Ian Morrison

There are only two issues in American health care. The first is universal access. The second is the need for a complete redesign of financing and delivery over the next 20 years. Why 20 years? In 2022, the peak of the baby boom turns 65. Fully 20 percent of the population will be over 65, compared with 13 percent today. We will have an aging white population expecting its Medicare to be paid for and delivered by an increasingly uninsured and increasingly minority working population. We will have dazzling new technologies and spineless politicians who will promise these technologies to the people without explaining who will pay for them. This does not compute. We can’t keep doing what we are doing.

The Institute of Medicine’s most recent report began the 20-year redesign process with some lofty ideals and practical first steps to cross the quality chasm, but the health care system is like a reluctant donkey, stubbornly resisting change. In health care we like to go to meetings about change, we don’t like to change.

The resistance to change is understandable. The U.S. health care system is bigger than the entire Italian economy. You would not expect the redesign of Italy to be trivial.

But make no mistake, we have no choice but change. And it has to start now.

Genomics is an important part of the redesign of health care. Randy Scott, founder and CEO of Genomic Health, wrote recently about the confluence of three powerful technology forces for change in health care: Moore’s law (the number of circuits per chip doubles every 18 months), Metcalfe’s Law (the power of the network is proportional to the square of the number of participants), and what Scott calls The Law of Finite Biology (all biological systems have a finite and thus knowable number of proteins, pathways, and so on). Together these forces will require the health care delivery system to redesign itself from an artisan delivery system of uneven quality to a system of mass customization: efficient, effective, and tailored to the individual needs, preferences, and genetic makeup of individuals.

Genomics will offer new tools of drug discovery, drug development, and customized clinical care. It will change the daily routine of all health care providers. At its extreme, the genomics revolution could lead to a health care system founded on public health, prevention, primary care, and prescription drugs rather than one centered on hospitals and proceduralists.

We need to flesh out alternate visions of a redesigned future. But more important, we need the leaders who can take us there. We need to celebrate the pioneers who drag the donkey across the chasm, who take the heat in the short run to show us the light in the long run. We have only 20 years, and it is a very big and very stubborn donkey.

Ian Morrison is an author, consultant and futurist based in Menlo Park, California. A shorter version of this editorial was published in the November/December 2001 Issue of the Health Forum Journal.

I grew up in Britain, in the Basil Fawlty school of customer service-customer as scum-which probably explains my low-level Maslowian view of most service businesses. I don’t need to self-actualize at my bank, I just need them to clear the checks I write (yet even this they find challenging).

All services should at least meet the basic Maslowian need of safety. Safe schools, safe airlines, safe hospitals should be a goal. The brilliance of the patient safety movement was that it set up a discussion of the lack of systems in health care by appealing to the most basic of needs. Great service companies like Charles Schwab or Starbucks have great systems (the information systems and the organizational capacity) to deliver consistent quality.

Beyond safety, most of us look for competence. Is the technical quality there? That’s harder to judge in health care-how do we know if our doctor does it right? Despite all the scorecards, most of us judge on subjective factors. Many patients in surveys claim to have changed doctors because they were dissatisfied with quality. It probably was not based on systematic analysis of the technical quality of the care, more that the physician didn’t connect with the patient, didn’t spend enough time with them, didn’t seem to care.

Comfort and convenience matter. The physical environment of health care is often intimidating, and caregivers are so harried they often don’t have time to make the patient feel comfortable. But why do we agonize over the nursing shortage and not over a bank teller shortage? Because banking has redesigned itself, with ATMs, to serve customers more efficiently. We have not redesigned health care delivery to maximize quality, customer service, and caring.

Caring is the key part of the health care experience. I am not talking about an affable bedside manner. I don’t want an excessively cheerful surgeon, kneeling by my bedside saying “Hi, I’m Bob. I’ll be your surgeon today.” God forbid that we turn the bedside into the same insincere, way-too-perky, customer service we get in chain steakhouses.

I want caregivers who recognize that I am vulnerable. No matter how smart, well informed, and empowered I may be as patient, friend, or family member, when I come in contact with the health care system I am frightened, anxious, and in pain.

Health care systems need to transform health care delivery to match the best in breed of the service industry in safety, competency, and consistency of customer service. But as we embark on the grand redesign of health care over the next 20 years, let us not neglect the caring part of the health care experience. We need to reduce medical errors, but we also need compassion, connection, and concern.

Ian Morrison is an author, consultant and futurist based in Menlo Park, California. A shorter version of this editorial was published in the September/October 2001 Issue of the Health Forum Journal.

