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Consumer-Driven Health Care: Implications for Providers, Payers, and Policy-Makers
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Customer Reviews
Rating:  - Helpful and Thoughtful, but Overly Complicated
Herzlinger points out that, unlike most other markets, health care is controlled by third-parties (insurers). Further, the absence of information that can help consumers choose also hobbles their role.
Most health care costs are incurred by people suffering from chronic diseases. Unfortunately, the current insurance system (20% enrollee turnover each year) discourages extensive preventive efforts - multi-year insurance policies are needed. Another problem is that insurers and providers sometimes are rewarded for acting in ways that increase work-time loss - eg. preferring open gall bladder operations (less medical cost) with longer away-from-work recovery times. Still another problem is that innovative providers that improve outcomes are likely to end up getting less reimbursement; instead, rewards go to mergers creating larger networks that can resist pressure for discounts.
Voluntary compilation of outcomes data efforts have not worked - eg. there is little/no correlation between JCAHO ratings and patient outcomes, while the Cleveland area effort was destroyed when the major participant dropped out over upsetness over the results. Regardless, there is a significant problem with risk-adjustment - it is very sensitive to coding thoroughness and exaggeration.
All good points, and I especially agree with her emphasis on focused-factories and as much consumer-available information as possible. However, the bulk of "Consumer-Driven Health Care" is taken up with low-value brief writings from supporters attending a conference organized on the topic. Additionally, Herzlinger under-emphasizes the health care waste attributable to assessing enrollee health, individual underwriting, and patrolling enrollee selection of providers and their subsequent care. Herzlinger's risk-adjusted premiums would likely acerbate the debate and costs.
A much simpler basis for revising our broken health care system exists - a national system such as in Canada, England, France, etc.
Rating:  - How to empower health care consumers
Although this book was written a few years ago, the issues addressed in it by Regina Herzlinger and other contributors seem even more relevant - indeed, more urgent - now than they were in 2004. How does Herzlinger characterize consumer-driven health care? It is "fundamentally about empowering health care consumers - all of us - with control, choice, and information." Such control will "reward innovative insurers and providers for creating the higher-quality, lower-cost services we want and deserve." What would be the role of government? She asserts that "government will protect us with financial assistance and oversight, not micromanagement."
The material in this substantial volume is organized within five Parts. Herzlkinger wrote the first, "Why We Need Consumer-Driven Health Care," then edited the contributions by others which comprise Parts Two-Five. She also wrote Chapter 78, "A Health Care SEC: The Truth, the Whole Truth, and Nothing But the Truth." For most of us who are not health care professionals, this volume provides about as much information as we could possibly need, much less process. I especially appreciate the fact that Herzlinger and her associate contributors make a conscious effort to avoid jargon, vague theories, oblique hypotheses, etc. They obviously believe that major health care issues are too important to be packaged as flimflam, swamp gas, and flapdoodle. Hence their rigorous focus on explaining (from a variety of perspectives) why consumer-driven health care is needed, and, how to establish and then sustain it.
Of special interest to me were these chapters whose titles correctly indicated what their respective authors discuss:
Chapter 5, "Health Care Productivity," Herzlinger
Chapter 20, "An Insurance CEO's Perspective on Consumer-Driven Health Care," Leonard D. Schaeffer (Chairman and CEO, WellPoint Health Networks)
Chapter 25, "Challenges of Consumer-Driven Health Care," Eugene D. Hill III
Chapter 34, "The Role of Information: J.D. Power's Paradigm Lessons from the Automotive Industry," J.D. Power III
Chapter 52, "Consumer-Driven Health Care: Management Matters," Richard M.J. Bohmer, Amy C. Edmondson, and Gary P. Pisano
Given the fact that this volume offers a total of 81 chapters, my guess is that each reader will find at least 10-15 of special interest to her or him. I presume to suggest, also, that many of those subjects which may seem to be of least interest and value will, in fact, generously reward a careful reading. It remains for each reader to review the Contents and then decide what to read and in which sequence.
Those who share my high regard for this volume are urged to check out Michael Porter and Elizabeth Olmsted Teisberg's Redefining Health Care: Creating Value-Based Competition, and two books by Lawton Robert Burns and his Wharton associates: The Health Care Value Chain: Producers, Purchasers, and Providers, and, The Business of Healthcare Innovation.
