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Something autocratic leaders don't understand

Another day, another perspective. The Guardian reports that another member of the select few advising the PM, Cameron, on health reform has been a bit off-message. It just goes to show that the people who held positions of power and authority in and around the NHS, when removed from that public duty, may just hold somewhat different views from they professed to hold. Did Mark Britnell think this way when we worked in the public sector? If so, why so silent?

Of course, part of the problem is the general lack of alternative perspectives within the NHS and the Department of Health, driven by the need to maintain a tight control on dissent (bad for decision-making). There is a somewhat natural and regretable tendency that when governments get into trouble, they behave like authoritarians, meaning they move to suppress dissent. Of course, the result is that they also legislate, or act in haste, and then repent at leisure, often courtesy of the courts, as decisions are progressively unpicked.

Britnell said things to please his audience, hardly unguarded, but certainly counched in language familar to Americans. Having chaired a conference on how to export American healthcare expertise to Europe, it is easy to get drawn into thinking that all things are possible when talking with Americans, something that folks familiar with the NHS would find seductive for its novelty.

Let’s look at what Britnell might have meant. There is nothing strange for the NHS to be a state insurer, since that is what it in effect is. Why were the premiums called ‘National Insurance’ anyway. The term insurance is also more easily understood in the US, and it more familar to those within the EU, as well. Perhaps the problem lies more in these shores, at not understanding the need to ‘translate’ language so people in fact can understand you. But then fog in channel, England cut off.

The NHS is highly politically polarising in the US; it is associated with rationing, queuing, and at least to many on one health discussion group, poor clinical outcomes. So the evidence, from the US side, is the NHS is not something to copy. The Canadian system is also highly politically polarising. Neither system particularly fascinates Amercians anymore, they are much more interested in the Netherlands. So it is with some courage that Britnell talked about the NHS in the first place — into the lion’s den and all that.

Would it be such a bad thing for the health system to thought more like an insurance system? Probably not. There is some evidence, controversial to some, that Bismarckian systems (i.e. insurance-based health systems), are more productive, easier to incentivise and provide better care than Beveridgean (i.e. the NHS, tax funded) systems, which are seen as better at managing costs. When Bismarckian systems get into financial trouble, they adopt centralised or other control systems familar to tax funded systems (cue recent reforms in France or Germany), while tax funded systems when they need to improve outcomes, shift toward insurance-type approaches, cue managed care, co-payments, clinical carve-outs (disease or medicines management) and so on.

The one big issue, hospital autonomy, or state ownership, is largely a non-starter if you really think about it. There is really no need for the public sector to own the means of production (i.e. the organisations that delivery health services), unless one is an unreformed Marxist. The NHS is probably better thought of as a guarantor of quality, access, and the purchaser of the care itself, something more akin to what proactive insurers should be doing. What appears to be interesting results from the last decades of reform is that public ownership of hospitals apparently concealed poor management, weak financial controls, convoluted clinical workflow, all of which led to poor productivity and value-for-money. These types of problems are not fixed by simply throwing more public money at them, but by changing the way they operate, the incentives that drive organisational behaviour. If you want to reduce emergency 7-day readmission rates (where most of the problems really lie, not at 30 days), some disincentives are appropriate, otherwise people don’t pay attention. A type of tough love.

One good thing is there is some possibility that this closet advisory group may not be breathing each other’s air, and that some original thinking may actually be taking place. However, I remain doubtful, since the people involved built their reputations within the very system they are now being asked to reflect upon. If they were that good at thinking this way, why weren’t they doing it before? Perhaps they were too obediant and on-message.

Regretfully, this mantra appears to be more important than the problem of NHS reform.

Edsel

News item in the UK: The sector’s funding body, the Higher Education Funding Council for England (HEFCE), announced (on 1 February 2010) that budgets are to be cut by £449 million for 2010/11.  This includes:

* A 1.6 per cent reduction (£215 million) in teaching funding;

* Research budgets will remain the same as last year;

* A 16.9 per cent cut in capital funding;

* A 7 per cent reduction for funding of special programmes and initiatives.

In a letter to vice-chancellors setting out the budgets, HEFCE said it recognised that the reductions will be “challenging” to institutions.

