Newtown, CT – April 19, 2013
As the legend goes, the Gordian Knot was cut in half by Alexander, revealing the ends, curled inside – Our own problems often seem just as intractable. Where are the ends from which the solutions can take hold? However much we try, however much we examine the problems from all angles, we simply can't grab hold of a reasonable solution. And that's because, over time, the conflicts of interest have become so intertwined that very few of the incumbents, if any, want to unravel the thread that has become their livelihood. Several articles this week remind us of this intractability. On the VBP front, a JAMA paper highlights the higher revenue generated by hospitals when stays become "complicated". Defects can be profitable for those who are paid to fix them, even if they contribute to their production. In response, AHIP states that we must move away from the perverse incentives of FFS that encourage such behavior. True, but a report from CPR issued last month shows that only 10% of commercial health plan dollars are linked to anything but FFS. If we must move away from that, why aren't AHIP's members rushing to do so? Have they only discovered now that FFS is not a panacea? On the VBID front, CVS recently announced a program to encourage employee compliance with filling out health risk assessments as part of a broad effort to engage them in their health. Pundits immediately jumped in to condemn the "stick" and decry the potential violation of personal health information. Really? Haven't employers launched lots of highly successful programs to compel employees to take generic substitutes to brands? Don't self-insured employers have access to all the claims data paid for employee medical expenses? Aren't they fully aware of the consequences of misusing PHI? The outcry is nonsense, but nonsense is what keeps the Knot intact. We must, therefore, cut it.
What this means to you – Trying to unknot this mess is futile. What's needed is radical surgery. For one, stop talking about "aligning incentives". It doesn't mean anything, and simply plays into the game of the agents of the status quo. Instead, focus on removing the disincentive to do good. Do we think that clinicians practicing in hospitals want to create defects? To do something that will knowingly harm a patient? I don't, but I do believe that public and private sector payers continue to encourage them to do so, and it makes no sense. We must therefore cut the current provider-payer contracts and rewrite them in a better way. Similarly, let's stop pretending that bribing employees is a worthwhile practice. As our friend Jim Knutson recently reminded us, when you pay employees to stop smoking, some start so that they can be paid to stop. It's silly. For the most part, health insurance benefits are designed so crudely that they almost always discourage positive engagement. Think about it. We discourage plan members from finding higher performing providers, we discourage them from comparison-shopping, and we generally discourage them from seeking good preventive care. We must therefore cut the current benefit designs and rewrite them. Unfortunately, there is no Alexander to cut our Gordian Knot, so don't look for someone else to do the job that needs to be done. Instead, look in the mirror.
Francois de Brantes
Health Care Incentives Improvement Institute, Inc.