avid runner, but have had a slew of running injuries—the most enduring of which is a chronic hamstring problem that has made sitting uncomfortable, and running impossible. But for a long time, my approach to any given injury was simple: run through it.

In my quest for quick fixes, I have seen more orthopedists than I can count. But there was one doctor, Dr. D., who tried to teach me the error of my ways. He told me that the problem was not with my body but with my behavior. He said I didn’t need MRIs or steroid injections but rather to stop running and give myself time to heal. And I, in turn, found much that was wrong with him: he started late, didn’t return phone calls, had bad breath, typed with one finger, and, above all, didn’t seem to listen to me. I decided he was the worst doctor in the world and went searching for a new one.

Many months and doctors later, last year, I found “my person.” Most important, she told me I would run again. That she was so nice, so pretty, and so put together (and she injected my aching gluteal region with steroid every time I asked) only reinforced my sense that I was in the most expert of hands. I loved her as much as I wanted to be her.

If you had mailed me a satisfaction survey, you can imagine which doctor would have gotten a bonus. But in the end, it’s Dr. D who was right. I still can’t run, but had I heeded his advice, I’d likely be back to doing marathons.

The problem with the patient-satisfaction surveys is that they assume we can evaluate specific characteristics of doctors, or hospitals, as distinct from their general likability. But that’s not easy. The halo effect is a well known cognitive bias that describes our tendency to quickly judge people and then assume the person possesses other good or bad qualities consistent with that general impression. The effect is perhaps best described in the many positive attributes we ascribe to someone we find attractive. As the Nobel laureate Daniel Kahneman noted, for example, “If we think a baseball pitcher is handsome and athletic … we are likely to rate him better at throwing the ball, too.”

This tendency has been well demonstrated in our judgments of the competence of political candidates, or our willingness to assume innocence for someone accused of a crime. (See Paul Bloom’s post on the unwarranted empathic response to the attractive face of the Boston Marathon bomber Dzokhar Tzarnaev.) Though there are several factors informing the general likability of physicians beyond how we feel about what they tell us, there is no reason to assume we would be somehow immune to this cognitive bias when it comes time to rate them.

Although we tend to be totally unaware of the effects of these haloes on our own judgments, hospitals and outpatient practices are not. That’s why they are investing millions of dollars in renovated rooms, new foyers, gourmet chefs, and valet parking. These are nice perks, and undoubtedly lead to higher scores across all domains of the satisfaction survey.

But do higher scores on a satisfaction survey translate into better health? So far, the answer seems to be no. A recent study examined patient satisfaction among more than fifty thousand patients over a seven-year period, and two findings were notable. The first was that the most satisfied patients incurred the highest costs. The second was that the most satisfied patients had the highest rates of mortality. While with studies like this one it is always critical to remember that correlation does not equal causation, the data should give us pause. Good medicine, it seems, does not always feel good.

Lisa Rosenbaum is a cardiologist, a Fellow at the Philadelphia V.A. Medical Center, and a Robert Wood Johnson Foundation Clinical Scholar at the University of Pennsylvania.

Photograph: Fox

The many reasons why the US is losing in health

  • very interesting piece
  • covers off Cth Fund and IOM comparative work
  • also discusses social determinants, and specifically the idea that less equal societies are comparatively less healthy across the board (including the wealthy)
  • The critical importance of poverty prevalence in a country’s health (AU is 12.5% c.f. average of 9% cf. US of 15%)

Woolf explained this disparity by citing the work of the British social epidemiologist Richard Wilkinson, who has proposed that income inequality generates adverse health effects even among the affluent. Wide gaps in income, Wilkinson argues, diminish our trust in others and our sense of community, producing, among other things, a tendency to underinvest in social infrastructure. Furthermore, Woolf told me, even wealthy Americans are not isolated from a lifestyle filled with oversized food portions, physical inactivity, and stress. Consider the example of paid parental leave, for which the United States ranks dead last among O.E.C.D. countries. It’s not hard to see how such policies might have implications for infant and child health.

  • Political systems have important effects on policy:  fewer “choke points for special interests to block or reshape legislation,” such as filibusters or Presidential vetoes allows change to be enacted without extensive political negotiation.

Other countries have used their governments as instruments to improve health—including, but not limited to, the development of universal health insurance. Health-policy analysts have therefore considered the effect that different political systems have on public health. Most O.E.C.D. countries, for example, have parliamentary systems, where the party that wins the majority of seats in the legislature forms the government. Because of this overlap of the legislative and executive branches, parliamentary systems have fewer checks and balances—fewer of what Victor Fuchs, a health economist at Stanford, calls “choke points for special interests to block or reshape legislation,” such as filibusters or Presidential vetoes. In a parliamentary system, change can be enacted without extensive political negotiation—whereas the American system was designed, at least in part, to avoid the concentration of power that can produce such swift changes.

