For the last several years, I have been closely analyzing the consequences of healthcare’s under-performance. The waste and sub-par performance have convinced me that there is no greater immediate threat to the American way of life and the American Dream than if we continue the status quo healthcare system. Naturally, there are other threats (e.g., climate change) but none that are not only severely impacting the nation today but have a negative impact that is growing far more rapidly. Further, if we solve healthcare it frees up resources to address other challenges facing (education and climate change being at the top of the list).
[In some tweets/comments, some have wondered whether this is a political diatribe. This is most definitely NOT intended to have partisan/political overtones. Let's just say it's been a team effort that has led us into this predicament. Many of my international friends have emphasized that their countries have similar issues -- perhaps not as acute but still real issues. The primary over-arching initiative I'm supporting to address these problems is the Health Rosetta which isn't country-specific -- in fact, I'm doing public speaking in Europe on this open source project.]
Dave’s Top 10 List of Collateral Damage from the American Healthcare System
Listed below are 10 examples of the collateral damage from the massive underperformance of the U.S. healthcare system. The first few are a direct result of how employers are addressing healthcare needs. The next few transcend both private and public payer programs. The rest of the list are a function of how healthcare is handled at the state and federal level. While that is out of the direct control of employers and benefits consultants, in many sectors, private sector innovation gets copied in the public sector. The public sector can either be a leader or follow the lead of the private sector.
- State level data shows how healthcare is strangling other budgets such as education as well as other social determinants of health. Bill Gates pointed out in a TED Talk, out-of-control healthcare costs are directly devastating education budgets. In other words, we're stealing our kids' future.
- Nest eggs have been crushed by $1M due to healthcare costs. 68% of working age people aren’t participating in an employer retirement plan. As a consequence, the majority of Americans have next to no retirement savings. Even with Medicare, it’s estimated that there are $300,000 of costs not covered by Medicare not to mention other living needs. Retirement accounts at Fidelity, MassMutual and TIAA-CREF would be far bigger if healthcare wasn’t stealing from retirement savings.
- Household income has been directly impaired by healthcare costs. Despite significant employee cost increases over the last 20 years for organizations, almost all of it has gone to fund healthcare’s hyperinflation rather into worker’s pockets. Washington Post, NY Times, WSJ, Time and others have reported, healthcare cost increases have been borne by both the employers and employees, not to mention shareholders. Despite employers spending huge sums to keep up with healthcare's hyperinflation, the reality is the status quo health benefits are horrible.
- Medical expenses are the number one driver of bankruptcy (even for those with health insurance). Some say it may also be the top cause of homelessness.
- There are unprecedented levels of dissatisfaction and burnout by doctors. A major reason is we’re layering more and more on top of a design failure.
- A new wave of exciting, health-improving healthtech is held back due to outmoded health purchasing practices (see Tech Industry, Heal Thyself for more).
- As US News & World Report found, due to healthcare costs, cities are unable to perform basic services such as maintaining roads. More dramatically, there are 100’s of millions of unfunded pension commitments due to healthcare costs.
- At the state and federal level, trains are literally going off the tracks and bridges are falling into rivers as healthcare costs have starved budgets of infrastructure investment. Both the NY Times and the nonpartisan Center on Budget and Policy Priorities have reported on the tragic consequences of the spending on healthcare waste and over-treatment while roads, airports, bridges and rails fall apart.
- As Atul Gawande pointed out in his book and in the recent PBS Frontline special, we are doing a horrendous job dealing with end-of-life issues leading to a tortuous experience for those at the end of their life and it needlessly squanders money in the process. Knowing the limits of medicine and what impacts quality of life, the fact is doctors die differently from the rest of us using much less intervention (not to mention cost). When the healthcare system honors people’s wishes, they spend far less and have a better experience (typically 30-70% less than other regions).
- As a former Chair of the Council of Economic Advisors once said, “We don’t have a debt problem. We have a healthcare problem.“ Every financial challenge the U.S. has would be solved if we get healthcare costs under control. The items that could be funded just with the waste in healthcare are almost unimaginable.
For those of us who have been in the industry, this should be an embarrassment. There is far too much smarts, talent and hard work going into healthcare to have such woeful performance. It will take a revolution involving people in every nook and cranny of the industry in society. Here's what I'm doing to do my part (spread the word!):
- I conceived of the open source Health Rosetta project so that it removed any excuse purchasers of healthcare have to keep them from getting dramatically more value from their spending.
- The 95 Theses for a New Health Ecosystem give health organizations a set of guiding principles on what will position them for success and deliver a much higher-value health ecosystem. If the Health Rosetta is the "what", the 95 Theses are the "how" on how to have success in the future.
- The goal of the documentary I'm working is to catalyze a movement that is a partnership between clinicians and citizens to demand more from what we're investing. The good news is employers are pouring more than enough money to fund a great healthcare system AND a comfortable retirement. The bad news is that until we change things, we're getting neither.More good news is that all of the components of the Health Rosetta have been proven -- they just haven't scaled nationally. Although, we now are seeing business coalitions set to revolutionize healthcare purchasing by adopting the Health Rosetta.
- The Seed/venture fund that I'm working on will provide investment capital behind the organizations driving the Health Rosetta. I can't say much more other than it builds off of the success of Healthfundr.
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Upcoming speaking engagements/trips
- Week of March 28: Washington DC
- Week of April 4: Montreal, Chicago
- Week of April 25: Orlando
- Week of June 13: New York City
- Week of July 4: Toronto
- Week of July 25: Montana
- Week of September 19: Northern Europe