In most markets, and most industries, organizations are accountable to their customers. If you make a product that doesn’t work or doesn’t meet customer needs in some other way, then you won’t make money and your shareholders will be unhappy. The magic of market forces makes firms accountable. But markets fail in healthcare. (By the way, that’s why we have a whole branch of economics called health economics and we don’t have dog food economics or Sport Utility Vehicle economics). The major source of market failure in health care, according to the Nobel laureates, is asymmetry of information-in a nutshell, doctors know more than patients. Therefore we have created all kinds of societal institutions like professions, universities, government regulators, health plans and review organizations in an attempt to make doctors and their workshops more accountable.

With the rise of the Internet and the new sophisticated consumer, some are challenging the asymmetry of information argument and asking why can’t healthcare be like other markets, and be accountable to the consumer. These critics have a point. A hundred million Americans have surfed the net for healthcare information according to pollsters at Harris Interactive. At the same time, consumers are declaring their preferences for complementary and alternative therapy and paying good money for it, out of their own pocket. Isn’t that the ultimate accountability?

Before we all get too carried away, let me suggest that there are two types of consumerism, the first is what I would call naïve market consumerism (this is Milton Friedman on steroids). Many in the pharmaceutical, medical products, and emerging health insurance markets subscribe to the notion that that whatever the consumer wants to spend his/her money on in healthcare is fine (and by definition utility maximizing for the consumer). So it’s the consumer’s choice, if she decides to lower her cholesterol by getting Lipitor prescribed by her doctor or by purchasing herbal remedies called “The Fat Trapper” and “Exercise in a Bottle” after she saw the infomercial. (Please note, I am not making this up, stay up late enough watching cable TV and you will know of the “Fat Trapper”).

A second form of consumerism is what I would term evidence-based consumerism. This makes the consumer a partner in the process of accountability by providing them with the scientifically based support to make informed judgment. It addresses the asymmetry of information full-on and tries to level the playing field. The explosion in health-related websites and self-help resources is assisting the consumer in overcoming their anxiety about not knowing enough. But to date, we have not made these information purveyors accountable for their counsel. We lack a system of accountability for healthcare information.

There are some signs of improvement. The FDA regulates drug information and so pharmaceutical companies are a reliable source of information about their products, although skeptics may be leery of their aggressive advertising and promotion. Similarly, the professional medical societies are playing a more formal role on the internet and will bring their professional standards (and biases) to the information exchange. This is not enough. Consumerism needs to be evidence-based, where there is a seal of approval placed on the information, backed up by the same accountability that exists in the peer reviewed scientific literature. Consumers are showing an appetite for industrial-strength medical websites (the kind that real doctors use) that are evidence-based . New organizations such as Medrock (a medical concierge service aimed at helping patients with serious medical conditions), BMJ Unified (a new joint venture between United Healthcare and the British Medical Journal), Medem and Medscape (both web-based businesses with impeccable scientific credentials) may all evolve as pioneers in evidence-based consumerism.

Ian Morrison is an author, consultant and futurist based in Menlo Park, California. This essay was published in the July/August 2001 Issue of the Health Forum Journal.

We have a Bush in the White House. Cheney, Powell and Condy Rice are bombing Iraq. And, health premiums are going up at double-digit rates. It’s 1990 all over again.

1990 was the beginning of big health reform. The recession pushed corporate America over the edge and healthcare became a CFO issue. Back then, the combination of cost escalation and recession led to a massive growth in HMOs, an acceleration in the number of uninsured (particularly among the marginally employed), widening dissatisfaction with health care generally, Harris Wofford, and the Clintons. Massive government health reform offered the prospect of universality.

Don’t count on an exact replay. There was a chance to do something big and the chance was blown. But a new set of forces may conspire to bring universality to the fore again, driven by the business of health insurance itself.

Three key driving forces are conspiring to challenge the traditional health insurance system:

