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Wednesday, December 23, 2009

The Death Of In-Person Medical Conferences

The Death Of In-Person Medical Conferences

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Will the withdrawal of large financial resources from big pharma, which have historically supported medical conferences, occurring at the same time as the entry of large numbers of physicians who are facile with and comfortable with virtual meeting tools spell the end of medical conferences in the US?

Tuesday, December 22, 2009

Health care reform reality- they just can't make this stuff up

As details become available on the odd mix of compromises required to buy the votes of key senators, it becomes clear that the time line which has been the driver of this process is viewed in terms of days to weeks, not years to decades. There is essentially no priority on creating an sort of workable system in the long term.

How else can one view the incorporation of the provisions to provide specific sweetheart deals for specific states. There is a certain irony that Nebraska, a state whose motto is "Equality before the law", gets a deal whereby the rest of the country picks up the tab for the expanded Medicaid mandate. Who can or will be held to this promise? How in the world can this be constitutional? Why not just have income taxes accrue to those who live in states who voted against you if you have the votes to pull this off?

The odd and unjustifiable preferences go on and on. There is an excise tax on "lavish" plans except for 17 states (I wonder how many have democratic senators?). Is there a precedent for federal taxes levied only on selected states? Hawaii gets a pass on all of this. How does that work?

Medicare advantage is going away...sort of. However, Florida residents as well as some individuals in Pennsylvania, New York, and Oregon will be grandfathered out of being impacted by these cuts. What about equal protection under the law? Is this a dead concept?

I can't help but think of George Orwell's Animal farm. Everyone is equal but some are more equal than others. Harry Reid believes it is all about compromise. I am not sure that he entirely understands just what he is compromising. Perhaps he does.

Sunday, December 20, 2009

Regulatory blunt force trauma

I came across a very interesting series are papers published in the Journal of Legal Studies in June of 2001. They were a series of articles published on the impact of managed care and the papers were compiled by one of my "heros", Richard Epstein, author of Simple Rules for a Complex World. If you have not read this book, it is really worth a look.

The feature paper was by David Hyman and it was entitled "Health Care Fraud and Abuse: Market change, social norms, and the trust of reposed in the workman".

There were accompanying critiques which were critical of Hyman's analysis at some levels, but were in general agreement overall. The summary of the critique by Arti Rai sums things up clearly:

"... that health care fraud control is largely a catchphrase that is being used to divert attention from the much more difficult task of allocating health care resources in a manner sensitive to both cost and quality"

In the almost 10 years since these papers were published, there has been a major push to address the issues of efficient allocation and quality. That is the good news. We should be concerned with cost and quality. However, what tools are available to accomplish these goals. There appears to be a sentiment that the same sort of administrative tools which were deployed (with marginal success) to reign in "fraud and abuse" can be used to deal with quality and cost.

I know that the product of these interventions will focus on what can be readily measured. This data will take on a life of its own, being analyzed almost exclusively by those totally divorced from clinical encounters. While these measures will start out as surrogates for actual desired endpoints, they will quickly become the only endpoints that matter for reward.

Saturday, December 19, 2009

The Scientist : Promises, Promises

Must read on science and predictions

The Scientist : Promises, Promises

This article underscores the basic tension between being a skeptic, which is required for doing good science, and the advocacy which is increasingly required to convince funding sources that your science is worth supporting. Zealotry comes from true believers, something which should be hard to find in the scientific community.

Gaming behavior in Medicine

I spent much of the morning trying to find any writings on gaming behavior in medicine. There is only a very modest amount written on this subject. This is not surprising since there is essentially no upside to whomever would decide to undertake such a project. There was a study published in JAMA in 2000 (Wynia, et al; 283: 1858) which undertook a survey of physicians. They found that almost 40% would game the payment system in order to further the ends of their patients. While this raises all sorts of ethical questions, in my estimation it misses the more prevalent and less noble gaming opportunities.

I found a very interesting letter published on December 5, 1990 in JAMA (264:2742) sent in by Dr. Paul M. Allen discussing what was then the novel activity of unbundling". He astutely identified this as identifying an economic and not a medical activity. What was most striking was his realization that:

"The magnitude of the problem is illustrated by the fact that companies have been formed whose sole purpose is to teach physicians or their office staff how to code."

This was a very interesting letter which had two citations.The first was the 1990 CPT book published by the AMA. The second was George Orwell's Animal House. There is a message here.

Thus the norms in 1990 were that this development (the formation of consultant billing entities) was a problem, a far cry from the present state where not only is this not viewed as a problem, it is viewed as an essential business practice. As part of our residency assessment were are required to have this as part of resident education. In the span of less than twenty years we have gone from being mortified by a particular behavior to viewing it as required.

The lesson is that financial pressures over time can and will alter norms. Our actions will move toward where our rewards (mostly financial) are derived. We will ultimately rationalize our behavior to justify our actions.

How common is the gaming behavior which serves physician interests? I can only speculate in the absence of hard data. However, if you take the 40% number derived from the JAMA study, it is not unreasonable to assume that at least an equivalent percentage will game the system to further their own ends. Most of the gaming activities are neither illegal nor are they frowned upon by peers. Quite the contrary; over time they are increasingly viewed as essential aspects of practice, much like believing the cows were struck by lightning (see

Sunday, December 13, 2009

Hard wired gamers

The Wall Street Journal

DECEMBER 7, 2009

Miles for Nothing: How the Government Helped Frequent Fliers Make a Mint
Free Shipping of Coins, Put on Credit Cards, Funds Trip to Tahiti; 'Mr. Pickles' Cleans Up

Enthusiasts of frequent-flier mileage have all kinds of crazy strategies for racking up credits, but few have been as quick and easy as turning coins into miles.

At least several hundred mile-junkies discovered that a free shipping offer on presidential and Native American $1 coins, sold at face value by the U.S. Mint, amounted to printing free frequent-flier miles. Mileage lovers ordered more than $1 million in coins until the Mint started identifying them and cutting them off....

Complete story at

I just thought this story was so interesting at multiple levels. First it was illuminating in terms of human behavior and the genius of human ingenuity. There is little reason to hold those who devised the program for the US Mint accountable. Who would have thought ahead of time that this program would be "gamed" by people using the frequent flyer system? Even if someone involved thought of this they would be embarrassed to raise this as a concern. I can hear the conversation now.. "Don't be so jaded!!! Would you do such a thing?"

The truth is that most people would not think of this and if they did, the little voice in their head would tell them that perhaps this was not quite right to do. Whether or not most people would not do this becomes irrelevant in the longer term. Someone, somewhere had a eureka moment when they realized how to game this program and this particular someone had no problem testing out their hunch, which paid off handsomely.

This type of information always gets out and spreads almost like a virus. At first, there may be resistance because something does not feel right. Perhaps it is legal but given the fact that this was not what the program was intended for, most people will elect not to pile on board. That is just a temporary state. Over time as we see others exploit such opportunities, we tend to be less resistant being swayed by seeing what we think we have lost. We do not like to "leave money on the table."

You might ask what this may have to do with health care and the health care reform debate. The story was just about a small element of the US Mint and the exploitation of an obscure program by perhaps dozens of people. The difference between the US Mint and health care is that despite the name (US Mint), the real money is in health care. Within the present and proposed health care structure and innumerable "gaming" opportunities. Furthermore, there are entire companies filled with very smart people whose only job is to think about ways to game the present system and any proposed changes. When one of these people or entities has a eureka moment, the information spreads at the speed of light to armies of people who sole focus is to exploit the discovery and turn this into dollars in their pockets.

Oddly enough, the entities which seem to be outside this information flow are those entities which devise the ground rules. Perhaps they are not actually outside the flow, they are just not at liberty to respond in any time frame relevant to the real world. The net effect of this is the unintended consequence of the complex command and control structure is to create what amounts to be unlimited opportunities to the gamers. In other words, those who are rewarded most are those who, virtually everyone would agree at the outset, were those who displayed behaviors which, although not illegal, were the least emulatable when the process began. Over time, the consistent reward of these behaviors creates a world where they are no longer frowned upon, but in fact become the aspirations of the many.

If these behaviors actually created value for patients, this would be a virtuous cycle. Unfortunately, the hit rate for rewarding what should be rewarded and for pricing specific activities appropriately is not even close to ideal. You might ask for specific examples. Just listen to any advertisement for specific medical services. No physician or hospital system is going to advertise for services that lose them money. Look at durable medical equipment (scooters for no cost), medications advertised to the public, and a host of specialty procedures (gamma knife surgery, specialty orthopedic practices focusing on young people, sinus surgery, high end imaging, endoscopy, skin cancer surgery, etc).

I do not mean to imply that no one actually benefits from these services. Many patients do. However, the criteria for the application of these technologies ultimately becomes defined by those who game the system most aggressively. When there are tangible and immediate rewards for stretching the rules and no brake on this type of behavior other than individual ethical constraints, the ethical framework will morph over time. Behavior which would be viewed as unthinkable and unlikely at the outset becomes the norm.

