A visionary and vanguard of the Internet and now healthcare tells MD+DI why he thinks revenues for the healthcare industry will decline and what device makers can do to succeed.
"Back to the Future Day" has come and gone, but questions about the future remain. Dr. John R. Patrick has been called an Internet pioneer, both for his roles in helping facilitate the technology and for his predictions about the evolution of the Internet. Patrick worked at IBM for 35 years, was vice president of Internet Technology there, and was a founding member of MIT's World Wide Web Consortium in 1994. He published a book in 2001, Net Attitude: What It Is, How To Get It, And Why Your Company Can't Survive Without It, about his thoughts on the future of the Internet and its impacts.
Patrick is also involved in the world of healthcare, as a member of the American College of Healthcare Executives and with 10 years of experience on the board of the Danbury Hospital. His new book, Health Attitude: Unraveling and Solving the Complexities of Healthcare, tackles the attitude change he sees as necessary for all stakeholders in order to improve the healthcare system.
Through e-mailed answers, below, Patrick shared more about his expectations for healthcare and what medical device makers need to know to thrive.
MD+DI: As you take a look into the future of healthcare, what are the major changes you envision?
Dr. John R. Patrick: The American healthcare system has many problems, perhaps more than we realize. However, the solutions are closer to reality than we may realize. The solutions fall in three categories: attitudes, technology, and policy. Attitudes need to change for patients, providers, payers, and policymakers.
Patients need to take more responsibility for their health. We need to ask more questions, gather personal data with mobile technology (mHealth), collaborate with physicians on diagnoses and treatment plans, and comparison shop for the treatments needed.
Providers need to re-focus on keeping us healthy instead of treating our ailments. Hospitals need to focus on the population it cares for and embrace the accountable care organization (ACO) model which will compensate them for value, not volume of care.
Payers need to collaborate with providers to increase patient safety and quality and cost effectiveness. They should demand that the providers they pay make their price lists transparent to consumers. They should adopt administrative standards so providers do not spend so much time with paperwork in working with multiple payers.
Policymakers need to eliminate the corruption that has crept into healthcare. Congress should immediately remove the provision in the prescription drug plan that prohibits Medicare from negotiating the price of drugs they pay for. They should also eliminate the approval for pharmaceutical companies to use TV advertising to entice consumers to seek drugs the vast majority of consumers do not need.
MD+DI: In your book, Health Attitude, you discuss the impact of empowered patients. In 20–30 years, what role do you see patients playing in their medical care and how does that differ from today’s proactive patient?
JP: The rapid introduction of mHealth devices is going to give consumers new tools to measure and monitor their health. They will accumulate data about their activity, heart rate, weight, body mass index, blood chemistry, and much more. Healthcare will become data driven. This does not eliminate doctors but it gives patients data and preliminary diagnoses which will facilitate collaboration with providers. In 20-30 years, some people believe it will not be possible to tell the difference between biological and non-biological beings. I prefer to keep my focus on what is coming in the next few years. I don’t think anyone knows what the world will be like in 30 years. If you look backward 30 years, there were no websites. Not one.
MD+DI: What new tools do you expect to exist to help empower patients and what should individual patients be doing to prepare for the future of healthcare?
JP: In 1976, Seymour Cray introduced the first supercomputer, the Cray-1. It cost 5-10 million dollars, weighed more than 5 tons, and used as much electricity as ten homes. Today’s smartphones are more than 100 times as powerful as the Cray-1. Hundreds of millions of people around the world carry them in their pocket or purse. I call them PSCs (personal supercomputers). The PSC will enable consumers to do things previously thought impossible. An example of what is to come is the AliveCor Mobile ECG. The device attaches to the back of an Apple or Android smartphone. In 2016, the AliveCor function will be incorporated in the Apple Watch. A consumer holds the smartphone with both hands and touches two or three fingers of each hand on the sensor on the back of the smartphone. In 30 seconds, the smartphone displays an electrocardiogram (ECG). There is no need to go to a physician office. It can be done at home or on-the-go. The consumer will know right away if the ECG is normal. The AliveCor app will tell you immediately if it detects atrial fibrillation (AF), a leading cause of stroke which afflicts millions of people. The ECG can be emailed to a physician. With a simple in-app purchase for $12, the ECG will be sent to a board certified cardiologist with a minimum of 12 years of advanced education who will provide an analysis of the ECG within 24 hours. This is one of many examples of the power of the PSC and mHealth. The FDA has now approved more than 150 mHealth devices and apps.
MD+DI: You also believe healthcare costs per patient will go down. How do you see this happening and what might it mean for the kind of healthcare we receive?
