The Real Reason We HAVE to do E-Health.

The following article puts the case for e-Health in the US as clearly and simply as I have seen it done.

Wednesday, July 08, 2009

Where's the HIT in HCR (Health Care Reform)?

by Bruce Merlin Fried, Esq.

Let's give credit where credit is due. From where I sit, Congress took a big step toward a digital health care system by including the HITECH provisions in the American Recovery and Reinvestment Act of 2009.

Approximately $30 billion in new federal spending was authorized for various health IT activities, the bulk of which goes toward economic incentives for physicians and hospitals to be "meaningful users" of certified electronic health records. Monies were also allocated for extension services, state initiatives, loans and grants. All good.

But I should have known. It was predictable. Certainly there is no reason to be surprised. Having included HITECH and its authorized funding in ARRA, it appears Congress thought its health IT work was done. Were it only that easy.

If we are to have real health care reform, a greater health IT effort is required than what was accomplished in ARRA.

Let's take a brief digression. It is essential, in my mind, that everyone working in health IT -- from the code writers to the technology geeks to the folks in the C suite -- understand that health care reform is the business justification for building a digitized health system. What is driving policymakers to reform the health system is not an altruistic sense of moral obligation.

Sure, there is certainly some of that. But the real driver is the fear that results from a clear-eyed assessment that our current health system is unsustainable. Absent substantial reform, the way we have organized and financed health care will collapse the system (and I don't just mean the health care system, I mean THE system, the economic system of the country).

More here (with links):

http://www.ihealthbeat.org/Perspectives/2009/Wheres-the-HIT-in-HCR-Health-Care-Reform.aspx

As far as the US is concerned Bruce is utterly spot on and everyone from the President down knows it.

How close are we to the same problem – healthcare becoming un-affordable and unsustainable – here in Australia?.

The following comes from Australia’s Health 2008.

This full report is found here:

http://www.aihw.gov.au/publications/index.cfm/title/10585

Health expenditure

• Australia spent 1 in every 11 dollars on health in 2005–06, equalling $86.9 billion, 9.0% of gross domestic product (GDP).

• As a share of its GDP, Australia spent more in 2005 than the United Kingdom (8.3%), a similar amount to Italy (8.9%) and much less than the United States (15.3%).

• Health spending per person was 45% more in 2005–06 than a decade before, even after adjusting for inflation.

• For Indigenous Australians in 2004–05, health spending per person was 17% higher than for other Australians.

• The spending on medications increased by 1.6% between 2004–05 and 2005–06—much less than the average increase of 8.6% per year in the decade before.

Point 3 is the really scary one!

We are a ‘boiling frog’ believing we can keep adjusting inflation adjusted personal spend up by 45% per decade because we are a rich country and so on! Health Spending essentially means out of pocket expenses. How long before the amount is bigger than the aged pension?

Here is the awful number:

“Over the decade, estimated real growth in health expenditure (that is, after removing the effects of inflation) averaged 5.1% per year (Table 8.2). Real growth in expenditure is measured using ‘constant prices’ (see Box 8.2).” (Health Expenditure is the total cost of Health Services etc)

Simple maths tells us that on this path, if sustained, we will double health expenditure about every 14 years. That means it will be about 18% of GDP by 2019 (from 2005-6) and 27-30% or so by 2035.

The 2019 figure would pretty much finish us and the 2035 figure would bankrupt the county –easy as that!

Worse still the clinical workforce are about to hang up their collective shingles and head for the exits.

Even the NHHRC sees a real issue:

“These projections indicate that, over the next 25 years, health and aged care spending will

increase to $246 billion – about one-quarter of a trillion dollars. By 2032–33, health and aged

care services will consume 12.4 per cent of gross domestic product.” (Note to only get here must assume a lot of economic growth which is not as sure as it used to be!)

Page 302 of Interim Report.

Then they say:

“If we continue with business as usual, the fastest growing areas of spending will be for acute

services, such as hospitals and aged care (see Figure 13.2). Changing how much, and where,

we spend will require greater investment in prevention and primary care, coupled with a real

commitment to keeping people healthy.”

The estimates come from here:

http://www.aihw.gov.au/publications/hwe/pahced03-33/pahced03-33-sum.html

Woo hoo. We need way more than that! How can they be so utterly stupid? We need a total health system transformation which drives efficiency, quality, safety etc up with every other trick we can think of to not top 12-15% of GDP by 2030.

See here for the Productivity Commission Estimates of the base state:

http://www.pc.gov.au/__data/assets/pdf_file/0004/13666/technicalpaper04.pdf

Guess what with medical inflation just 1% above GDP growth we get to 17% of GDP by 2030 and 20% by 2045 or so (quite unaffordable of course). Like climate change you can dispute the details of the figures but to pretend there is not an ‘oncoming train’ would be just silly (the precautionary principle applies for sure!)

The bottom line is that tinkering around the edges is not going to work! If we want to be able to afford the clinical care we actually need we must change to have less waste, less re-work, more efficiency, higher quality and so on. Health IT can help a great deal along with programs to increase evidence based practice and research that ensures we only do those things for patients that have a real chance of helping. What these things are and how to apply the information that is already available could also do with more effort – along with the preventive approaches so long promoted.

We are all going to regret it if we do not begin a transformation to an evidence based, e-Health enabled Health System sooner rather than later.

David.