In NYC, if you an ominous orange “C” appears in the window of a restaurant, you’re likely to redirect your patronage to an establishment that has scored higher on the sanitary grade scale. Dr. Raz Winiarsky, cofounder and chief medical officer of Spreemo, thinks like restaurants, medical provider quality should also be more visible and influential. The focus of Spreemo is radiology in workers’ compensations claims. (This isn’t boring, keep on reading!) Why this specific niche? The answer is twofold: 1) radiology is a medical service that is treated like a commodity: people seek the cheapest or most convenient option. However, diagnostic imaging from disparate providers is not like varieties of apples; there is an expansive range in the quality of radiology, and as such there is a significant degree of patient outcomes based on the radiologist. 2) Spreemo has found a niche where it is actually feasible to get providers to compete with each other based on quality instead of price: workers’ compensation. Workers’ compensation is insurance that provides injured-on-the-job-employees with wage replacement and medical benefits, provided the employee relinquishes his or her right to sue the employer (Wiki). As such, these insurance companies desire to get employees healthy and back to work as soon as possible. And as it turns out, if you get employees better treatment, they are likely to return to work quicker. Spreemo’s Yelp-like star rating system for radiology quality is based on several factors including education and training, the quality of equipment, and price. Patients are rewarded with better quality, while radiologists adhering to quality guidelines can expect higher reimbursements.
This idea that healthcare should be quality driven is not novel, but in this country, it is far from operational. The fee-for-service model, which predominates today, reimburses healthcare providers based on the volume of services they provide, not the quality of care. And while I do not wish to disparage healthcare providers– because I do believe physicians as a whole place the well-being of their patients first – why invest in more expensive equipment, training, and services if there is no incentive to do so? As Dr. Winiarsky contends, our system chases the cheapest options for care, effectively driving healthcare quality lower and lower. A radiologist on Spreemo's site voices: why buy a new, $1.5 million dollar imaging magnetic resonance imaging (MRI) machine when an old $200,000 piece of equipment will suffice, and there is no forward incentive to cover the $1.3 million differential?
This idea that healthcare should be quality driven is not novel, but in this country, it is far from operational. The fee-for-service model, which predominates today, reimburses healthcare providers based on the volume of services they provide, not the quality of care. And while I do not wish to disparage healthcare providers– because I do believe physicians as a whole place the well-being of their patients first – why invest in more expensive equipment, training, and services if there is no incentive to do so? As Dr. Winiarsky contends, our system chases the cheapest options for care, effectively driving healthcare quality lower and lower. A radiologist on Spreemo's site voices: why buy a new, $1.5 million dollar imaging magnetic resonance imaging (MRI) machine when an old $200,000 piece of equipment will suffice, and there is no forward incentive to cover the $1.3 million differential?
But the problem is, that $1.5 million piece of equipment likely enables the radiologist to see the pathology better. Furthermore, an MRI on its own is not a conclusion: there is an extensive spread between MRI diagnoses. In New York City alone, the disparity of care was shocking. Dr. Winiarsky’s team took patients to a dozen different radiologists to get MRIs (don’t worry, no radiation here) and observed not just a range of diagnoses, but wrong diagnoses. And a radiologist’s diagnosis isn’t an isolated measurement: it affects patient treatment, prognosis, and time back to work.
Healthcare is driven by money, but in this little niche, Spreemo has indirectly found a way for quality to be the driving factor. But can this work in other areas of medicine? In other industries, the consumer has a powerful voice, as the customer’s reviews, patronage, and freedom to choose between competitors drives businesses to satisfy the customer. However in healthcare, the consumer not only expects poor service at a doctor’s office, they still almost always return to the same office. Furthermore, even though consumers are allowed to select their own health insurance, the choices are often all just different tiers from the same provider. And what incentive does the insurance company have to deliver good service? The patient pays for services up front (because you select a plan and are locked in) so there is no incentive to foster patient-insurer relationship, loyalty, or quality of interchanges.