Now what is to be done? Predictably, the higher education sector in the UK is arguing that this will affect perhaps 200,000 students who won’t be able to get a university education. A few weeks ago, the sector argued that the UK’s place as a top tier home of higher learning was at risk — but that came from the elite Russell Group, which represents perhaps the top of the top universities in the UK.

There are a number of possible ways of thinking about this. A few:

  1. Universities already get a lot of money, and they perhaps could reduce their running costs — think of the disorganised structure of the academic year, think of teaching loads or confused performance management (is it teaching quality, research or publications??), and pretty good employment contracts. (I had one once.)
  2. There are too many universities trying to do too much, and perhaps it would not be a bad thing if some either closed or merged with another institution. The loss of the old polytechnics deprived the higher education system of a sensible alternative. Since comparisons to the US are frequently made, it is worth noting that some of the US’s top institutions are not called “university”, anyway, but ‘institute’ and indeed ‘polytechnic’. One could also look for new innovative institutions to emerge to challenge much that universities do. For instance, research institutions without university links, or which are focused on compelling issues — check out the Santa Fe Institute, for instance. Universities are not the only fruit!
  3. Cutting capital funding is not such a bad thing, given the horrendous financing of a state-sponsored capital funding body. Better universities learn how to build collaborative relationships with sources of capital, than expect their funding automatically to come from the state.
  4. Perhaps too much inadequate research is done, poor deployment of intellectual effort at reaching wider learning communities, responding to new ways of structuring learning beyond the rather tired full or part time dichotomy, and so on.

But of course, the key dilemma remains, what is to be done?

I take an optimistic view, but I would put the challenge at the door-step of the universities.

Rather than complain, prove that 800 years of public and private investment hasn’t been wasted, and come up with sensible solutions that would establish a sustainable approach going forward.  I doubt 200,000 or 200 students would be disenfranchised as a result, new ideas would emerge.

A recent book review in the Financial Times of Louis Menand’s The Marketplace of Ideas, would be a good place to begin some fresh thinking. The reviewer, Christopher Caldwell, notes:

Starting in the 1970s, professors, newly alert to injustices in society at large, took aim at credentialism and departmentalisation in every nook and cranny of American life – except, Mr Menand notes pointedly, their own. The professorial hierarchy continued to rest on a system of arduous PhDs (raising high barriers to entry), “disciplinarity” (denying the authority of the non-credentialed to teach or even discuss academic subject matter), and tenure (jobs for life). It was a system well-suited to monopolising bureaucratic power, but less well-suited to the free flow of ideas. Menand cites a 2007 study to show that, in the 2004 presidential elections, 95 per cent of the social science and humanities professors at elite US universities voted for John Kerry and 0 per cent (statistically speaking) for George W. Bush. Monopolies produce smugness and sameness in universities, just as they do anywhere else.

The title of this blog entry takes from a line in the film Independence Day, where the President says to the Geoff Goldblum character, ” And we’ll see if you’re as smart as we all hope you are” It is now time for the universities with their massive subsidised top-tier braintrust put on their thinking caps, stop playing victim and take responsibility for the solution.  The university-based economists let us down quite badly with failing models of our economies, and we are all paying for it in one way or other. Let’s not see two in a row.

The elephant in the room in healthcare is the hospital, about which I have suggested that we will build the last one in 2025.  What will “smart hospitals” look like, and why should we care?

Hospital Universitario Marqués de Valdecilla, ...
Hospital Complex, Spain

Why should we care?

Hospitals are expensive and complex labour intensive organisations originating in industrial era thinking.  Little has been done to modernise the institution itself, although much has been done of course to improve what hospitals do. We also know that hospitals account for a considerable carbon burden and consume a huge amount of energy since they operate 24 hours a day. We know that as labour intensive institutions they suffer from the challenges all such organisations face as they try to improve operating practices and reduce running costs. Healthcare delivery is characterised by regulated cartels, which serve both to protect the public, and protect professional practice from incursion by other health professionals.  A bit like an early 20th century factory with craft guilds.

We should care because these institutions need to become smarter in the use of modern technologies and practices, but this process is slow and cumbersome, and while they evolve, the taxpayer is faced with paying the costs of institutions which in many cases should be replaced. This is not to say that those who lead hospitals are not focused on these issues, but only to say that their job is not easy and with the many vested interests around, challenged.

