Healthcare Transformation – Let’s be Provocative

by Jason Uppal, Chief Architect, QRS

Recently, I attended a one-day healthcare transformation event in Toronto. The master of ceremony, a renowned doctor, asked the speakers to be provocative in how to tackle the issues in healthcare and healthcare delivery in a specific way. After about 8 speakers – I must admit I did not hear anything that social media will classify as “remarkable” either in terms of problem definition or the solution direction – all speeches emphasized the importance of better healthcare. I watched one video, Jess’s Story, and I am convinced without discussion that we need a better way to deliver care.

I am an Engineer and not a Medical Doctor. In my profession, we spend 90% of our effort defining the problem and 10% solving it with known solution patterns. In this blog, I would like to define the healthcare delivery problem and offer a potential solution direction.

 First the Basic Facts

Table 1: Healthcare Spending and Quality

Country 1980 [$] 2007 [$] 2010 [$] 2012 [$] Healthcare Quality Ranking
US 1106 6102 8233 8946 6
Canada 3165 4445 5
Germany 3005 4338 1

Note: $ represent per capita spend per year, sources of information are public; references can be made available if required. Healthcare Quality Ranking – lower the number the better

Firstly, the obvious fact is that the US spends more on healthcare per capita and gets less for it.  These facts as well as many other studies lead to the same conclusion.

Problem Definition, Option 1 – Straight-forward reduction of healthcare costs: US healthcare roughly represents 18% of the US GDP. Reduction in spending will result in shrinking the GDP, unless politicians spend the saved money somewhere else. This is not a good option as we all know the impact of austerity measures without altering the underlying process. Or even closer to home, the impact of the recent sequesters on air traffic in major us airports has resulted in terrible delays and has significantly inconvenienced the traveling public.  We learned during the 1980s when “reengineering” was a sexy terms that when we reduced labour by 30%, we simply hoped the remaining souls would figure out how to do work with less.  We all knew what that approach did, fat paycheques for the CEO and senior management and entire industries got wiped out.

Problem Definition, Option 2 – Reduce healthcare costs and issue health  dividends: Let’s target to reduce the base healthcare spending to $4000 per person per year. This will bring spending to the 1980 level with inflation factored. The remaining funds, $4946 per capita ($8946 –$ 4000), be given as a health dividend to the population and providers. This will go to both the population as a tax credit and to providers as an incentive to keep those that they care for healthy. This will not reduce health care spending, have no impact on the GDP, but will certainly improve the health of our biggest producers and consumers in the economy.

There is proof that this model could work to reduce overall cost and improve population health if both the population and providers are incented appropriately. Recently, I had an argument with my General Practitioner’s (GP) secretary who wanted me to come to the office three times for the following:

1)     to receive the results of my blood test,

2)     to have an annual physical check-up,

3)     to remove  couple of annoying skin tags.

Each procedure was no more than 2 to 7 minutes long, they insisted that it have to be three separate appointments. A total of 10 minutes of consult for three procedures with my GP would have cost me an additional 7 hours in my productivity loss (2.0 hours to drive, 0.5 hour wait and 1.0 hour productivity loss due to distractions of the appointments). A reason for this behaviour is that the way physicians are incented; they are able to bill the system more based on the number of visits alone. Not based on what is good for both the patient and provider.

Therefore, I will define the problem this way: reduce the cost of base care to $4000 per capita and incent both the population and provider to stay and keep their customers healthy. Let the innovation begin. There is no shortage of very smart architects, engineers  and very motivated providers who want to live to their oath of “do no harm”.

Call to Action:

  • To help develop next generation healthcare delivery organization – we need the help of healthcare Zuckerbergs, Steve Jobs, Pierre Omidyar, Jeffrey P. Bezos; people who can think outside the box and bypass the current entitled establishment for the better.
  • We are taking first step to define an alternative architecture – join us in Philadelphia on July 16th for a one-day active workshop.
  • Website: http://www.opengroup.org/philadelphia2013
  • Program Outline: http://www.opengroup.org/events/timetable/1548
    • Tuesday: Healthcare Transformation
    • Keynote Speaker: Dr David Nash, Dean of Population Health Jefferson University
    • Reactors Panel: Hear from other experts on what is possible
    • Workshops
      • Be part of organized workshops and learn from your fellow providers and enterprise architects on how to transform healthcare for the next generation
      • This is your trip to the Gemba

uppalJason Uppal, P.Eng. is the Chief Architect at QRS and was the first Master IT Architect certified by The Open Group, by direct review, in October 2005. He is now a Distinguished Chief Architect in the Open CA program. He holds an undergraduate degree in Mechanical Engineering, graduate degree in Economics and a post graduate diploma in Computer Science. Jason’s commitment to Enterprise Architecture Life Cycle (EALC) has led him to focus on training (TOGAF®), education (UOIT) and mentoring services to his clients as well as being the responsible individual for both Architecture and Portfolio & Project Management for a number of major projects.

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