Aligning Incentives Across Disparate P&Ls

My company sells solutions that typically span multiple avenues of care. We’ve encountered a unique problem: incentives to improve care coordination rarely align when disparate P&Ls accrue to different players across the continuum of care. In other words, split P&Ls pose a destructive risk to care coordination and ultimately outcomes.

How does this play out in the real world?


Most health systems do not own or operate their own ambulances (Atlantic Health System and NS-LIJ being notable exceptions). Instead, ambulances are typically run by local governments or private companies. Why is this a problem? Many of the most critically ill patients arrive to hospitals via ambulance. Many of these patients are are in time-critical conditions. Ambulances should have the best tools to help save those patients and improve outcomes and suffering. All of the care that ambulances provide should be coordinated with the receiving hospital.

However, ambulances, especially publicly-operated ambulances, run on extremely tight margins; they can’t afford to invest in many new technologies. Hospitals won’t invest in tools for ambulances – even for at-risk patients – since hospitals won’t actually control the deployment of the technology to ensure they impact outcomes for at-risk patients.

But what if hospitals owned the ambulances that fed the hospitals? In this model, as hospitals move towards risk-based care-delivery models, incentives will be aligned to deploy mobile technologies into ambulances to improve time-to-care, diagnostics, and even triage patients to avoid hospitalizations entirely. Specifically, what if every ambulance was equipped with a mobile X ray, CT, EKG, ultrasound, and a suite of standard diagnostic tools (blood pressure, thermometer, stethoscope, etc? Upon arriving at a non-emergent patient’s home, the paramedics could locally diagnose and triage the patient with a virtual physician’s input and avoid non-essential ER admissions.

But that can only happen if incentives – specifically P&Ls – are aligned across the continuum of care.

Outsourced physician Management Services (e.g., EmCare)

Many hospitals contract with physician groups to staff service lines in the hospital. Although these groups provide real value – e.g., more flexible hours and operational processes – than employed physicians these groups also break up how P&Ls are accrued.

For example, many anesthesiologists align as a group to contract with hospitals. Within their practice, these MDs may find a new automated anesthesia monitor that enables more effective management of residents and CRNAs across multiple ORs. In turn, anesthesiologists should be able to extend the MD:mid-level ratio, drive improvement in patient safety, and make more money. But, concerns about damage, theft, and losing the hospital contract render these same anesthesiologists unlikely to ever buy the equipment themselves. Hospitals will also be reluctant to invest since they won’t accrue the financial benefits of improved labor productivity since the financial benefits accrue to the anesthesiologist group, not the hospital.

But Modularization Works In Other Industries

Indeed, most value-chain centric industries are highly modular. Each layer of the value chain can independently optimize itself and control how it interacts with the layers of the value chain above and below it. A few examples:

In the movie value chain, movie production studios don’t own and operate theaters; theaters are independent

In the retail value chain, retailers usually don’t act as distributors, and distributors don’t usually act as producers

With the exception of Apple (who by no means control the entire value chain), most of the computing value chain is modular; retailers like Best Buy have no hand in chipset design, chipset manufacturing, OEM design, OEM manufacturing, operating systems, Internet infrastructure, internet service providers, or cloud services.

Modularization In Healthcare Delivery: Can it work?

Healthcare delivery is not a linear value chain. Each player in the healthcare delivery system doesn’t build incremental, linear value on top of its suppliers. Rather, healthcare delivery involves the coordination of a breadth of disparate resources to A) diagnose, B) treat, and, C) manage chronic conditions / maintain wellness (these are the three different businesses that Clayton Christensen astutely observes in his excellent book, The Innovator’s Prescription).

Healthcare could perhaps be modularized if a certain set of providers acted to diagnose a patient, then handed off the patient to another set of providers for treatment, who in turn would transfer the patient to another set of providers whose job it was to manage ongoing chronic care. However, this arrangement is only tenable if: 1) the boundaries between these three different businesses are clear and distinct, and 2) the providers in each have a high degree of confidence in the “output” from their “suppliers” (e.g., an accurate diagnosis).

What are your thoughts? Have you seen other scenarios where disparate P&Ls lead to mis-aligned incentives? Have you seen risk-based payment models that successfully bridge disparate P&Ls?

