Future Now
The IFTF Blog
HC2020 Interview Notes: Dr. Arnie Milstein, Mercer/PBGH, March 6, 2009
HC2020 Interview Summary: Dr. Arnie Milstein
Interviewer: Richard (w/ Brad & Andrea) Date: March 6, 2009<o:p></o:p>
1. His work
* Improving quality AND reducing cost of health care via:
- Increasing performance transparency (metrics for
providers & patients)
- Developing consumer-decision support tools
- Changing how doctors & hospitals are paid
- Changing insurance design to encourage consumers to
choose better/cheaper alternatives
* Developing new, more efficient forms of chronic care
delivery (e.g., A-ICU)
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TRENDS/CHALLENGES
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2. How optimistic about future of health/healthcare in
2020?
The general direction of change is positive, but he is
pessimistic about the pace & magnitude of change that is occurring.
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3-4. Biggest trends or challenges & responses
1) Payment systems will change to reward doctors &
hospitals that improve quality of care.
Markets will become more performance sensitive.
* RESPONSES: As
a result of this pressure, medical practices will change:
- IT platforms will emerge to track & measure
performance
- IT platforms (expert systems) will embed “active
decision support tools” to prompt doctors & nurses to follow best practices
- Telemedicine will allow remote consultations (already
available throug Blue Cross Hawaii)
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2) Doctors are increasingly able to participate in
networks to learn to improve “health production” through best practices
exchanges
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3) Biggest trend, though will not be felt till after
2020: the ability of health care to absorb & execute on modern service
production processes: “Do for health care what Wal-mart did for retailing” (or
Toyota for manufacturing). Currently, health care has neither the platform or
the knowledge (or incentives) to move to continuous improvement processes.
- EXAMPLES of advanced practices: Virginia Mason,
ThedaCare, Geisinger, Intermountain Health Care (Salt Lake)
- DRIVERS: Institute of Medicine, 1998 Blue Ribbon Report
= “US health care is NOT the best in the world; average performance sucks” –
continued to argue that more must be done to improve performance.
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5. Have these trends surfaced before?
See Altman & Levitt, “The Sad History of Health Care
Cost Containment As Told in One Chart,” Health Affairs, January 2002: “Neither
regulation, voluntary action by the health care industry, nor managed care and
market competition have had a lasting impact on our nation’s health care
costs.”
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6. Challenges/responses not on radar now?
Telemedicine may evolve as a tool for stimulating more
competition.
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FUTURE SCENARIOS
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7. Most preferable scenario
- The gap between real GDP growth and increase in health
care costs declines from 2.5%/year --> 1.5%/year.
- The average level of quality defects is cut in half
- Level of adherence to best practices increases from 55%
--> 75%
- Average customer satisfaction rating increases from 80%
--> 85%
- Substantial increase in public reporting of healthcare
performance
- Significant changes made to linkage of payments to
performance
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8. Most plausible scenario
- There is only a “trivial moderation” in growth of
health care costs (2.5% --> 2.25%)
- Slight decline in quality defects
- Providers are the winners
- Medical specialists in US still be paid 50% more than
in Europe
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9. Most negative scenario
- Health care costs continue to increase at historical
rates
- More people are uninsured or underinsured
- Government begins to cut back on other spending to pay
for health care
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10. Wrap-up
Pain from current inefficiencies in the system is largely
invisible: 24,000 people per year die of “uninsurance” – but not visibly. Those suffering the most pain are the “near
poor,” not the politically powerful. But
if costs keep increasing, this pain will hit the middle class by 2030.
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More generally, people who are sick and scared are not
good customers – they don’t shop for cost or quality.
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A lot of doctors are being rewarded for mediocre
performance. Without effective competition, providers perform “below the
price-performance frontier”
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How to bring about change:
1) Change Medicare payment
rules to reward performance;
2) Change ERISA to apply same rules to rest of
medical care;
3) Clarify rules so
that any provider of telemedicine is deemed to be practicing in the state where
he/she is.