What would be refreshing would be leadership for clinical workflow change to come from the professions themselves, due recognition of their need to evolve and reform rather than simply protect the status quo.  We need these groups to drive change in healthcare, rather than waiting for politicians or Ministries of Health to set the agenda. Of course, informed and empowered patients will eventually not put up with much of the nonsense that confronts them when they seek healthcare, but that is another story.

What will they look like?

We are left with wondering how to improve how they do what they do.  Enter ‘smarts’. This brings together a constellation of forces currently abroad in the world, ranging from automated building management systems, smart grids, energy recovery systems, to wireless technologies in hospitals to remove the wires.

Coupling smart systems together creates networks that can link patients in their home to monitoring facilities and first-responder capabilities. With the added advantage of wireless, we have untethered remote monitoring.  In the end, we have real-time healthcare.

Smart hospitals will not need to define themselves in terms of their geography or location, that is in terms of buildings. They will define themselves in terms of two factors:

  1. their capabilities and
  2. how they deliver these capabilities.

Indeed, the organising logic of the modern hospital will be replaced with one akin to a dating agency — it will link people with needs to capabilities to meet those needs — built on a sea of clinical, and patient information, and connectivity to various organisations that can deliver the services (healthcare) that is needed.  This breaks the current approach to vertical integration (based on the industrial conglomerate model) and replaces it with the virtual hospital, a network of focused and tasked organisations.

I had scoped such an approach to a redesign effort for a teaching hospital, which would have replaced a campus model (mainly an old building and some attached add-ons) with a distributed and electronically-linked (ehealth stuff here)  network of perhaps 24 centres scattered across a city of a million or so.  But industrial era logic prevailed and they went with the single building.

I guess we won’t get smart hospitals until we have smart planning.

Medicare logo
Papering over the cracks or the basis for comprehensive reform?

In an earlier post, I raised the ideological differences that may underpin much of the political rhetoric.

Of course, many informed commentators understand the problems and challenges facing US healthcare, which can be the best in the world.  And much good learning about how to make a health system better come from the US.  The NHS has learned much from the US, too.

But the NHS is like any system, built on assumptions and reflects a view of healthcare delivery that may not be shared by everyone.  However, many do share the underlying principles of universal healthcare, just not the organising principles that the UK used in designing the NHS.  There are other systems of healthcare organisation, and there is evidence that Bismarckian systems (non tax-funded systems) may actually produce better outcomes and care.  On that basis, the NHS is vulnerable to structural criticism, but not for trying to deliver a universal healthcare system that decouples the need for healthcare from the ability to pay.  The Americans in particular would not argue that people need healthcare, but they would debate how best to pay for it.  Hence the debate.

But the NHS does have vulnerabilities.  Let’s summarise a few:

1. NICE is seen by many as establishing a value for a human life based on quality adjusted life years, general affordability of a medicine based on a blend of clinical effectiveness and cost.  While NICE lacks statutory authority to enforce its decisions, its role from a US perspective would support the conclusion that within the NHS is a decision process that indeed does value human lives.

2. Overseas observers may be forgiven for not following the daily reform of the NHS, and on that basis, cursory searches of the health literature will produce historical documentation that supports the view that the NHS has been known to cause considerable personal suffering through the persistence of waiting lists.  For many US commentators, this equates to a form of rationing, which in their view is unacceptable.  Granted that people wait in all health systems; but in the past, the NHS can be accused of having used administrative procedures, like waiting lists, to queue patient care on the basis of clinical need, but with fewer deployed resources per capita than other countries, patients did in fact  suffer health consequences from waiting.

3. As a cash-limited system, the NHS is open to greater criticism from American commentators, who are more comfortable with co-payment systems, and systems which in effect enable people to buy their way to the front of the queue.  Since it is deemed unacceptable to use co-payment as a mainstream payment mechanism in the NHS (unlike the health systems in other European countries such as France, where co-payments are the norm, coupled with supplementary insurance), other commentators would naturally wonder why resource constraints that penalise people seeking greater healthcare cannot be overcome through personal discretionary payments.  The Canadian healthcare system comes under very similar US criticisms here.  That the NHS as a purchaser fails to fully integrate the provider infrastructure would seem odd to Americans and many Europeans, more accustomed to receiving care from a system that is largely agnostic over who owns the provider (public, private, voluntary, profit, not-for-profit).  More generally, the ability to pay more would be seen by some as not necessarily penalising others who might pay less or nothing — there is no moral contradiction for some here — as both types of patients will in the end get seen; the consumption of healthcare by the rich does not necessarily reduce the availability of healthcare for the poor, some would argue.  But it is important to keep in mind Titmus’s point, that a welfare system that only services the poor will lack support of the middle class, and in the end fail in its social welfare objectives, and also be financially unviable.  This is one argument for community risk rating and pooling.

