With
all the talk in the news today about “fixing” the health care system, few if
any specific practical ideas have been proposed. Everything is expressed in
platitudes and generalities. Yet, in order to really fix health care, the
quality, accessibility, and affordability of medical care will need to be
vastly improved. In addition, the relationships among employers, employees,
and the health care system will have to change to reflect the new global
economy.
Some
important observations and proposals are made in a new book called The
Innovator’s Prescription: A Disruptive Solution for Health Care1by Clayton M. Christensen, Jerome H. Grossman, M.D., and
Jason Hwang, M.D. Christensen wrote the ground-breaking book The
Innovator’s Dilemma,2 in which he described the effect of disruptive innovations on industry after
industry.
The
greatest innovations, he observed, do not come out of steady research and
development by established companies. They come from start-ups who innovate on
the cheap — usually in a way that big companies feel they can ignore as
irrelevant. By the time the new solution is replacing the established product,
it’s too late, and the larger company’s business has already been disrupted by
innovation.
In
his new book, Christensen applies the same principles to health care.
The fact is the U.S. health care system is broken. The cost of medical care
more than doubled between 1970 and 2007, rising from 7 to 16 percent of GDP.
Ordinary people simply can’t afford good health care. In fact, neither can the
U.S. government. Medicare threatens to eclipse all spending in the budget
except for defense. The burden of health care costs on corporations in the
U.S. makes them globally less competitive. They have to add the cost of health
care into the price of their products, which makes them more expensive than
foreign offerings.
Moreover,
city, state, and county governments have obligations to pay health care for
their employees that effectively put them all in the red and force them to cut
funding for important infrastructure and education needs.
The
central problem with the U.S. health care system is that it is a model based on
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