The Race Between the Shark and the Engineer

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The Race Between the Shark and the Engineer

• November 19, 2004

Arnie Milstein MD, MPH Pacific Business Group on
Health Mercer Human Resource Consulting The
Leapfrog Group arnold.milstein_at_mercer.com
?2004 A.Milstein
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Meet the Medical Miracle SharkMuzzle these Jaws
or Spend gt50 of Employee and Retiree Income on
Health Care
Annual Percent Changes per Capita in Health Care
Expenditures and in Average Hourly Wages for
Workers in All Industries, 2000 through 2003
Data are from Strunk and Ginsburg, 2004. Dental
work by Dr. Milstein.
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Meet the Care Efficiency EngineersIncentivize
Their Ascendance or Face Social Strife
CARE SYSTEM
EMPLOYERS
OUTCOMES
Supportive market environment

• Safe
• Effective
• Efficient ? ? ??
• Personalized
• Timely
• Equitable

Organizations that facilitate the work of
patient-centered teams
High performing patient-centered teams
GOVT PLANS

• CARE SYSTEM RE-DESIGN IMPERATIVES(The Domain of
  Efficiency Engineers)
• Redesigned care processes
• Effective use of information technologies
• Knowledge and skills management
• Development of effective teams
• Coordination of care across patient conditions,
  services, and settings over time
• Use of performance and outcome measurement for
  continuous quality improvement and accountability

????
1Adapted from Crossing the Quality Chasm, IOM,
2001.
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Toward What IT-enabled Endpoint Might Chronic
(and Acute) Care Evolve?

• Customers personal values will be periodically
  elicited and shape risk assessment methods and
  responses
• Health risk assessment and response cycles (i.e.
  treatment planning) will be automated,
  continuous, less visible/disruptive and begin
  before birth
• Cyberists will perform the majority of
  non-automated work
• Accountability for implementation of clinical
  workflow steps will be explicit, and workflow
  will be automatically captured and adjusted

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Nearer Term Evolutionary Steps

• Frontstage providers will increase systemness
  via pretty good ehrs connected to backstage
  providers
• Balkanized backstage providers will merge
• Therapeutically-dosed P4P will stimulate
  provider adoption of evolving evidence-based best
  practices in chronic care
• Increasingly performance-sensitive health benefit
  plan designs with automated continuous
  electronic prompts will increase consumer
  selection of, and cooperation with, superior
  backstage frontstage providers

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Efficiency Engineers Will Allow Us to Outswim
the Shark To Newfoundland Beyond
Newfoundland
50th ile
Low Longit. Efficiency High Quality
High Longit. Efficiency High Quality (Dream
Suppliers)
MD Quality Index(outcomes or adherence to EBM)
50th ile
?Lower Higher?
Low Longit. Efficiency Low Quality (Nightmare
Suppliers)
High Longit. Efficiency Low Quality
MD Longitudinal Cost Efficiency Index (total
cost per case mix-adjusted treatment episode)
Lower Longit. Efficiency/ Higher Cost
Higher Longit. Efficiency/ Lower Cost
Adapted from Regence Blue Shield
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Closing Thoughts on Racing the Shark

• Political tensions will force all insurers to
  blend P4P (AKA Supply Chain Management 101) with
  more sharply tiered consumerism (AKA 18th
  Century micro-economics)
• Static near-term percentage point net gain may
  exceed 25 points on cost-efficiency 40 points
  on quality reliability
• Continuous, dynamic, IT- enabled annual
  efficiency gains from care re-engineering must
  eventually offset the annual incremental cost
  burden from the flow of biomedical miracles
• Real time, multi-source clinical information
  capture, decision support, and workflow
  management based on interoperating IT
  solutionswill be the jewels in the efficiency
  engineering crown
• Skeptical about efficiency engineerings yield?
• ... Think Stockholms Jonkoping Clinics
• ... Think Southwest Airlines