Health Care Innovation

Thomas Friedman in the NYTimes describes the innovation in data management and health care arising in the last couple of years:

The goal of the health care law is to flip this fee-for-services system (which some insurance companies are emulating) to one where the government pays doctors and hospitals to keep Medicare patients healthy and the services they do render are reimbursed more for their value than volume.

To do this, though, doctors and hospitals need instant access to data about patients — diagnoses, medications, test results, procedures and potential gaps in care that need to be addressed. As long as this information was stuffed into manila folders in doctors’ offices and hospitals, and not turned into electronic records, it was difficult to execute these kinds of analyses. That is changing. According to the Obama administration, thanks to incentives in the recovery act there has been nearly a tripling since 2008 of electronic records installed by office-based physicians, and a quadrupling by hospitals.

The Health and Human Services Department connected me with some start-ups and doctors who’ve benefited from all this, including Dr. Jen Brull, a family medicine specialist in Plainville, Kan., who said that she was certain she had been alerting her relevant patients to have colorectal cancer screening — until she looked at the data in her new electronic health care system and discovered that only 43 percent of those who should be getting the screening had done so. She improved it to 90 percent by installing alerts in her electronic health records, and this led to the early detection of cancer in three patients — and early surgery that saved these patients’ lives and also substantial health care expense.

Policy analysts typically discuss the pros and cons of a new law with respect to existing conditions (institutions, technologies, etc.) remaining as they were (ceteris paribus in econ-speak). But, in this case, the ACA led to new incentives for business startups in a potentially profitable market. And these startups could change the game. This wave of new programs, apps, and technologies may prove vital in improving the efficiency of medial treatments, enhancing patient outcomes, and keeping costs down.

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