By Bruce Stanley
What happens when care becomes cost-prohibitive?
We routinely hear about how great healthcare is in this country, with our state-of-the-art technologies, digital health, and the best labs, doctors, distribution network, products, treatments, medications, innovation, hospitals, etc. Often the pundits say if only we could run it like a “real” business, we could eliminate all the idiosyncrasies, fraud and abuse. But the fact that we’ve been trying to run healthcare like a business for quite some time and haven’t fixed many of our systemic failings makes me wonder about the merit of that belief.
Having a “business-like” vision isn’t in and of itself wrong. What seems to have evolved, however, is that profitability has become paramount. Just look at healthcare CEO salaries and ask yourself, “How many patients has that person treated lately?” Probably not many.
Using a “business approach” to healthcare leads to greater interest and financial returns in ongoing treatment. In fact, treatment is where the money is. One doesn’t have to look far to see glaring examples: diabetes treatment, opioid overprescribing, extravagant pharma advertising, and to some extent, the push for new digital health devices and apps.
Then there’s the explosion of medication costs. The news often highlights the high cost of orphan drugs for patients with rare diseases. But what about the costs for patients with mainstream chronic diseases? There are probably hundreds of examples, but one that personally comes home to me is prescription pancreatic enzymes, which have stratospherically increased in price over the last decade. One must question, what’s changed?
And what about hospital funds being used to create gardens dedicated to the spouse of the CEO – the same CEO who shut down clinical departments needed by the community?
Disappearing patients
During the Vietnam War era, many uttered the slogan, “What if we had a war and nobody came?” Similarly, I question what would happen to our healthcare system if patients simply didn’t show up for care. Even today, individuals with “good” insurance refuse to have certain tests done, return for a follow-up doctor visit or pick up a high-priced medication from the pharmacy. The costs are unaffordable and the value of the treatment questionable.
We have convinced ourselves that the healthcare in the USA is the best in the world. In many ways, that’s true. But what if it becomes so cost-prohibitive that care becomes available only to the wealthy and well connected?
In a recent conversation, a colleague shared with me how her critical life-sustaining maintenance medication has risen dramatically in price since 2000. She described that her drug underwent numerous patent changes but nothing materially changed. It became a new drug with new protections. Never did the drug’s manufacturer consider how the skyrocketing costs would affect the patient both with her medication regimen or lifestyle. Nor did they appear to care.
When patient care becomes so segmented and only the wealthy have access to it, support systems like insurance, innovation, manufacturing, distribution – which are all predicated on volume – collapse. Where does that leave the rest of our industry? Maybe we need to rethink the approach that healthcare needs to run solely like a business, and return to the belief that healthcare is about creating cures and healing patients.
Bruce Stanley is a global supply chain, business development and contracting operations advisor and consultant with over 30 years in the healthcare industry. In 2011, he co-founded The Stanley East Consulting Group, in Ipswich, Mass., a consulting practice specializing in supply chain, contracting, business development, order fulfillment and project management for small and medium-sized companies, startups, and companies in transition or divestiture. He is also a published author of many observational commentaries on healthcare processes, and an adjunct MBA professor teaching global supply chain, contracting and healthcare informatics and regulations. He previously served as senior director, contracting operations, for Becton Dickinson.