Would Universal Health Care Stifle Medical Innovation?

An excellent article appears at The New Republic. Jonathan Cohn discusses 'The best case against Universal Health Care' in his article "Creative Destruction."

This is an absolute must read...

Besides, true innovation ultimately benefits everybody by pushing the boundaries of the medically possible. Can we really count on a universal coverage system to weigh all of that? In other words, can we really be sure that universal health care won't come at the expense of innovative medicine?

This [scrutinizing treatments for cost-effectiveness] , in turn, would lead to both less innovation and less access to the innovation that already exists. And the public would end up losing out, because, as Tyler Cowen wrote last year in The New York Times, "the American health care system, high expenditures and all, is driving innovation for the entire world."

Consider this innovative treatment for Parkinsen's disease --

The story of Deep Brain Stimulation actually holds some important lessons about how innovation frequently takes place--and why it's not all that dependent on a non-universal, private health care system like the one we have in the United States. For one thing, it turns out that DBS isn't exactly an American innovation. If anybody deserves credit for developing it, it's the French--and one French doctor in particular.

That doctor's name is Alim-Louis Benabid...A recently retired neurosurgeon who did his work at the University of Grenoble, near the French Alps...

Did the for-profit system drive this innovation? --

In this sense, DBS offers an important window into the way medical innovation actually happens. The great breakthroughs in the history of medicine, from the development of the polio vaccine to the identification of cancer-killing agents, did not take place because a for-profit company saw an opportunity and invested heavily in research. They happened because of scientists toiling in academic settings.

According to Robert Gross, an Emory University neurosurgeon and expert in the field, Benabid had actually approached the companies that already made electrodes for use in treating chronic pain, suggesting they develop a device specifically for Parkinson's. But they declined initially, so Benabid had to use the existing devices and adapt them on his own. "The companies did not lead those advances," Gross says. "They followed them."

So who does lead medical innovation? --

"The nice thing about people like me in universities is that the great majority are not motivated by profit," says Cynthia Kenyon, a renowned cancer researcher at the University of California at San Francisco. "If we were, we wouldn't be here." And, while the United States may be the world leader in this sort of research, that's probably not--as critics of universal coverage frequently claim--because of our private insurance system. If anything, it's because of the federal government.

The single biggest source of medical research funding, not just in the United States but in the entire world, is the National Institutes of Health (NIH): Last year, it spent more than $28 billion on research, accounting for about one-third of the total dollars spent on medical research and development in this country (and half the money spent at universities). The majority of that money pays for the kind of basic research that might someday unlock cures for killer diseases like Alzheimer's, aids, and cancer. No other country has an institution that matches the NIH in scale. And that is probably the primary explanation for why so many of the intellectual breakthroughs in medical science happen here.

But what has happened to NIH funding in recent years? --

It so happens that, starting in 2003, President Bush and his congressional allies let NIH funding stagnate, even though the cost of medical research (like the cost of medicine overall) was increasing faster than inflation. The reason? They needed room in the budget for other priorities, like tax cuts for the wealthy. In this sense, the greatest threat to future medical breakthroughs may not be universal health care but the people who are trying so hard to fight it.

And once again, President Bush is threatening the veto the Labor-HHS-Education bill (H.R.3043) which would provide much needed funding for medical research.

Congress has incorporated nearly $4 million in funding in the bill for the development of a multiple sclerosis and neurodegenerative disease research center at West Virginia University in Morgantown, W.Va. This first comprehensive center for MS research and care in West Virginia holds great promise for people living with MS not only in the state but nationwide.

In addition to this specific funding for MS, the Labor-HHS bill includes a 3.1% increase for the NIH, a 6% increase for the Centers for Disease Control and Prevention (CDC), and $2 million for state respite care grants authorized by the Lifespan Respite Care Act (which MS activists helped pass last year).

Entrepreneurs and Revolutionists

This morning, I opened my Feed Reader and found an interesting article at Repairing the Healthcare System, "What is an Entrepreneur?"

After discovering Dr. Feld's blog, I have cheered and I have cringed.

Here's a cheer inducer--

"Keep Your Head In There!" - Repairing the Healthcare System
The lesson to be learned is never put you head in front of a fast ball. The healthcare system lesson to be learned from this story is even though they (the healthcare insurance industry) are bigger, more powerful and stronger you need to stick in there and do the right thing. Remember there would be no healthcare system without the primary stakeholders, the patient and the physician.

This one induced a cheer, followed by a cringe--

"This Is What I Mean By Innovative Thinking, Part 1" - Repairing the Healthcare System
The people who control the healthcare system have to start thinking of concepts that will benefit all the stakeholders and not simply the stakeholders in power. I am certain the stakeholders in power are threatened by the potential for change just as the controllers of the educational system are. We now live in a knowledge based economy. The legacy thinking in healthcare has to change. It is presently proprietary and opaque. It is dominated and controlled by the insurance industry. It has to be transparent and beneficial to all.

