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Health Care – Competing at the Right Level

David P. Lind BenchmarkThanks to the health reform law, Iowa and Nebraska just received a new health plan to compete with the other insurance companies doing business in both states.

Owned by its’ members and led by a board they elect, Midwest Members Health Inc. is a nonprofit consumer operated and oriented plan (CO-OP) that will be up and running by January, 2014. This is the same date that Iowa will have either a new state-based insurance exchange or a federal exchange. This new carrier will receive around $112 million in loans over 15 years, giving it enough money to cover claims and maintain financial solvency. A great start for an organization just approved in February.

But will this new competition create lower premiums for consumers and employers?

Hard to say.  

I must admit, I’m a skeptic whenever there is talk about how important it is to have “more competition” between health insurance carriers. Competition is important, but competition at the RIGHT LEVEL is even more important—if not critical. Health premiums are nothing more than a derivative of health costs, so having more carriers compete for our business will not meaningfully change the premiums if we can’t FIRST fix our health delivery system, one of the biggest cost drivers.

True competition must begin at the level where care is delivered—at the provider and patient level.

It is also extremely important to have transparency in cost and medical outcomes measurements. If carriers and providers don’t provide this transparency, I fear we will see more of the same—uncontrolled costs.

Knowing up front what the cost is for a given procedure and the most likely outcome for that cost (by medical provider) is absolutely necessary. This is not currently happening in Iowa or across the country. And it MUST happen if we have any glimmer of hope of containing costs in the future.

Harvard competition guru Michael E. Porter may be on to something when assessing the competitive environment in the health care industry.

Why is competition in health care not focused on value? The most fundamental, unrecognized problem with the U.S. health care system is that competition operates at the wrong level. Competition is both too broad and too narrow. Competition is too broad because much competition now takes place at the level of health plans, networks, hospital groups, physician groups, and clinics. It should occur in addressing particular medical conditions. Competition is too narrow because it now takes place at the level of discrete interventions or services. It should take place for addressing medical conditions over the full cycle of care, including monitoring and prevention, diagnosis, treatment, and the ongoing management of the condition.

Sounds reasonable to me … how about you? I hope this new health plan is a success. But real, meaningful success will only come when we have true competition in the right places.

Iowa Employees: Don’t Worry, Be Happy!

David P. Lind BenchmarkI know, sounds kind of soft, doesn’t it? What does happiness have to do with the bottom line? Turns out, more than you may think.

According to a 2008 Gallup Healthways study, employees who are not satisfied with their lives tend to stay home from work about 1.25 more days a month (or work 15 days LESS a year). Now there’s a bottom-line impact you can measure.

On the other hand, employees who score high in happiness receive more kudos from customers and generate higher earnings for their employers.

Harvard researcher Shawn Achor addresses our ability to increase our happiness in the Jan/Feb 2012 Harvard Business Review article, “Positive Intelligence.”

It seems that we have things a bit backwards. Many of us believe that in order to have happiness, we first must experience success. “If I land that new client, I’ll be very happy,” we think. But after the newness of that success wears off, the happiness that results is temporary. 

Achor makes a strong case that we must “cultivate a positive mind-set” before having the successful outcomes we desire.

My takeaway is that we have the ability to cultivate our own habits that will eventually rewire our brains to view the world with more optimism … and happiness. In other words, happiness can become habitual. Sign me up!!!

For employers, the good news is that happy employees mean positive things for your organization—and your bottom line.

So what habits can we develop that will rewire our brains? Achor suggests pursuing any one of the following five positive exercises each day for three weeks:

  • Jot down three things you’re grateful for.
  • Write a positive message to someone in your social support network.
  • Meditate at your desk for two minutes.
  • Exercise for 10 minutes.
  • Take two minutes to describe in a journal the most meaningful experience of the past 24 hours (moleskin book, iPad Notes, etc.).

I would like to add one more “exercise” to this list.  Make it your mission on a frequent basis (daily or weekly) to find a way to help others…or at least demonstrate a random act of kindness. One small (but rewarding) example is to pay for the person behind you when buying coffee at a coffee shop (or your favorite place). You never know, you might impact that person’s day in a positive way…in addition to making your day more fulfilling by giving to others.

All of the above exercises sound easy to me! What about you? If being happy is contagious, why wait?

Health Care Fortune Teller

David P. Lind BenchmarkDuring the past two years, I’ve fielded countless inquiries from curious Iowans asking me to put on my fortune-teller hat and look into my crystal ball to predict how health care reform will impact their lives. Questions run the gamut:  

  • Do you think it will solve the ills of our health care system?
  • How will health insurance rates be affected by the new health reform law?
  • Will I be able to keep my own doctor?
  • Will employers continue to offer health insurance to their employees in 2014 and beyond?
  • Will the U.S. Supreme Court deem the individual mandate unconstitutional? If so, will health reform be repealed?
  • Who will be the chief czar of the newly created “Death Panel” in Washington, D.C.? (OK, this one was a bit exaggerated by me!).

Anxiety and fear are often at the root of these concerns. Perhaps the questioner watched the nightly national news and caught a vignette about how reform will impact a certain segment of society, or perused a magazine article that portrayed a certain provision in the law as either negative or positive. We have certainly been bombarded with “facts” from supporters and detractors of the law since March, 2010. No wonder we are feeling confused and overwhelmed with the complexities imbedded in this mammoth law.

I typically refrain from giving my views on the health reform law. But, when confronted, my comments sound something like this:

  • There are usually two (or more) sides to every argument, and health care is no exception to this maxim.
  • Determine the source of the information before accepting it as truth. Supporters and detractors may not portray competing arguments with much objectivity. Be mindful of possible agendas that may cloud the “truth” they espouse.
  • There are NO Silver Bullets that will solve the ills of our health care system. It took us 60-plus years to get into this mess, and it will take time to put our health care ‘system’ on the road to “recovery.”
  • Lastly, I will ask them if they always believe the weather forecast. Because forecasting how reform will impact us is similar to trying to predict the changing weather patterns in Iowa over the next year (or week)!