Each round of state intervention in the health care market has created new gaming opportunities and there is no reason the believe that the next rounds will provide any fewer chances. In fact there is every reason to suspect that they will provide a bounty of opportunities unlike anything seen heretofore. We have an army of consultants and employed MBA's deployed with the charge of find the money. They are to a great degree unaware of and unconstrained by the nuances of medical practice. Their success is measured by the most measurable of metrics...dollars. Let the games begin!

Saturday, December 12, 2009

How could they have been so blind? Hindsight and Foresight

A recurring theme of human history could be termed "How could they be so blind!" This refers to the many events which led up to some sort of major human tragedy which in retrospect displays two common characteristics. First, there is virtually complete consensus that the events should and could have been avoided. Second there is disbelief that no one apparently stood up and intervened in some way to prevent the obviously undesirable events from happening.

The most recent event which could fall into this category is the housing bubble which collapsed in 2008 bringing upon us the worst financial calamity of almost 100 years. I think the lead up to the collapse and the forces which drove us to this state have broad implications outside of the housing market and actually have tremendous implications in health care markets as well.

Even in hindsight, it is very difficult to sort out what EXACTLY happened. That is not possible. The temptation is to identify who is at fault but the reality is virtually everyone is at fault by the nature of what we are and how we are individually motivated. In my estimation the financial collapse had its origins in the misalignment of incentives and an iterative process which, over time, consistently punished those who tried to act as voices of reason.

Specifically the mixture of undesirable tax advantages, unwise subsidies, ill-conceived legislation, and short sighted interest rate policies created an environment where individuals and companies made huge amounts of money doing really stupid activities. Those individuals who resisted jumping on board made what happened to be a bad financial decision in the short term, even though their decisions appear to be prudent in the longer term. Over time, those people who were more prudent either changed their minds or left the business, leaving only those with an outlook and perspective which fed the bubble and had disastrous consequences in the end. In the short to intermediate term, the feedback loops which operated basically punished only those who ultimately were vindicated. In the mean time they were dismissed and marginalized while the true believers were laughing all the way to the bank.

At any given moment of time looking back in time after a calamity happens, it is always easy to see the folly of certain activities. When events are unfolding, it is more difficult to to have the insight required, particularly when we find ourselves awash in a sea of rewards for doing what ultimately turns out is absolute folly.

You might ask how this relates to health care? In many respects health care now operates under a similar perverse mix of peculiar tax incentives, unwise subsidies, ill-conceived legislation which result in individuals and companies making ridiculous sums of money. Those in health care who raised concerns about thoroughly bizarre billing schemes and business practices find themselves in a position where they are in some sense acting irrationally. If you can legally bill and collect large sums for particular activities, why not preferentially engage and bill for these activities. Why would ANYONE leave money on the table? The environment which fosters such thinking has gone on long enough the effectively cull out anyone who resists buying into this culture.

The present business model is predicated on full exploitation of difficult to defend pricing and billing activities. No one wants to make the prices transparent since this activity will make the indefensible price structure obvious. However, the pricing and payments are transparent to those who provide the services. This results in aggressive promotion of high margin activities whether they are of particular value to patients or not.

All this may be obvious to those in the know, generally insiders in the health care industry. However, there is little incentive to speak or act since this would likely result in punishing only yourself. Thus the bubble will continue to grow and like the mortgage industry, the voices of reason will be culled out over time, leaving behind only those who will be blindsided. When the day of reckoning comes, we will all ask why don't anyone see this coming?

Friday, November 27, 2009

New models for care of whom?

* The Wall Street Journal

* NOVEMBER 27, 2009

Insurer Aims to Alter Health-Care Fee Model


Blue Cross Blue Shield of Massachusetts Inc. is expected to announce Friday a deal covering 60,000 members of the Caritas Christi Health Care system, marking one of the country's largest experiments in fundamentally changing the way doctors and hospitals are paid.

In most of the U.S. health-care system, doctors and hospitals generally earn money when people get sick, under a reimbursement system known as "fee for service." But Blue Cross is trying to change the payment model to a system in which doctors and hospitals earn more by keeping patients healthy and out of doctors' offices and hospitals.

If successful, the approach offers a potential model for the rest of the U.S. Legislation to overhaul the health-care system pending in the Senate calls for Medicare to set up small experiments to change reimbursement in ways similar to what Blue Cross is attempting....

Full article at:

I am not a fan of the present payment scheme in American Medicine...far from it. However, the idea that a what amounts to be a capitated network controlled by hospitals would end up delivering better service and care to patients has serous flaws. In order to understand the almost certain breakdowns which will occur using this model, you need to first think about who is contracted to who.

Ideally, contractual arrangements are constructed between two parties and some sort of exchange happens between the two parties. Each party controls their own resources and has the ability to continue the relationship or to end the contract. The decision to invest their own resources and continue to relationship is based upon their own criteria which may or may not bear great semblance to criteria established by someone else. You can decide what is important to you and allocate your own resources accordingly

In the case of a capitated health care network proposed, there are patients who relinquish or are granted financial resources through some mechanism (wages withheld, taxes, government largess) and this money goes directly to some third party, generally some variant of insurance company. Thus from the start, those who supposedly are the final recipients of any health care services control none of the resources. Patients ultimately must be dependent upon the kindness of strangers unless the incentives of those who hold the money are aligned with the needs and wants of patients. Fat chance that will happen consistently.

Next the real contractual arrangements are negotiated between the insurance company and some sort of health care delivery agent. In the Massachusetts plan outlined in the WSJ story, the insurance company develops some sort of prepaid agreement with hospitals based upon the assumption that for a set amount of money, hospitals will deliver complete care to a set of patients. The idea is that hospitals can function as some sort of accountable entity. The question becomes accountable to whom?

Ultimately hospitals (or integrated health care systems) in this scenario are accountable primarily to legal entities with whom they have entered into contractual obligations, that being the insurance companies who hold the money. Any actual obligation to patients, who hold a limited ability to control resources, must be secondary.

One of the basic tenants of moving to a capitated model in an integrated system is that physicians will no longer be paid for doing more things to patients, thus ending a perverse incentive structure which rewarded some physicians for over utilizing lucrative activities. However, the new system will replace one set of perverse incentives with a second perhaps worse incentives. Physicians (and presumably non-MD extenders of all types) will be employees of of the specific entities which have primary contractual obligations not to patients but to insurers.

Will (or should) all encounters between patients and providers be preceded by the equivalent of the reading of the "Health Care Miranda" statement which might read like:

" I may appear to be your personal physician (physician extender, nurse practioner..) and have your best interests in mind. However, I am an employee of the XXXXXXX Health Care system with whom I have a contractual obligation. You may have specific wants and desires relating to your health care and our priorities at XXXXXXX Health Care system hopefully overlap to some degree with your priorities. My entire compensation and benefits are paid by XXXXXXX Health Care system. My year end bonus is primarily based upon specifically measurable end-points which may have little to do with your specific health or well being. It is our mission to deliver what we have convinced our contractual partners that you need, not necessarily to deliver what you want. I am incentivized to avoid making you particularly unhappy but there is little financial reason for me to aim to go much beyond this goal since I do not actually work for you".

Wednesday, November 25, 2009

Where are our blind spots?

Hindsight is 20/20. Yes, it may be cliche but it is also a truism. Nowhere is this so obvious as when a major scam or hoax is uncovered. When Bernie Madoff's Ponzi scheme was revealed, the warning signs were so obvious in retrospect.

Many things change but one thing that does not is for us to thrive (both individually and together), we must be trusting to some degree. In being so we are prone to be scammed and when we or someone else is the victim of a scam or hoax, we scratch our heads and ask, how could we (or anyone) be so gullible?

Being a person of science, I am reasonably well steeped in the concepts of skepticism and testable hypotheses. One of the great things about the scientific method is the emphasis on testing things in an environment where one has a good handle on most of the key variables. The problem is that context has only limited applicability to the real world. Most of the circumstances we find ourselves in real life which require some sort of decision are one shot deals where we do not even begin to know all the variables. We will experience an outcome where we are not able to make any reasonable comparisons to alternative outcomes. We will be able to decide whether we are happy with our respective outcomes and nothing more.

Under only the rarest of circumstances do people live without the need for interactions with other people. We require "things" as well as emotional support from our fellow humans, much of which which obtain through formal and informal exchange. Ideally, the exchange which occurs results in each party benefiting from the exchange. There are circumstances where it is obvious when one of the parties has been deceitful and the exchange is asymmetric, and it becomes obvious in a time frame where those affected understand the outcome.

In contrast, there are many instances throughout history where entire populations have been "scammed" for generations. Perhaps the most obvious examples have been ruling elites who employed sages, priests, wizards, and the related classes of experts who provided purported glimpses into the future. Many models were used. The ancient Chinese used broken bones from animals and the Greeks and Romans consulted the Oracle of Delphi. Perhaps it is too strong to use the term scam since this implies some sort of intentional deceit. Still experts sold themselves as having skills beyond what they could actually deliver. No one caught on for hundreds of years because there was not way to demonstrate their predictions were actually wrong.

