Technology can solve a remarkable number of problems, but in some cases, it simply cannot overcome the monkey wrenches that litter the system. Health care is unmistakably one of those cases. But can you fault Blue Cross Blue Shield Association (BCBSA) CIO Dough Porter for trying anyway using big data? Maybe.
A Health-Care Morass Too Big for Big Data
Health care is a mess. Up is down and down is up in a system that government has been “fixing” (in more ways than one) for decades. Whatever one thinks of U.S. President Barack Obama—including whether he honestly believed his signature health-care revamp, Obamacare, would work—health-insurance premiums have continued to rise, and so has spending. And that spending growth is in spite of repeated, insistent claims on the part of Obama that health-insurance premiums would fall (saving “the average family $2,500 on their premiums,” according to one phrasing of the promise). Instead, according to Investor’s Business Daily, “Since 2008 [when Obama made his claim of $2,500 in savings], average family premiums have climbed a total of $4,865.” A chart in that article based on Kaiser Family Foundation data shows no significant change in the growth of health-insurance premiums.
This is not to bash Obama per se—a Republican president would no doubt have done just as badly, if not worse. But the idea that anyone even believed such demonstrably outlandish promises indicates that people are blind when it comes to this industry. As such, many will buy whatever snake oil comes down the pike with claims of being able to save the situation. Sometimes, that snake oil has a technology tinge to it—in the case of BCBSA CIO Porter, its flavor is big data. Porter may well believe he has a solution, but history suggests otherwise. Proponents of electronic medical records (EMRs) made similar claims, only to have their hopes dashed as evidence pointed to no discernable benefits.
Writing at InformationWeek, Jessica Davis rightly identifies one of the main problems with health care (in two related parts): “Two of the most frustrating aspects about being a consumer of the US healthcare system involve trying to find out about how much a particular medical procedure really costs, and how to compare one provider to another in terms of quality and expense.” In other words, there is no price discovery. (Sounds a bit like the stock market, doesn’t it?) She then cites the BCBSA’s “Axis” program, which “is creating a reference tool that will provide price points on medical procedures for particular geographies....This Axis application for cost and geographies will not only look at the price of the procedure itself, but will also bundle in the cost of pre-procedure appointments and post-procedure follow ups, providing a realistic total cost price reference.”
So far so good. But remember, proponents of EMRs listed all sorts of seemingly logical reasons why getting rid of those old stacks of paper files would cut costs and therefore spending: fewer repeat procedures, better doctor access to information enabling better diagnoses, fewer medical errors and so on. Obviously, it didn’t work—and it has created a frustrating situation for many doctors (and their patients). But what of all those rationalizations that sounded so good?
Maybe you really can’t fix stupid. Also writing at InformationWeek, Larry Loeb notes that “US healthcare will undergo a significant change Oct. 1, which could cause major disruptions, and most of the public has no idea that it is coming. On that date, all healthcare providers and facilities must start using ICD-10, the 10th revision of the International Statistical Classification of Diseases and Related Health Problems (ICD), a medical classification list from the World Health Organization (WHO), to describe medical problems for billing.”
Did you notice anything wrong with that situation? Let’s bring it back to the data center world. Imagine you discovered something amiss with your cooling system, so you called in an expert repair company. Now imagine that before billing you, that company had to determine which of 70,000 or so “codes” best describes your problem, then had to fill out a bunch of paperwork to submit to another company to handle payment. The relationship of the work to the repair company’s reimbursement is uncertain at best (but it’s always less than what is claimed), so the repair company must charge you accordingly. What do you think the cost will be to you? Higher (a lot higher) or lower than if you just spoke directly to the company about parts and labor?
In the same vein, insurance companies and government (both separately and through their combined efforts) have so fouled up the health-care system that a half-hour with a doctor may cost different amounts depending on how the visit is “coded.” The cost is not how much time and supplies the doctor uses, but how much a bunch of government and corporate bureaucrats decide it should be. Imagine what IT would be like if in addition to the normal frustrations, this level of inanity were added into the mix.
Fighting the System
The use of big data—through BCBSA’s Axis system or something similar—may just be one of the few positive options (at least in theory) in a bad situation. Will it have any significant effect on prices and health-care spending? No, because the problems in these cases are systemic. Efforts to impose universal health-insurance coverage mean an increase in demand for services (after all, if you’re paying premiums—or not—you might as well get something for it). Apart from an increase in supply, which seems unlikely given the market’s lack of freedom in this area, prices must rise.
In addition, health insurance necessarily insulates patients from the cost of health-care services. Big data analysis of cost is therefore of little benefit when the customer refrain is “my health insurance’ll cover it,” although analysis of quality may be of some fringe benefit (theoretically, anyway). But no technology has shown any power in stopping the growth of health-care spending. No matter how big your big data is, it can’t overcome how big the monkey wrenches are.
No amount of technology can overcome the systemic problems that plague (no pun intended) health care. Insurance, instead of being a means to only handle remote, catastrophic possibilities, has consumed the entire industry as virtually the only means of payment. (And those who decline to participate in this racket are regularly berated for supposedly wrecking the system and increasing costs.) The government aims to get everyone else on board too, further bloating a broken system. The real solution isn’t technology, but a free market: dispensing with asinine coding schemes, eliminating government regulations, licensing and the entire spectrum of fiddling. Let courts adjudicate matters of malpractice and other justice-related issues just like they do in other industries. Once the bureaucratic dead weight is removed, then the industry will be poised for a breakout of lower prices, fast innovation and rising quality of service. If a free market worked for IT, why can’t it work for health care?