Debate over rights and true consumers hinders achieving value
Healthcare costs have been on the rise for many decades and there have been multiple attempts and models to curb spending. We are presently shifting to value-based payment models under the theory that unlike previously in a fee for service world, paying only for what increases quality and satisfaction while lowering costs is a way to true value. Early data is not showing these new models to be driving the savings expected. We are early in this shift of thinking and payment reform, but I believe there are some fundamental points that will need to be addressed before we will truly see improvement.
Healthcare in this country has been deemed to be a social right. This fact is consistent with our social beliefs that as a human being, one has certain given rights, of which access to basic healthcare is one. Education is also an example as is the fact that we have a military to defend us whether we want to be defended or not.
With such rights come responsibilities. There are many who believe that if you have a right, then you also have responsibilities to not abuse that right and to live within certain norms. This duality of rights and responsibilities is a core issue. Which side trumps? If I do not uphold my responsibility, do I lose my rights? This is a very difficult question to answer, but if I have the ability to lose my right based on my actions, then it is not a right, but a privilege. Some then argue that by not upholding your responsibilities, you’re infringing on my rights. But what rights are those? These are difficult matters to discuss, but need to be as they are at the heart of the matter.
Supply, not demand, currently in charge of solutions
A second prevailing component to our present situation is that the supply side of healthcare is being asked to form the solutions for the demand side. Why is this? There are many reasons that are given: people don’t understand medicine and must be told what to do, the system is too complicated so transparency on both costs and procedures is unavoidably missing, our payment model (including Medicare) removes the true consumer of the goods away from the payment of those goods, and the list goes on. I am not accusing the supply side of being wrong or not being altruistic; I am only pointing out a dynamic that makes true value obtainment difficult.
Until the demand side becomes more involved, this issue will continue. You might argue that the demand side is involved, since Medicare is driving the conversation around value-based payments and employers cannot sustain the increases in healthcare costs for their employees, thus they are making changes to benefit designs. The problem with these statements is that Medicare and employers are not the true consumers or the demand side of services. Though they are the payers for healthcare services, they still must manage their constituents who are many steps removed from the reality of the situation and have other dynamics that must be managed. For example, those that control Medicare reform need to be re-elected and your employer must keep you happy so you do not quit.
You might now argue for the creation of true market forces and let the demand side drive healthcare to wherever it will land based on such forces. However this won’t, and shouldn’t, happen because of the debate around healthcare as a basic human right.
Managing opposing dynamics in healthcare is a balancing act
So now that I have laid out the conundrum and likely root cause of why we are not seeing the true movement to value we all want, what do we do? Whenever we are in a situation of managing polarity, we first need to understand and accept that fact. Using the example of needing to breathe in order to live, we accept the fact that breathing takes both inhalation and exhalation, that neither is more important than the other, that they are dependent on each other, and that at times you need to do more of one than the other.
Though there are many opposite but dependent components of healthcare and costs that are in play, the two that I believe are at the center are the dynamic are healthcare as a basic human right and the demand side needing to be more involved in what defines value and how to achieve it. We are not in a situation where it is one or the other, but rather in the position where we need to solve for the issues by taking both dynamics into account and managing the differences. The goal would be to optimize both components and be flexible in knowing that it will always be a fluid situation in need of tweaking.
A fundamental principle to solving any problem is the understanding of the basic variables and components of that situation. Once we do that, we can start creating models and solutions that really address the issue at hand.