There is constancy throughout history in that widely held beliefs are found to be simply wrong at a later period of time when tools or circumstances allow for actual testing of hypotheses. It is very unlikely that this has changed or will change in the near future. The question arises, what widely held beliefs do we now have that will prove to be completely wrong?

Sunday, November 22, 2009

Understanding what is knowable

A piece appeared last week in the WSJ on the rating system of wines and how a particular winery proprietor and Professor conceived and executed a blinded trial to assess the ability of wine tasting to provide any sort of consistent and reproducible results. The piece can be found at:

A relevant excerpt which summarizes the key findings is:

"The unlikely revolutionary is a soft-spoken fellow named Robert Hodgson, a retired professor who taught statistics at Humboldt State University. Since 1976, Mr. Hodgson has also been the proprietor of Fieldbrook Winery, a small operation that puts out about 10 wines each year, selling 1,500 cases

A few years ago, Mr. Hodgson began wondering how wines, such as his own, can win a gold medal at one competition, and "end up in the pooper" at others. He decided to take a course in wine judging, and met G.M "Pooch" Pucilowski, chief judge at the California State Fair wine competition, North America's oldest and most prestigious. Mr. Hodgson joined the Wine Competition's advisory board, and eventually "begged" to run a controlled scientific study of the tastings, conducted in the same manner as the real-world tastings. The board agreed, but expected the results to be kept confidential.....

In his first study, each year, for four years, Mr. Hodgson served actual panels of California State Fair Wine Competition judges—some 70 judges each year—about 100 wines over a two-day period. He employed the same blind tasting process as the actual competition. In Mr. Hodgson's study, however, every wine was presented to each judge three different times, each time drawn from the same bottle.

The results astonished Mr. Hodgson. The judges' wine ratings typically varied by ±4 points on a standard ratings scale running from 80 to 100. A wine rated 91 on one tasting would often be rated an 87 or 95 on the next. Some of the judges did much worse, and only about one in 10 regularly rated the same wine within a range of ±2 points.

Mr. Hodgson also found that the judges whose ratings were most consistent in any given year landed in the middle of the pack in other years, suggesting that their consistent performance that year had simply been due to chance."

There is an important lesson to be learned from this study. Perhaps the most important knowledge that anyone can have is the knowledge required to recognize that you don't know. This actually reminded me of an experience I had in my internship in the late 1970's when I spent a year as a general medical intern. I worked in a general hospital caring for patients with acute bread and butter medical problems. We had a substantial numbers of patients with acute strokes and it was at the beginning of the era of sophisticated imaging tools. However, our specific hospital did not have a CAT scanner. We were able to get scans in a not so timely fashion from another sister hospital in the area.

For the first half of the year the medical service would admit the patient and get an immediate Neurology consultation. The Neurology resident would come with their big black bag and use the time honored tools of the bedside neurology exam to localize the lesion. They would then write a detailed noted confidently describing where the stroke lesion resided in the brain. They did so based upon years of experience using these tools and there was great confidence in the utility of thse time honored tools. After their assessment the Neurology team would then recommend the patient receive a CAT scan of the brain when the test could be done.

Unfortunately, the time honored bedside tools had never actually been validated since the tools to validate them had not yet been developed; that is until new imaging tools were developed and deployed in the late 1970's. During the first six months of my internship the sequence was always neurology evaluation, detailed report, and then CAT scan. The results were remarkable. The CAT scan showed the bedside neurological evaluation was basically always wrong when it came to identifying the actual site of the stroke. The second half of my internship the sequence was always neurology evaluation, CAT scan and then detailed report. When confronted with unambiguous evidence that the time honored tools were terribly flawed, these tools where quickly jettisoned.

There was no strong financial stake held in the bedside neurological assessment. In fact, it is not at all surprising that a tedious, time consuming, and poorly compensated activity such as this would become history when a better tool came along. However, strongly held but weakly supported beliefs are not always let go so readily, particularly when they serve as the underpinnings for financially lucrative activities.

Under those circumstances it is devilishly difficult to get the parties who have something at risk to objectively ask fundamental questions. How do I know what I believe to be true is actually true? What knowledge is really knowable and how do I actually know this to be true? While this may all sound to be the stuff of late night bull sessions in a college dormitory, it really is central to any professional activity where clients come to you as a trusted person of authority. Strongly held beliefs supported by nothing more than strongly held beliefs tend to serve only as rationalizations of self serving activities.

Wednesday, November 18, 2009

Evidenced based medicine vs. Politically based medicine

The latest blow up regarding the Preventative Services Task force recommendations on mammography should dispel any doubts about our ability to create a firewall around "evidenced based medicine" to prevent decisions from being politicized. Politics always trumps reason. However, many of the assumptions underlying health care reform are undermined by this observation.

It is commonly accepted that health care is a basic human entitlement which should be guaranteed by legal protection. In order for this right to attain such a status, we need to be in the position to define what the scope of the right should be. Presumably, this definition should be based upon what is rational and beneficial to patients. How hard can that be?

The mammography screening controversy underscores how difficult this process is. Few areas have been as well studied for as long as the effectiveness of mammography for preventing breast cancer death. Much of the criticism of the Task Force's recommendations have focused on the perception that their recommendations were solely based upon financial considerations, implying that the only reason not to screen are because it is just too expensive to screen in the younger age groups. This is not an accurate assessment of their work. The full report can be found at

There is much more to the story than money. First, the underlying data does not inspire great confidence in the utility of mammography to save lives. The number of subjects to screen over 10 years to save one life in the 50-60 age group is estimated to be around 1300 with the confidence intervals ranging from about 300 to over 7000! The number to screen in the 40-50 age group was ~1900 with an only slightly smaller confidence interval (900 to 6000). I have to wonder if this data is EVER presented to patients when screening is placed in front of them as an option. What this essentially means is that for any given primary care physician over their entire practice lifetime they could order literally thousands of screening mammograms and they may be saving no lives whatsoever.

When you start to compare numbers from various studies, they just do not add up. For example, in a study by Rowan T. Chlebowski, M.D., Ph.D., Harbor–UCLA WHI Clinical Center, published in 2008 findings from the WHI Estrogen plus Progestin (E+P) Hormone Trial. Of the 16,608 women enrolled in the E+P Trial, 8,506 were randomly assigned to take active study pills with combined estrogen plus progestin, while 8,102 took inactive placebo pills. Each woman had a mammogram and breast examination yearly. Biopsies were performed based on their physicians’ clinical judgment.

During the 5.6 years of the trial, 199 women in the active hormone group and 150 women in the placebo group developed breast cancer. Assuming the rate of cancer formation is relatively constant, one can extrapolate that about 300-400 women will develop cancer over the 10 year window. Given the meta-analysis of the Preventative task force where you need to screen about 1500 women on average for 10+ years to save one life, this would suggest that screening would have saved around 4-6 women in each of these roughly 8000 women cohort. What about the other 150-200 women? Does that mean that all the remaining women's lives, who were diagnosed and treated for breast cancer, were not saved?

At least part of the explanation may be the explosion in the diagnosis of ductal carcinoma in situ (DCIS), which is clearly a consequence of increased screening intensity. As noted in the PSTF report;

"some view diagnosis and treatment of ductal carcinoma in situ (DCIS) as potential adverse consequences of mammography. There is incomplete evidence regarding the natural history of DCIS, the need for treatment, and treatment efficacy, and some women may receive treatment of DCIS that poses little threat to their health. In a 1992 study, 44 percent of women with DCIS were treated with mastectomy and 23 percent to 30 percent were treated with lumpectomy or radiation. In one survey, only 6 percent of women were aware that mammography might detect nonprogressive breast cancer."

Using common funds to pay for screening activities hides the fact that each of us is assuming part of the cost for this. It is a common foil to say that you cannot put a cost on a life saved. There are at least two flaws with this reasoning. First, the evidence of lives saved is marginal in the younger age groups. Second, there is little evidence that decisions by patients are done in an environment where the actual numbers are conveyed to them in an understandable fashion. Part of the problem may be that most physicians are not aware of the numbers. Even if the direct monetary cost to the participant may approach zero, is it a good deal? If you have to put up with more than 500 false positives to find one cancer, and 95% of those cancers do not seem to behave malignantly anyway, is that an activity that most patients if well informed would buy in to?

The question is whether the present data on the effectiveness of mammography when presented to an informed consumer would convince individual women to spend their own money. We could make some estimates as to what the actual cost per person screened could be based upon a rough assumption of $100 per test and a biopsy rate of 1 woman biopsied by 10 screened. This means on average every woman will need to pay for 10 screens and one biopsy per decade. Whether this would end up being a needle or open biopsy or something even more involved such as sterotactic biopsy is an open question. Lets just assume a conservative $2000 cost. Add in another $1000 for total time travel, lost wages and productivity for a total cost of $4000. How many women would pay $4000 for the equivalent of a lottery ticket which to reduce their risk of death over the course of one decade by about 1 in 1000?

