An Alternative To Just Resisting

One of the problems with simply resisting is that it seems passive. That there’s nothing else there. The Democrats need to take another play book from the Republicans now that they have some momentum on Healthcare reform. We all know that the ACA (aka Obamacare) is an imperfect law, as any law is, so there’s plenty of room for improvement there. Why not take advantage of that, but do so using their own requirements against.

One of the main arguments against ACA is that it’s expensive. According to Bernie Sander’s pushing Medicare to all would save individuals somewhere between just under $4,000 and just over $5,500 per year. That’s a lot of money for most people, in some cases over 10% of their income. One study is putting the savings for the overall economy at an absurd half TRILLION dollar saving. In one year. Let’s say that we’re less optimistic and say it’s 20% of that, so a cool $100 billion dollars. That’s 1/7 the amount of TARP, which was used to bailout the banks. When we injected $700 billion into the economy it saved it from the worst banking crisis we’d seen since the ’30s, injecting that much extra money into the economy at the individual level would have a huge multiplicative impact on the economy, much more than just pushing that money into a single location.

So my proposal, which is more modest than Medicare for all, would be to propose Medicare to everyone that makes less than < $30,000 year or maybe 20% above the minimum living wage in a city/region. Regardless, this would help the people that are protesting most loudly, the rural red states. The rest of Obamacare could stay the same, it would just really help the bottom of the population. We could even extend it to small business owners so their employees get a perk of Medicare and all those benefits without that employer needing to worry about their employee’s healthcare. The other benefit is that companies like Hobby Lobby wouldn’t be able politicize healthcare and would allow individuals to make decisions about things like birth control for themselves.


ICE has been brutally cracking down on immigration the past few days. Democrats should introduce a comprehensive immigration reform that protects the country and aliens. I think that this is something that red states and red parts of blue states are going to be filling the pinch on. Apparently, farmers that supported Trump in California are now worried about losing most of their work force. This is a pretty valid concern. In Austin Texas, Immigration and Customs Enforcement (ICE) conducted raids of illegal aliens by targeting their children. There are reports of their cars following school buses waiting for children to get off the bus to ask the parents for immigration paperwork.

While Arizona was enforcing their paper’s pleas law the state lost between $300 million – $1 billion in agricultural output, while losing out in another $147 million in cancelled conferences in the state. Arizona isn’t known as a agricultural powerhouse, if something similar happens in California, the entire country is going to feel the impact with massively increased food prices. Arizona’s Ag output is about $7.3 billion while California’s is estimated closer to $50 billion, if we lose 1/7 of California’s ag output that’s losing as much as all of Arizona (Az lost about 1/7 of theirs due to papers please). That’s a huge hit to that economy, ripple that out across the entire country and we’re potentially looking at a recession with food prices skyrocketing. Furthermore, many of these illegal aliens are actually paying taxes, of the estimated 11 million about 6.1 million pay taxes which equates to billions in federal and state revenue.

Democrats should instead offer reform that allows non violent illegal aliens a path towards citizenship or some sort of migratory work visa that is designed and so that the workers that want to use that program can go home when they are finished with the year’s work. This should guarantee access to the US for a number of years in such a way that people feel they are safe to go back and forth across the boarder. Partner with Mexico to vet the candidates for these types of visas to ensure that they were upstanding citizens in Mexico and that there are no gang connections. Furthermore, work to protect these migrants so that there’s no need for them to ever mule drugs across the boarders. Require that these workers get car insurance, licenses, and health insurance while they are here (or at least pay taxes for them to cover their portion of Medicare if the above passes). As for those that are already here, stay the course with Obama’s practices, which were more aggressive than past administrations, but still more human than what Trump is doing. Provide a path for citizenship for those that are here. Even toss in a requirement to learn English if you want to mollify the far right.

That still leaves the question of refugees and the Muslim ban. First, I think we need to make sure that the people we train here with PhD’s should be enabled to stay easily. This shouldn’t even be a question, we should in fact require it for any one that is trained in the US or require them to pay back the entire cost of their education immediately. This is what the Netherlands does – or at least Eindhoven University of Technology does. Additionally, if we’re concerned about too many foreigners taking these positions we need to incentivize American students to pursue higher levels of education so there are few spots for immigrants. I personally think that for the best result science and business needs diversity, so I’m for getting more people more degrees.

