Went to a lecture last night by a guy named Christensen, who's supposedly the national expert on health care economics and stuff. Here's something by him.

Fascinating discussion of this topic. Began by talking about steel and rebar and how the market shifted drastically when larger mills got too set in their path and then were swallowed by mini-mills. Not bad management, just an inexorable trek to obsolescence.

Then, a discussion of health care premiums as a percent of the family income. was 7 percent, then 14, and in about 6 yrs will likely be about 30+%. This is, like the large steel companies, a predictable march towards unsustainability.

In fact, the only way to keep costs down is to develop cost-effective and routinely efficient strategies for health-care delivery. Any discovery process has three stages: intuitive discovery -> generalities that allow for comprehensive discussion of the problem -> specific rules for addressing the issue. There are medical problems that fall into those categories: Type 1 diabetes requires intuitive care, not strict rules. But, treatment of a sore throat has been honed to a set of specific rules that are patient-friendly and cost-effective. Those rules must be implemented to be efficient and cost-effective in situations where care is properly defined. It isn't, generally, because doing more results in more billing, doesn't it?

And, hospitals have positioned themselves as extremely expensive situations. Rather than a streamlined, efficient, cost-effective method of delivering a small cluster of products, they insist on a setup that is inherently hyper-expensive so that it can provide "anything." Small clinics geared towards, e.g., hernia repair, are about 1/3 the cost - for the same product. They are the only way to keep health care costs from skyrocketing.

Unsustainable skyrocketing care costs are also the result of inefficiencies in variations in ordering lab, prescribing medicine, and the general multi-site runaround that seems to be common. 

However, the way to keep costs under control and avoid the unsustainable price rise is anathema to fee-for-service medicine. If the provider makes money by ordering or providing a service, then preventative care is against their financial interests, no? They make less money if they recommend fruits and vegetables and more if they do an angioplasty. It's just how the FFS world is.

So, this gentleman predicted that fixed-pre-payment is the only reasonable method of keeping our culture healthy and preventing the current rise in health care costs. This is different from HMOs. It's a system wherein patients pay a fixed amount per month, and the health care system receiving those premiums knows that it is in their best financial interest to keep the patient from unnecessarily utilizing services, so as to be good stewards of the premiums paid (and that includes giving high-quality care so as to not lose premium dollars to lawsuits, right?).

And therefore he predicts that in the next 6 years, we will see the collapse of the FFS (fee-for-service, the old steel mill model) medical system as we see it today, and a move towards fixed-pre-payment services (the more efficient mini-mills for steel) across the country, competing to keep patients healthy (quality data are readily available as advertising attractants to subscribers) while providing a personable experience and integrating their providers, lab, imaging, etc. (Services in separate locations increase inefficiency/waste and drive up costs, and so are automatically less favorable.) He names a few medical care systems across the country that are already doing this. Those that aren't (the fee-for-service world) are about to have the rug yanked out from under them as they figure out integration, cost-effectiveness, integrated services, and the electronic medical record.

May we live in interesting times...