Information Technology Reference
In-Depth Information
approach to chronic disease described at the end of the previous section. Among
these are the use of the Internet to bridge time and space by taking advantage of the
availability of technology in the home. Most importantly, both depend on the will-
ingness to “think outside the box” with respect to how we do business. If the USPS
can do it, why can't the healthcare system?
Perverse Incentives
“A problem is something you have hopes of changing. Anything else is a fact of life.”
-
C R Smith
[
10
]
The answer has a lot to do with financial incentives. If the USPS can transfer the
entire package preparation and drop off function to the consumer, they reap any
resulting financial benefits. It costs less to process the package because their cus-
tomer is doing much of the work. Their customer is more likely to use their service
because it is more convenient.
Though there are clear fi nancial bene fi ts to avoiding unnecessary care, the bene fi ciary
is usually the employer that insures their own health benefit, an insurance company or
government. In most circumstances, if a physician uses technology to avoid unneces-
sary care, visits to the emergency department or hospitalizations, the physician's
income is certainly not increased and may even be diminished. Moreover, any time
spent by staff using some new technology-mediated process may represent lost income.
To make matters even worse, up until very recently, if a practice wanted to utilize tech-
nology to facilitate an innovative care model, it would bear the entire investment.
This conundrum, in which there is a mismatch between who has to invest and
who might benefit, is characteristic of what my colleague, Bill Rouse, and others
refer to as a “complex adaptive system”. [
11
] In such a system there are multiple
“independent agents” each of whom are intelligent, adapt to changing conditions
and act to optimize their own self-interest. Moreover, no entity is in control.
So, despite the availability of enabling technology to transform healthcare, adop-
tion would continue to lag without incentives to bridge the self-interests of the inde-
pendent agents. Solutions have been tried for decades. For example, in a health
maintenance organization (HMO) employers typically contract for the care of their
employees on a fixed annual basis. If the care costs more, the HMO has to make up
the difference and loses money. If it costs less, the HMO benefits financially. This is
a clear example of trying to change incentives. This contrasts sharply with traditional
fee-for-service model where providers typically make more money the more services
they provide. There is room to argue about whether the fee-for-service approach
leads to the delivery of unneeded services but few could argue that it provides a dis-
incentive to invest in technologies to replace traditional approaches to services that
can be reimbursed with new technology-based alternatives that are not.
A landmark 2008 survey of 2,758 physicians [
12
] strongly supports this conclusion.
Despite the long time availability of electronic health record systems with the capabil-
ity to improve clinical decision making and expedite the management of prescriptions
and other orders, in 2008 only 4% of physicians had a “fully functional” system that
