Innovation and Effective Healthcare for The Masses: An Oxymoron?

I tread carefully when it comes to discussions on optimizing healthcare solutions for the masses because Stephen Hawking's image crops up in my mind with this question: What if we designed a wonderful system that made it really difficult for Stephen Hawking to seek assistance at any point in his life? Replace Stephen Hawking with any person important to you, or who you believe is important to society, and you know what I mean.

Teams designing an effective healthcare system for the masses have challenges on sustaining innovation that are slightly different from those faced by mass market consumer products companies.

For a mass market beverage company, the challenge in supporting innovation may exemplified by the case of the Quaker Oats Company product portfolio acquisition. However, for regulators designing an effective healthcare system, the real challenge in societal optimization of healthcare lies in supporting innovation "pathways" through:
1> supporting basic research, and,
2> providing markets, processes and infrastructure for very expensive drugs to hit the market, and,
3> providing patients means to seek solutions outside the "mass" healthcare system.

For patients that have to pay out of pocket, then the government must make this process seamless, painless, and provide structures that help individuals extract some "economic rent" from (no apparent or direct attached economic benefit to) society. Depending on the context, you could call easy access to private, non profit foundations, to help fund your recovery, a form of economic rent.

In fact, the government may leverage experience with organ transplants for designing these "innovation pathways": http://www.organtransplants.org/understanding/unos/

The three points listed above are examples of the way certain "types" of innovation may stop getting support once creating and sustaining a mass market healthcare system becomes a prime focus of the society. I realize I am effectively proposing an indirect subsidy for innovation. I am in favor of this sort of indirect subsidy, because my hypothesis is that this may have a multiplier effect on drug research. My perspective is that this indirect subsidy would be similar to the investment in national highways in the last century.

What do you think?


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Find Clarity on the Healthcare Debate. Now. Here's How.

Based on the French Openesque rallies in Congress over Healthcare so far, most folks, including Peter Singer in an NYT article*, agree on some key points:
1> Private health insurance must remain available.
2> Consumers must pay less for healthcare.

So, why are we still debating? The "how" is keeping us busy! You, as the consumer and the raison d'etre of this battle, can seek the following from your representatives:

1> A baseline of the current healthcare costs, overt and covert, by consumer segments.

2> Projected costs for current and proposed healthcare plans.

3> Healthcare market structure definition and guidelines for market agent behavior, tied to measurable outcomes, that all entities- private and government- must adhere to.

In plain old straight talk, the answers to these questions help *you* decide.

Both Democrats and Republicans have leveraged the government as a market agent in the financial services industry. This learning could be transferred to the Healthcare industry. It may shed light on triggers for the government to become a service provider market player and also triggers for the government to exit the service provider value chain to return to just regulating the market.

In terms of cost, talk to any healthcare practitioner and he/ she will tell you its all about incentives. What would you change if an internist is not paid by an insurance company for taking steps that help prevent a more expensive medical condition later because it is not part of her job description? What would you change if you thought someone was recommending tests for sleep apnea when its a case of tonsilitis? This requires clarity on not just market structures, but also incentive processes.

To summarize: These questions with help each party in the debate develop a contextual, competitive positioning strategy to achieve recognizable differentiation in the market through both methods and outcomes.


If you are wondering how we can continue supporting broad innovation in healthcare, see here:
http://randomjunkyramblings.blogspot.com/2009/07/innovation-and-effective-healthcare.html
* Peter Singer's New York Times article on healthcare: http://www.nytimes.com/2009/07/19/magazine/19healthcare-t.html?pagewanted=5

What do you think?


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