But the patient as consumer is a revolution that is slowly approaching. Patients are interacting with the healthcare system much more frequently. Startups like ZocDoc allow patients to review doctors, while Medisafe is an app that allows users to track medication dosage adherence. In addition, social media outlets and wearable fitness devices mean patients are generating and viewing much more data about their health. Moreover, the recent shift to high deductible health plans incentivizes consumers to shop around and make informed decisions for the best plans, For example, the WSJ reported that during this season’s healthcare enrollment season, many employers introduced computer tools to help recommend the best plan for each employee.
the consumer not only expects poor service at a doctor’s office, they still almost always return to the same office.
There is another push for healthcare consumerism, and it comes from costs. Healthcare costs in the United States are high, and while there are proposals that could bring down the cost of healthcare (eliminating fee-for-service), costs will in all likelihood remain high. These costs could be kept in check by the government, but socialized medicine (socialism in general) is not something Americans easily stomach (Bill Maher and Bernie Sanders recently debated socialism on Real Time). Many Americans are uncomfortable with the idea that the government can give and take something away, especially something like healthcare. So if then healthcare is not treated like an entitlement, but rather a commodity, then the price of healthcare will be dictated by what the market can bear. In other words, the cost of a medication – say a medication that is the only approved drug for a disease – will be set at the highest point at which it will still be purchased. One can see the enormous hazards of such a handling of healthcare. However, if healthcare is still treated as more of a commodity, but it is possible for the patient-consumer to have a voice and a say, then perhaps medical care prices can be commensurate with the consumer’s regard for the medical care provider. High costs could at least be justified with quality behind it. A consumer should be able to choose expensive, best-in-class services, or have the freedom to select a less expensive option when basic treatments will suffice. In this system, healthcare is still being treated like a commodity, but in a way that empowers the patient consumer.
Healthcare consumerism is dawning, but it has not yet arrived. Startups like Spreemo are pioneering change, making us realize old principles of healthcare are flawed and need to be recast. In order for healthcare consumerism to truly arrive, the consumer must be informed and truly understand both their options and what quality really is. The patient is the consumer, and they deserve to know what they are buying. The New Yorker claims that only 1 in 7 Americans understand the basics of healthcare plans. How can the patient demand the best quality when they don't understand the system? There are several steps that can help facilitate the change to a quality driven healthcare system. First, consumers must be convinced that there are quality problems in medical care, and that these problems can be improved (ie… I had no idea MRI diagnoses could vary so much, and in NYC alone.) Secondly, quality reporting must be standardized and universal, and the reporting must be relevant and easy for the consumer to understand, as well as widely disseminated. Lastly, insurance providers must reward quality improvements to healthcare providers.
It won't be an easy, but we must do our part to drive our healthcare system to one driven by quality.
Sources
1. Spreemo
2. The New Yorker: The Healthcare Industry's Relationship Problems
3. Business Insurance: Higher doctor fees may get injured workers back to work faster
4. WSJ: Picking a health plan? An algorithm could help
5. Pando: How to find a doctor that doesn't suck? Spreemo has a new answer.
6. Commentary: Healthcare commodity, not entitlement
7.Health Affairs: Consumers and quality-driven healthcare: a call to action
8. Real Time: Bill Maher and Bernie Sanders debate socialism: US is 'already a socialist country'
1. Spreemo
2. The New Yorker: The Healthcare Industry's Relationship Problems
3. Business Insurance: Higher doctor fees may get injured workers back to work faster
4. WSJ: Picking a health plan? An algorithm could help
5. Pando: How to find a doctor that doesn't suck? Spreemo has a new answer.
6. Commentary: Healthcare commodity, not entitlement
7.Health Affairs: Consumers and quality-driven healthcare: a call to action
8. Real Time: Bill Maher and Bernie Sanders debate socialism: US is 'already a socialist country'
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