Healthcare Wants You Sick?

Updated: Jul 28

Healthcare was built on a fee for service model that is hoping you get as sick as possible for payment. This may seem strange. How could that be? If you think of the financial side of healthcare, first you can pay up to your deductible above what the insurance company. This could be labwork or primary care, which the latter would like to direct you to a specialist. It was never about prevention. The sicker you are, the more labwork, imaging, and related expenses. Is this the healthcare you would like? Financial engineering can tell which reimburse and pay best and to support more of that.


The incentives of fee for service should be changed versus the feeling it is incentive to be helping itself, but we have several problems. 1) How do you define when someone needs care for prevention? It is less quantifiable. 2) Do we really have the level of healthcare workers to expand care? Medicare is only growing from a U.S. aging population. How can we service them under these considerations? Medicaid is a money loss to healthcare systems. Medicaid documentation is much stricter. It has a high rate of claim rejection relative to others. There are good reasons for this, but also drawbacks.


In discussion of Medicaid, things are worse than appears. I hear from nurse practitioners working in cardiology that if only enough patients had seen the doctor and followed up, ones that are not strictly genetic or mostly genetic wouldn’t have reached a stage of heart failure. Then you learn the social determinants of health stigma of seeing the doctor, or worse yet, scheduling is made hard for them because Medicaid patients are just not money makers. There are questionnaires and scales to fill out about social determinants of health, but unless it is more serious enough as mentioned in fee for service, the interventions are not there.


There is good news. Value Based Care has emerged as a means to support prevention in comparison with the fee for service model (1,2,3) . This is where the innovation is happening in provider services (4). While Value Based Care is still limited overall in adoption, it is growing. To define Value based Care, the healthcare process is to identify when a patient needs care through prediction and risk stratification. Another way to say this, value-based care tries to find when you need the care and provide it then. Another form of prevention in our health system is trying to prevent readmission of hospitalizations. Both are step in the right direction. But serious limitations still exist. How do we get to the root of issues of a patient and fix them before ending up in a worse risk stratification or reducing your risk stratification altogether? Value Based Care needs social worker, psychologists, and areas of healthcare that have traditionally been out of would be too much pressure on the healthcare system. They more so work outside a traditional healthcare network. This sounds daunting.


You are probably thinking after reading this ask why can’t we have a continuous care. It used to be the family doctor knew you, understood you, and could help you. At least if you are old enough! More nurses, social workers, etc. would drain our abilities. You should be receiving a continuous care that follow personalize to you. Wouldn’t that be great! From older healthcare to today there is a change. We have exponentially more data than ever before. How come companies like Google know more about you than your healthcare providers you may ask? The use of data has built on claims and the benefit of insurance. This is the same problem is like what we find with a FICO score (5). Great methods based on the data from the past. We have never really developed a 21st century healthcare but great actionable healthcare from the 1980’s and so. Electronic health care systems were built for billing and management, and less the utility of healthcare providers. RADECTHealth is working to address this challenge. Others we believe are doing so as well


Part of the problem is data and making that actionable in Value Based Care. Then how is this data managed and understood to be useful? This question asked another way, what if we could debrief a whole team of clinicians and look back at the patient in hindsight and say what to do. Can software accomplish this? This becomes a question of whether we can bring all this into a team-based care record. RADECTHealth is also working on this. Others we believe are doing so as well. For this to really work, we need to educate and make patients proactive in their healthcare. This is another checkbox to what Value-Based Care needs.


What all this means is Value Based Care is a progression and should evolve from a prediction into a continuous care model that expands on the family doctor model as a team-based model. We should be able to bring this comprehensiveness to everyone. RADECTHealth would like to partner with Value Based MSO’s if you are one to make this happen.


(1) Porter, Michael E. "Value-based health care delivery." Annals of surgery 248.4 (2008): 503-509.


(2) Mjåset, Christer, et al. "Value-based health care in four different health care systems." NEJM Catalyst Innovations in Care Delivery 1.6 (2020).


(3) Catalyst, N. E. J. M. "What is value-based healthcare?." NEJM Catalyst 3.1 (2017).


(4) Justin Larkin and Julie Yoo. Risk-based Contracting for Value-based Care, a Founder’s Playbook, April 6, 2022.

https://a16z.com/2022/04/06/risk-based-contracting-for-value-based-care-a-founders-playbook/


(5) Rob Kaufman, The History of the FICO Score. August 21, 2018.

https://www.myfico.com/credit-education/blog/history-of-the-fico-score

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