Missing Elements of Health Care Reform

Missing Elements of Health Care Reform
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Health care policy is fraught with political risk in large part because both sides overemphasize demand-focused policies (insurance structure) and underappreciate supply-focused policies (resource allocation and technological innovation). In doing so, they play a repetitive zero-sum game. Additionally, both sides underestimate the extent to which states can enable providers to augment the supply of care without waiting for federal government action.

A thought experiment—let’s call it the Calendar Test—can clarify these points and make a handy guide for reviewing the logic of proposed reforms.

Imagine a primary care physician working 10 hours a day. Half the day, she does tasks other than seeing patients: administering the practice, editing electronic health records (EHRs), reviewing charts, communicating with colleagues, and reading medical literature. During the remaining five hours, she sees 20 patients for 15 minutes apiece. Most of that time consists of entering data into EHRs, asking routine questions (“How has your blood pressure been lately?”), and engaging in polite chatter (“How is your son feeling?”). She employs nurses and technicians who work frenetically all day.

Now, give four new people coupons entitling them to appointments with this doctor on this day, but don’t add resources. Don’t reduce required administrative duties, either. There are three ways the doctor can handle this increased demand, keeping in mind that expanding the day to 25 hours isn’t an option: (1) work an extra hour and give up an hour of leisure; (2) cram four extra patients into the five hours by cutting each encounter by 2.5 minutes; or (3) remove four patients from the day’s appointment calendar.

Now expand this scenario. On each of the year’s 250 workdays, give four additional people coupons for appointments with this doctor. Then do the same with all 200,000 primary care physicians in America. Finally, offer coupons for visits to medical specialists.

This is what the Affordable Care Act did (It may have been even worse, since the newly insured people are sicker on average than the previously insured). This is what single-payer advocates hope to do even more of. And this is what those seeking to repeal and replace the ACA may end up doing unless they focus heavily on the generally neglected supply side—enabling markets to find new resources and ways to make existing resources stretch further. While buying and selling insurance across state lines, aggregating small businesses into larger risk pools, and creating more high-risk pools may have merits, they don’t necessarily lighten any doctor’s appointment calendar.

Suppose doctors refuse to work an extra hour each day, and suppose chopping 2.5 minutes off of each encounter undermines standards of care or doctor-patient bonds. The real challenge, then, becomes, “How can we find ways for four of the doctor’s prior patients to care for their health without need of a doctor’s appointment?” This is the Calendar Test—the question any would-be reformer ought to ask about his own proposal.

In fairness, health care reformers of all political stripes pay homage to the supply side. The ACA’s authors hoped to streamline physician-patient encounters through mandatory EHRs, but the result has been to consume even more time and depersonalize encounters. Conservatives hope medical malpractice reform and more health savings accounts will cut patient loads (I suspect they greatly overestimate the possibilities of both).

The good news is that modern technology and management offer ways out of this zero-sum game. Some keys lie with the federal government. Last year’s bipartisan 21st Century Cures Act, in addition to President Trump’s first speech to Congress, indicates that U.S. policymakers do understand the importance of streamlining the process for Food and Drug Administration approval of drugs and devices—innovations that can clear time on doctors’ calendars.

My favorite example is a small, $99 device (AliveCor Kardia) attached to my iPhone. In 30 seconds, I can perform a clinical-quality electrocardiogram and receive an instant analysis of my heart rhythms. On at least one occasion, it may have prevented an unnecessary emergency room visit, and it may have cut down on the frequency of my visits to my internist and cardiologist. Such devices are proliferating, though FDA sluggishness slows the rates of development and adoption.

But many of the biggest opportunities lie with state governments—red and blue—that have spent a century fashioning obstructive laws and regulations. Here are ways states could begin to lighten the beleaguered doctor’s appointment calendar without harming patients’ health. Each approach is barred by some states and embraced by others:

  • Telemedicine lets patients use their smartphones, tablets, and laptops to consult with physicians through Skype-like interactions. A nationwide pool of telemed doctors allows demand smoothing whenever bottlenecks appear (such as during localized epidemics). 24/7/365 availability invites early intervention, potentially eliminating time-consuming problems resulting from procrastination.
  • Online prescription websites allow patients to order certain medications without perfunctory, time-consuming face-to-face appointments with doctors. Technologies enable drug vendors to heavily scale due diligence (quality control, safety checks, patient identification).
  • Nurse practitioners, practicing independently, can attend to patients with routine complaints.
  • By eliminating restrictions on the corporate practice of medicine, business efficiency specialists can play a larger role in health care. Newfound efficiencies can lighten physicians’ administrative load, leaving more time for patient interactions.
  • Similarly, eliminating certificate of need laws means medical providers can allow more efficient provision of care.
  • Interstate licensing reciprocity makes it easier to meet short-term and long-term changes in demand patterns. Once a medical or nursing license is usable across state lines, it will become easier for providers to temporarily relocate (say, during flu season in colder states) or permanently relocate when demand shifts from one state to another.
  • States can broaden the ability of out-of-state and in-state volunteer physicians, nurses, and others to attend to patients in underserved areas and during disasters.

All of these ideas are being applied to good effect in some states and prohibited in others. Unleashing supplies of resources is likely to be far more productive than arguing over who should pay how much for a fixed set of resources and whose care should fall through the cracks.

 

— Robert Graboyes (@Robert_Graboyes) is a senior research fellow with the Mercatus Center at George Mason University, where he focuses on technological innovation in health care. He authored “Fortress and Frontier in American Health Care,” teaches health economics at Virginia Commonwealth University, and is a recipient of the Bastiat Prize for Journalism.

 

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