Welcome to the tragedy of the commons. All this discussion is irrelevant if services such as mammography are paid for by individual resources. The total cost of screening per woman screened is likely on the order of a few thousand dollars over the course of a decade, and represents pennies per day. That amount is hardly the stuff that insurance should pay for, being neither unpredictable or extremely costly.

This controversy is just one small piece of health care. Once you move to a system where resources are placed in a common pool and are allocated via some sort of consensus driven process, you have a mess. This latest controversy clearly shows that any attempt to base decisions on a scientific consensus are doomed. It involves people and the decision will be a political one. End of story. Now all we need to do is extrapolate this out to the entirety of health care decisions regarding allocation. If we can't unambiguously define whether mammograms are warranted as a health care right after all this investment of time and money, how are we going to deal with the defining the scope of the remaining 99.99999% of health care?

Tuesday, November 17, 2009

Designing complexity - Are we deluding ourselves?

Perhaps more than 10 years ago I heard Don Coffey speak. I do not remember the specific topic but he introduced the talk with a aerial picture of the island of Manhattan. He pointed out that there were somewhere in the neighborhood of five million people on this island and there was three days of food. He posed the question "How do all these people remain fed?"

His point was that there was no master feeding plan, no food czar, no ultimate authority. However, there was an abundance and a variety of foods which rivaled any place on earth. How could that be? Something as important as food, which is essential to the lives of all those millions of people, could not be left to chance. Who could have designed such a system?

The system was not designed, but it evolved over time... a long, long time. The rules were basically simple. If I have or create something I own, I can trade it for something else someone else is willing to give up voluntarily in trade. Voluntary exchange which occurs in an environment respectful of the rule of law, if the rules are right is an amazing facilitator of spontaneous order and complexity. Ultimately that complexity was manifested by amazing density, complexity, and abundance which is now the island of Manhattan.

The present state was not intentionally designed or engineered by men. Devoutly religious people are ridiculed for believing in deity based intelligent design. Some devoutly secular people also worship at this same altar blindly, embracing an equally implausible notion that mortal men can achieve god like powers associated with intelligent design of complex systems. It is what Freidrich von Hayek termed the fatal conceit.

Complex and durable systems are systems that can respond to change. It is very difficult to design the ability to respond to change into complex systems. Complex and durable systems come as a consequence of iterative processes. These systems can adapt if they can place lots of little bets and can take many small losses in order to find innovation and adaptation to an always changing world.

In the present health care environment, we are tied to systems that are cumbersome and almost impossible to change. In every domain imaginable we are constrained, whether financially or via regulatory shackles. Our financing models could not be more flawed. When I think of our almost complete dependence on federal funding for our research and teaching missions I cannot help but think of Koala bears and eating only eucalyptus leaves. Cute and quaint, but not a particularly viable strategy for thriving. The clinical domain is not far behind in moving to a eucalyptus leaf only diet.

The regulatory chaos is beyond crazy. We have licensing bodies, non-state regulatory bodies, regulations relating to state payers, agencies which regulate insurance mandates, private/public partnerships to set prices of services, and the general direction of these activities is toward increasing the layer upon layer of rules and regulations. Each new program is conceived in broad terms in documents which rival War and Peace in length, yet these serve only as a framework for the actual regulations which are subsequently written. The regulations are written by agents who cannot help but be insulated from the real world unintended consequences of their ramblings. It is the untended consequences which will have much more lasting effects than anything initially planned.

It all comes back to how we conceptualize the formation of complex networks of human interaction. How do all those people on Manhattan get their food? Intelligent design by humans invariably results in not so intelligent constructs. A bill in Congress to create a universal food care program with a public option for the island of Manhattan would lead to out of control costs, reduced choices, and many hungry people.

Thursday, November 12, 2009

They just can't make this stuff up!

A colleague of mine is dilligently reading the entirety of both House and Senate health care reform bills. He sent me the following amendment to the Senate Bill:

Value-Based Modifier for Physician Payment Formula: The Secretary of
Health and Human Services would be required to apply a separate,
budget-neutral payment modifier to the fee-for-service physician
payment formula. This separate modifier will not be used to replace
any portion of the Geographic Adjustment Factor. The separate payment
modifier will, in a budget-neutral manner, pay physicians or groups of
physicians differentially based upon the relative quality of care they
achieve for Medicare beneficiaries relative to cost. Costs shall be
based upon a composite of appropriate measures of cost that take into
account justifiable differences in input practice costs, as well as
the demographic characteristics and baseline health status of the
Medicare beneficiaries served by physicians or groups of physicians.
Quality shall be based upon a composite of appropriate, risk-based
measures of quality that reflect the health outcomes and health status
of Medicare beneficiaries served by physicians or groups of
physicians. In establishing appropriate quality measures the Secretary
would be required to seek the endorsement of the entity with a
contract with the Secretary under section 1890(a) of the Social
Security Act. The Secretary would also be required to take into
account the special conditions of providers in rural and other
underserved communities.
By 2017, all physician payments must be subject to this payment modifier.

I don't even know where to begin to think about this. To believe that this could be implemented in any time frame and result in a positive experience for anyone involved with Medicare (and likely all other insurance that the Feds touch) should be a test for loss of reality testing.

What will be measured as a surrogate for quality?
Who does the measuring?
How will any of these measures be assessed for actual validity?
Who makes decisions as to weighting?
Given this is by definition a zero sum game (budget neutral fashion), who decides the winners and losers?

There are over 1 billion encounters with doctors alone in the US each year. How many hours will it take to develop the appropriate quality metrics that will be applicable to even a fraction of these encounters? By 2017 all payments need to be subject to this payment modifier?

Sunday, November 8, 2009

Standardization, modularity, and the changing world

Much has been made for the merits of standardization of process within health care environments as a vehicle to improve outcomes and safety. The real power of standardization is when it can be deployed with modular design. Combining these two characteristics allow for safety, efficiency, and the ability to adapt to change.

Modular design allows engineers to tinker with one component without altering the function of a different component. While this is well appreciated within the engineering and software domains, it is not well appreciated within complex human systems. However, when thinking about it within the context of software design, it is easy to see how complex human systems share many of the same characteristics.

When building new software, it is very common to build upon the foundation of old code. Likewise, human institutions are rarely created de novo. They are generally created using older structures and forms and are frequently created using social groups derived from pre-existing structures. When creating new software, the operating units or files may operate in a self contained fashion, may require the function of other programs, or may be required by other programs for their functions. These represent interdependencies.

Modifying operating files which are dependent upon or required by other files creates added complexities. Their interdependencies must be defined if possible and unintended consequences identified. These complications of changing parts of software have uncanny parallels to manipulations of complex human systems. The more modular the software, the fewer interdependencies that exist, and the easier it is to manipulate and change any given component.

Within complex human systems there are a host of interdependencies which exist. Whenever there is a "change order" issued, it is best to understand just how modular your system is. Before you can begin to understand what might happen as a consequence of such a change order, you need to at least begin to understand simply the nature of interdependencies which are likely to come into play. In the health care environment we are only beginning to appreciate what we are up against.

Our present architecture is not standardized nor modular. Our interdependencies are extensive and only minimally defined. Perhaps our greatest interdependencies are financial. Within large integrated health care entities the function of many financially non-viable units is dependent upon financial resources generated by other units. Since interdependencies create non-modularity, it only follows that financial interdependency creates inflexibility. You can't alter one piece without altering the function of other units. This does not bode well for entities engineered this way since the only thing which we can predictably anticipate is a changing world and survival of the most adaptable entities.

Saturday, November 7, 2009

Plans and innovation

I am a product of the western world. There are a number of assumptions which go with growing up in such an environment. One of those assumptions is that of progress. We are raised to believe there is some sort of directionality in human development, moving toward some end which is more desirable than the present. Recent history by in large reinforces such a belief system, although there and many people who contest the assumption that what we have experienced represents an improvement over how people lived in the past. I for one think they are crazy and would not for a minute want to roll back time to a point where most children died in childhood and people eked out a day to day existence.

Given our circumstances as people have improved immensely over the past 300 years (see Steven Landsburg -, it poses a fundamental question. What portion of that improvement was the consequence of specific and intentional human plans and what part was due to unintended consequences of activities committed to for other completely unrelated reasons. For example, did the industrial revolution develop because of a strategic plan put forth by English merchants? Did the German pharmaceutical industry develop because of some master plan devised by the German chemical industry? Obviously the answer to these question is no. Whether it be technological, legal, or social innovations which made quantum leaps possible, the really big ones happened more because the random juxtaposition of events rather than anything planned.

There is no question that certain outcomes clearly benefit from having a well defined plan and defined end points. However, if the game changing breakthroughs are almost always unplanned and linked more to serendipity than planning, what are the ideal rules to implement that fosters both prudent planning and flexibility sufficient to permit disruptive innovation?

