Who Killed Health Care?: America's $2 Trillion Medical Problem - and the Consumer-Driven Cure [Hardcover]

Regina Herzlinger (Author)

Book Description

Publication Date: June 1, 2007 | ISBN-10: 0071487808 | ISBN-13: 978-0071487801 | Edition: 1

In the battle for U.S. health care, patients and doctors are losing.

Who Killed Health Care? shows how to win the war.

One of the nation's most respected health care analysts, Regina Herzlinger exposes the motives and methods of those who have crippled America's health care system-figures in the insurance, hospital, employment, governmental, and academic sectors. She proves how our current system, which is organized around payers and providers rather than the needs of its users, is dangerously eroding patient welfare and is pushing costs out of the reach of millions.

Who Killed Health Care? then outlines Herzlinger's bold new plan for a consumer-driven system that will deliver affordable, high-quality care to everyone. By putting insurance money in the hands of patients, removing the middleman in the doctor-patient relationship, and giving employers cost relief, consumers and physicians will be empowered to make the system work the way it should. Herzlinger describes in precise detail how her innovative program will provide

• Smaller, disease-focused medical facilities that provide complete care for patients
• A national system of medical records that provides privacy with confidential access by approved practitioners
• Mandatory performance evaluations of all hospitals and all other medical organizations
• Mandatory health insurance with subsidies for those who cannot afford it

Who Killed Health Care? is a call to arms that must be answered; the welfare of every American hangs in the balance.

“A brilliant analysis… A must-read.” – Bill George, Professor, Harvard Business School and Former CEO of Medtronic

“As it becomes more and more obvious to everyone that our current health care system is unsustainable, this is the book that had to be written.” – Daniel H. Johnson, Jr. MD, former president of the American Medical Association

“Regina Herzlinger’s ideas to tackle the crisis of the U.S. health care system are based on keen knowledge of the system’s existing difficulties along with insights that introduce the reader to new streamlined choices that have the potential of getting both quantity and cost under control.” – Joseph Kennedy, founder, chairman, and president, Citizens Energy Corporation, CEO, Citizens Health Care, former representative (D-Mass)

“Regina Herzlinger… offers a vision of the way things can be, should be, and will be sooner or later. The only question is: how long do we have to wait?” – Greg Scandlen, founder, Consumers for Health Choices

“Regi Herzlinger has brilliantly articulated a better way – embracing the principles of competition and innovation that cause every other sector of our economy to thrive. Discharging American health care from the ICU can only happen by putting individual Americans – not politicians and bureaucrats – back in charge of their health care decisioins.” – U.S. Senator Tom Coburn (R-Okla), M.D.

“Following on the heels of her landmark Market-Driven Health Care, Herzlinger lays it on the line with her expose of what many who work in the health care industry have felt in their gut. Now it is articulated in an entertaining and must-read portrayal, with you and me as the only way out.” – Dennis White, executive vice president for strategic development, National Business Coalition on Health

“A wonderful Orwellian romp through issues which carry a deadly irony. The killers of health care are, of course, the third parties, each of which has an itchy palm and a commitment to profit or power which exceeds the commitment to service, with each engaging the others within a politically shaped box. Rarely has the case for the public been made with so much force, foresight, and wit, and a better way forward shown so clearly.” – James F. Fries, MD, Professor of Medicine, Stanford University School of Medicine

“You can practically hear the war chants as Professor Herzlinger sets out her view of what’s wrong with the health care system and how to fix it. You’d best read it so you can decide which side you will be on when the battle is joined.” – Paul Levy, CEO, Beth Israel Hospital, Boston, MA

“Regina Herzlinger, the nation’s leading expert on consumer-driven health care, has given us a brilliant analysis of the flaws in our health care system and what it will take to get it back on track. Her latest book is a must-read.” – Bill George, Professor of Management Practice, Harvard Business School, Former CEO, Medtronic, and author of Authentic Leadership

“You don’t have to agree with her diagnosis and prescription for the U.S. health care system, but you do have to read her book. Once again, Professor Herzlinger has put together a well researched, well written, and very provocative blueprint for the future of health care.” Peter L. Slavin, MD, President, Massachusetts General Hospital

Editorial Reviews

Review

“Mrs Herzlinger is America's leading advocate of market-driven, consumer-orientated health reform. She wants a national system which requires individuals to buy health insurance, with help in the form of tax breaks for all punters, and subsidies for the poorest. She wants insurance prices to be risk-adjusted and hospitals to be free to charge what they like so they can offer new services as the market demands. Most importantly, she wants the government to demand transparency of price and quality from this notoriously murky industry.”-The Economist

(The Economist 2007-07-05)

From the Back Cover

Doctors. Parents. Citizens. Employers.

They're all ready for the cure to America's health care crisis:

WHO KILLED HEALTH CARE?