4. The NHS can be criticised for confusing the politics of the NHS and the politics of healthcare, itself.  To external commentators, this mixes the essential relationship between the doctor and patient, with a state-mandated intermediary.  US commentary in part is predicated on avoiding any government intermediary between doctor and patient.  The NHS is a system for delivering care, while healthcare itself is essentially a private matter between doctor and patient, as many would argue.  You can always change the system, but the relationship remains.  Tinkering with the former in ways that alters the latter for many is unacceptable.

It is worth keeping in mind that the UK is not the only health system that American critics could attack; it is probably one of the easier to learn about and which offers an extreme view from their perspective.  Critics for years have attacked Canada’s health system as ‘socialised’, but have failed to target Italy’s.  They have generally ignored insurance-based or Bismarckian systems perhaps because of the insurance approach, which is closer to their view of how risk should be managed — buy insurance, don’t buy the risk itself.

The NHS itself, is a particular way of organising and paying for a universal health system, and there are separate debates in the UK about whether the NHS should become an insurance-based model, and so and so forth.  But in the end, few Americans are actually inconvenienced by their healthcare system, and perhaps think very little about it, in much the same way as UK citizens enjoy the benefits of the NHS, without necessarily being concerned exactly how it is financed.

Universal health systems do work well and apportion risk across the whole population in most cases without a lot of public hand-wringing.  UK politics is perhaps overly sensitive given the past problems with NHS waiting lists and apparent rationing, and dysfunctional separation of public and private providers adding delay to access to treatment.  These problems are largely absent from Bismarckian health systems of France, Germany etc, and so there is always the general public accountability to be had about whether the UK is making appropriate evidence-based decisions about the financing system it uses.  But that is quite apart from the fact of universal coverage.

In the end, the US doesn’t want an NHS style healthcare system.  In fact, very few countries actually copy the form the NHS form of financing (tax funded), preferring to use insurance, and of those that are tax funded they tend not to copy the organisational style of the NHS (state-run/owned hospitals for instance). This is keeping in mind that there are four NHS’s — one in each UK country, with the English NHS being the most progressively reformed (with some US ideas, too).

There is much to learn from looking at other health systems, and the US clearly isn’t having that sort of reform debate.  Something perhaps for the US to think about again.

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So various US publications have waded into the health reform debate with comparing the US with the UK’s NHS.  These commentary, as many other bloggers and those on Twitter, are of varying degrees of stupidity, ignorance and general lack of insight.

It is worth keeping in mind that for decades, there have been comparisons between Canada’s healthcare system (very similar to the UK’s NHS, but there are very important differences, too) and the US.  The Americans have these debates constantly and the various lobby groups are well-equipped to flood the ether with their rhetoric. There is a deep-seated concern about ‘socialised’ medicine, about the role the state usurping individual responsibility, and about power and control.

And the spirited defence of the NHS will no doubt continue apace.

But underlying the debate is the unanswered question of why does the US have so much trouble with reforming its healthcare system in the first place.

One reasons is that Americans seem have a lot of trouble with what are called free-riders.  Because their system is insurance based, those who do not take out/cannot afford health insurance, get a ‘free ride’ on the taxpayer, through the federally funded Medicare/Medicaid programmes for instance.

By and large, Americans philosophically are liberal in their outlook, and believe that individuals should make the most of their gifts, so the system rewards, and celebrates success, and while not necessarily punishing failure, ignores it as long you pick yourself up and get on with improving your life.  Ideologically, that means that it is hard to grasp that everyone may have an interest in the general welfare of individuals, AND that the responsibility for the general welfare is the responsibility of government. Practically that translates into a political ideological debate about the role of the state.

