Quit Wasting My Healthcare

Healthcare Innovation and the New York Times

This past Sunday, the New York Times Business Section featured an article on large health insurance plans (http://www.nytimes.com/2009/03/01/business/01health.html?_r=1&scp=1&sq=aetna,%20healthcare&st=cse).

The most intriguing point for me was the quote by Paul Grundy, MD from IBM who said that insurers “don’t have a clue about providing what we really want to buy.”  The article goes on to report that “insurers say they are innovating.”

But how can there be such a disconnect between insurers and their large employer customers?  I think the answer lies in the varying priorities and demands of employer clients themselves.  Through my discussion with dozens of employers big and small, I am struck by how they all “want” the same thing—better healthcare for less money.

However, they all have their own ideas on “how to get” what they “want.”  Some believe wellness is the answer—keep people from getting sick in the first place through improved personal habits with the big three being diet, exercise and smoking cessation.  Others believe the answer is a return to primary care and a “medical home” to coordinate care and provide continuity.  Still others believe the answer is pay-for-performance—paying doctors and hospitals more if they do a better job and less if they underperform.  Still others believe the answer is value-based benefit design—making more cost-effective medications and services cheaper for employees in terms of copays and coinsurance, while making lower-value medications and services more expensive for employees.  Still others believe the answer is consumerism—empowering employees and their doctors to be more cost-conscious when making decisions about medications, tests and treatments.

No wonder insurers have a hard time innovating—they are being pulled in multiple “innovation directions” by their employer customers.  But this is not a bad thing.  Innovation is all about trial and error and I think “multiple innovation directions” is a necessary approach given how multifaceted healthcare is.  In the end, I also think it will continue to move us toward the goal of better healthcare for less money.