As we watch the endless chain of news articles, talking-head commentary, political pandering and pundits debate healthcare reform and its place in our future, I can’t help but take a giant step back, scratch my head and ponder how we got where we are today, while simultaneously laughing and thinking to myself, “You just can’t make this stuff up!”
It’s clear that the American healthcare system is broken. It spends (compared to other nations) one of the highest per capita in terms of healthcare dollars and percentage of GDP, while simultaneously producing mediocre to poor life expectancy as a result of those expenditures.
So how did we get here? Although there are many variables involved, one of the primary drivers is our fee-for-service reimbursement system, which rewards providers based on the volume of services provided, instead of a continuum of care service integration, outcomes and results model. Couple that with risk avoidance-practiced medicine due to the U.S. legal system, and here we are.
Think about it: Given these two variables alone, the number of services performed that don’t truly need to be performed pushes our healthcare system’s capacity–and therefore the costs associated with providing this care–to a staggering level. This backwards-incentive system also drives substantial duplication and overlap of services, promotes dis-economies of scale between organizations, and promotes a silo effect–which in turn has the synergistic outcome of amplifying artificial demand (tests are often duplicated simply because clinicians seldom share information with each other).
To better highlight this problem, I will share a story. I recently was privileged to see the excellent work at a local Regional Health Information Exchange, where they aggregate data from different healthcare providers to offer a consolidated look at a patient’s health-care record. I was shocked and appalled by one of many examples I was shown. Over the course of a year or so, one patient had received hundreds of x-rays, duplicative prescriptions and procedures due to the uncoordinated and non-integrated efforts of our healthcare market. The expense of this alone was staggering, but more importantly is the harm this patient received by those who were supposed to help her. This, coupled with a reimbursement system that has seen service revenue growth mostly keeping pace with these out-of-control costs, actually encourages our current unsustainable pathway.
Lessons from EMS
So why do I think EMS can teach healthcare a lesson? First of all, the reimbursement model for ambulance services is not even close to how healthcare gets reimbursed. Honestly, EMS could be considered a rounding error in the Centers for Medicare and Medicaid Services’ budget compared to reimbursement for inpatient and outpatient services. Keep in mind, EMS is considered by the federal government as a supplier, not a clinical provider. This means we are considered in the same category as durable medical equipment and medical oxygen and are reimbursed as such. I don’t know about you, but I consider myself to be a clinical provider and not a transportation commodity. This is not to say that the way we are reimbursed is the solution, because it isn’t. My point here is to highlight the miniscule dollars we receive and our seemingly natural ability to covert those dollars into high-quality services.
While this stark reality punches our EMS egos in the gut, it does have a silver lining. It has forced us to learn how to provide better service, faster and cheaper, and has taught many of us how to create a world-class EMS system out of Scotch tape and Popsicle sticks.
Think about it, how many of us in EMS wear many different hats, whether it be HR, operations, fleet maintenance, training, finance or what have you? Most of us do. Why? Because most of us can’t afford to have specialization and departmentalization that generates large overhead infrastructures, as you typically see in other healthcare or similar high-revenue generating industries. If we can afford it, it’s usually because a community is willing to provide a substantial tax subsidy, or because we’ve maximized mass economies of scale through regionalization or consolidation, or we’ve employed high-performance EMS practices in regulated marketplaces.
Because most of us in EMS have never had money to throw at problems and, honestly, have had a difficult time even keeping what we do get from the payers (the government especially), we have had to become “Mac-Gyvers” at business, similar to the way we are in our clinical patient care practices. It’s in our nature to overcome and adapt to the situation we’re dealt to get the patient to some sort of definitive care.
This type of economic situation has forced us to innovate and adapt to available revenues while figuring out how to provide a higher level of quality and dependable service. It’s this type of impetus that gave birth to innovations such as the Public Utility Model EMS System, Failsafe Franchise EMS System, competitive bidding practices that rely on performance-based contracting and performance bonds, and the concepts behind System Status Management and high-performance EMS–which are just fancy terms for custom, industry-specific, efficient operations management techniques (see my May 2013 EMS Insider article for more on this topic).
Although some would argue that these innovations are bad for patient care and employee well-being, such critics are typically also sitting on a tax-subsidized, low-productivity perch from which they can cast stones, ravenously defending their way of life. This is not to say I am jealous (although sometimes I admit that taking a lean approach is hard work), but I also believe I have a responsibility for fiscal stewardship to the communities and populations I serve in addition to providing for the best clinical services and best people possible. Many say these objectives contradict each other and cannot be simultaneously achieved, and to these individuals I say, “Hogwash!”
I believe with healthcare reform we will start to see these same types of behaviors throughout the industry, as innovative and forward-thinking health-care systems reinvent themselves to shed layers of fat, using many of the same concepts and ideas we, in EMS, have employed for decades.
These include:
“¢ Regional consolidation;
“¢ Hub-and-spoke service-delivery systems;
“¢ Demand-based peak-load staffng systems;
“¢ Lean-systems engineering;
“¢ Clinical and operational standardization;
“¢ Decision support-based systems;
“¢ Throughput optimization;
“¢ Command and control systems;
“¢ Regulation of markets;
“¢ One-size-fts-all service delivery systems; and
“¢ Innovative use of integrated information management systems.
In addition to this, the trend of having healthcare executives with EMS backgrounds seems to be emerging, giving credence that in some healthcare arenas, there’s an understanding of our (dare I call it) plight and a desire to learn from us and leverage our wisdom. Just as we see in EMS, there will be many healthcare-based naysayers hiding behind the emotional veil of patient care, or sitting on subsidized perches casting stones attempting to deflect change. But to them I quote Machiavelli: “For this is the tragedy of man–circumstances change, but he doesn’t.”
