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