Getting What You Paid For

[Applause]

his name

was oscar meyer

an adorable animal he was being raised

to be a show pig

but unfortunately he was also likely

host

of a bacteria called e coli o157

a bacteria that caused a severe

infection in his owner

so severe that his own or an

eight-year-old boy

landed in my pediatric intensive care

unit

the infection ravaged his small body his

lungs

filled with fluid and we needed to put a

put him on a machine for him to breathe

his kidneys failed and he needed

dialysis to clean his blood

we weren’t sure if he was going to live

or die

his parents his parents were amazing

always by his side hoping for the best

vigilant never leaving

unfortunately it was planting season and

while they were there with him

the family farm suffered

after a couple weeks he started to turn

around and start to get better

and around the same time the medical

bills started to show up

to witness the burden of the finances

on top of all the stresses of having

your child in the icu

was almost unbearable to see

i remember after a couple weeks of him

getting better

and the parents selling to the icu

routine the dad started to ask questions

every couple days or so you go to the

billing office get a list of what we had

spent

and you bring that to morning rounds the

time of the day that we go over

our plans of care and there he would ask

questions

tough questions questions that my

medical training

really didn’t prepare me for

that lab you got same lab you got

yesterday same lab you got the day

before

completely the same you doing anything

differently with that

tylenol why does it cost so much in the

hospital

can i just bring some from home

his father was so polite but you could

see that the burden was on him

and truth be told my answers were rarely

sufficient

why do we get that lab well it’s our

routine

and true we actually didn’t do anything

different but it’s just kind of what we

do

tylenol i guess that’s the hospital

price

and no you can’t bring anything from

home in

it’s very important for me to emphasize

this key point

at no point in his care do we make a

medical decision based on cost

at no point do we discuss costs with a

family when discussing therapies

or treatment plans we just did what was

right

we did what was necessary after all his

life was in the balance

there is no cost to that

story ends well he recovered went home

to his farm

and yet years later i reflect back to

those weeks and months that he was in

the hospital

and i think to myself in the process of

saving his life

did we bankrupt the family

this is a extreme example of health care

costs in today’s society

if you ask anybody in a life or death

situation they’ll likely say

that cost is of no concern but the

reality of health care is it’s

rarely life or death more often than not

it’s mundane

the routine the common illnesses

before talking about healthcare value i

think it’s important to talk a little

bit about healthcare costs

and about health care costs here in the

us

costs here in the us are extraordinarily

high and it doesn’t necessarily buy the

health

we think it does in 2018 the us spent

3.6 trillion dollars on health care

despite spending over 30 thousand

dollars per household annually

the u.s ranked lowest in life expectancy

and the highest in chronic disease

burden

of major high-income countries such as

canada

united kingdom and australia

what is even more worrisome for me is

the fact that 10 percent of this spend

comes from out of pocket spend meaning

10 percent of the spend comes out of

your pocket after

insurance pays for an average family

with

insurance this could amount up to 3 000

annually this kind of spend

is what creates the health that we have

here in the u.s

a recent study of icu patients

discharged with respiratory distress

noted that two-thirds reported a

financial burden after discharge

not surprisingly two-thirds of

bankruptcies in the u.s are medically

related

i think it’s worth emphasizing that

again two

out of every three bankruptcies in the

u.s are related to the high cost of

medical care

what we know from research is that 20

percent of a community health

is dependent on clinical care that 3.6

trillion dollars and rapidly spending

for you

80 however are based on social economic

factors

same factors that are completely

devastated by financial burden

i’ve been in healthcare for 20 years now

i know i look young

and in that time i’ve worked in almost

every aspect of healthcare

i’ve worked as a management consultant i

worked as an operational leader a

strategist

i worked in senior health care

administration i worked

for a startup as a clinical advisor i

worked in academia

in health services research and teaching

medical students but the role that’s

most near and dear to my heart is

i’ve been a clinician for my patients

throughout this time i’ve seen all

aspects of health care from payment

to delivery to innovation and this is

what i know

the us healthcare system right now as it

stands is still predominantly dependent

on a fee-for-service infrastructure

so what that means is anything that i do

for you and taking care of you the more

i do

that service the more i get paid

if i ask you to come to clinic every

single day for a month i get paid for

every single visit you show up for

every dollar that is spent within the

health care industry

is revenue for someone else in the

healthcare space

this is a perverse incentive

value is actually quite different from

cost that we’ve been talking about

cost is part of that value equation

value

takes cost into consideration if i told

you that there’s a new drug on the

market

and the drug’s 100 percent better than

the existing drug and

cost 10 dollars more most of us would

say that’s a that’s a high value

medication

if the same medicine is only one percent

better two percent better five percent

better

and cost ten thousand dollars more you

would argue that that may be a low value

medication

value takes cost into consideration as

we select our path toward health

our current health care system is not

dependent on value

instead it is care regardless of cost

now

providers want to do the right things

we want to take care of our patients the

best of our ability if there’s a therapy

out there

that is better than what we are

currently doing we want to try that

therapy if there’s a medication out

there

that is more effective than what you’re

currently getting

most providers who prescribe that

medicine often without consideration of

cost

but let me ask you this if you needed to

pick a medication to control

hypertension

or high blood pressure which one of the