I think the key factor is the nature of the challenge one is approaching. There are really three types of problems which we can address. There are simple problems or tasks where the outcomes are clearly definable and the resources and expertise needed to solve them are readily and widely available. An example of this might be the building of a house. It might be expensive and take many months but building a house is a task which has been done literally millions of times.

There are complex and difficult tasks which require coordination of many people and resources over an extended length of time. Some of the challenges may not be fully defined at the time the task is taken on. However, the full scope of the problem can ultimately be defined and resources needed to address the problem identified or created. An example of this was sending a man to the moon. There were initially a number of initially undefined elements but in the end, it was a complex but definable and solvable problem, based upon Newtonian physics, 20th century material science, and for the most part definable variables.

Finally, there are wicked problems ( These are problems which we cannot even come close to defining all the variables where the only certainty is the presence of unknown unknowns. Approaching one element of a wicked problem will virtually always have unintended consequences.

Improving the human condition in the long run is a wicked problem. Any intervention is likely to have both planned desirable outcomes as well as unintended undesirable ones. How do we continue to act and not be paralyzed with the fear that our actions will bring disastrous and unintended consequences?

I believe the key to success (as measured continued innovation and progress) is to continue to plan on a relatively small and local scale and to hedge our bets. Provide incentives for people and groups to plan for and gain from small incremental improvements. History would suggest that small wins are like lottery tickets. Acquire enough of them and you will get a game changer. Plan to do too much and attempts to control too much over a time frame beyond which you cannot reliably predict outcomes will generally result only in unintended consequences.

Takeover of the amatuers

In a world in which people's activity is becoming ever more hyper-specialized, our ideas of what we do and how we support ourselves changes rapidly. This trend has tremendous implications within medicine and there is no reason to believe that this trend will impact medicine any more or less than other realms. Ultimately, in an ideal world what any given person does and is rewarded for should have some value to the recipient of that good or service. How this translates to medicine is that patients should be as good or better off after their encounters with us than before.

The question arises "What can I (or anyone) do which is of value to other people and why?" Presumably, the other people I am referring to are those who I am directing my service to. In the realm of medicine it is presumably patients. What is the nature of those value adding activities and what specific expertise or talents do I have which allow me to provide these services better or exclusively?

As I see this, physicians historically have held central positions in health care because they had access to unique information which allowed them make predictions and solve problems, they controlled access to specific diagnostic and therapeutic tools, and they were in a unique position to coordinate human activity to facilitate the care of patients. In order to function in these roles they required substantial training on the background of particular innate talents. The net result of these requirements is that medical management talent was a scarce resource.

This combination of characteristics is not unique in history and is a narrative which describes the existence and evolution of virtually every professional class whether it be priests, scribes, journalists, or professional photographers. In each of these cases, barriers to entry and need for unique tools or expertise limited access to the profession and created a scarcity. However, technological change created rapid displacements. Ultimately, technological change allowed for massive entry of "amateurs" into these respective fields and undermined the role of the professionals.

Much of this historical information is is well described in Clay Shirky's book "Here comes everybody" but some specific observations are well worth repeating. He describes the role of the scribe in the middle ages when the ability to read and write were rare skills and that the scribe was an essential and scarce resource and a key cog in the ability to pass on knowledge from generation to generation. The potential loss of intellectual material which would not occur between generations without the scribe was immense. However, the introduction of the printing press changed all these assumptions and opened the business of replication of the printed word to a much larger number of non-scribe amateurs. Much was actually written lamenting the loss of the scribe profession but interestingly these writings were disseminated using the printing press technology.

In our contemporary world, there are similar trends happening in the world of journalism. Until recently, entry into the world of publishing was limited by the ability to print and disseminate writings. That is not longer the case. A word processor and an internet connection conceivably make everyone into a one man publishing company and this capability is moving toward the loss of the journalist as a professional class. The scarcity associated with previous business model (that is few publishing outlets and few journalists)has vanished. The amateurs have taken over. There is no clear distinction between the professional class and everyone else.

So, what does all this have to do with medicine and health care delivery? The "amateurs" are coming to health care, facilitated by a variety of technological changes, particularly those impacting dissemination of information. Over 45 years ago Kenneth Arrow identified what he believed to be a key and unique element to the health care industry which made it different; information asymmetry between patient and provider. It is remarkable that this concept is still emphasized, as if nothing has changed in the past 45 years.

It is not as if the information asymmetry as evaporated but the calculus as morphed remarkably. As information relating to health care has exploded, physicians have become less and less dependent upon their own brains and rely more and more on information tools which they can access on demand. However, these tools are generally not proprietary and are accessible to patients and other non-physicians. Thus the justification of professional class on the basis of access to and control of information is going away.

Specific technical skills may also serve as a justification for the physician professional class. However, best outcomes in this realm are generally linked to practice, process, and narrow focus. This appears to hardly be a justification for for the broad, extended, and expensive training model now used to train physicians. We perhaps can get better outcomes by focusing on specific technical skills required to do very specific focused tasks.

Finally, the professional class distinction for physicians may be justified on the basis of their ability to synthesize information and coordinate the activities of many people. This skill set is always prized but is not unique to medicine. Entry into the realm may be from many different educational and experience paths. It could be argued that since current medical education has no particular focus on these specific skills and that the current set of financial incentives with traditional medicine has created a culture which is indifferent to this particular need, that these functions should be moved elsewhere.

Where does this leave the medical profession and what is its fate in the future? Perhaps the more important question is how will technological and social change alter our ability to serve the medical needs of our patients? There is little question in my mind that we will cede control to the amateurs in many realms that were traditionally our realms. Innovation brings disruption and our profession will be disrupted. In the end our measure should not be how it affects our particular guild but instead how it affects our patients. It will be a hard pill to swallow.

Monday, November 2, 2009

Financial Innovation in Health Care

After reading Clayton Christensen's book, "The Innovator's Prescription", I began to think about how our current payment structure has stifled needed innovation in medicine. When we think of innovation, we tend to focus on technological change. However, dramatic and beneficial change in any industry requires the simultaneous implementation of technological and financial pieces. When Sony entered into the the US television market, they benefited from access to marketing channels via the upstart Kmart whose business model was not dependent upon service revenues. The lesson of this story was that the technological innovation needed a financial innovation to be viable.

The automobile was simply an expensive toy of the wealthy until Henry Ford created a disruptive manufacturing process which included putting more money in the hands of his workers. The telecommunication revolution was driven by both technology and new business models which were allowed by the dismantling of ATT and novel approaches to bundling telecommunication services. Expansion of home ownership was made possible by both advances in building materials as well as development of mortgage products which expanded the power of credit to persons who previously did not have that option.

How are these observations relevant to health care? I believe that the financial innovation piece is as important as any other innovation in the creation of an improved health care system. The object of any change is that it should move us toward expanding what is available and affordable to more and more people. We have naively assumed that whatever technological advancement is developed at whatever cost can be deployed by declaring it a human right and insisting it be made available by some sort of redistributive magic. That will not work.

Current plans for reform provide no blueprint for the type of financial innovation which is requisite for moving toward a world were better care is available to more people for less cost. To meet those ends we need to put in place mechanisms which facilitate the development of payment schemes which support real disruptive innovation. Whether everyone is "covered" is ultimately meaningless if coverage is for legacy services offered under legacy conditions by legacy providers. Using legacy payment schemes will guarantee modest variations on the status quo, overspending on overpriced services, predictable shortages of underpriced services, and no real change or innovation.

What does the fee actually cover?

Yes I am going to bash the payment system yet again. I can't help it. The more I think about this the more that I realize that undesirable outcomes can be directly attributable to how doctors are paid.

When I see a patient, I am paid for the specific encounter, that is the actual face to face time I spend with the patient. However, there is a series of post visit obligations which which I encumber as well. There are four characteristics of these post visit obligations that are worth noting. First, the actual obligations are poorly defined. Second these obligations are essentially uncompensated. Third, delegation of these obligations, even to those with little or no training generally has little downside to physicians. Lastly, the extent of these post visit obligations can be managed most efficiently by selecting a subspecialty whose workflow generates few and well defined post encounter obligations.

Historically the practice of most specialties and subspecialties of medicine generated sufficient revenues from the encounter to support the activities which were not directly compensated. However, as the margins decreased, physicians responded by focusing more and more on activities that generated direct payments. For activities which generated few downstream unfunded obligations, the higher throughput created few problems. When you were done with the face to face encounter your were done. For specialties like primary care, each encounter predictably created an additional post encounter unfunded obligation. Ramping up billable activity in this context created an unsustainable workload to support non-compensated activities. One approach was simply to stint on what is not paid for. For the most part this approach had positive financial outcomes at the cost of practicing medicine in such a way that was more in the physician's best interest than the patients.