Is The Future Of Smart Clothing Modular or Integrated?

OMSignal recently raised $10M to build sensors into smart clothes. Sensoria recently raised $5M in pursuit of the same mission, albeit using different tactics. Meanwhile, Apple hired the former CEO of Burberry, Angela Ahrendts, to lead its retail efforts.

And Google is pushing Android Wear in a major way, with significant adoption and uptake by OEMs.

There’re two distinct approaches that are evolving in the smart clothing space. OMSignal, Sensoria, and Apple are taking a full-stack, vertical approach. OMSignal and Sensoria are building sensors into clothing and selling their own clothes directly to consumers. Although Apple hasn’t announced anything to compete with OMSignal or Sensoria, it’s clear they’re heading into the smart clothing space in traditional Apple fashion with the launch of Health, the impending launch of the iWatch, and the hiring of Angela Ahrendts.

Google, on the other hand, is licensing Android Wear to OEM vendors in traditional Google fashion: by providing the operating system and relevant Google Services to OEMs who can customize and configure and compete on retail and marketing. Although Google is yet to announce partnerships with any more traditional clothing vendors, it’s inevitable that they’ll license Android Wear to more traditional fashion brands that want to produce smart, sensor-laden clothing.

Apple’s vertically-integrated model is powerful because it allows Apple to pioneer new markets that require novel implementations utilizing intertwined software and hardware. Pioneering a new factor is especially difficult when dealing with separate hardware and software vendors and all of the associated challenges: disparate P&Ls, different visions, and unaligned managerial mandates. However, once the new form factor is understood, modular hardware and software companies can quickly optimize each component to drive down costs and create new choices for consumers. This approached has been successfully played out in the PC, smartphone, and tablet form factors.

Apple’s model is not well-suited to being the market leader in terms of raw volume. Indeed, Apple optimizes towards the high end, not the masses and this strategy has served them well. But it will be interesting to see how they, along with other vertically integrated smart-clothing vendors, approach the clothing market. Fashion is already an established industry that is predicated on variety, choice, and personalization; these traits are the antithesis of the Apple model. There’s no way that 20% or even 10% of the population will wear t- shirts, polos, tank tops, dresses, business clothes, etc., (which I’ll collectively call the “t-shirt market”) made by a single company. No one company can so single-handedly dominate the t-shirt market. People simply desire too many choices for that to happen.

OMSignal and Sensoria don’t need to worry about this problem as much as Apple since they’re targeting niche use cases in fitness and health. However, as they scale and set their sites on the mass consumer market, they will need to figure out a strategy to drive massive personalization. Apple, given its scale and brand, will need to address the personalization problem in the t- shirt market before they enter it.

The t-shirt market is going to be exciting to watch over the coming decades. There are enormous opportunities to be had. Let the best companies win!

Feel free to a drop a comment with how you think the market will play out. Will the startups open up their sensors to 3rd party clothing companies? Will Apple? How will Google counteract?

If You Can't Beat Them, Fund Them!

This post was originally featured on EMRandHIPAA.

In Where Does It Hurt, Athenahealth CEO Jonathan Bush explicitly calls out a number of businesses that are disrupting hospitals. Specifically, these businesses are performing a single function – e.g. labs, imaging, birthing, urgent care – at a much lower cost with higher quality than general-purpose hospitals. These modular businesses are disrupting hospitals by ruthlessly focusing all of their operations around a single service line to optimize quality and reduce costs. This stands in stark contrast to hospitals, which generally try to be all things to all people (the antithesis of entrepreneurship and general business practices).

I’ve previously outlined how healthcare providers are struggling as they shift to risk-bearing reimbursement models. They’re straddling two dramatically different business models as they try to transform their businesses from fee-for-service to risk-bearing. Inverting a business with thousands of employees and billions of dollars worth of assets and processes is nearly impossible. This is even more challenging in a highly uncertain and fast-changing regulatory environment.

But what if there was a better way?

In the Innovator’s Solution, author Clayton Christensen describes how multi-billion dollar companies such as Apple, IBM, Johnson and Johnson, and Intuit have disrupted themselves. When faced with disruptive changes in their respective businesses, these incumbents disrupted themselves by:

  • Funding a separate operating division with its own P&L
  • In physically removed location
  • With dedicated employees who have no responsibilities to the old business model.