Rating: - Huge but a litle simplistic
Sub-Title: Implications for Providers, Players, and Policy-Makers --,Citizen participation, Consumer satisfaction, Evaluation, Health & Fitness, Health Care Administration, Health Care Delivery, Health Care Issues, Health Policy, Health planning, Health/Fitness, Medical / Nursing, Patient Compliance, Patient satisfaction, Health systems & services, Medical / Administration, Personal & public health, Medical ==If your interests or profession lies in any area of health care this is a book that you almost have to have. In its almost 1,000 pages nearly every aspect of health care coverage is discussed. The format of the book includes some 200 pages written by Professor Herslinger followed by some 72 articles written by some 93 participants in a conference she held. As you would expect, the quality of the papers vary greatly. ==There are also a few reasons to disagree with some of Professor Herslingers basic thesis. She seems to believe that health insurers would compete in a fair market place to provide care to anyone. This is simply not true. If an insurance company can pre-select to eliminate giving any coverage at all to the sicker or more risky patients, it is to their benefit. An AIDS patient, with a requirement for expensive drugs can be folded into the coverage written for a large group, but an individual policy would have to be very expensive, or simply not written at all. The coverage of such patients is covered with what I think are unrealistic assumptions. ==The book presents a series of views that are just a bit simplistic, but which are forming a part of the national debate on health care. The information is needed if only to be aware of the discussion.
Rating: - Thoughtful Contribution
In Consumer-Driven Health Care, Regina E. Herzlinger, a leading health care thought leader and a professor at the Harvard Business School, provides a thought-provoking look inside a new, powerful force slowly transforming America's dysfunctional health care industry. Consumer-Driven Health Care builds on her popular 1997 book Market-Driven Health Care: Who Wins, Who Loses in the Transformation of America's Largest Service Industry.
In the first part of her new 900-page book, Dr. Herzlinger makes a convincing case about how and why health care is broken and why market-based solutions - which empower consumers - are best. She restates the case she made in Market-Driven Health Care for putting consumers directly in charge of their own decisions (picking insurance plans, making medical decisions).
Through transparency of information, a realignment of incentives, and new tools to support decision-making by patients, the consumer-driven model gives individuals a clear stake in their own health care. While not unique to other parts of the US economy, the approach is a radical departure for the $1.7 trillion health care market. As Dr. Herzlinger makes clear in her energetic analysis, the absence of these proven market-based tools goes a long to explain why health care became our most inefficient, outdated, and error-prone industry.
The second part - about 80 percent of the book - is a collection of 73 think pieces written by 92 other experts. With short introductions by Dr. Herzlinger, these articles serve as a useful initial knowledge base for a growing field with an uncertain future.
The book has its limitations. For example, Dr. Herzlinger's case for the consumer-driven model fails to address the Medicare and Medicaid systems. It also leaves a variety of practical transition and execution issues unaddressed, although these are beyond the purpose of this volume. Because articles were written several years ago as part of a conference and most of the writers lack purchaser-side experience, the book also does not deal with the growing list of market-based reforms underway by large employers and innovative health plans.
In addition, since the field is still in its infancy, Dr. Herzlinger is a business researcher, and the contributors are largely wide-eyed entrepreneurs, the book will likely frustrate health policy wonks and others stuck in the technical minutia and ideological fights that characterize most health care discussions. But then, that's just as well. Too often analysts forget that health care is a business and operates as a market, albeit a flawed one insulated from tools proven to drive quality and efficiency. And we need all the wide-eyed, out-of-the-box thinking we can get.
Dr. Herzlinger also has her detractors. It reminds me of the old joke that there are two kinds of people in the world: people who like Wayne Newton and people who don't. Well, it seems that health care wonkdom is divided by those who like Reggie Herzlinger's ideas and those who don't. However, given the massive problems in American health care, her plain-spoken, business-savvy contributions remain as useful as they are provocative.
For a good primer on consumer-driven health care, I recommend you start with Let's Put Consumers in Charge of Health Care, a concise article by Dr. Herzlinger in Harvard Business Review (July 2002 issue). Available here on Amazon ($7, PDF).
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