Beyond this though, I don’t really know what remedies to offer, someone with greater immigration reform experience should weigh in here, but generally, we need to accept refugees for crises we created.

Reigning in the Cloak and Dagger

It’s time we ended cover operations like the one in Yemen. They create resentment towards the US and since they are covert we don’t know what’s being done in our name. We need to end drone strikes and use diplomatic channels to address these concerns. Democrats should introduce bills that require increased oversight of these operations and reduce the executive power to conduct military operations without Congressional approval and/or a formal declaration of war. It is very unlikely that this will pass at all, but there are a lot of people on both sides of the aisle that believe there needs to be more constraints on what the President is able to do without approval or oversight. We have now been conducting these raids for 15 years and there has been no increased safety in the US due to them.

The other area where the same operatives are heavily engaged is mass surveillance in the US. Democrats need to introduce a bill that stops. Simple as that. It’s been shown not to work as with any large data set it’s possible to create find correlations that really don’t exist. It’s possible create sinister reasons for why a person is doing completely innocuous things.

I think if Democrats repeatedly introduce bills to attack these areas, they will get more and more support as the Trump administration continues to crack down. These sorts of initiatives will show they have a backbone and that they really are actually striving to make things better. Without at least these three changes, there’s no way that Democrats can mount a serious “resistance” to Trump. We’ve seen how loud and upset people are with Obamacare, the next step is to figure out how to do the same with the other two.

Starting with Lean

I had a great conversation with a new friend yesterday. He’s a dentist and is looking to drive continuous improvement within his small organization. He’s feeling overwhelmed, since he’s busy with being a dentist, running an office, and managing a small team adding any extra responsibility seems like it’d put him over the top. He wants to do process improvement because he things that there’s a lot of waste in his small organization but he is terrified of starting because it seems like more work that he doesn’t have time for.

This isn’t the first time I’ve heard of a Dentist wanting to improve processes or go Lean. While working at Samsung I watched a Webinar about the Lean Dentist, Sami Bahri, who several years ago began to implement Lean at his dental practice. He’s since gone on to write two book, one of specific importance to both Healthcare and Dentistry: Single Patient Flow. This really turns the concept of provider centric care on its head. The goal of Single Patient Flow is to maximize the “utilization” of the patient. No, this doesn’t mean treat patients with unneeded tests to keep them “busy.”

No it means that we need to measure the value added component of their time in the clinic and set a goal of that as close to 100% as possible. This means warm hand-offs between any assistants and the doctor, it means no waiting in the waiting room. No waiting in the office for people to come. None of this is something that we’re willing to pay for, yet we must pay for it. Actually in most cases our employers are paying for it through lost productivity at our jobs.

Moving towards patient centric offices also changes the how the patient expects to interact with you. They will know more because they did some research coming in, this information could be wrong so it will take more time to explain to them the correct diagnosis. People using WebMD is a result of dissatisfaction with existing doctor offices.

Becoming more patient centric is a big deal and takes a lot of work. Where do you start? With anything. Yes that’s a bit of a cop out statement, but it’s also true. Pick anything that is causing pain for either your staff or your patients and map it out. Figure out what the process currently and where the wastes are. Work to eliminate them. Start with something small like how you answer the phone or greet the patient when they walk in the door. Figure out who should be doing this and how to ensure it’s the right person doing this work.

Start somewhere. Start where you can have a quick win. Start where you think it will help the patient quickest first.

Work, Lean, and Health

I just visited a nutritionist today. I’ve had issues with Gluten for years and I’ve also been diagonosed with Hypoglycima which is a condition where my blood sugar levels aren’t well regulated by my body. The combination of the two has caused me no end of issues. At this point, it’s been difficult to tell the difference between a glutening and low blood sugar, at least a low level glutening anyway, a serious glutening it’s pretty obvious. I feel drunk within a few hours and then have the shits the next day or two. It’s pretty bad. Anyway, the combination has been pretty difficult to pull a part. When i have spikes in my blood sugar it makes me feel out of it as well. So, I’m going to really address both of these issues through better nutrition and probably more working out as well.