This formula by no means guarantees success, but it creates an environment in which the disruptive division can potentially save the business as a whole, so long as the disrupting business has the operating freedom to disrupt the parent. Employees shouldn’t be bound to the processes, assets, and values of the old business model.

How can providers disrupt themselves?

How can providers, in particular large hospitals and health systems, adopt Christensen’s disruption framework? By funding their disruptors! This strategy drives value across a number of dimensions:

1) Hospital management will have the opportunity to learn about the operational expertise necessary to modularize their existing operations at a lower cost

2) Hospital management will have access to insider information about their own disruption that they would otherwise lack. They can in turn use this information to make smarter decisions about their own businesses, and potentially buy out the disruptees if they become too disruptive.

3) Drive inbound referrals from the periphery to the hubs

4) Generate a financial return

A practical example

My company, Pristine, recently spent some time learning about urgent care centers. We wanted to sell urgent care centers a lightweight telehealth platform so they could beam specialists and hospitalists into the urgent care center. This would allow the urgent care center to generate more revenue by avoiding “leakage” while also generating more revenue for the consulting specialist, guaranteeing more referral traffic to the host hospital, and providing the patient a more convenient experience. All parties would win. The idea was perfect in theory, except…

We discovered that non-hospital owned urgent care centers generally dislike hospitals, and are in fact too proud of the quality of care they provide to patients at much lower cost. These urgent care centers know that they’re disrupting hospitals, but are holding that against the hospitals as a reason not to align interests. Similarly, the hospitals view the urgent care centers as a competitive threat and have no desire to do business with them.

The more I think about this situation, the more I’m convinced that hospitals should invest in their disruptors. A financial tie will massage the hard feelings that exist and create an opportunity in which community resources can be most effectively coordinated across the continuum of care. As we move towards risk-based models, hospitals will need to drive patients to the most capitally efficient cost center that can diagnose and treat the patient.

What are your thoughts? Do you know of any major health systems investing in their disruptors? Or of any health systems that are outright trying to disrupt themselves by establishing modular service lines themselves? (Banner Health and University of Arizona are doing this to some extent!)

Why Are Telemedicine Systems So Expensive?

This post was originally featured on EMRandHIPAA.

Like many other enabling-technologies in healthcare, telemedicine has vast unrealized potential.

If we make location completely irrelevant and can deliver care virtually, we can address the supply and demand imbalance plaguing healthcare. The benefits to patients would be enormous: lower costs and improved access in ways that are unimaginable in the analog era.

However, one of the many roadblocks to adoption is the cost of the legacy technology powering clinical telemedicine use. In this post, I’ll outline why the telemedicine systems are so expensive, even in the era of Skype and other free video-conferencing systems.

The Telemedicine Industry Is Old…School

Telemedicine as an industry has existed for about 15 years, although uses of telemedicine certainly predate that by another 10-20 years. A decade and a half ago, the foundational technologies that enable video-conferencing simply weren’t broadly available. Specifically, early telemedicine companies had to:

1) Develop and maintain proprietary codecs
2) Design and assemble hardware (e.g. proprietary cameras) and device drivers
3) Deploy hardware at each client site and train end users on its management
4) Build an expensive outside sales force to carry these systems door-to-door to sell them
5) Endure long, grant funding-driven sales cycles

Though some of these challenges have been commoditized over the years, many of the legacy players still manage and maintain the above functions in-house. This drives up costs, which in turn must be passed onto customers. Since many customers initially paid for telemedicine systems with grant money (that telemedicine technology companies helped them write and receive), the market has historically lacked forces to drive down prices. Funny how that seems to be a recurring theme in healthcare!

But, there’s a better way

Today, many startups are building robust telemedicine platforms with dramatically lower cost overhead by taking advantage of a number of technologies and trends:

1) Technologies such as WebRTC commoditize the codec layer
2) The smartphones, tablets, and laptops already owned by hospitals (and individual providers) have high quality cameras built into them
3) Cloud providers like Amazon Web Services make it incredibly easy for young companies to build cloud-based technologies
4) Digital and inbound marketing enable smaller (and inside) sales forces to succeed at scale.
5) To reduce the cost of care, providers are increasingly seeking telemedicine systems now, without wading (and waiting) through the grant process of yesteryear.

