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Saturday, March 1, 2014

Why should we aspire to efficiency?

I came across the 3M's health information  systems blog and a piece titled "Healthcare's Efficiency Challenge"(Link). The author reviewed a book by  William Baumol called The Cost Disease which tries to understand why we have not been able to garner much in terms of efficiency gains in the health care industry. The author posed the question: 
 How do we make the healthcare system more efficient, to improve the output while lowering the costs?
I would suggest until very recently that there has been little incentive or desire to improve efficiency. The payment system has rewarded quite the opposite of value and participants have taken them where the incentives have directed them. Do more, use more complex and expensive approaches, and any marginal level of improvement garnered, even at huge cost, was justified and compensated. The results are predictable and will become increasingly difficult to defend.

Two hundred years ago, 95%+ of the population was engaged in agriculture. We required the overwhelming part of the population to participate in this workforce in order to feed ourselves.  It represented a fundamental change in human social organization which in fact dated back perhaps 10,000 years. A transition occurred, particularly accelerated in the 20th century where a way of life on the farm was destroyed.  The net effect was we now have a remarkable abundance of food at markedly reduced prices. What this transition desirable or would it have been better to
have preserved a way of life, even if had meant food would not have become more abundant?

This sort of transition is not unique. Automation of manufacturing has made countless products better and cheaper and in each case has met with tremendous resistance from specific groups who power or status have been disrupted. The Luddites sought to burn the looms that revolutionized cloth making. Various guilds fought the industrialization of craft trade. In each case they desired to maintain a certain way of life and this may be romanticized. However, the preservation of the way of life for a selected group needs to be understood within a larger context of the even more substantial  improvements which would be garnered by an even larger populations. Call it progress if you will and some might want to disparage. However, the lot of people remarkably better. Who wants to go back to infant mortality and average life span of 40 years of age.

In many respects, medicine is facing just this issue. The historical model for care delivery is archaic and simply not scale able. Wecould be aspiring to deliver care to more for much, much less money, but that is not our priority quite yet. Will it ever be a priority for organized medicine? Would the AMA come out with the statement that we don't need so many expensive physicians. I doubt this. It is simply too disruptive and not realistic to expect that the disruption will be driven from within the industry. It never is.






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