How does this connect to work and lean process improvement though? Well, at Cambia, we get a discount for eating salad’s and other healthy foods, so I’ve already been doing that, but that’s not the work connection I’m talking about. I just started reading a book called “Lean is Healthcare” which I picked up because I thought it was actually a book on Lean in Healthcare – pretty understandable confusion I think. I’ve only read a few pages, but as a lean practitioner it really ressonated with me. The premise is that Lean is a way of improving your employee’s health. Thinking about it now, it’s pretty obvious, but it definitely was an Ah HA moment when I read that.

Lean helps create flow in work. This is for both the product as well as the worker. Flow can be described as feeling you get when everything is just clicking. It’s like when a basketball player can’t miss a basic, they are in a state where they are relaxed and feeling good. It’s similar to a meditative state – think about any of the projects that you’ve gotten into and time just flew by. When you think about work, you never think about flow like that. I’m sure you’ve had bits and pieces of flow – but they don’t last very long. However, imagine if you were able to get into a job where everything you did flowed like that. Where you walked into the office and you walked out feeling accomplished, got things done, and excited to come back tomorrow.

I think there are a few companies that encourage that – companies that encourage creative coding and design are likely the best at this type of work. Why? Because they are all about thinking and connecting ideas and concepts to each other. It’s easy to get into a meditative state when you’re really jamming away at code. I feel a similar mode of thought when I’m blogging with a keyboard that works.

Work like this makes you feel better. It’s better for your health, better for your life balance, and better for your confidence. With that in mind, shouldn’t it be a moral imperative for a company to shift to enabling work like this? Work that makes you feel accomplished, healthy, and productive? Isn’t it also a financial imperative as well as all these things increase the value the company gets out of you as an employee?

I think the answer is yes to all these questions. I will be thinking about this as I work at Cambia continually driving towards for productive work and healthier stress balance for the employees.

Healthcare Exchanges offer a way forward

In my last Healthcare blog I argued that because of the structure of our payment system, the network effects of the providers, and reimbursement rules healthcare isn’t a free market. I believe that the exchanges in the Affordable Care Act aka Obamacare, actually offer a path forward that may take us closer to a freer market for healthcare than anything we currently have.

First I need to say that they are not an immediate silver bullet the exchanges only offer a way forward and do not guarantee any changes in the market. Furthermore, if the exchanges do provide the changes I’d like to see it will take time, several years in fact, for those changes to have a broader impact on the market.

What are the exchanges? They are essentially a market place where a customer can select a type of insurance with a specific network that meets their needs. How is this different than what we have had in the past? Well, typically health insurance has been only offered through your employer and you get what they offer. If you don’t have a full time job, you’re basically out of luck and paying a huge monthly premium. The exchanges level that playing field by increasing the pool of people that will be using those types of insurance and allowing across state competition for health insurance. For example, there’s only one Blue Cross Blue Shield provider across all the exchanges in the US. That’s a pretty big change.

Because there is competition based on meeting the needs of the customers there will be much faster feedback to the “plans” as they are called. If members don’t like a specific offering, they won’t make any money and the next year will be forced to make a different offering to attract more members. Furthermore, there will be switching across the plans as people realize they dislike certain features. I believe this will happen for several years until a “dominate” plan design emerges based on the success of those plans. Healthier members, low turn over, and acceptable level of revenues for the insurers. Expect these metrics to be similar to the mobile industry in the US (ARPU, Churn, etc..).

Because of the relatively fast feedback on the products in the market and the possibility to have at least three offerings on the exchange (Gold, silver, bronze), insurers can experiment with different types of plans and benefits. The most popular one at this point is something called Accountable Care Organization, which is somewhat similar to an HMO, but is supposed to be better (we’ll see). ACOs as they are called will have to keep track of the overall quality and re-admission rates with a goal of continually driving up quality of care and reduce re-admissions. Additionally, these are narrower networks of care than a traditional PPO that most people have become accustom to.

That’s fine, but that doesn’t really help with the fact that it’s a networked economy and that there’s still a huge imbalance of knowledge. Well, here’s where the insurers can changes things up. Instead of focusing on the narrow set of providers in their region, they can look to create a network based upon the specific of the member’s conditions and have those members go to the specialty providers that offer the best care for those conditions. Even if they are out of state or out of the country.

