Category: Healthcare Costs

Express Scripts Undoes Turing Pharmaceuticals: Witness the Rise of the “Activist” PBM

Everyone knows the recent story of “rapscallion” Martin Shkreli: the ethically depleted CEO of Turing Pharmaceuticals who bought the rights to Daraprim, a generic anti-parasitic medicine and marked up the price of a tablet from $13.50 to $750 overnight.   As disgusting as Shkreli’s story is–  the more important and interesting tale is how Turing was subsequently undone by ...

Administrative Bloat in Healthcare is a Land of Opportunity: On Direct to Consumer Price Transparency

I was recently connect with two smart entrepreneurs (James Millaway and Stan Schwartz, MD) who run a company called The Zero Card.  Their business is a platform where consumers and employers have access to transparent “cash” prices for a range of medical services.  Providers display their best non-insurance rates and offer a fixed price for an episode of care. Individuals (or ideally self-insured ...

On Getting Burned by Population Health Thinking: (Why has a Decade of Intervention not Prevented More Deaths From Brain Aneurysms?)

In our house we take a lot of fizzy vitamin C to prevent colds in the winter. As doctors, my wife and I both know that science doesn’t support our decision… We take it anyway. We shouldn’t. After all, the well respected Cochrane group (which grades and distills multiple studies into a single “meta-analysis”) clearly ...

A (Lower Cost) Healthcare Industry to Deal With a (Higher Cost) Healthcare Industry

I was recently on the phone with a medical device company executive who was describing his company’s efforts to develop a non-invasive diagnostic device that could quantify the degree of cirrhosis in a patient with liver illness.  It’s technology that his firm sees as timely given the recent introduction of Solavdi and other Hepatitis C therapies: the device will be offered as a way ...

The Pendulum Swings Between Individualism vs. Collectivism in US Healthcare. What Does the Next Decade Hold?

Communities don’t think, don’t believe, don’t want, don’t have needs, don’t have interests and don’t make decisions. Only individuals have minds that generate desires and needs – and only individuals can make choices and decisions. Harry Browne- Libertarian Candidate for American President, 1996 and 2000 When I visit my European in-laws, some who work in ...

Why Value Generation Doesn’t Grow Your Risk-Bearing Medical Group: On Being Foiled by the Middleman

Imagine that you are an electronics manufacturer who has figured out how to build a superb stereo system at a far lower cost (20% less) than your competitors. Over time you’ve perfected the system, created a reputation for high quality and have a machine that sounds great.  Your manufacturing efficiencies position you to sell at ...

Spending Money to Save Money? Navigating Population Health “Hard-Dollar” Investments vs. Downstream “Unicorns and Rainbows” Medical Savings.

Most medical groups considering risk contracts usually understand that they’ll need to make significant investments in population health infrastructure for capitation to work out financially.  After all, capitation can only be profitable if the risk-bearing group has the ability to manage the use of expensive downstream healthcare services and minimize unneeded care. The problem is that the relationships between ...