Salmon Upstream, LLC

Developing and implementing real-world community solutions.

Competition in Medicine

I know in America we are bred to believe that competition is the ultimate method of bringing out the best, but think about what that means in healthcare: if one doctor or facility is the best, then everyone else is getting substandard care.

For my city, this is a big deal, but it is also a good example of why competition has no place in medicine. I know in America we are bred to believe that competition is the ultimate method of bringing out the best, but think about what that means in healthcare: if one doctor or facility is the best, then everyone else is getting substandard care. That's not the way it should be. We should cooperate, working together in an effort to provide the absolute best carefor everyone.

The government is pushing us -- in a good way -- towards cooperation. But like everything, it gets complicated. And then, we get unexpected results of legislation, and they can be incredibly profound. Enter the Accountable Care Organization, or ACO. This is essentially a cohesive medical system intended to provide better care for less cost. The manner in which Medicare is beginning to pay doctors -- and every other payer will follow -- strongly favors these legal entities.

It works like this: if I am a solo doctor, I am going to be measured against other doctors. The better I do (based on some defined metrics) the more I get paid. OK, so far so good. Now, if I am kinda crappy, I get paid less. So it is in my interest to do my job well, and this will weed out the bad doctors, yes? Well sorta.

Good is defined as above the 50% line, and bad is defined as below it. There are gradients of good and bad, but there is no middle ground. Which means every year, half of the doctors get a bonus, and the other half take a pay cut...ignoring the fact that few solo private practitioners can handle a pay cut. And what if all the doctors around are actually good doctors? That doesn't really matter, it's you against the world. To me, it seems a good method to pick Navy SEALs, but maybe not so much family docs.

But, doctorshave the option of joining an ACO. If you do that, you don't get measured individually, you get measured as a group. And these groups have more resources, more ways to save, more ways to cross cover, more ways to perform well. That's good, and that's one of the reasons we are being asked to join up: the results are better.

What's not to like?

Well, there are some subtle issues. With ACO's, individual doctors aren't measured against each other, they are considered part of a group. But that group, the ACO as a whole is, it goes up against other ACOs. To do that, we have to have a way to measure that entire group's performance. Which is not as easy as it sounds. How do we know a group is doing well taking care of patients? There are all kinds of variables. For instance, who is actually the patient's doctor? You may have a family doc you consider your own, but here we have to define that. What if you see a specialist, too? Now who is your doctor? Is it the cardiologist who does an expensive procedure on you? Is the person you see the most? That has to be defined. What do we look at to tell if they are keeping you healthy? What if you have a chronic disease? Does that mean the doctor is not good? What if you get cancer? All of these things have to be considered. It is extremely complicated.

Here is the kicker: because the government needs to measure the performance of these groups, doctors can't move from one group to the other. If they did that, how would we be able to figure out who did what? So what we are left with is: (1) all doctors kinda needto belong to an ACO, and (2) a doctor can only belong to one ACO.

And that, my friends, has huge implications, here and elsewhere.

Because if we end up with 2 different ACOs covering the same area, then we draw a line down the healthcare system and everyone and everything has to get on one side or the other. Competition. And that is exactly what we are going to have, right here in little Lynchburg.

For years, we have tried to align all of the doctors into a single entity. This wasn't for control, it was to increase collaboration. But not everyone saw it that way, and for a variety of reasons, the primary care groups slowly morphed into those associated with the hospital, and those that remained independent. Not too long ago, those independent primary care offices, in an effort to maintain autonomy, formed their own group, with the intention of becoming an ACO.

But it is not so easy. There are numerous requirements, and jumping through those hoops means all sorts of red tape, and not a small amount of money. Money for things like an electronic medical record system that can provide the government all the data it needs to judge how well you are doing. It's so complicated that the network I am involved in, Archetype Health, is only now considering applying for ACO status, despite being sponsored by the hospital system and thus having far better resources.

So what did the private group do? They joined an outside ACO: Privia Health.

What is that? Well, Privia is a group of primary care doctors that have formed an ACO aimed at best practices in healthcare. They have great data to show how effective they are at taking care of their patients. That's good, right? Won't that bring better medicine to our area? Well, yes. Sorta. And sorta not.

One enormous downside is that part about doctors only being allowed in one ACO. If Archtype Health becomes an ACO -- and we pretty much have to with the way the reimbursement formulas work -- any doctor in Privia will be prohibited from joining with us, and vice versa. Which means patients will have to choose. It means we will not be able to share resources like labs and radiology equipment and electronic medical records. The very laws that are designed to increase collaboration will actually become the largest impediment to cooperation that our area has seen in a long, long time.

Yes, we can try to work together. But, intentional or not, the financial incentives will encourage competition. Let's say I come up with a clever method of improving outcomes or reducing costs. In an ideal world, I would share that across the region, hoping to help anyone who could benefit. But now, it will be to my advantage to hoard it at our system, and deny it to those other guys. And their patients. And that idea makes me kinda ill. That's not what we are supposed to be doing.

And there are other issues too, even more subtle. I am planning to go through some locally-generated, heart-stopping data about the health of our region (yet another rant), but let me give you a preview: affluent people are healthier than poor people.


Yes, it's true. People in poverty do worse in virtually everyaspect of healthcare. What's that got to do with the price of tea in China? Let it sink in a bit.

If the government is going to measure my performance on outcomes, how can I make myself look better? Simple: I just choose to look after healthier patients. The last thing I want to do is look after sick people, right? But wait! That's not allowed. I can't deny service to sick people! That's true.

But I can refuse to see poor people.

There is nothing that says I have to accept patients with no insurance, patients with Medicaid, or even patients with Medicare. By selecting which insurance I accept, I not only maximize my reimbursement, I automatically improve my outcomes data. Compared to the other guy, the one that takes responsibility for the uninsured, the under-resourced, the difficult patients? I kick his ass. For my own benefit, I skim off the easy, high-paying patients, and I come out looking better, and with much higher margins. All at the expense of whomever in our society makes an effort to help the ones that need it most.

And that inevitably leads to a little bit of vomit in my mouth. Bleck. And though I admit I am proud to be on the side that is doing the right thing, that's honestly not fair. I know many doctors on the other side of the wall. And I can tell you that now that most of them are well removed from the decisions and forces that push these changes and write these agendas. As often as not, physicians are just along for the ride.

This is what happens when business is woven into medicine. It's what happens when we try to use competition to improve healthcare. Because competition favors the one that studies the rule book and finds the angle and exploits it for maximum effect. That's simply the way business people are trained. And there is nothing wrong with that, if you are making smart phones or TVs or some other widget. But not doctors, not hospitals. There is no place for that when it comes to people's health. And that is precisely why that part of our culture, that competitive mindset, it has no place in medicine.