Granted this data is a bit out of date, however it’s likely to be accurate, according to the Innovator’s Prescription (pg 96) there are facilities that have become so specialized in certain conditions (hernia repair) that their cost to treat those conditions is $2,300 while a general hospital costs an average of $7,000 and has a much lower re-admission rate than the general hospital. With this in mind an insurer could use these specialty clinics and even fly their members to receive treatment and still save money.

This would dramatically change the shape of the network for the members of those insurers and improve overall care and results. It would also dramatically change the interaction with providers in the member’s region as well. Some hospitals are already feeling the pain in this such as Seattle’s Children’s Hospital (which is suing over being excluded).

I don’t think being exclusive it the right direction, I think creating a strong partnership with members through health coaching and care management can help drive better results and education between the provider, insurance company, and member.

This will require continual experimentation with the types of networks, the way the insurance companies interact with their members to take it from a confrontational interaction (from the member’s perspective), and how the providers plan to engage with insurers. There needs to be incentives to encourage providers to recommend non-traditional recommendations. Incentives to support healthy living for the members. Only experimentation in all of these areas can inform the insurers how to engage better to dramatically improve the health and reduce the cost of our nation.

Advances in Healthcare science will change our lives

We are at the very beginnings of a healthcare industrial revolution. Perhaps, we’re beyond just the beginnings, we’ve seen huge leaps and bounds in diagnosis and treatment in the last 20 years. In my life time Aids has gone from being a quickly terminal disease to a disease where people are able to live relatively healthy lives which also last nearly as long as the average person. This is all without needing to have the sums of money of Magic Johnson.

This alone is something to celebrate, but there’s a lot more work to be done in easing the pain of suffering patients. Many Americans suffer from dibilitating heart diseases, which in some cases require heart transplants. Transplants are extremely risky procedures because the body can and does reject the new hearth. So, even after receiving the new heart, many patients are on immune system suppressing drugs. This increases their risk of infection and contracting other diseases, which can of course reduce the quality of life and inreases the risk of premature death due complications of the transplant. Recently, there’s been a serious break through in building a heart scaffold.

What is a heart scaffold? This is essentially a structure that allows your own cells to re-build your heart. In the case of this breakthrough, another heart had all of the specific cells that would have been rejeted by the transplant patient. The underlying structure remains because it is generic tissue that is transferrable between species. This break through allows patients to use their own stemcells and heart cells to convert the scaffolding into a function heart that is the patient’s own heart, not a transplant heart. This reduces the likelihood of rejection by the patient, eliminates the need for the immune suppressing drugs, and improves the results.

In the paragraph above, I said transferrable between species. The heart that is being used isn’t even a human heart, it’s a pig heart. This greatly increases the supply of hearts, because the number of hearts that can be transplanted is based on the number of peole willing to donate a heart and that are in good enough condition to be transplanted into another patient. We can hope for future advances for other types of organs as well.

This isn’t the only type of advancement we’re seeing along this vein. There is a pen that can draw cells on bone, and there are 3D printers that are being developed to print organs, like livers.

We live in exciting times for sciene in healthcare. We just need to figure out how to have medicare and insurers pay for the next.

Healthcare is not a free market

From the obvious department, amIright? Yes, but not for the reasons you think. Healthcare cannot and never will be a free market. There are several reasons for this that I will elaborate on here.

Healthcare consists of micro-regulation in the form of the reimbursement structure. This is an artifact of two different systems combining to make things worse. First, because the Federal Government is big and has two different programs one for Federal Employees and one of those in need Medicare/Medicaid (I’m combining them here for simplicity), there’s also the VA, but that has much less influence on healthcare. These two programs set the terms on how the government will reimburse or even pay providers for care provided. These are based on Current Procedure Terminology (CPT Codes) and not based upon your diagnosis. Essentially the government sets a price they are willing to pay for a procedure. As one of the largest market players, this influences all of the other payers (IE insurance companies). Many insurance companies use Medicare payment rates to set their own, which drives down the cost of a procedure to the point, in many cases, where it’s below the cost of the actual care. This drive providers to select more expensive and more procedures in many cases to make up the short fall. This payment model also makes it hard for new procedure methodologies to be adopted as they may not be paid for.