following would you pick

the first medication is extremely

effective brand new

name branded taken once a day no side

effects

costs 500 a month

the second medication is a generic years

in the making battle tested

you have to take it twice a day though

and occasionally will give you nausea

but most will tolerate it okay it’s ten

dollars a month

what if there’s a third medication you

have to take three times a day

this medication strangely enough will

give you a rash

looks kind of weird but that’s about it

this medication only costs one dollar a

month

which one would you pick you’re probably

doing some calculation in your head you

know what does it work to you to take a

medicine three times a day versus two

times a day versus one time a day

what is it worth you’d have a little bit

of nausea what is it worth you to have

an unsightly rash and you’re coming up

with a dollar amount in your head

and likely the dollar amount varies

across the audience

but in healthcare we’re not given the

ability to balance the cost to the

benefit we’re not

given the ability to determine that

value equation for us

instead that calculation is done by the

provider

and patients get a binary choice

the providers will think well what is it

that

mr smith would want obviously he would

like the very best

he wouldn’t want to take a medicine more

than once a day and he clearly

wouldn’t want to rash and he clearly

wouldn’t want nausea

so mr smith leaves the clinic with a 500

a month medication

having never discussed the fact that

there are other medications possible

what providers lose sight of in the

process of finding the best for their

patients

is that cost matters to health almost

like a side effect

and in this case side effects is

medication adherence

we know from an adult study of

cardiovascular patients that

one in eight adult cardiovascular

patients actually reported medication

non-adherence

due to cost what’s even more worrisome

is that often people avoid care

because of cost a survey of americans

revealed that

half of americans have some point in

their lives

avoided care because of a presumption of

cost

by trying to do the best that we can for

patients and avoiding

the discussion on costs we inadvertently

as providers

may have created poor health for our

patients and communities

despite lots of research demonstrating

that value-based care

improves outcome and decreases costs

despite multiple value-based initiatives

that are across the u.s trying to

replace the fee for service

infrastructure

the adoption of value-based care has

been very limited

and one could be very cynical and say

well

payers providers other people in the

ecosystem

they’re going to lose income so there’s

no way they’re going to adopt this one

could be very simple going to say that

the whole system needs to be chucked

before something like this can ever

happen

and ultimately aspects of both are

likely true the relationship between

payer

provider patients the healthcare

ecosystem

all that will likely have to change in

order to pursue value

the way that providers think about what

they do

directed toward health as opposed to

health care services will also have to

change under value

but i remain optimistic i believe we

could do this

and i believe that because it’s the

right thing

for what we spend in the euro in the us

we should have the best health

in the world we all want

the highest amount of value in what we

spend in health care

so how do we get there i like to propose

a simple first step

i propose that there needs to be a

transfer of power

from patient up from providers to

patients

that patients not only get education

advice and counseling

but they also get agency in deciding

what it means to

them to have a value-based care

lack of agency however happens even when

knowledge exists

thing is earlier this year i was a

patient

i had a relatively routine procedure

same day outpatient surgical procedure

for

inguinal hernia repair went

amazing it was a great day went in did

my surgery

laughed pain was well managed i

recovered quickly

about a month later i received my bill

the thing is even as a provider once i

became a patient i lost

agency this is what i discovered in my

bill

when you first go in obviously you’re

going to have surgery you need an iv

they put an iv in before the iv start

they give you a little lidocaine under

the skin to numb that surface

so that when the iv goes in it doesn’t

hurt as much

it’s pretty common practice what i

didn’t realize was that lidocaine

solution

cost 75

to manage surgical pain one of the

things that i was given was intravenous

tylenol

one dose 550

to manage localized surgical pain my

provider injected

one of the newer local anesthetic into

that area

so that i could recover quicker that

injection

two thousand six hundred and fifty

dollars

now it’s very very important that i say

the next part

i was a hundred percent happy with my

operation

it was great i recovered nicely my pain

was

manageable it was great

but if asked

i likely would have refused the

lidocaine if i knew it was 75 dollars

if asked i likely would have just taken

a dose of tylenol at home for one dollar

as opposed to

550 iv

if asked i may have pursued what kind of

generic options i had for my local pain

injection versus the brand name what’s

the cost difference what’s the benefit

difference

in every one of these examples what i

would be selecting

is greater pain at lower cost

but just like you all did a little bit

earlier in our minds we balance the cost

and benefit

especially since none of these

medications were life or death

if given a choice would i have refused

some of these medications

knowing that my out-of-pocket expense

for this one-day procedure

was four thousand dollars

absolutely but i was not given choice

i was not given agency what i was given

was the best care possible without

consideration of cost

i believe this is how value starts

value starts by shifting that decision

from the provider to the patient through

education

through advice through counseling but

ultimately

through giving agency and this won’t be

easy

providers have to give up power

and patients have to ask for agency

i think back to my icu patient getting

better

outside of the life and death situation

and i think

would i have given the family agency to

select a path of greater pain for lower

cost

i think back to myself as a patient in

the operating room or about to go in

for a routine procedure non-life

threatening

would i have asked for agency to select

a path

of greater pain and lower cost

more importantly should i have asked

the next time you see your doctor will

you ask

you