The Biggest Challenge in US Healthcare – Becoming a Retail Industry.

We shared, at a recent monthly meeting, a copy of Paul Keckley’s excellent article, The Biggest Challenge in US Healthcare – Becoming a Retail Industry. Because this is such an important article, addressing perhaps the most foundational issue in healthcare today, we wanted to point it out once more and highlight it in case you missed it.

As Keckley so appropriately points out (and we’ve argued strenuously)….

Ours is a B2B [business to business] industry. It’s great business for manufacturers and middlemen who successfully access capital markets to create their newest and best parts and facilities, especially if they’re able to align with frontline workers to use them as much as possible…..It’s big business and profitable for most.

In other words, it’s a system working pretty well for the big (and getting bigger) players. The simple and straightforward problem, of course, is that it’s not working so well either for the people whom it’s supposed to serve – patients – or for the organizations that fund most of (e.g., the employers). And while we can give lip service to “patient-centered care” until the gurneys all come back to central supply (and it feels as though we have already), the system won’t transform until the market shifts to a B2C (e.g., business to consumer) model.

What will that require? Two things:

1. First and foremost, it will require employers who insist that payment models bundle services as they do in other industries. Your employees or your procurement department buy complete computers – not separate keyboards and screens and hard-drives that they then have to put together. And, in Colorado, Colorado PERA is leading the way in this regard. But it was PERA, not a health plan, that forged the way.
2. The second prerequisite will be tools to make quality and price not only transparent, but user friendly. While, in this regard, the plans do seem to be trying to move forward, our members tell us that outsiders like Castlight and Healthcare Bluebook provide the most appealing applications.

As Keckley points out, it’s not that the B2B model hasn’t served us well. It did - for a period of time. But change comes particularly glacially to healthcare and, in this case, the model has not only outlived its usefulness, it’s now hurting our families and our companies.

It’s time for an employer-led transition to a B2C market. Don’t expect the B2B stakeholders to set the pace. The market’s working pretty well for them.