In short, telemedicine companies today can build dramatically more cost-effective solutions because they don’t have to incur the costs that the legacy players do.

Why don’t the old players adapt?

The simple answer: switching business models is exceedingly difficult. Consider the following:

1) Laying off hardware and codec development teams is not easy, especially given how tightly integrated they are to the rest of the technology stack that has evolved over the past decade

2) Letting go of an outsides sales force to drive crafty, cost-effective inside sales is an enormous operational risk

3) Lobbying the government to provide telemedicine grants provides an effectively unlimited well to drink from

Changing business models is exceedingly difficult. Few companies can do it successfully. But telemedicine is no different than all other businesses that thought they were un-disruptable. Like all other technologies, telemedicine must adapt from legacy, desktop-centric, on-premise solutions to modern, cloud based, mobile and wearable-first solutions.

The Health Insurance Demand Problem

This post was originally featured on EMRandHIPAA.

A family friend was recently admitted to the hospital after a traumatic motorcycle accident in Colorado. He’s not in great condition, but he’s hanging in there. In light of having just written this post about the cost of highly acute care, I couldn’t stop pondering about his health insurance.

Health insurance is a bizarre creature. Unlike other forms of insurance, people actually want to consume what they’re insured against, defying the very premise of the insurance model!

Confused? Let’s dive in.

No one wants to consume traditional insurance

People never file claims for traditional forms of insurance unless something bad has happened, like car or home accidents, natural disasters, or death (covered by life insurance). In some of these cases (like minor fender benders), the insured customer often elects not to file a claim in order to avoid a premium increase. When people do file traditional insurance claims, that means something sufficiently bad has happened, and the insurance system kicks in place to recoup the damages.

People do want to consume healthcare insurance

Healthcare insurance is a wildly different animal. Only a small percentage of total hospital admissions are highly acute, catastrophic cases. A large majority of the care delivery system services non-catastrophic cases, from preventive care to counseling, scheduled (and elective) surgeries, and skin rashes, for example. Patients want as much (non-catastrophic) healthcare as reasonably possible, and they want their insurance companies to pay for it.

This is a classic principal-agency problem. The person making financial decisions isn’t bearing the cost of those decisions; in fact, the person making financial decisions is empowered to blindly spend without thinking. To make matters worse, many healthcare providers encourage patients to consume costly diagnostics and procedures with little regard for value, knowing that insurance companies will pick up the tab.

Realigning incentives

As it currently stands, this system breaks most of the basic assumptions of capitalism: the principal-agency problem, pricing information, and ability to compare producers/providers.

Reducing demand and utilization of healthcare resources is impossible. Since patients are currently incentivized to demand unlimited care without caring about cost, supply will always find a way to satisfy demand. So, how can we realign the incentives to fix the system?

The only way to reduce demand is to make patients accountable for their own healthcare expenses. With the insurance customer suddenly conscious of the cost and value of their subacute healthcare consumption, providers will be incentivized to compete and offer lower costs.

Thus, insurance companies should provide patients “catastrophe-only” plans. These plans would fully and generously cover highly acute care needs, like trauma, cancer, or stroke care. However, like a vehicle insurance plan without comprehensive coverage, the cost of treating the medical equivalent of a keyed car (e.g. a purely speculative blood test) would fall to the individual.

As CEO of a company in the healthcare space, it pains me to know that I’m contributing to the healthcare incentive problem by providing employees with a traditional healthcare plan. But until healthcare insurers offer catastrophe-only plans, patients will continue to blindly consume. In fact, even the Affordable Care Act failed in this light; the national and state-based exchanges don’t offer a single catastrophe-only insurance plan. They are all bundled and are ripe for unbundling.

You Better Stay Healthy, Or Else...

This post was originally featured on EMRandHIPAA.

As I read Jonathan Bush’s new book, Where Does It Hurt?the most salient problem that Bush discusses is that hospitals can’t effectively measure or attribute their costs. As a result, they can’t make good decisions since they don’t know how to attribute costs and revenues.