  • universal health coverage is not just altruistic, but also self-interested
  • healthcare is only responsible for between 10 and 25% of improvements in life expectancy – SDH responsible for the rest, mainly elements that impact on early childhood

Most experts estimate that modern medical care delivered to individual patients—such as physician and hospital treatments covered by health insurance—has only been responsible for between ten and twenty-five percent of the improvements in life expectancy over the last century. The rest has come from changes in the social determinants of health, particularly in early childhood.

 

 

 

http://www.newyorker.com/online/blogs/elements/2014/06/why-america-is-losing-the-health-race.html

JUNE 13, 2014

WHY AMERICA IS LOSING THE HEALTH RACE

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Many Americans are aware that the United States spends much more on health care than any other country in the world. But fewer people know that the health of Americans—by many different measures—is actually worse than the health of citizens in other wealthy countries.Two major reports, both released last year, provide further elaboration of this apparent paradox. The first, “The State of US Health, 1990-2010,” documented trends in mortality and morbidity across the thirty-four member countries of the Organization for Economic Cooperation and Development (O.E.C.D.). The study, published in The Journal of the American Medical Association (to which I am a contributing writer), showed that both life expectancy and healthy-life expectancy improved in the United States over two decades. But the pace of those improvements was considerably slower in the United States: in 1990, the U.S. ranked twentieth among O.E.C.D. countries for life expectancy, and fourteenth for healthy-life expectancy; by 2010, it had fallen to twenty-seventh and twenty-sixth, respectively. The other charts and tables in the report—about heart, lung, and kidney disease; diabetes; injuries and homicides; depression; and drug abuse—all show Americans suffering poorer health.

The second report, commissioned by the National Institutes of Health, and conducted by the National Research Council (NRC) and the Institute of Medicine (IOM), convened a panel of experts to examine health indicators in seventeen high-income countries. It found the United States in a similarly poor position: American men had the lowest life expectancy, and American women the second-lowest. In some ways, these reports were not news. As early as the nineteen-seventies, a group of leading health analysts had noted the discrepancy between American health spending and outcomes in a book called “Doing Better and Feeling Worse: Health in the United States.” From this perspective, the U.S. has been doing something wrong for a long time. But, as the first of these two reports shows, the gap is widening; despite spending more than any other country, America ranks very poorly in international comparisons of health. The second report may provide an answer—supporting the intuition long held by researchers that social circumstances, especially income, have a significant effect on health outcomes.

Americans’ health disadvantage actually begins at birth: the U.S. has the highest rates of infant mortality among high-income countries, and ranks poorly on other indicators such as low birth weight. In fact, children born in the United States have a lower chance of surviving to the age of five than children born in any other wealthy nation—a fact that will almost certainly come as a shock to most Americans. But what causes such poor health outcomes among American children, and how can those outcomes be improved? Public-health experts focus on the “social determinants of health”—factors that shape people’s health beyond their lifestyle choices and medical treatments. These include education, income, job security, working conditions, early-childhood development, food insecurity, housing, and the social safety net.

Steven Schroeder, the former president of the Robert Wood Johnson Foundation—the largest philanthropic organization in the United States devoted to health issues—had a definitive answer to my question about why Americans might be less healthy than their developed-country counterparts. “Poverty,” he said. “The United States has proportionately more poor people, and the gap between rich and poor is widening.” Seventeen per cent of Americans live in poverty; the median figure for other O.E.C.D. countries is only nine percent. For three decades, America has had the highest rate of child poverty of any wealthy nation.

Steven Woolf, of Virginia Commonwealth University, who chaired the panel that produced the NRC-IOM report, also pointed to poverty when I asked him to explain the causes of America’s health disadvantage. “Could there possibly be a common thread that leads Americans to have higher rates of infant mortality, more deaths from car crashes and gun violence, more heart disease, more AIDS, and more premature deaths from drugs and alcohol? Is there some common denominator?” he asked. “One possibility is the way Americans, as a society, manage their affairs. Many Americans embrace rugged individualism and reject restrictions on behaviors that pose risks to health. There is less of a sense of solidarity, especially with vulnerable populations.” As a percentage of G.D.P., Woolf observed, the U.S. invests less than other wealthy countries in social programs like parental leave and early-childhood education, and there is strong resistance to paying taxes to finance such programs. The U.S. ranks first among O.E.C.D. countries in health-care expenditures, but as Elizabeth Bradley, a researcher at Yale, has documented, it ranks twenty-fifth in spending on social services.