• Consumer Payment for Healthcare. In pure form, defined contribution health plans are ones in which employees are given a fixed dollar contribution by employers and asked to choose among a choice of insurance options or care systems. While it is fashionable to talk about defined contribution as the next megatrend, it may play out in a more prosaic way with consumers simply paying more out of pocket for healthcare through co-payments, co-insurance and deductibles. Employers jacking up the cost sharing with employees is defined contribution by stealth. Either way it will represent the reversal of a 30 year trend where there has been progressive economic insulation of the consumer from the cost of care. When consumers have to pay more of their own money they will become even more demanding, more skeptical, and more fearful of being left behind.
• Customization of Care. Genomics will yield new tests that tell us all about our future course of disease and health. But more important than the burden of prescience (which we futurists carry with us all the time) consumers will know that their care will be more effective if customized for them. The right drug, for the right patient, at the right time will become the mantra reinforced by the pharmaceutical industry and the morning shows. The combination of predispositional genetic tests in the hands of consumers and insurers alike with the desire for customization by consumers and technology vendors will undermine the current health insurance system. In particular these trends aggravate the three Achilles heels of health insurance: moral hazard (when you have insurance you use it); adverse selection (you buy it when you know you are going to need it); and cream skimming (we won’t sell it to you if you really need it).
• Technology Tiering. Consumers will be asked to trade-up with their own money for superior technology. The three tiered formulary is a harbinger of things to come: the brand name over the generic, the low side effect drug over the higher side effect drug. Viagra and cosmetic surgery were just the beginning of this trend, but it will become more mainstream. While it’s harder to see how the technical content of inpatient care will be easily tiered : “Will that be the $1,000 or the $2,000 stent Mrs. Johnson?”, the trend is there. According to pharmaceutical companies, health plans and PBMs alike there has been remarkably little backlash against the tiered formulary. It is inherently American: you pay for the upgrade with cash or frequent flyer miles.

We are moving towards a system of floors and ceilings. We Americans want a floor below which no American falls, and the right to trade up with our own money. New economy entrepreneurs, innovative health insurers, and pharmaceutical executives are all salivating at the prospect of serving the affluent clients who can, and will, trade up to these new ceilings. But the new world of customized, consumerized and tiered healthcare will all unravel politically, economically, and morally if we do not guarantee the floor for all Americans. The business of healthcare must make a case for universality. Without it, the new consumerist nirvana can neither be created nor sustained.

Ian Morrison is an author, consultant and futurist based in Menlo Park, California. This essay was published in the May/June 2001 Issue of the Health Forum Journal.

Health care is complex. It is full of professions, guilds, unions, and community stakeholders, all of which make leadership more difficult. How do you lead in such an environment? I offer, with some humility, my five pillars of leadership:

1. Distinguish between managing and leading.

This is by no means an original thought, but it is at the heart of the health care leadership problem. Health care at all levels, from presidential policy to bedside decisions, is over-managed and under-led. What’s the difference? You can do no better, in my view, than John Gardner’s definition in his 1990 classic On Leadership (Free Press, 1990). To paraphrase Gardner, leaders distinguish themselves from the general run of managers in at least six respects:

• They think longer term.
• They understand the relationship between their organization and the wider environment.
• They reach and influence stakeholders beyond their own organization’s boundaries.
• They put heavy emphasis on the intangibles of vision, values, and motivation, and they understand intuitively the non-rational and unconscious elements in both leading and following.
• They have the political skill to cope with the conflicting requirements of multiple constituencies.
• They think in terms of renewal and adaptation to an ever changing reality, not just sticking to the system.

2. Respect leadership as a political process.

Leading an organization is more like running a small country than managing a large store. Leadership is inherently political, which frustrates many promising managers who have been promoted because of high marks, good work performance, and self-righteous excellence. In a world of coalition building, compromise, and horse trading, these managers get frustrated, and many fail as leaders.

3. Understand the American leadership preference.

Americans like reluctant leaders with a casual, easygoing style much more than pushy, formal ones. They like Tom Hanks in Saving Private Ryan or Jimmy Stewart going to Washington, not Gordon Gekko of “greed is good” fame. This is why George W. ran his campaign with a “gee shucks” style and Al Gore took “business casual” to new lows.

4. Honor moral leadership.

A lot has been made of values-based leadership in recent years, but even Attila the Hun had values. When people say value-based leadership, they tend to be implying they have the right values, therefore their position should be followed. I prefer to think about the moral base of leadership. Is your position on the side of the angels (consult your own God here)? Is it life affirming? How would it look on the front page of The New York Times? Does it feel right in your gut? And most important, what would your mother say?

5. Lead the revolution.

Strategy guru Gary Hamel’s new book Leading the Revolution (Harvard Business School Press, 2000) is a must-read about the importance of breakthrough innovation in business strategy. Hamel in a nutshell, and in his own words:

Health care desperately needs innovation, not just in process and tools, but in business and organizational design. We need leaders who can imagine better futures.

Ian Morrison is an author, consultant and futurist based in Menlo Park, Calif. A shorter version of this editorial was published in the March/April 2001 Issue of the Health Forum Journal.