Although this has been widely known for sometime, the implications of this are particularly interesting. Since hospitals don’t know how much it costs to actually deliver care (especially multi-faceted, complicated care), their various revenue streams are effectively subsidizing their expenses in an almost random manner. Accounting for costs and attributing revenue is nearly impossible.

Bush notes that more focused care centers – such as standalone labs, imaging centers, and minute clinics – can afford to offer many of the same services as hospitals with equal or greater quality at a lower cost. They can achieve this because they have dramatically less operational overhead than hospitals and have staff performing the same core basic functions repetitively. Indeed, practice makes perfect.

There are hundreds of companies all over the country building healthcare practices based on this very premise: labs, imaging, procedures, home health agencies, ASCs, birthing centers, cath labs, urgent care, retail clinics, and more. Focused-centers are slowly eating away at hospitals by providing better services at lower costs.

Today, hospitals make enormous profits by dramatically marking up routine procedures and services. But that won’t continue forever. As the ACA pushes patients towards high-deductible plans so that patients act more cost consciously, they will seek the more affordable alternatives. Patients will not agree to pay a $300 ER copay and $2000 MRI when the urgent care center down the street offers a $99 copay and $400 MRI. As patients make better decisions, hospitals will lose some of their easiest, most profitable revenues: extremely marked up lab tests, images, procedures, etc.

What will hospitals be left to do when their easiest, most profitable revenue vanishes? They will shift focus to what they do best: performing miracles. Hospitals will compete for high-end services such as-complex surgeries and intensive care. However, because routine services subsidize the hospital’s overhead, they currently offer surgeries and intensive care at a “discount.” When hospitals can no longer subsidize their complex care with routine care, hospitals will raise prices for the highest acuity services that can’t be performed elsewhere. If you thought acute sickcare was unaffordable, think again. The cost of complex care is going to grow dramatically in the coming years.

Understanding Apple Health

This post was originally featured on EMRandHIPAA.

Apple recently announced Health and Healthkit as part of iOS 8, and initial responses have been mixed.

At one extreme, the (highly biased) CEO of Mayo Clinic called Apple Health “revolutionary.” At the other, cynical health IT pundits claim that Apple Health is a consumer novelty and won’t crack the enigmatic healthcare system. As a cynical health IT pundit myself, I’m more inclined towards the latter, but have some optimism about Apple’s first steps into healthcare.

For the uninitiated, Apple Health is a central dashboard for health related information, packaged for consumers as an iOS app. Consumers open the app and see a broad array of clinical indicators (e.g. as physical activity, blood pressure, blood glucose, sleep data). You can learn more about Health and Healthkit from Apple.

The rest of this post assumes significant understanding of modern health IT challenges such as data silos, EMPIs, HIEs, and an understanding of what Health and Healthkit can and can’t do. I’ll address what Apple Health does well, ask some questions, and then provide some commentary.

Apple Health does a few things well:

1) Apple Health acts as a central dashboard for consumers. Rather than switching between five different apps, Health provides a central view of all clinical indicators. In time, Health could help patients understand the nuances of their own data. By removing friction to seeing a variety of indicators in a single view, patients may discover correlations that they wouldn’t have observed before. With that information, consumers should be able to adjust behaviors to lead healthier lifestyles.

2) Apple Health provides a robust mechanism for health apps to share data with one another. Until now, health app developers needed to form partnerships with one another and develop custom code to share information; now they can do this in a standardized way with minimal technical or administrative overhead. This reduces app lock-in by enabling data liquidity, empowering consumers to switch to the best health app or device and carry data between apps. This is a big win for consumers.

Unanswered questions:

1) How does Apple Health actually work? Apple provided virtually no details. Does the patient need the Epic MyChart app on their phone? Is there custom code integrating iOS to Epic MyChart? Is there a Mayo Clinic app that is separate from Epic MyChart? If not, how does Apple Health know that the consumer is a Mayo patient? Or a Kaiser Permanente patient? Or a Sutter Health patient?

2) Does the patient give consent per data value, or is it all or nothing? How long does consent last? Must consent be taken at the hospital, or can the patient opt in or out any time on their phone? Who within the health system can access the consented data?