The current approach to the presence of perverse incentives is to mount a campaign which aims to influence physician practice behavior by appealing to their professionalism. Such an approach, appealing to physician conscience based upon the assumption that physicians can be durably influenced to respond to incentives other than those directed at self interest, may sound appealing. We should feel obligated to do what is right if we were correctly socialized. However there is little in history to suggest that it is at all functional. It is more likely an exercise in wishful thinking. The product of lecturing medical student on professionalism will quickly wither in the face of real life economics in a world which financially punishes those who model the desired but not rewarded behavior. Bad incentives trump good intentions in the long run.

Humans are driven by self interest. To deny this is a non-starter as an entry point into any social problem solving activity. In creating a system in which lack of rewards for specific activities is baked in, we basically guarantee these activities will go away. We lament that physicians fail to engage in activities where they receive no compensation, but this should come as no surprise. In order to treat a patient with a given disease, you need a correct diagnosis. To fix a pathological health care system, we also need the correct diagnosis. What is broke? It is the payment system stupid!

Tuesday, October 27, 2009

Insurance fix - Yet again

Disruption - Who moved my cheese moments in history

I can't say I know exactly what is coming that will disrupt the world of medicine. After listening to the Christensen video and reading his book "The Innovator's Prescription", it is clear to me that economics, social and technical change will result in major changes in the not to distant future. As in the words of one of my colleagues you cannot have change if everything remains the same. The question is, what will actually change? What should change?

I won't begin to answer those questions since I am virtually guaranteed to be wrong. What I can predict without question is there will be winners and losers. I suspect that physicians will be perceived as being relative losers but the reality is more nuanced that this. Some physicians have already been relative losers in how the health care drama has unfolded. The fate of the reminder may turn out to similar. However, it is unlikely that docs will be driving cabs as suggested a number of years ago when sages predicted a glut of physicians.

Whatever the outcome, disappointment will likely be out of proportion to actual fate. There is nothing like rising expectations and feelings of entitlement which are subsequently dashed to serve as the genesis of major disappointment. This may serve as the source of personal disappointment or even population wide resentments. I recall reading a book "Balkan Ghosts" by Robert Kaplan a number of years ago. In this book he detailed the history of the Balkans. The book came out in the early 1990's immediately after the death of Marshall Tito and the fragmentation of Yugoslavia.

I was struck by the resentments described and their historical origins. It turns out that essentially every ethnic group within the confines of the former Yugoslavia had overseen a large empire at some point in the past and the geographic extent of each of those empires overlap extensively. All the groups believe that the largest area occupied by their respective historical empires represent their entitlement and they will have no peace until they can restore their specific empires to rightful places. Such expectations are the perfect set up for disappointment and conflict.

We have lived through what can be viewed as a golden age of physicians. The diagnostic and therapeutic powers we have acquired along with the remarkable earnings have been without parallel in modern history. Our empire is perhaps at its zenith. It is only a matter of time before our power and influence will wane and our earnings power will moderate. The reality that ours is a service activity and that we will become more and more beholden to our patients is not an altogether objectionable end point. However, it will mark a change from the PAX Doctorus empire. We and our patients will be best served by resisting the temptation to strive to restore the old order.

Thursday, October 22, 2009

Powerful tools out of control

I read an interesting book, "Demons under the microscope". It was a fascinating story about the origins of modern medicine, focusing on the the development of the modern pharmaceutical industry. Based upon the narrative of this book, the transforming event of modern medicine was the development of sulfonamide antibiotics in the early 1930's. Prior to the avialbility of this medication, physicians were uniformly therapeutic nihilists, and for good reason. Surgery, despite antiseptic methods was frequently complicated by life threatening and life ending infections. Childbirth was extremely dicey and frightfully large numbers of otherwise healthy women died from post-partum infections.

The introduction of sulfonamides changed more than therapeutics. Its introduction changed how people viewed medicine and how medicine viewed itself. The public's view of medicine changed to virtual awe. From expectations that included frequent and unexpected death from infection, the public moved to viewing physicians and modern medicine as regular miracle workers. However, that awe is now waning with an new generation whose perspective is that old miracles are now mudane expectations.

The boundless confidence of medicine post sulfa stands in marked contrast to the pessimism that marked medical therapeutics even months prior to the discovery of sulfa drugs. We tend to forget the extraordinary explosion of novel small molecule therapetics that followed sulfa development was preceeded by many decades of failed discovery, looking for magic bullets. The small molecule therapeutic explosion initiated by sulfa drugs unleashed not only a revolution in the control of infections, but also served as the impetus for development of coutless diagnostic and therapeutic interventions.

The tools that developed subsequently were simply unbeleivable. The chemical libraries with sulfa backbones were deployed to address other therapeutic targets such as hypertension and diabetes. Te ability to treat a host of primary and secondary conditions facilitated the drive to develop new diagnostic and surgical tools. The medical industry developed more and more powerful tools, much like the aircarft industry developed more and more powerful engines. Both of these industries strived to break through various barriers.

Successfully strapping a bizzilion horsepower engine onto an aircriaft ultimately required the simulataneous development of sophisticated control mechanisms. That much cannot be said for the health care industry. We have amazingly powerful tools which can be deployed in a host of ways but they are frequently deployed with either no control mechanisms associated or no one at the controls. That might not be a huge problem when those tools propel you at the speed of a gentle stroll. However, we increasingly find ourselves strapping therapeutic rockets to our patient's backs, excited that we can use them to gain altitude, without much forethought about where they will go and how they will land.

We can no longer live off the legacy of those pioneers who developed the first miracle drugs. Those miracles are simply what is expected as the norm. More powerful tools are great but the proliferation of options and the explosion of the diagnostic and therapeutic matrices make the development of control mechanisms essential for the next health care revolution.

Saturday, October 17, 2009

Christensen Video -

MIT Video - The Innovator's Prescription: A Disruptive Solution to the Healthcare Crisis

This is both an enlightening and very disturbing presentation. It should remind us that the only thing that never changes is that everything changes.

CPT: The mother of all financial evil in medicine

We have experienced a dramatic change in the culture within academic medicine with the marked changes in the relationship between industry and Universities. It has had some painful elements and perhaps has gone a bit overboard. However, the experience has awakened a consciousness regarding the underlying motivators of our actions, particularly relating to what we do to patients and why.

We are flawed human beings whose default mode is to look out for ourselves. The presence of industry influences for the most part gently molded and manipulated our behaviors, gently nudging us toward prescribing this drug or another, utilizing this test vs watchful waiting. I can say with a great degree of confidence that while industry influence may have pervasive effects throughout medicine, there are much more profound and undesirable influences which basically touch and strikingly influence virtually EVERY encounter.

I am talking about the CPT and how it controls what health care providers do. For those of you who do not know about the CPT, it stands for Current Procedural Terminology. It is a series of billing codes owned by the AMA which are required for billing essentially all encounters in medicine. Unless you are flying without any ties to third party payers, you are inextricably tied to use of the CPT.

The use of the CPT can be linked to two of the worst aspects of present day medicine. First, the practice of medicine has become heavily focused on money and revenues. In a recent article in the NEJM "Money and the Changing Culture of Medicine" by Hartzband and Groopman, they point to altered behavior in physicians who are involved in substantial sharing of financial data relating to their practices. The altered behavior included loss of empathy for their patients. The shared financial information they referred to was primarily the use of items such as P&L data for specific physicians.

They seem to have missed the most pervasive financial element which touches every encounter; the bill with its associated CPT code. Every physician (and extender) has basically every patient visit punctuated by an encounter with CPT. This serves as an immediate and consistent reminder that every service action has an external and arbitrarily assigned economic value, independent of any value received by the patient. The typical physician quickly learns what CPT codes are valuable, and what codes are to be avoided. Talk about immediate feedback loop! This is a B. F. Skinner dream. If this does not alter behavior I do not what what does.

The pernicious element of the CPT is not just the value assigned to any given code, but is the conceptual nature of what it values and what it does not value. The explicit message from CPT is you get paid for doing things recognized within CPT, for doing things to patients in your own little silo, and what is valued is only what you do and document when patients are in your presence. Doing things for patients when they are not in your presence is basically never linked to dropping a bill or a CPT code. In this case the lack of a CPT code is almost as reinforcing as its presence. The message is there is no code, no bill, and no pay.

One could potentially view this as a indictment of fee for service in general. However, the fee for service in and of itself is not the problem. Exchange of money for services or goods within an environment which allows for explicit and transparent pricing and a binary exchange system is the fundamental unit of exchange in free societies. This type of free exchange allows for wealth generating "win-win" transactions, the foundation for the remarkable economic transformation which has occurred over the past millennium.

The problem with CPT is it applies dysfunctional constraints in the form of an artificial set of allowable transactions associated with arbitrary and fixed values, unrelated to actual value received by patients. We then place CPT in a position to influence human behavior in a most fundamental way. Presto! It should be no surprise that it ends up altering our behavior in a way much more fundamental than drug rep donuts or big pharma pens. It is the most extreme case of the tail wagging the dog.

It should be no surprise that we have ended up with perverted incentives and fragmented health care. That is exactly what CPT rewards those involved to do.

