"We cannot solve our problems with the same thinking we used when we created them."
Almost a century after Albert Einstein said this, it remains as true as his theory of relativity. The healthcare crisis in the U.S., as in much of the world, is structural and not incidental. It is the inevitable result of an outdated, reactive, episodic, clinic/hospital centric, “fee for service” system that is unscalable, and therefore increasingly inaccessible and unaffordable to many.
It reminds me of the time around a quarter of a century ago when my car would break down with little warning, costing me a not so little fortune to fix at a “repair shop”. Today, most cars are equipped with sensors that continuously collect data, computers that dynamically analyze the performance and alert when necessary to “pre-emptively service” to avoid a breakdown. This is what we do with much of our physical assets nowadays but not the most important one: our body.
Predictable and preventable illnesses are responsible for almost 70% of healthcare expenditure. The current system we call healthcare is misnamed; It was designed for “sick care” and should be renamed as such. For a true healthcare service, we need to create different economic incentives and operating models that are not just designed to deal with our crises and emergencies but to avoid them as much as possible. Much of what is required for this new economic and operating model for healthcare is already here, it is just not well distributed or fully developed.
“It’s the economy, stupid."
James Carville’s famous phrase applies to the healthcare sector as much as any other. Most institutions optimize for their financial incentives. Many say our healthcare system is broken. That is simply not true when you look at it from an economic incentive lens. How can a sector of the economy that has been showing the fastest and most consistent year-on-year “growth”, to now have captured just shy of 20% of the GDP, be called broken? In a “fee for service” system, where providers are paid for “activities”, any rational capitalist institution would optimize to maximize those activities. And that is what they have successfully done.
So, the starting point of any transformation from sick care to healthcare should be to fix the economic incentives. Instead of paying for activity, we should align incentives of payers, providers and beneficiaries by paying providers for managing their population’s health and benefiting by avoiding crisis and emergencies. This is what is happening across all other areas of “asset” insurance and maintenance with great results and should now be applied to healthcare. The good news is this is no longer a niche idea but is now accepted and advocated by many.
“If you can dream it, you can do it.”
Walt Disney’s advice is even more true in today’s world of accelerating innovations. Instead of the current reactive and crisis ridden sick care service, it is possible with today's technology to create a new data centric, proactive and integrated care service for population health management at scale. This no longer needs to be a dream and can be built.
The diagram below illustrates Babylon’s approach to delivering a digital-first health service in a manner that is scalable and affordable through an omni-channel mix of AI, digital, virtual and physical services as necessary. Central to this approach is continuous monitoring and collection of relevant data, algorithms for real time and intelligent analysis, protocols for appropriate rewarding and alerting and a scalable and proactive, digital first “health service” that can intervene early before small concerns become unwanted and unnecessary emergencies. Digitizing, automating and virtualizing as much of the physical care needs as possible is also necessary to improve accessibility and affordability of healthcare.
Much of the thinking and capabilities needed for the transformation of the sick care industry to a healthcare service are already here. We cannot afford to revert back to the old-ways that caused this mess to begin with. It is now possible to reshape a new model for healthcare. Those who do so and deliver it at scale will make quality healthcare accessible and affordable for every person on Earth.