Aligning Properly Placed Incentives to Improve Health and Healthcare Services

imageWho are the eHealth leaders in America?  And I don’t mean thought-leaders.  I mean who in America is leading the pack in the actual use of Health ICT to better serve patients?  There are certainly practices and hospitals here and there doing some very good work, but the national leaders are clearly Kaiser, Group Health Cooperative, Geisinger, and a few other staff-model, managed care organizations.  Have you ever wondered why it is that organizations like these lead the pack in eHealth?  It’s not just that they are large and have the resources and scale to implement ICT (information communication technology).  It’s that they have a business model that supports the delivery of eHealth services to patients under their care.

A recently published survey by one of our good partners (Dell) shows the delta that exists between what patients want and what most hospitals and health systems deliver when it comes to using technology and on-line services.  What do patients want?  Eighty-one percent reported that they would like electronic access to more information about a hospital to help determine things like medical expertise, physician experience and insurance acceptance.  Seventy-four percent of patients said it should be possible for electronic medical record systems to share information between their physician, hospital, rehab center, laboratory, etc.  Seventy-six percent of patients thought they should have access to electronic prescription processes.  In another recent survey by Intuit, seventy-three percent of Americans surveyed said they would use a secure online communication solution to make it easier to get lab results, request appointments, pay medical bills, and communicate with their doctor’s office.  If fact, anytime anywhere access to services was rated so important that nearly half of respondents said they would consider switching doctors for a practice that offered such on-line services.

imageWhat is on the minds of healthcare executives?  Seventy-nine percent of polled executives have concerns about training clinicians and hospital staff in order to achieve process improvements and time-savings.  Seventy-eight percent were somewhat or very concerned about maximizing their ARRA incentives payments (qualifying for federal funds for implementing electronic record systems and using them “meaningfully”).  Eighty-five percent said they are somewhat or very concerned about being able to afford needed initial and continued technology investments.

If satisfying patient desires for more on-line services didn’t top the list of healthcare executives, don’t be surprised.  Believe it or not, under the current payment system most hospitals don’t think of the patient as their customer.  Their customers are the physicians who refer patients to the hospital.  It is the services ordered by and provided by those physicians that bring income to the hospital.  The more the physician does to or for the patient, the more money he or she makes, and to some extent, the better the hospital does as well.

Under managed care (or accountable care) the incentives work a bit differently.  Organizations make more money when they keep people well.  They make more money when they figure out how to deliver health information and medical services in more efficient ways, and that includes delivering information and services using technology.  These organizations have discovered that it is quite possible to extract twenty to thirty percent of the demand for information and services from their brick and motor facilities and deliver these things on-line.  When they do, everyone seems to be happier.  Patients like the timely service and convenience of doing things on-line.  The organization’s finance department appreciates the savings.  The doctors and other clinicians get to spend more time doing what they were trained to do in the clinic, and also get paid for dispensing information and services when using telephone, e-mail and video visits—something that generally doesn’t happen today.

imageThis week I’m traveling to Toronto, Canada, to speak at a healthcare executive event being sponsored by Microsoft.  Considering how healthcare is organized in Canada, it only makes sense that the country is well positioned to benefit from the promise of information communication technologies applied to health and healthcare.  Canadians would get additional, less costly and perhaps more satisfying options for certain healthcare services.  Provincial governments would realize potential savings from on-line care.  Providers would likely want to participate if they knew they would be compensated.  In effect, the system should work much like a giant Kaiser or Group Health where there is already plenty of proof that using technology to scale the delivery of health information and services in new and innovative ways saves money.

That is the promise, but the reality can only happen both here in America and in other countries of the world, when business incentives align with the service levels and outcomes we truly hope to attain.

Bill Crounse, MD                                      Senior Director, Worldwide Health                         Microsoft

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