Sunday, October 11, 2009

When franchise players leave the team

Today I read in the LA Times and the Washington Post that the poster child for integrative health care, the Mayo Clinic, is making moves to limit access to patients who have certain forms of Medicare and Medicaid. It is pretty obvious that they are making those decisions since their margins on those patients are less advantageous than patients covered under other insurers or those who pay cash. If the truth be told, they are likely pursuing a strategy publicly that virtually all other health systems are doing privately if they can.

What does it mean when major health systems limit access to insured patients. Obviously it means they will have a hard time getting what they want when they want it. The implications in a world post health care reform will very much depend upon how health care reform is structured. There will likely be outlets for que jumping for those who have means, although there is no guarantee this will be the case given our experience with Medicare. What sort of enhancements will be available to those who have means?

It may be that the Mayo model is dependent upon extracting higher rents from private insurance models and being geographically placed to avoid specific high cost, lower margin patient populations. If health care reform closes the avenues for patients to pay premium prices, either indirectly through their insurance or directly through their own pocketbooks, what happens to the Mayo model? Does their model have sufficient margins to continue with only the geography piece to exploit?

In contrast to the Mayo refusal to accept selected patients covered by Medicaid and Medicare, most public hospitals are happy when they can receive any payment for much they end up providing for free, but they do not represent the model for sustainable health care of the future. I suspect they may fare even worse under health care reform. The first thing to go will be their local subsidies. Taxpayers will not believe there is any reason for their tax dollars should go to pay for both underwriting a national health plan and their local public hospitals.

One thing that we should all expect is that things that our actions will always generate a combination of intentional AND unintentional consequences. The unintentional consequences which will unquestionably occur is that the only viable health care entities which will survive in the future are ones that can avoid spending more money than they take in. Virtuous, non-profit seeking organizations will do fine as long as their non-profit seeking behaviors result in consistently positive cash flows. That is not likely in the long run (or even in the short run).

In a world where prices for services float and multiple levels of service are priced through market measures, there are all types of opportunities for for health care organizations and providers to fill the almost infinite numbers of niches which ultimately serve human needs. However, the direction we are moving will result continuation of the status quo; financial survival of organizations that can figure out how to avoid the terrible trifecta: poor payers, bad geography, and poorly paying health care activities.

Thursday, October 8, 2009

Close but no cigar

I saw the article link on Greg Mankiw's Blog to Martin Feldstein's piece in the Washington Post ( It is an interesting idea which proposes to use a a government issued health insurance voucher to underwrite the private purchase of high deductible policies which feature a sliding scale deductible based upon a fixed percentage of gross income. He also advocates the voluntary use of a government issued credit card to cover the deductible if individuals or families do not have cash flow to cover expenses.

The upside is that this approach would create some pricing discipline in medicine, since people would be less insulated from the actual cost of much of medicine. It would be worth testing in a demonstration project. However, I see at least two major problems. First, I cannot see the Federal Government as an effective agent in terms of running a credit card company. How exactly would this work? Would this simply be farmed out to MasterCard of Discover? Would individual states handle this?

I have a hard time imagining Uncle Sam playing the role of loan collector. Granted, the Feds know a lot about our individual financial circumstances but I fear that political fallout would preclude aggressive collection of health care debts. A program like this would also be very prone to massive fraud.

It is great that the proposed program builds such an effective safety net. That is the very reason that I fear it has such a potential for similar or worse moral hazards than our present system. Ultimately, the only effective curb on ridiculous pricing of health care services is when the public in general feels their sting. Insurance insulates the public to a sufficient degree to insulate medical pricing from consistent downward pressures. This is not to say that lots of people don't get hurt by health care expenses. However, enough are protected to allow for the system to continue, for now.

This approach still does not explicitly address the problem with pricing in health care. Presumably since most of ambulatory care would occur below the deductible, how will prices for non-insured services be determined? While virtually all providers now participants in insurance plan, a move to high deductibles would prompt many to move to a non-insurance model. While I believe this would ultimately create a more rational pricing structure, the transition could be very disruptive. Would Medicare be part of this voucher program?

Sunday, October 4, 2009

Location, location, location

I am amazed that the longer I practice medicine, the more it looks like real estate. I know that sounds bizarre, but allow me to elaborate. There is a dictum in real estate which says something to the effect that the most important determinant of value is location, location, and location. Ostensibly what this means is the actual structure is really of secondary importance, no matter what anyone has put into it. What is most important is where the structure happens to be placed.

The practice of medicine follows the same rules. Instead of location we deal with context. Information in medicine is critical but information without context is difficult to interpret and potentially dangerous. When I was in training, we still checked serologic tests for syphilis on every patient who was admitted to the hospital. While this practice was perhaps useful at a time where the prevalence of syphilis exposure and occult carriage was significant in the patients who were being admitted, by the time I came along most of the positive blood test that came along were false positives. The screening test was a good test within a certain context but its application needed to remain within that context for it to be useful.

The utility of both diagnostic and therapeutic interventions need to be understood within the context they are validated. In fact, the entire practice of medicine needs to be examined within the context of who we see and why we see them. During the past century, there has been a fundamental change in the types of patients we see and why we see them. We have moved from a model of seeing patients when they clearly identifiable present problems to a model where we see them when they are feeling fine in the hopes that we can keep it that way. Unfortunately, I do not believe we have adequately modified our thinking to account for this dramatic change in context.

There was a time where most patients seen were actually sick. Our physical exam tools were validated (at least to some degree) within those contexts. Similarly, most of our diagnostic tests were validated within specific well defined disease contexts. Rales detected on chest exam within the context of fever and a cough points to pneumonia. A positive RPR within the context of a young sexually active man with a palmar plantar rash is meaningful.

Despite moving to a well patient model, we still do many of the same things to our patients, using tools that have been validated in patients with illness. What is the utility of listening to the chest of an asymptomatic 20 year old? What is the utility of examining every square centimeter of skin in a young, dark-skinned patient with no personal or family history of skin disease? What is the hit rate for relevant findings for any of these routine exams or labs in asymptomatic individuals?

Like real estate and location, the first thing to always consider in medicine is our location equivalent, context. We should not even begin to consider how many baths or how big the yard is until we have clearly defined location, location, location.

Informing and consenting

I read a piece on Medscape summarizing the findings from a recent Archives of Internal Medicine article (Hoffman - Arch Intern Med. 2009;169:1557-1559, 1611-1618.). In this study they found that fully one third of men who underwent PSA testing where not counseled ahead of time regarding the purpose, implications, and limitations of the screening test.

I can't say this was surprising. From first hand experience I can attest to the fact that we medical training focuses on wrote memorization of vast amounts of trivia, development of specific technical skills, and a culture of testing which relies on multiple choice tests which substitutes forced selection of the "right" answer for any actual appreciation of nuance and uncertainty. How can a physician present choices when this discussion has rarely been entertained in their training environment.

There are so many structural and cultural problems which influence this outcome that it is hard to begin to look where to make changes. I believe there are two principles which should guide us with our encounters with patients. First,after we have intervened we should be relatively confident that the patient is better off than before we intervened. Second, the principle of patient autonomy is (or at least should be) central to everything we do. Basically, adherence to these two principles will result in no intervention unless we believe the patient is better off AND we can convince the patient of this.

With this as a starting point, perhaps we should consider changing some terminology. We now engage in a process which is termed informed consent. Just the way the wording is set up places the emphasis on the consent, informing being just a modifier of the consent process. I propose we change this to informing and consenting. This places equal weight on both processes since the consent is actually meaningless without the informed piece.

There is an organization called the Foundation for Informed Medical Decision Making which is developing educational tools for patients to make such decisions ( This has tremendous potential but has a number of potential unintended consequences. It will be a source of pressure on physicians to remain informed. I have no doubt of the ability of information systems to outstrip the knowledge base of even well read providers. It will also provide a challenge in terms of who can and will vet the information. Perhaps a "Wikopedia" like model will develop with multiple editors. I am sure that will serve as a challenge to the keepers of the temple of knowledge. What is sure is physicians will be challenged in terms of being the sole source of proprietary knowledge. The asymmetry of information noted by Kenneth Arrow 50 years ago may have been a temporary state.

The great screening disappointment

There were two stories which hit the lay press this week which dealt with related issues, prostate cancer and melanoma. The NY Times article - Melanoma on the Rise, or Is It Just Diagnoses? By NICHOLAS BAKALAR September 28, 2009 ) is in fact one of series articles in the NYT dating back over 10 years which have raised similar questions after prompting from articles published in the peer-reviewed medical literature.

This article, reporting on a study published in the September issue of The British Journal of Dermatology, raised the question whether early screening using skin exams actually results in any patient benefit. The usual actors weigh in, stating the usual justifications for their positions, an exercise which I think is the equivalent of what we used to observe in our very small children when they engaged in "parallel play". They were in the same room and using the same toys, but they displayed little actual substantial interactions or exchange.

