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Monday, June 18, 2012

Innovating in Health Care While Managing Fiscal Constraints

Ida Goodreau, Board of Directors, Genome BC & Adjunct Professor, Sauder School, UBC

Premise is that public sector always views innovation as something that drives up costs. Private sector doesn't see it that way, because of what innovations they allow into the business.

Ironically, while health care costs across the Western developed world are increasing rapidly, hospital spending specifically has trended down in the last 12 years. The well known and discussed paradox is the demand for high quality care within a fiscally sustainable system. Patients (who are taxpayers) want improvements in life expectancy and functionality, while taxpayers (who are also patients) want greater system efficiencies at lower costs.

The definition targeted is a diminished gap between GDP and health care spending within 20 years.

Innovation in health care over the past twenty years an be measured as successful if we use extended life expectancy as a metric, but not if we measure it against the cost. It seems cold to put a price against the length of a life, but this is the reality that the population wants, per the paradox we discussed earlier.

So the crux is how to adapt innovations that improve health outcomes at reduced costs. The innovations in question are technology devices, drugs, and information, process redesign, and over-all system redesign. We know what all these innovations can and should look like. We need a model for cost-effective integration of these innovations, and an agreed upon set of metrics for measuring progress and assessing risks.

Ida suggest we need to look at systems around the globe where healthcare is privatized, as those are driven by business economics to be the most innovative. The key factors to be considered are:
Lower cost and consumer direct payment
Closer to the patient
Re-invention of delivery by use of existing technologies
Right-skilling the workforce
Standardised operating procedures
Copying and then building

Ida proposes also that innovations should be frugal to deliver superior value at a fraction of the costs typically seen, and new technologies should be designed to work within an integrated continuum of care.

Ida re-iterates that the core issue with Canada's healthcare system and why we cannot make the urgent changes needed to innovate cost effectively is that "no one is really in charge."

The innovations and the cost reductions are both necessary, and have been put off for years, but time is running out, as we are approaching a tipping point. Ida proposes that Canadian health care leaders must align, and agree on how to make the public system leverage the optimizations that privatized health care solutions use.

- Posted using BlogPress from my iPad

Location:Water St,Kelowna,Canada

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