I agree that the dominant stakeholders in our current healthcare system are threatened by the potential for change. Those in the insurance industry, and the agents who represent and broker insurance products, would have us (patients, individuals, consumers) believe that an individual's struggles or complaints are the direct result of personal irresponsibility in making poor choices in life. Although there may be individuals who make poor choices, such as choosing to eat a dozen donuts each week and not exercising, I strongly disagree with the notion that individuals find themselves seriously underinsured because maybe they didn't research all insurance options available and failed to choose the 'full coverage' package, or that they chose a less expensive package when a 'full' package would have been available, or if only they had used an agent...bullshit!

The insurance industry, including the 'non-profit' providers, are truly in the business of business, not facilitating health. I vaguely remember when health insurance was called medical insurance. This is one reason I never expected pro-health services or activities, such as yoga or nutrition counseling, to be covered by my medical insurance. But I did expect that my medical insurance would cover medical services and products, such as doctor's visits, hospitalization, surgery, testing, vaccines, physical therapy, and most importantly prescription medication.

And this induced a cringe -


"This Is What I Mean By Innovative Thinking, Part 1 (con't)" - Repairing the Healthcare System
Only the consumer will change the healthcare system. It will start with the demand to change the insurance paradigm to the ideal medical saving account. We have seen the failures of the government as a single party payer in the VA Healthcare System. I suspect we are only seeing the tip of the iceberg. I cannot understand why politicians think it will be any better when a single party payer system is applied to the entire population.

I know the consumer does not want that system.


Wait a minute! How do you know what the consumer wants?

If you want to know, ask the consumer, ask the patient.

If you take the time to listen, you will hear consumers strongly supporting a move toward a single-payer system or at least a system which requires the stakeholders to play by the same rulebook. So far I'm only hearing business leaders, investors, policy makers, entrepreneurs, and other big stakeholders say that we need to educate and convince the individual consumer to take control of their healthcare dollars and to negotiate or bargain-shop for healthcare services.

"Optimism Is The Operative Word. We Can Do It!" - Repairing the Healthcare System
The patients must be responsible for their care and their healthcare dollar. Access to care must not be restricted. Patients are capable of being responsible consumers of healthcare given the appropriate incentives.

We will need strong leadership. We need a leader who really understands the problems in the dysfunctional healthcare system. A leader who is not afraid to act contrary to the pressure of facilitator stakeholder vested interests There does not seem to be one around. We will need groups of citizens who are angry enough at the present system who will be willing to demand a consumer driven healthcare system. People power can demand that leadership. First they have to understand the problem and solutions.

Okay. Dr. Feld had me again until he used that phrase, 'consumer driven healthcare.' Here's an interesting website I just discovered yesterday. Republicans for Single-Payer Universal Health Care with Informed Choice. I was intrigued and looked further into the site to see what they had to say which led me to Balanced Choice in Health Care for All. In the description of Balanced Choice, it becomes apparent that the program is designed to limit the dollar amount which the 'insurance' pays and leave the remainder, called the 'gap', for the patient to pay. This would make the consumer more cost-conscious and thus more responsible in spending their healthcare dollars.

This is the fundamental philosophy behind a consumer-driven healthcare system. And many proponents in favor of a consumer-driven system are the same ones in favor of a market-based system. [A free-market healthcare system is a whole other discussion for another time.]

"What Healthcare System Could Work? A Universal Healthcare System Will Not Work!" - Repairing the Healthcare System
The solution should be pretty clear to all following my blog. I advocate the American way! I believe a consumer market driven system with government making rules for the benefit of all members of the society. When one stakeholder takes advantage of another stakeholder to the harm of the other stakeholder the government has to intercede.

Maybe Dr. Feld has my attention again. I support the idea of uniform rules and creating a level and fair playing field.

Then yesterday, Dr. Feld writes about entrepreneurs and discusses the rise of convenience clinics in large chain stores. One proponent of these retail clinics is Steve Case who founded Revolution Health.

"Revolution Health Group is a leading consumer-centric health company founded to transform how people approach their overall health and wellness. By putting individuals at the center of their own healthcare, Revolution Health allows them to make informed choices and offers more convenience and control over their individual healthcare decisions."

"Revolution Health is part of the Revolution LLC family of companies created by Steve Case to be a disruptive force in industries in need of a "better way."" - (from Revolutionhealth.com)

From Dr. Feld's articles, I don't think that he likes the idea of Redi-Clinic or other convenience clinics due to the effect they may, or may not, have on the stability of physicians in family practice.

"Look What Happens What You Are Not Looking, Part 1" - Repairing the Healthcare System
I believe in-store clinics are a bad idea and they will fail. If successful these clinics can potentially put family practitioners out of business. If they are marginal, they will put a reasonable dent in the primary care physician’s ability to make a living. It is presently difficult for family practitioners to make a decent living. The development of in-store clinics is the result of the difficulties patients are having with affordable access to medical care. If patients have to go to the emergency room of a hospital, wait three hours to be seen, and incur a large bill for a simple illness the healthcare system is not being responsive to the patients’ needs. Convenient Care Clinics’ attraction to patients is they help them avoid these barriers to care.