3) Given that there are hundreds of EpicCare silos and dozens of CareEverywhere silos, how does Apple Health decide which silo(s) to interface with? Does data go to an HIE or to an EMR? If to an HIE, can all eligible connected providers access the data with consent? If a patient has records in multiple HIEs and EMRs (which they likely do), how does Apple Health determine which HIE(s) to push and pull data from?

4) Does Apple Health support non-numerical data such as CCDAs? What about unstandardized data? For example,PatientIO allows providers to develop customized care plans for patients that can include almost any behavioral prescription. Examples include water intake, exercising at a certain time of the day, taper schedules, etc.

5) Can providers write back to a patient’s Health profile? Given that open.epic doesn’t allow Epic to send data out, how could Apple Health receive data from Epic?

7) How will Apple handle competing health apps installed on the same consumer’s phone? For example, if I tap “more diabetes info” in Apple Health, will it open Mayo Clinic’s app (and if so, to the right place in the Mayo Clinic app?) or the blood glucose tracking app that came with with my blood glucose meter? Or my iTriage or WebMD app?

8) Is Apple Health intended to function as a patient-centric HIE? If so, what standards does it support? CCDA? FHIR? Direct?


1) The Apple-Epic partnership is obviously built on open.epic, which Epic announced in September of 2013. It’s likely that Apple and Epic reached an agreement around that time, and asked the public for ideas on how to shape the program to get a sense of what developers wanted.

2) The only way to succeed in health IT is to force the industry to conform to one’s standards, or to support a hybrid of hybrids approach. Early indicators show Apple (predictably) trending toward the former. Unfortunately, Apple’s perennially Apple-centric approach inhibits supporting the level of interoperability necessary to power an effective consumer health strategy. Although Apple provides a great foundation for some basic functions, the long term potential based on the current offering is limited. What Apple has produced to date provides for sexy screenshots, but appears to fall short of addressing the core interoperability and connectivity issues that plague chronic disease management and coordination of care.

3) In a hypothetical world at some indeterminate point in the future, there would be a patient-facing, DNS-like lookup system for provider organizations (Direct eventually?). Patients should be able to lookup provider organizations and share their data with providers selectively. Apple Health provides a great first step towards that dream world by empowering patients to see and, to some extent, control their own data.

You Get What You Ask For

This post was originally featured on EMRandHIPAA.

I recently had a chance to meet Dr. Dave Levin, the first CMIO from Cleveland Clinic, at the Texas HIMSS conference, where I spoke about Google Glass in healthcare. During his keynote, he gave a quick overview of his book – mHealth: Global Opportunities and Challenges – that I’m reading now.

The most important thing I took away from his presentation is that people will do exactly what you tell them to do, not what you’d like them to do. More specifically, people will optimize against what they’re measured against. This is a classic business truism, but one worth repeating.

In order to receive Meaningful Use cash for adopting EMRs, providers are jumping through an excruciatingly difficult series of hoops. Among those hoops is the primary theme of MU Stage 2: patient engagement.

But patient engagement is not an end. Patient engagement is a means to an end. Although there are certainly disagreements on what the end should be (depending on one’s political alignment), the federal government is clearly pushing value-based care delivered through PCMH and ACO models.

So why are we measuring arbitrary metrics such as “5% of patients engaging with their providers” through some sort of patient engagement product? By incentivizing arbitrary usage metrics, we will see little healthcare delivery transformation, despite all the intent in the world. Instead of flipping the clinic by utilizing patient engagement tools as part of a broader healthcare delivery strategy, providers are just going to optimize to barely get by getting 5% of their patients to send them a message through their patient portal.

Consider instead these potential alternative metrics, that better reflect the spirit of the MU regulations:

1) Percentage of patient population cared for under a value-based rather than volume-based model.

2) Percentage of simple visits – script refills, ear infections, etc. – conducted remotely via telemedicine instead of in person.

3) Percentage of visits avoided simply by answering questions via asynchronous secure messaging/pictures.

4) Percentage of complex visits handled by an MD (in which the intention is to hand off simpler visits/procedures to non-physician practitioners to lower costs)

There are certainly problems with some of these proposed metrics. They don’t solve all incentive problems; the system can always be gamed. But compared with existing measures, the above metrics do much more to force providers to rethink care delivery models and flip the clinic.