JP: The Patient Protection and Affordable Care Act (ACA) has ten parts to it. We hear a lot about the health insurance part of it, which needs significant repair. However, there are some good things in the ACA we don’t hear much about it. The accountable care organization (ACO) will help bring down the cost of healthcare. For hospitals and physician organizations which participate in an ACO, they will receive a fixed amount of compensation for patients they take care of. For example, a hospital might enter into an ACO agreement with Medicare to provide healthcare for 30,000 patients in a particular zip code. The hospital might receive a fixed monthly payment of $750 to care for the patients. If a patient is readmitted for a problem or gets an infection while in the hospital, there is no additional reimbursement. Hospitals will look for ways to keep patients out of the hospital. They will focus on patient safety and quality for patients that are in the hospital. The population under the ACO will be healthier and the cost will be lower.
MD+DI: What should medical device makers be doing to prepare for the future of healthcare?
JP: Consumers and policymakers will be demanding more transparency of healthcare costs. Imagine shopping on Amazon and seeing no prices. That is what we have with healthcare. With larger deductibles, consumers are going to comparison shop. Some will choose medical tourism and have procedures done in other countries with lower costs. Hospitals receiving fixed payments under an ACO are going to evaluate medical devices for efficacy and cost. Medical device manufacturers will need to display and justify their pricing. They will need to be competitive with the alternatives.
MD+DI: If healthcare costs per patient might go down, what does this mean for the revenue and profits that medical device manufacturers make?
JP: The biggest problem in the American healthcare system is the cost. Between 1975 and 2008, Medicare spending grew 2.5 % faster than our nation’s economy consuming an increasingly larger share of our nation’s economic resources. America spends 50-100% per person more than other developed countries. With 10,000 new seniors turning 65 and joining Medicare every day, we cannot afford the out of line cost. Affordability has become a matter of great concern to individuals, families, and businesses across the country. Businesses cannot remain competitive in the face of continued increases in healthcare cost. Many individuals struggle with their own share of healthcare expenses. More than one out of five Americans has medical debt. The high cost forces some to avoid care they may need, or thrust them into bankruptcy.
Getting American healthcare cost in line with other developed countries will mean reduced revenue for the healthcare industry. The reduced revenue will lead to lower costs which may include fewer employees. Hopefully, the realignment will occur through improved efficiency and headcount reductions can occur through normal attrition. Healthcare is choking growth in other segments of the economy. Warren Buffet, in 2013 on CNBC, said healthcare costs are “a tapeworm in the US economy.” More growth in other segments will create employment opportunities and economic growth. The healthcare industry will continue to thrive.
MD+DI: Robots already play a large part in certain surgical procedures. Do you see the role of robots changing in the future and if so, how so?
JP: Robotic surgery is growing because more new surgeons are trained on them and the outcomes continue to be at least as good as open surgery. Incisions are smaller, blood loss is less, time in the hospital is shorter, and recovery times are speedier. The reliability and speed of the Internet has now reached the point where remote robotic surgery can be a reality. A patient can be on an operating room table while the surgeon at the robot console is 1,000 miles away instead of just across the room. Remote robotic surgery will allow expert surgeons to deploy their skill wherever it may be needed.
Robots will also play an important role in home healthcare. As the senior population and chronic illness grow, the need for home health aides will increase. Robots will fulfill some of the demand. Basic care and rehabilitation can be highly repetitive and robots do not get bored. Robots will continue to gain attributes and capabilities of humans, including facial expressions. In many cases they will become the best friend of a homebound patient.
MD+DI: What trends do you see today among medical device makers that you think will expand in the future? Any trends today that you think are merely fads?
JP: The power of the PSC combined with medical devices, apps, and the cloud will open many new opportunities to do things at home not previously thought possible. Outset Medical, in San Jose, CA, believes there is a better way to do kidney dialysis. The company has landed FDA clearance for an innovation, called the Tablo System, about the size of a PC server on. A large touchscreen display leads the user through the dialysis process, using animation and intuitive step-by-step instructions. The system can connect to a water tap and create the needed filtered water. It can also produce the required dialysis solution. The system reduces the size of the equipment and the complexity of the process. The company’s vision is to enable consumers to perform their own dialysis at home and by themselves.
MD+DI: How do we get from today’s reality to the tomorrow you are envisioning? What are key changes, requirements, or legislation needed to move us into the future of healthcare?
JP: Continued evolution of technology will empower consumers to care for themselves at home and on the go. Big data and analytics will enable providers to focus on population health instead of just the traditional model of treating one patient at a time. As I discussed in Health Attitude, patients, providers, payers, and policymakers all need to change their attitudes toward how healthcare is delivered. Reimbursements need to be provided for telehealth. Laws need to be modified to allow consumers to obtain care across state borders if they choose. The healthcare information technology industry must accelerate efforts to provide complete compatibility between electronic health record systems so that providers and patients can collaborate more effectively. Adoption of new health attitudes will result in safer and more affordable healthcare.
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