The growth of these in-store clinics is the result of the primary care physicians’ (PCPs’) inability to set up their medical practices to match the needs and schedules of the hectic life of patients in America today. The blame should not only fall on the PCP. The blame should also fall on organized medicine’s inability to recognize and respond to the needs of the PCPs’ and the practicing physicians’ patients. Organized medicine should be developing programs to teach PCPs how to respond to the changing needs of patients’. If medical practices do not respond to the needs of their patients, someone will.

"Look What Happens When You Are Not Looking, Part 3" - Repairing the Healthcare System
Who is not looking? The consumer, patients, doctors and hospitals are not looking. Some day they will all wake up. It is important to see right now what is happening in front of everyone’s eyes. The devaluation of medical care as a way of lowering the price of medical care is happening right now.

The real problem to solve with medical care costs is the cost of the treatment if complications of chronic disease. The complications of chronic disease cost the healthcare system 90% of the healthcare dollar. Effective treatment can lower the cost by at least 50%.

Unholy alliances are formed by the smell of money. The healthcare insurance companies would love the in store clinics because they serve to devalue the physician driven medical care services even further. Innovative cutting edge ideas for medical care should be developed by physicians. After all, who are the experts in the delivery of medical care? However, many physician groups are dysfunctional because of the pressures of overhead, reduction in reimbursement and malpractice concerns. They are fighting for their lives as reimbursement continually decreases. Physician practices must become more innovative, more efficient and more effective. If not I believe the delivery of quality medical care in a dysfunctional healthcare system with decrease even further.

The smell of money. Mmmm. (I wish.)

This past Tuesday, Steve Case through Revolution LLC launched a subsidiary Revolution Money, a payment system company. "Revolution Money's first two major offerings are Revolution MoneyExchange, a service for social and instant messaging networks that enables consumers to safely transfer funds via the Internet for free; and RevolutionCard, a credit card protected with a personal identification number," says Washington Business Journal.

On August 3, 2007, Revolution LLC launched Revolution Places, "an original approach to sustainable destination resort communities." Costa Rican President Óscar Arias Sánchez and Revolution Chairman Steve Case announced the first development, "Cacique, Costa Rica, a first-of-its-kind 650-acre luxury resort community scheduled to open in 2010."

"Revolution Places will bring together premiere hospitality partners and innovative lifestyle brands to develop a new authentic vacation experience that retains the local environment and culture. With a full complement of sustainability principles and community involvement, Revolution Places will create high-end developments that provide consumers with treasured and limited for-sale vacation real estate. These developments will also feature personalized service and unique amenities for home owners."

On July 25, 2005, Revolution Living introduced Lime - Healthy Living With A Twist. "Lime is part of a larger plan by AOL cofounder Steve Case and his company, Revolution Living, which bought the media group [Wisdom Media Group] in April as part of its investments focused on a more natural, healthy lifestyle. Lime will provide a fresh perspective on health and wellness, including content related to healthy foods, mindful exercise, alternative healing, and eco-friendly living. Lime will help consumers better themselves physically, intellectually, and spiritually, and help them live in balance, marrying "what's good for you" with "what feels good." "

Beyond Redi-Clinic, Revolution Health is affiliated with CarePages which is a social networking site, ConnectYourCare which offers assistance to employers and consumers transitioning to consumer-directed healthcare, Extend Health which offers alternative health insurance solutions, and drugstore.com which offers online shopping. Also, Steve Case is finding businesses which cater to the health living lifestyle and is making deals and purchasing large interests in such companies as Gaiam which produces DVDs and equipment related to yoga and pilates. In April 2007, Revolution Health even formed a partnership with the American Academy of Family Physicians "with the shared mission to help consumers find a “medical home,” help technology work seamlessly for consumers and promote a more patient-centered model of care."

As interest grows, I predict that Revolution Health and all of the subsidiaries of Revolution LLC will prove to be a powerful force, very Google-like, in shaping how we think of healthy living. Even PC Magazine, reviewed Revolution Health as a 'Site of the Week' in January 2007.

Finally, let's return to yesterday's blog post by Dr. Feld.

"What is an Entrepreneur?" - Repairing the Healthcare System
How can the healthcare system promote innovation and entrepreneurship to reform the healthcare system for the consumer’s benefit while maintaining freedom of choice for patients and intellectual freedom for physicians. Both freedom of choice for patients and intellectual freedom for pysicians have been severely hampered in the last 35 years. The impingement on these freedoms by restrictions imposed by rules, regulations, and system advantage to secondary stakeholders have led to the mess we are currently encountering.

I believe the mess is a result of the influence various stakeholders’ vested interests have on the political system. I also believe the time has come for the consumer as the most important stakeholder in the healthcare system to demand that the politicians hear them. The politicians need to stop listening to and acting on the vested interests of secondary stakeholders who control the system presently.

This is going to take the will of the people to be informed and express their vested interest. I believe we are getting there and being heard. We still have a couple of problems. It is going to take a Google-like entrepreneur to help the consumer solve the existing problems in the healthcare system.

Sounds to me that Revolution Health just may reveal Steve Case to be a 'Google-like entrepreneur' indeed.

Now please don't ask me if I think the Revolution Health movement is THE ANSWER to our problems....because I don't.