Getting Spanked by Car Maker CEOs: Even Detroit Thinks Healthcare’s Innovation and Productivity are Bad
Inside Healthcare Computing has graciously agreed to make previous Mr. HIStalk editorials available from its newsletter as a weekly "Best Of" series for HIStalk. This editorial originally appeared in the newsletter in October 2006. Inside Healthcare Computing subscribers receive a new editorial every week in their Electronic Update.
Big-company CEOs have healthcare on their mind. I know that because they keep insulting us in the national media. We’re too expensive and we underutilize technology, they’re telling the world. It’s our fault that jobs are moving offshore, not their own corporate greed or inefficiency.
My first reaction: who do they think they are? We’re getting lectures on innovation, productivity, and cost control from GM? If I wanted that kind of advice, I’d go to Toyota.
Unfortunately, they’re right. The healthcare price increase merry-go-round has to stop eventually. Most of the job growth since 2001 was in healthcare, and that’s not something to be proud of. We’re leaving an expensive mess for our children to clean up just as Baby Boomers suck the system dry with their healthcare demands. If GM doesn’t like it today, they’ll hate it tomorrow, unless they’re watching the show from China or India by then.
Businesses want to force computers on us, dragging us kicking and screaming out of the dark ages. Unfortunately, software doesn’t automatically bring increased productivity and lower cost. If it did, all of those hospital dollars spent on Microsoft Office and Windows would have made us stunningly more effective instead of just giving employees something to screw around with as a pleasant productivity alternative.
I’d like to think that computerization can really reduce costs, but I haven’t seen it happen anywhere yet. I keep hearing about all of those showcase sites buying the latest and greatest, but the correlation to bottom line and quality outcomes is murky at best. Where’s the average 100-300 bed hospital that has seen its overall costs drop 30% because of software? You’d know them because every other hospital in town would be out of business.
Hospitals can cut expenses in three ways, all of them at their local level. They can manage labor, which is by far their largest expense. They can go after the utilization and cost of drugs and supplies. They can control physician practice variation. I’m glad I said “can” instead of “do” because, for various reasons, these things don’t happen. Software can’t fix them because they’re management problems, although given desperate enough circumstances, they could be fixed.
I’m glad much of our recent IT investment relates to patient safety and outcomes. I hope electronic medical records really do become a standard, with all the information sharing that the RHIO people keep yapping about. But when it comes to drastic cost reductions driven solely by buying and implementing software, I’d say that’s wishful thinking. There’s a lot of work to be done fixing the system and its underlying misaligned incentives before we even try to automate it. No business became a world-beater just by installing SAP, even if they were lucky enough to not be one of those that went bankrupt trying.
I do see a ray of hope in being called out by big-company CEOs. As hard as it is to have change forced on you, I think that time is here. I work in a hospital, but I’m also the occasional patient and medical bill-payer. When wearing those hats, I’m just as mad and frustrated with the system as those CEOs and I bet you are, too. Healthcare is too expensive, too bureaucratic, and too unimpressive in benefits delivered. As a software guy, I’m pretty sure that fix will take more than just people like me.
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