The realization that what appeared to be such a simple concept, that is screening for cancer, turns out to be so devilishly difficult is slowly playing out in the peer reviewed realm and inexorably spilling into the lay press. The history of the screening paradigm is wonderfully reviewed by Dr. Barnett Kramer (Editor of the JCNI) in a great video on the Research Channel.

It can be accessed via Google video. The take home message is it is easy to discover what can be diagnosed as early cancer. Whether what is discovered is actually biologically malignant and whether intervention prolongs lives is uncertain.

There are some very interesting parallels to earlier events in human history outside of medicine. Many has always had a desire to predict and control future events. Throughout much of history, these efforts have focused on supernatural deities and magical thinking. For over 1000 years the Oracle at Delphi held sway over critical decision making in the western world. The same origins of hard science in astronomy are intermixed with the magical thinking in astrology. The revolution of science and Newtonian mechanics led earlier generations of scientists to believe in determinism; that with enough information regarding our current state we could predict the future.

The quantum revolution of the early 20th century put an end to such thinking in the world of physics and the impact of this is still diffusing out, slowly influencing thinking in other predictive realms. It is unquestionably painful to the luminaries of both physical biological sciences, creating and understanding of the uncertainty which is inherent in any predictive activity. The hard lesson was that one can never be sufficiently informed about the present state to reliably predict the future state. Determinism is dead and this should be recognized as being true within medical sciences as any other branch of science.

Predictive health initiatives and screening activities to prevent future events are wonderful marketing tools. We all want them to be true, they attract idea patients (who are not sick), and they validate our own desires to have predictive powers. Like other fields (e.g - finance, meteorology, business) the value of health professionals is still linked to our ability to look into the future and we are understandably reticent to admit the limits of our prognisticatory capabilities. If we can't provide such information, where is our worth?

The problem with the predicting the future is that it has not happened yet. Where the stakes are high enough, prediction will always result in action which always has the potential to alter the outcomes. Whether the intervention made a difference is not discernible. It is Schrodinger's cat all over again.

Monday, September 28, 2009

What's the point?

The piece by Jamie Heywood: Forget Medical Privacy in Wired Magazine last week ( regarding patient access to medical records makes perfect first. However it raises a number of questions. Why have we not shared such records in the first place? What is the historical background regarding information conveyed from physicians to patients? What exactly is the contractual relationship between doctor and patient? Who hires the doctor? What is the specific agreement between patient and physician in terms of deliverables? What is the purpose of the medical records? Are all the purposes of the medical record the same for all parties who may need access to the record?

When you start to think about the medical record in this light, it appears that many elements and aspects of the medical record have never really been defined. For the physician, the record developed as a tool which allowed him (or her) to recall key elements of the patient’s history at subsequent visits. It was primarily a tool which allowed future care to be done with sufficient information about the past. The patient had little interest in these notes since they did not contain information which could be interpreted by the patient. There was generally no agreement that the physician would create any sort product such as a written document relating to the patient’s care. The physician’s job was to diagnose and treat.

At some point, the medical record developed additional purposes. It took on legal importance, perhaps sometime in the 19th century during the nation’s first “malpractice crisis”. In the 20th century it became an essential piece in justification of billings. In order to get bills paid, both physician and patient acquiesced to having a third party be privy to the physician notes. One of the third parties was the State since state payers became dominant players in the game. Furthermore, the medical record took on legal importance in that it took on specific and perhaps onerous legal protections in the form of HIPPA.

While the ambiguity regarding ownership and purpose of the medical record was not critical in an earlier era, it creates problems in the present environment. It represents only a piece of the ambiguity inherent in the entire structure of the medical encounter as currently structured. There is a contractual relationship between physician and patient and perhaps it is desirable to better define the nature of the deliverables. When I go to an attorney to deal with a specific legal issue, I generally have a defined expectation as to what I will have when the encounter is completed. Similarly, I have comparable expectations when I see my accountant or other financial advisors. These are fellow professionals who have created a much less ambiguous relationship with their clients.

The ambiguity theme permeates medical encounters. Our present encounter structure harkens back to an earlier era where the doctor patient relationship bore scant resemblance to our current times. We (as clients) now schedule meetings with a host of professionals in the hope that we derive some benefit. For anyone who has any concept of time management, an agenda-less meeting is an anathema. Yet, we actively discourage patients from bringing an actual agenda. Bringing a list is generally evokes outright hostility but why is this? Shouldn’t patients and physicians welcome transparency in regards to actual goals and objectives?

As it stands, some vague rationale for a visit may be understood. It may be represented by some brief and often misspelled reason for a visit typed into the schedule by by some call center employee who might as well reside in Banglore. It may be as nebulous as here for a “check up”. Ultimately what is the product of a specific visit? Would it not be reasonable for both patient and doctor to have defined the anticipated deliverables before the visit?

At least one of the deliverables might be a summary report which is geared to the patient. It should be structured is such a way that the conclusions of the provided are obvious as is the rationale for any specific interventions and tests. The report need not be available immediately after the encounter since not all conclusions and plans can be formulated in real time. This report unquestionably would belong to the patient. Whether all notes and information collected as part of the visit would belong to the patient could be open to debate. However, the simplest approach to this problem is to define the deliverables as everything the patient paid for; all tests billed to the patient as well as a summary report which contained defined elements. These elements would include the diagnosis, a modifier which could convey the degree of certainty (unquestionable, likely, possible, atypical), prognosis, reasons for treatment, and recommended interventions.

Instead, we engage in factory medicine, encouraged by payment schemes which were openly designed to encourage volume. Patients of earlier generations raised in a culture of deference to physicians and general stoicism tolerated the movement toward cattle call medicine, occasionally erupting in sporadic annoyance but more commonly responded with bewilderment. The newer Gen X and Yer’s failed to understand why, in a world increasingly engineered to cater to their individual needs, medicine was so unresponsive. Not surprisingly no one has a good answer other than this is how we have always done things.

Tuesday, September 22, 2009

The inherent dependence of specialists on generalists

I had some recent surgery to repair an orthopedic issue. The surgeon is extremely good at what he does. He benefits from being very focused on a defined skill set and he does what he does repeatedly and often. Practice does make near perfect.

For the model of physician care which requires defined and discrete tasks whose execution requires little knowledge beyond the specific organ-limited pathology, this approach works fine. The orthopedist may repair my knee, the gastroenterologist may peer into their periscope, the dermatologist excise the skin cancer, or the cardiologist may place their stent. Assuming the patient survives the immediate post procedural period and the repair holds, any other problem the patient may have is someone else's concern.

This whole model is predicated on the assumption that problems can be treated discretely. Many problems can be approached this way and there are substantial incentives to stake out your claim as a physician in an arena where problems can be managed with such distinct beginnings and ends. However, one of the problems with this approach is a product of hyper-specialization; the loss of the ability to do much of anything else.

Who in this model sees the big picture? I believe in the ideal world, from the perspective of a patient, the most valued healer is someone who cares for them, not someone who can do something to them. Interventions may be a piece of the care package, but as those whose professional activities become more and more focused on a limited number of things they do and think about, they become less valuable in terms of integrating care. There may even be a point where their skill sets render them incapable of this. When a physician has done nothing but robotic prostatectomies, or ERCPs, or Mohs surgery, or cataract surgeries, or knee replacements for countless years, they likely are not able to keep sufficiently up to date to perform any function which requires them to have a broad medical knowledge base outside of their narrow focus of expertise.

There may be financial advantages to individual physicians who can claim to be incapable to having the understanding which would allow them to care for many facets of their patient's needs. From the standpoint of controlling one's time and being paid optimally for acquired skills, the ideal scenario is assume responsibility for only a very defined period of time and to be paid as handsomely as possible for a defined intervention. However, I think virtually anyone would be hard pressed to see this as a model which would be highly desired by patients under any circumstances.

In virtually all other realms of human interactions the person who is most highly valued is the one who is in charge. We value those who can coordinate human activity, identify where activity has created real value, and see where other activities represent only Brownian movement. In medicine, assuming long term broad responsibility is like holding the "old Maid" in cards. It means making difficult decisions, open ended commitments, dealing with lots of uncertainty, being responsive to all types of patient needs and getting paid badly. If the building trade were like medicine, the most poorly paid schmucks would be the general contractors.

We still have cadres of generalists and specialists who maintain a generalist knowledge base. These docs often find themselves fielding calls from patients on a broad variety of topics, even outside their realms of expertise. Patients are good at detecting physicians who have a modest knowledge base and exhibit the slightest proclivity toward problem solving. Why any physician would persist in this type of behavior in the current climate may be hard to fathom. To some it is a higher calling. To others perhaps it is reflective of some sort of personality disorder, trying to gain stature by demonstrating competence beyond their peers. Given the present incentive structure, it is not unreasonable to predict the behavior will become increasingly less common at a very time where it is needed more than ever.

The trend toward hyper-specialization is not going away. Perhaps it is accelerating. When do we reach a tipping point? If 10% of the physician workforce is completely incapable of understanding anything outside of their narrow focus of technical expertise, is that a problem? What about 50%? 80%? Should someone else fill that void?