The NRC-IOM report emphasized the effect of social forces on children and how those forces carry over to affect the health of adults, noting that American children are “more likely than children in peer countries to grow up in poverty” and that “poor social conditions during childhood precipitate a chain of adverse life events.” For example, of the seventeen wealthy democracies included in the report, the U.S. has the highest rates of adolescent pregnancy and sexually transmitted diseases, and the second-highest prevalence of H.I.V. This platform of adverse health influences in childhood sets up the health disadvantage that remains pervasive for all age groups under seventy-five in the United States.

It seems likely that many Americans would respond to these figures—and to the role poverty plays in poor health outcomes—by assuming that the data for all Americans is being skewed downward by the health of the poorest. That is, they understand that poor Americans have worse health, and presume that, because the United States has more poor people than other wealthy countries, the average health looks worse. But one of the most interesting findings in the NRC-IOM report is that even white, college-educated, high-income Americans with healthy behaviors have worse health than their counterparts in other wealthy countries.

Woolf explained this disparity by citing the work of the British social epidemiologist Richard Wilkinson, who has proposed that income inequality generates adverse health effects even among the affluent. Wide gaps in income, Wilkinson argues, diminish our trust in others and our sense of community, producing, among other things, a tendency to underinvest in social infrastructure. Furthermore, Woolf told me, even wealthy Americans are not isolated from a lifestyle filled with oversized food portions, physical inactivity, and stress. Consider the example of paid parental leave, for which the United States ranks dead last among O.E.C.D. countries. It’s not hard to see how such policies might have implications for infant and child health.

Other countries have used their governments as instruments to improve health—including, but not limited to, the development of universal health insurance. Health-policy analysts have therefore considered the effect that different political systems have on public health. Most O.E.C.D. countries, for example, have parliamentary systems, where the party that wins the majority of seats in the legislature forms the government. Because of this overlap of the legislative and executive branches, parliamentary systems have fewer checks and balances—fewer of what Victor Fuchs, a health economist at Stanford, calls “choke points for special interests to block or reshape legislation,” such as filibusters or Presidential vetoes. In a parliamentary system, change can be enacted without extensive political negotiation—whereas the American system was designed, at least in part, to avoid the concentration of power that can produce such swift changes.

Whatever the political obstacles, a major explanation for America’s persistent health disadvantage is simply a lack of public awareness. “Little is likely to happen until the American public is informed about this issue,” the authors of the NRC-IOM report noted. “Why don’t Americans know that children born here are less likely to reach the age of five than children born in other high income countries?” Woolf asked. I suggested that perhaps people believe that the problem is restricted to other people’s children. He said, “We are talking about their children and their health too.”

The superior health outcomes achieved by other wealthy countries demonstrate that Americans are—to use the language of negotiators—“leaving years of life on the table.” The causes of this problem are many: poverty, widening income disparity, underinvestment in social infrastructure, lack of health insurance coverage and access to health care. Expanding insurance coverage under the Affordable Care Act will help, but pouring more money into health care is not the only answer. Most experts estimate that modern medical care delivered to individual patients—such as physician and hospital treatments covered by health insurance—has only been responsible for between ten and twenty-five percent of the improvements in life expectancy over the last century. The rest has come from changes in the social determinants of health, particularly in early childhood.

Self-interest may be a natural human trait, but when it comes to public health other countries are showing the U.S. that what appears at first to be an altruistic concern for the health and care of the most vulnerable—especially children—may well result in improved health for all members of a society, including the affluent. Until Americans find their way to understanding this dynamic, and figure out how to mobilize public opinion in its favor, they will all continue to lose out on better health and longer lives.

 

Allan S. Detsky (M.D., Ph.D.) is a general internist and a professor of Health Policy Management and Evaluation and of Medicine at the University of Toronto, where he was formerly physician-in-chief at Mount Sinai Hospital. He is a contributing writer for The Journal of the American Medical Association.

 

Photograph by Ashley Gilbertson /VII.

Blumenthal: On the need for the leaders to be IT savy

 

http://www.commonwealthfund.org/publications/blog/2014/jun/of-leaders-and-geeks

Of Leaders and Geeks

 Tuesday, June 24, 2014

Consider these seemingly unrelated developments:
  1. An IT failure (healthcare.gov) nearly destroys a president’s legacy, while a seeming IT triumph (the National Security Agency’s electronic snooping skills) throws his foreign policy into turmoil.
  2. According to Michael Lewis’ fascinating and scary book, Flash Boys, Wall Street geeks make billions through high-frequency trading, running circles around clueless masters of the universe in charge of America’s biggest banks and hedge funds.
  3. For the second year in a row, the American Medical Association elects a health IT expert as its president.

This could be nothing. But then again, could it be something really big? Could we be witnessing a fundamental change in the requirements for leadership in health and every other sector of society?

We all live with stereotypes and here is one of the most powerful: We have leaders and we have geeks. Leaders change history. They sit atop governments and corporations. They craft strategy, cut deals, rally the troops, and guide humanity into the future. They don’t need to understand technology, because they have geeks.

