Representatives from eight U.S. Federal government agencies, including the FDA and Veterans Administration, among others; health financiers (VCs, angels); health tech start-ups; providers, life science companies, and analysts, attended the Health Care Innovation Day DC sponsored by West Wireless Health Institute on April 28, 2011. The meeting had the tagline, A Discussion with the FDA, setting the stage for a day-long consideration of the role of regulation vis-a-vis health innovation.

The $2.5+ trillion question (annual spending on health care in the U.S.) is: can innovation drive making health care “cheaper?”

This was the underlying theme of the panel on which I sat in the morning, along with Dr. Peter Almenoff of the Veterans Health Administration, Dr. Peter Neumann of Tufts, and Dr. Youseph Yazdi of Johns Hopkins, moderated by the out-of-the-box thinking Dr. Joseph Smith who is West Wireless’s Chief Medical and Science Officer.

Don Casey, CEO of West Wireless, introduced the day talking about “infrastructure independent health care” — that is, health care delivered anywhere, not tethered to an inpatient setting, physician’s office or clinic. The concept shifts the focus of care, especially targeting managing chronic conditions where people live, work and play. This is possible through the use of ubiquitous sensors, especially non-invasive ones, in medical devices, homes, and mobile phones, among other platforms.

Don gave the example of traditional home care: today, the home care worker visits a patient and spends 90% of her time collecting information and 10% of the time actually providing care. Don asked: what happens if we flip those metrics and free up time for the care-worker to actually care? Sensors implanted in medical devices can track and communicate patient health parameters to a medical record or other data repository before the home worker arrives at the patient’s residence, thus preparing the nurse/caregiver in advance of the visit. Home care is but one of many scenarios where infrastructure-independent health care can play out to improve quality and reduce costs for the life cycle of the medical condition being managed.

Dr. Smith preceded out panel saying, “It’s time to jailbreak health care” from its current constraints of reimbursement tied to specific physical locations (hospitals, doctor’s offices, etc.) as well as other limits on health delivery-creativity. Dr. Almenoff of the VA reinforced this point by saying that the patient’s “home is safe,” often a safer, healthier place to be than the inpatient institution due to exposure to medical infections, medical errors in drug dosing, and adverse events that were outlined in the IOM’s report, To Err is Human. He also talked about the VA’s approach to expanding transparency throughout the agency and in publishing health statistics publicly available online at hospitalcompare.va.gov.

On the issue of innovation and cost reduction in health, Dr. Yazdi pointed out that this next generation of medical engineering students has cost reduction “in their DNA.” Looking at life cycle costing, the use of innovative materials, and Six Sigma approaches have entered health design.

Dr. Neumann’s strategy for improving the cost-benefit metric in health care is on creating incentives that drive physicians and consumers to change behaviors that drive cost increases in health care. (For more on that topic, the book Nudge is a must-read.)

My take on the cost/innovation conundrum is borne out of that great testimony to Congress given by Dr. Charles Safran in 2004 when he said, “Patients are the most underutilized resource in the U.S. health system.” Since chronic conditions consume $8 in $10 spent on health care in the U.S., let’s address the end-user cost-driver: the patient. This can be done through leveraging broadband and personal wireless networks (via mobile phones, especially smarter and smarter ones) which are ubiquitous across all ethnic groups in the U.S.  This will require a consumer marketing approach to segmentation, motivation, and laser-like focus on health engagement.

Health Populi’s Hot Points:  This week’s publication of the World Health Organization’s report, Global Status Report on Non-Communicable Diseases, states that 2/3 of the world’s people now die from NCDs–in short, chronic conditions. These are largely borne out of 4 lifestyle behaviors: alcohol consumption, tobacco use, lack of physical activity, and poor nutrition (based on healthy food access and/or decisions).

We don’t have to add a lot of new technology spending to the health care budget to get to health engagement. Health citizens are already taking blood pressure, measuring blood glucose, wearing pedometers — well, some people are. The art of health engagement marries nudging and motivations tailored to individuals based on their cultural, medical, and technology preferences, coupled with connected health where each health citizen has a medical home that ensures when a medical device communicates a signal, that data goes to a clinician/coach/smart software that informs the patient on their next health micro-decision. This will require more elegant design of devices, a mindset like Apples’ and Procter & Gamble’s, and perhaps a bit of Disney thrown in to inspire engagement and even entertaining approaches to “doing health” for consumers to sustain behaviors over time.

2 Comments on Are health innovation and cost-reduction mutually exclusive? Insights from West Wireless’s Health Care Innovation Day DC

Steve Agular said : Guest Report 10 years ago

"The art of health engagement marries nudging and motivations tailored to individuals based on their cultural, medical, and technology preferences, coupled with connected health" - I couldn't agree with you more. I attended an event last Friday (Health Tech 2011, in Boston) where several behavioral change / wellness management companies presented and I noticed that most of these companies use narrowly-focused reward systems, rather than taking into account the different ways people are motivated. I think the companies that integrate a myriad of motivational factors (financial, family-related, community, etc.) will be most successful.

Jeremy Shane said : Guest Report 10 years ago

Jane, thanks for this great summary of the session. At the broadest level, innovation is the ONLY way to "bend the cost curve," as Washington politico-economists are wont to describe the goals of health care reform. Unfortunately, two things need to exist for the actual "savings" to occur. First there has to be a sufficient revenue or profit potential, and the potential needs to exist not just for the entity at the point of care but for society at large. When President Eisenhower had his heart attacks, he was prescribed bed rest, a pretty low cost remedy, but if applied across the board for most Americans -- leaving out the moral dimension of life extension -- not a great outcome if people started dying in their 50's and 60's on a broad scale from heart disease. And so, open heart surgery, then stents, then incremental improvements upon that transformed care. On a constant dollars basis, even today with efficiencies gained, and greater efficacy, it is probably still more expensive than "bed rest" in the 1950's to hospitals. But society is immeasurably richer -- not only the wealth created by device and drug makers for their employees and shareholders, and the ancillary economic benefits, but the direct benefit to society of having a more productive workforce for a longer period of time. I think many in Washington who debate what "should be done about health care costs" fail to define the cost to society of failing to innovate, as much as they focus relentlessly on the cost at the point of care to deliver treatment inefficiently. The only thing cheaper than "treatment" in the long-run are cures, which is a deeper conversation about medical research and patient involvement (where patients remain the greatest untapped resource as well). Ultimately, motivating consumers to behave differently, or to be conscious of the impact of their decisions -- years before they amidst a health care crisis (like a heart attack) will require clear financial incentives or social rewards. Long-term these will be good, not only because people will have a tangible stake in daily decisions, but it will erode the power of payment intermediaries who benefit from the system as it is, where they can extract premiums to "manage" conditions, instead of curing them, or helping people avoid getting them in the first place.

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