Data Transparency, Retailization and Disruption in Contemporary...
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Data Transparency, Retailization and Disruption in Contemporary Medical Practice

By Chris E. Stout, PhD, College of Medicine, University of Illinois at Chicago, Vice President, Department of Clinical Research and Data Analytics, ATI Physical Therapy

Chris E. Stout, PhD, College of Medicine, University of Illinois at Chicago, Vice President, Department of Clinical Research and Data Analytics, ATI Physical Therapy

Many years ago, I wrote a book on technology applications in the practice of healthcare. My! How times have changed—in some ways. One evergreen point that I’d like to reprise herein should be as much of a mantra as it is a cautionary tale. It is a quote from H. James Harrington, wisely noting that “automating a bad process not only ensures that we can do a bad job every time, but that we can do it faster and with less effort than before.” Indeed.

I have been my experience that it is not unusual that in medical practices that members may be split between Luddites and Evangelists (a.k.a. Early Adopters). That is, some may get giddy with the feeling of downloading the latest app, buying the newest gizmo, or establishing a following on the current social medial platform du jour, while others may prefer paper ledgers and an abacus. Thus, it’s crucial for clinical leaders to both recognize such compositions/divisions in their practice as well as manage them. I have been a part of an acquisition of a smaller practice what relied on paper medical records, and (honestly) were fearful of using a computer. In fact, in trying to orient and train them to our systems, we found they did not have a “technology vocabulary” as we worked to help mitigate anxieties and provide training to our systems. (I suspect this is thankfully on the decline, but practice managers and leaders should be sensitive, aware, and empathic to differing technological skills and familiarity. Not every clinician is a power-user of all technologies.)

I have worked more than three decades in healthcare and medicine, and throughout all that time, it has been pretty much a mess when it comes to third-party payment. I’d wager a guess that the hourly reimbursement for psychotherapy is pretty close to the same as it was when I started clinical practice. On the bright-side, most everything else has improved—technology, evidence-based practice guidelines, training, and so forth.

The phenomena that are getting people’s attention, as well as headlines, are the curious potential disruptors of Walmart buying Humana or the seemingly odd triumvirate of Amazon, Berkshire Hathaway and JPMorgan getting into the healthcare business.

Retailization

Years ago, I recalled making the shift from going to my optometrist’s private practice to a franchise chain. I experienced a greater selection of frames and options, ubiquitous locations that were all easy to get to and could access my optometric health record, and do all that at a lower cost. The fees are transparent, and in my case, I pay out of my (HSA) pocket as I do not have insurance coverage for such. Honestly, I did not miss having “my” optometrist versus the tradeoff of all the other features, and cost savings to boot. These kinds of “practices” can be viewed medical practice threats or opportunities depending on a practice’s positioning and ability to innovate—or disrupt, a la Clayton Christenson.

In a related vein, the President signed into law the Food and Drug Administration Reauthorization Act of 2017 which included the Over the Counter Hearing Aid Act (also known as the “do-it-yourself model for hearing care”). This, for the first time in history, allowed individuals the ability to directly buy their hearing aids without having first to visit a physician or audiologist’s practice. This did not make those providers very happy.

But what about other medical practices? A patient can see a nurse at their local Walgreens if they want to. But while a convenience, I’m not sure that having a nurse sit by the pharmacist is adding a lot to their bottom-line. On the contrary, I suspect that it is Darwinian-market forces that are driving the various orthopedic and cosmetic options popping up next to the local Burger King.

"With such ubiquity of healthcare and medical options sprouting about, I think one of the natural results, or consequences, is that of commoditization"

Even the distinction between elective and non-elective procedures are starting to blur in the retail landscape as pediatric care and urgent care storefront franchises are popping up in a strip mall near you. Every week, I get coupon flyers offering discounts not only on new carpet or a roof repair but also for cool sculpting and Lasik surgery. Some have called this empowering for the patient; it just seems a bit weird to me.

Commoditization

With such ubiquity of healthcare and medical options sprouting about, I think one of the natural results, or consequences, is that of commoditization. This can lead to the slippery slope of the proverbial “race to the bottom” vis-à-vis buying based on price.

Does this trivialize healthcare or democratize it?

Once a product or service seems to be of about the same quality and is abundant, the differentiator becomes price. Once the price is in the equation, and there is competition, there is then margin squeeze, and then practice managers begin to worry.

Going shopping…?

With the retailization and commoditization of medicine comes the obvious question of going shopping. Indeed, price transparency is gaining greater momentum in medicine. In April, the Centers for Medicare and Medicaid Services publicly announced that “…it may require that hospitals post charge information as part of the proposed 2019 Inpatient Prospective Payment System rule…” online for all to see. Companies like Castlight have been working with employers to help inform their employees as to costs and provider quality as a means of more informed decision making when it comes to selecting a provider for their medical needs—in the context of financial cost and benefit design/coverage.

Several states already have such information publicly available as was noted in a paper published in the Journal of the American Medical Association which found that “…as of early 2012, there were 62 patient-oriented, state-based health care price websites” which note hospital, drug, and nursing home pricing.

Ikea versus Artisanal

I know that when I go to Ikea to buy something, it will not be an heirloom to be handed down through the generations. It is sort of like informed consent—I knowingly trade off quality for a low cost. Fair enough. The same is true when I choose to pop for that five-star hotel room over Motel 6.

But in medicine and healthcare, the cost/quality/value formula is out of whack, and that’s true even before the confusing noise of third-party payers comes into play. A study conducted via a systematic review of the published literature examining the relationship of cost and quality in healthcare found rather unsatisfying results: “Most studies have found that the association between cost and quality is small to moderate, regardless of whether the direction is positive or negative.” This is undoubtedly a concern for Concierge Practices.

It is very, very difficult to foresee and forecast the unintended consequences of complex systems. I’m sure that no corporate leader of an insurance company thought that their refusal to cover more expensive pain medications that were not addictive over the cheaper, albeit highly addictive alternatives, would have sparked the opioid epidemic that we are amid today, for example.

As payment systems and models evolve, I remain hopeful that clinical decision making can become more about foresightful approaches to care that are patient-centric, clinically collaborative, and funded via innovative methods. The harbingers of such innovations may be perhaps seen in capitated, direct contract, and shared risk approaches. And as the mega-retailers like Walmart and Amazon are now focusing more so on healthcare, I am sure we will see even more creative experiments put into action.

Such challenges to medical practice and the provision of healthcare services, no matter what the specialty, need to be addressed head-on, with eyes wide open, and in a context of marketplace awareness combined with technological savvy, and a good dose of innovative (dare I say disruptive) thinking. All this needs to be set in a context of good, old analog leadership, and shared vision.

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