Some people will interpret these metrics as a way for the federal government to institute socialist control over healthcare delivery. These fears, though, are disproportionate. While a slippery slope argument can be made in this case, the US government has only on a few occasions actually nationalized private functions. In most of those cases, the nationalization was short-lived (such as General Motors 2009).

Given the clout of the AMA and other players, the probability of sliding down this slope seems exceedingly low. History has shown that there is too much friction in the status quo in the US healthcare system for the system to change on its own. At any rate, some change is better than none!

So, Uncle Sam, hear this: you get what you measure. So please measure what you actually want.

The Nurse Will See You Now

This post was originally featured on EMRandHIPAA.

The Atlantic just wrote a piece highlighting the growing trend of non-physicians (commonly referred to as midlevels) providing healthcare. The reason is simple: supply and demand–more precisely, a fixed supply.

For any location where a patient demands healthcare services, there is only a binary result: either there is a qualified healthcare professional available to deliver care, or not. This slide (from Pristine’s investor presentation) illustrates this:


The supply and demand problem is further compounded by an archaic regulatory system. The path toward becoming a physician, at least in the US, is so arduous that the decision to pursue becoming an MD must be made by age 18 or 19. Even if a huge cohort of 18 year olds suddenly decided they wanted to be physicians, the artificially capped supply of available residency slots each year stimies traditional supply and demand economics.

Nursing, on the other hand, has a more varied cohort in terms of age of entry. Many nurses don’t enter the profession until well into their late 20s or 30s. The same is true of physician assistants. This has resulted in a more liquid supply of non-physician practitioners, and these non-physician practitioners are available to respond to the influx of new patients resulting from the ACA, and to the growing number of retiring baby boomer population.

Given the fixed supply of physicians, there are two fundamental ways to solve the supply and demand problem: make physicians more efficient, or substitute physicians with others who can do an equally good job for a given patient’s needs.

The realities of practitioner supply suggest that nurses and other non-physician practitioners will deliver an increasingly large percentage of healthcare services. Physicians will be relegated to the “high end” per Clayton Christensen’s disruption theory. That could manifest itself in a future in which midlevels deliver primary care and triage more acute conditions to “higher end” specialist physicians.

The greatest challenge in the triage-centric model led by midlevels is the (historically quite poor) communication among healthcare providers. We will need a robust technological infrastructure to support the seamless transfer of patient data among providers. Additionally, we’ll need more capable communication tools to empower providers to connect with one another and with patients regardless of location.

Telemedicine seems to be taking hold to power a future in which location is irrelevant. Interoperability is improving within health enterprises, though there are some signs that community health information exchanges (HIEs) are notdoing as well as many had hoped.

At some point down the line, we’ll likely look back and wonder why location mattered so much. It shouldn’t, and because of telemedicine, and liquid data connectivity, it won’t.

Happy Mother's Day! Telemedicine Edition

This post was originally featured on EMRandHIPAA.

In honor of Mother’s Day, I thought I’d write a post highlighting how telemedicine can benefit mothers caring for their children.

Many children can get up to 6 ear infections per a year. Everytime it happens, children complain, and inevitably mothers take their kids to the pediatrician. In most cases, the mother already knows what the problem is (because it’s frequent and easy to diagnose), but yet she has to drag her child to the doctor, leave the kid in a room full of other sick children for half an hour, only to spend 5 minutes with the pediatrician to get a prescription for antibiotics. Then she has to drive with her child to the pharmacy to pickup the medications, and then get her child back home. Meanwhile, she’s falling behind on work.

What a pain. I can’t imagine fighting that battle even once per year, let alone 6 times!

Healthcare shouldn’t be hard. And in my cases, such as the pediatric ear infection, it’s not. What if mothers bought a Cellscope, took a picture of her child’s ear, sent it to her doctor, then received antibiotics from PillPack the next day? Or better yet, what if the medications arrived via drone delivery within an hour?

I’m optimistic that 10 Mother’s Days from now, moms across the country won’t have to deal with so much frustration to solve what is such a simple problem.