Geeks sit in cubicles off-site somewhere. They spend their days coding, wiring, and rushing to help impatient leaders whose systems are down. Geeks show up when they’re needed, and go away when they’re not. The technology they manage is like plumbing or electricity. If you don’t like your plumber or electrician, there’s always another in the wings.

Leaders don’t have to manage geeks. They have people who have people who manage geeks.

Like all stereotypes, this one is exaggerated and not wholly accurate, but it makes a point. In health and other areas, leaders sometimes take a kind of perverse pride in their ignorance of information technology and how it works. It’s as though familiarity with IT would damage the aura that qualifies them for the huge responsibilities they seek and enjoy. Of course, they may have content expertise acquired during their rise through the ranks. In health care, it may be training and experience as a health professional and/or academician; in business, it may be marketing or finance; in government, it may be elected office or policy expertise. But almost never is an understanding of information technology considered a vital ingredient in preparing leaders to assume their great responsibilities.

There are exceptions. The leaders of some of the world’s most successful new companies—Microsoft, Google, Apple, Facebook—are or have been technologists.  But they run technology companies. It makes sense that for this industrial sector, real geeks should sit in the CEO’s office.  But for most of the rest of our public and private enterprises, the gap between technology experts and leaders persists.

This may be changing. Recent history suggests that at least for health care leaders—whether in government or the private sector—a deep appreciation for, and even understanding of, information technology may be a vital asset.  How could it be otherwise? In health care, as elsewhere, information is power: not only the power to heal, but also the power to improve quality, efficiency, reliability, safety, and value.  And information technology, acting as a health care organization’s circulatory system, collects, manages, and circulates that information.

Today’s and tomorrow’s successful leaders do not need to be technologists, but they do have to own technology policy and problems in a way few do right now. And they have to incorporate into their inner circles of advisers individuals capable of bridging the historical divide between technology experts and leaders. The alternative could be a future full of healthcare.gov launches, or worse, a continuing failure to take full advantage of the power of information to optimize health system performance.

 

Health economics lays down the dirty on doctors… not sure i buy all of it

A couple of suggested reads following a chat with Anthony Carpenter…

Le Grand – Government failure

 

FROM: P132-134 in W.C. Hsiao/Health Policy (32) 1995 125-139.

Hsiao – market failure

While physicians can serve as agents for patients, advising them about needed medical treatments, physicians also provide those treatments and earn their livelihood from them. The dual role of agent and provider creates an imperfect agency relationship, allowing physicians to induce demand for their own services in the interests of profit or professional satisfaction.

[…]

Studies have found that physicians possess the ultimate degree of market power as demonstrated by their ability to price-discriminate [17] and to induce demand for profitable services such as the use of expensive and profitable technology, surgery and drugs [18]. This market failure results in high income for physicians, performance of unnecessary services (which may harm patients), and overuse of expensive technology and drugs.

[…]

Moreover, even in normal circumstances, physicians and hospitals cannot tell patients in advance the price of treatment because of the uncertainty of diagnosis and individual’s recovery rate. Thus, a basic prerequisite of market competition – advance price information-is largely absent in the clinical-service market.

Hospitals also tend to be local monopolies. Because of the large capital investment required to build and equip a hospital, and because of economies of scale, a community may have only one or two hospitals. In an unregulated environment, a hospital could use its monopolistic power to generate excess profit, offer poor-quality services, and acquire expensive and prestige-enhancing technology without regard to cost-effectiveness.

However, price controls are not sufficient to control health costs. International experience shows that providers can increase the volume of services by inducing demand, altering medical practice patterns, and shifting to high-priced drugs, which give higher mark-ups to compensate for falling revenues arising due to price regulations. Developed countries have thus had to regulate both price and quantity. Payment methods based on capitation, total hospital budget, and global budget for physician services have all proven effective in controlling costs and allocating resources. The United Kingdom has adopted the capitation payment method for GPs. Managed-care plans in the United States are also adopting capitation payment. Canada, Germany, and Japan all rely on one form or another of global budgeting to control cost inflation and allocate resources. Their experiences with

global-budget approaches show that these methods are effective in containing cost escalation [20].

Because providers can induce demand, developed nations have found that they have to control the aggregate supply (such as the number of hospital beds, the number of physicians, and distribution of physicians by specialty) in conjunction with other government actions. Otherwise, as Germany found, excess supply creates pressure to increase global budgets. Government has also had to regionalize expensive and complicated services (such as kidney and heart transplants, hip and knee replacements, coronary artery bypass grafts, and the like) because competition for prestige prompts medical centers to acquire the latest technology regardless of cost-benefit.

FROM: P132-134 in W.C. Hsiao/Health Policy (32) 1995 125-139.