Healthcare is a network economy – nearly all care happens close to home. This is why groups like the ACLU argue that driving more than an hour for an abortion is an unnecessary burden on women. Because of the proximity of the majority of care (10.2 miles) this creates a local network of care based on the original provider a patient sees. When you receive a referral, there are a few different routes this can go, best doctor the the referrer knows, another doctor in the same clinic, or in the same care network (such as UPMC in Pittsburgh or Kaiser Permanente in CA). This drives an incentive to send patients within the network leading to mutual referrals or money staying within that care network even if there are better doctors for that specific patient outside of that care network. In addition to the Doctor’s network there is, of course, your insurer’s network which may be in direct conflict with the professional network that your provider has.

Imbalances of knowledge – in typical free markets there’s an assumption that everyone has the same amount of knowledge. In Healthcare, it is abundantly clear that this isn’t true. Most patients have little to no understanding of their diseases when they are first diagnosed. On the other hand, both their insurer and provider has an extensive knowledge of the disease. This limits how well the patient is able to correctly make decisions about their healthcare. It also pushes reliance to the provider whenever there is a disagreement between insurer and provider. The member can’t effectively participate in those conversations about care. Furthermore, there maybe little penalty to the patient if they fail to follow the prescribed course of care until much later where neither the insurer or provider can enforce a change of behavior to reduce costs for the entire system now through treatment rather than later when there are more complications.

These are but three cases that highlight the lack of free market mechanisms in healthcare. Even in cases where a patient wants to seek the best care it’s typically the patient’s responsibility to pay for it if it’s not with in the insurer’s network. In many cases these clinics can reduce systemic costs through lower point of care and lower likelihood of readmission after care.

Over the course of the next few weeks I will discuss Exchanges and their potential, how healthcare can be made more affordable using process improvement tools and other mechanisms. I plan on writing weekly on healthcare. If you have any topics that interest you please comment and let me know!

Tools that will help disrupt Healthcare

I’ve been reading this really interesting book on healthcare – it focuses on the potential Hows that healthcare can be disrupted. If you aren’t sure what disruption and/or disruptive innovation is then check out my last blog about some of the industries where it’s occurring and you’re likely part of the disruption.

If you buy your own health insurance you may have noticed a new type of insurance. It was new to me whenever I joined my health insurance company in the North West. Neither AMD nor Samsung had similar plans so when I first signed up for it, I was extremely ignorant of what it was and just signed up for something that looked good. This type of insurance is called HDI w/ HSA.

HDI: High Deductible Insurance. This means that you’ll likely have a high deductible (obviously) and will have to pay out of pocket.
HSA: Healthcare Savings Account. This is an account that allows you and your employer to make pre-tax contributions. You will also be able to pay for healthcare tax-free and accrue interest tax free as well. This is great in terms of how much money you actually gain from this. When you pay for a healthcare service like a Doctor’s visit, you’ll have to pay all $150, however, since you didn’t pay taxes on that $150 you end up saving money. Further, your employer can contribute to this account in the same fashion as your 401(k) and your account will be invested in a similar fashion as a 401 (k).

Of course there are some draw backs to this type of health insurance. First, until you reach your deductible you’re going to end up paying out of pocket. You could potentially have a deductible as high as $5,000 which is highly undesirable. Your employer might not contribute to your account, which places more of the burden on you, which sucks.

How can this contribute to disrupting healthcare? Well, you’re going to start really shopping around for your day to day medical expenses. You’re not going to go to a specialist unless you really think you need to. You’re not going to go straight to the hospital for care. You’re going to try to find another place to get the care you need. This will open up the possibility for care givers to provide healthcare in other fashions. This will potentially change the way that insurers will begin to pay out to providers as well.

There is also a push for Accountable Care Organizations, look for those as well, which are paid based on outcomes rather than the type of service being provided. These organizations will help disrupt incumbent firms and will likely capture the attention of insurance agents. I believe that in many cases this is where a lot of Exchange insurance programs are going.

Personally, I’m excited about the potential to work within an insurance company to disrupt the industry. I believe that there are changes that can be made internally, through educating on what metrics are and how to improve based on these metrics. I also believe that we’ll be in a position to help enable providers to be more efficient and effective care.