Why does that matter?

The US politically is a different system from parliamentary democracies. In the latter, political parties stake out ideological territory (left, right, socialist, whatever) and the electorate chooses.  In the US, the United States itself IS the ideology.  The political parties are interpreters of this founding ideology and the electorate chooses within that ideology from the political parties.  That explains in part why there is a narrow range of political choice on offer in US elections, and why, under the skin, all political beliefs flow back to the founding ideology of the US Constitution, and its revolutionary roots.  The US believes it is the definition of democracy, so why would one have varying degrees of political persuasion if you’ve already solved the hard problem.

That means that the health reform debate is predicated on historical consensus about the political objectives of the US as a democratic entity. One of these principles challenges the role of government, another principle addresses individual liberty and third focuses on how the US interprets the public interest and general welfare.  The third principle is NOT interpreted by the state (as in the US, the state is a creation of the people), as it is parliamentary systems (where the state exists independently of the people — read Hobbes).  In the US, the resolution of a political debate amongst competing interests determines the public interest as the state does not have an independent existence and so cannot have its own guiding principles.

Why should this matter?

Because in the US, these debates nourish the democracy itself. The discussion is not esoteric but fundamental to the concept that Americans have of their country.  Such debate in UK, France, Germany, Canada, etc, with universal health systems, will invariably invoke principles to resolve the issue, that can not work in the US political arena.  The difference, of course, is that while the Americans will have the debate, other countries will sit complacently by while their governments pursue reform policies which should be challenged and debated outside the government.  The differences are subtle, but important.

A statue of Asclepius. The Glypotek, Copenhagen.
In whose name do we reform healthcare?

President Obama’s comments today to the American Medical Association in Chicago represent the slow, but certain, turning off the health reform supertanker that is the US healthcare system.  Despite evidence of the need for improved clinical working practices, use of guidelines, better use of evidence, powerful groups have resisted over the years opportunities for root and branch change.  Speaking to the AMA, Obama identified a few key barriers he sees as crucial to change:

  • eliminate the notion of pre-existing conditions
  • find alternatives to fee-for-service reimbursement
  • share best practice better.

Of course, there are many other moving parts within each of these, and others he mentioned (e.g. generic medicines, clinical IT, etc.).  But these three offer opportunities for substantial realignment with the US.  In turn, and briefly, by eliminating the insurance barrier of pre-existing conditions means adopting population-based health risk.  That moves the US to social insurance models familiar to Europeans.  The problem will be overcoming the problem of free-riders, which be-devil some US policy commentary, but free-riders in automobile insurance claims are not quite the same thing as someone who is poor and in ill-health getting access to healthcare.  Alternatives to fee-for-service opens the door to outcomes-based payment systems, enables better bundling of care across clinical pathways and more closely aligning payment to what actually happens to patients.  By integrating care, financial incentives move closer to actual clinical and hospital work patterns; similarly, with innovative thinking about how to structure reimbursement based on outcomes, payers can more effectively encourage reform with hospitals, to move them away from fragmented care.  Sharing better practice should seem the natural thing to do, given that everyone in the end does benefit when good practices are shared.  But sharing better practice can undermine competitive advantage in market-driven health economies; by shifting to alternative payment systems, sharing practice will make more sense, especially if payers act together.  However, ever mindful of potential for collusion, payment systems and information sharing must enable consumer and payer choice, rather than close down options, in an anti-competitive spirit.

This president is compelling in his expression of the anxiety so many Americans feel about what is wrong with their healthcare system, and he is to be commended for taking this challenge into the heart of the medical community.  In that respect, I am optimistic that some sort of change will come in the US.  More importantly for other countries’ healthcare systems, we see a lesson in a way to conduct health reform.  His big-tent approach is a lesson for other countries that feel health policy and reform comes from aligning the interests of narrow interests, of specialist commentators, academics and civil servants.

One lesson to take away is that health reform is something that must be conducted within the society, with all the key participants engaged.  It is not just the culmination of a rational research study, using contracted experts, who more often than not breathe each others’ air.  No longer, I think, can international observers be critical of US reform intentions.  Indeed, for some countries who think they have a pretty good and publicly funded system, US reform may show them to be small, mean-spirited systems, narrow in focus and costly overall.

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