“ A brilliant analysis…a must read.”-Bill George, Professor, Harvard Business School and former CEO of Medtronic

“As it becomes more and more obvious to everyone that our current health care system is unsustainable, this is the book that had to be written.”-Daniel H. Johnson, Jr., MD, former president of the American Medical Association

“Regina Herzlinger's ideas to tackle the crisis of the U.S. health care system are based on a keen knowledge of the system's existing difficulties along with insights that introduce the reader to new streamlined choices that have the potential of getting both quality and cost under control.”-Joseph Kennedy, founder, chairman, and president, Citizens Energy Corporation, CEO, Citizens Health Care, former representative (D-Mass)

“Regina Herzlinger...offers a vision of the way things can be, should be, and will be sooner or later. The only question is: how long do we have to wait?”-Greg Scandlen, founder, Consumers for Health Choices

“Regi Herzlinger has brilliantly articulated a better way-embracing the principles of competition and innovation that cause every other sector of our economy to thrive.”-U.S. Senator Tom Coburn (R-Okla), MD

“Following on the heels of her landmark Market-Driven Health Care, Herzlinger lays it on the line with her exposé of what many who work in the health care industry have felt in their gut. Now it is articulated in an entertaining and must-read portrayal, with you and me as the only way out.”-Dennis White, executive vice president for strategic development, National Business Coalition on Health

See all Editorial Reviews

Product Details

• Hardcover: 240 pages
• Publisher: McGraw-Hill; 1 edition (June 1, 2007)
• Language: English
• ISBN-10: 0071487808
• ISBN-13: 978-0071487801
• Product Dimensions: 6.4 x 1.1 x 9.3 inches
• Shipping Weight: 1.2 pounds (View shipping rates and policies)
• Average Customer Review: 3.9 out of 5 stars  See all reviews (39 customer reviews)
• Amazon Best Sellers Rank: #192,102 in Books (See Top 100 in Books)

More About the Author

Regina E. Herzlinger is the Nancy R. McPherson Professor of Business Administration Chair at the Harvard Business School. She was the first woman to be tenured and chaired at Harvard Business School and the first to serve on a number of corporate boards. She is widely recognized for her innovative research in health care, including her early predictions of the unraveling of managed care and the rise of consumer-driven health care and health care focused factories, two terms that she coined. Money has dubbed her the "Godmother" of consumer-driven health care.

Most Helpful Customer Reviews

52 of 54 people found the following review helpful

5.0 out of 5 stars How to solve "America's $2 trillion medical problem" June 28, 2007

By Robert Morris HALL OF FAMETOP 100 REVIEWERVINE™ VOICE

Format:Hardcover

According to information released by the Centers for Disease Control and Prevention on June 24, 2007, about 43.6 million people in the United States, or 14.8 percent of the population, had no health insurance in 2006. The finding, based on a survey of 100,000 people, is lower than previous federal estimates of 46 million. The estimate is based on those who did not have insurance at the time of the interview. About 54.5 million people in the country, or 18.6 percent of the population, had no insurance for at least part of 2006. Whatever the exact numbers, there is obviously a very serious problem with health care provision in the U.S. In fact, dozens.

In her previously published book, Consumer-Driven Health Care, Regina Herzlinger explains that consumer-driven health care 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. Herzlinger wrote the first, "Why We Need Consumer-Driven Health Care," then edited the contributions by others that 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.

In this volume, Herzlinger focuses her attention on what she describes as "America's $2 trillion medical problem" (about the current size of the economy in China) and explains why consumer-driven initiatives offer a "cure." More specifically, she exposes "the iron triangle" of third parties (i.e. Congress, health insurers, and hospital administrators) that have opposed consumer-driven health care and thereby subordinated, if not totally ignored the welfare of patients as well as their personal physicians (if they have any). These third-parties are the ones who have "killed" health care for tens of millions of uninsured or under-insured people who, Herzlinger insists, have been deprived of power, information, and choice. She is a passionate and well-informed advocate of nothing less than major, extensive, and comprehensive health care reform.

"Four armies are battling to gain control [of health care]: the health insurers, hospitals, government, and doctors. Yet you and I, the people who use the health care system and who pay for all of it, are not even combatants. And the doctors, the group whose interests are most closely aligned with our welfare, are losing the war." What to do? Herzlinger's convincing, indeed compelling and eloquent response to that question is best revealed within her narrative. However, for present purposes, here are a few key recommendations:

1. Consumers must take back the money their employers and government now take from their salaries and taxes to buy health insurance on their behalf so they can make their own purchase decisions.

2. Physicians must be empowered to design better, cheaper health care.

3. The destitute must be subsidized by "the rest of us" so that can purchase health insurance "like everybody else."

4. The federal government must help subsidize the destitute, provide transparency (a key factor for all consumers, actually), and prosecute fraud and abuse.

In Parts 1 and 2, Herzlinger explains who is killing health care and how they are doing it. She identifies both "villains" and "heroes." In Part 3, she "lays out the principles as well as the specifics of consumer-driven health care - what it is, why it will work, what it offers to all of us - and analyzes the lessons from consumer-driven systems like Switzerland's." Then in Part 4, Herzlinger provides a step-by-step plan "of the carrots, the sticks, and the laws that will make this consumer-driven system happen."

Many of those who read this brief commentary of mine may ask "So what?" Perhaps they are satisfied with their current health care coverage. It is possible but unlikely that many (if any) of those who are destitute - who have no health care insurance coverage whatsoever - check out reviews of books, much less purchase and then read them. The fact is, those who are satisfied with their current health insurance coverage are probably paying too much for their share of its total cost. And a separate but related fact is that their employer is also paying too much for its share of the health care coverage that it is required by law to provide to its full-time employees.

Herzlinger has a crystal clear vision of what health care should be and do but she is also a pragmatist. She fully understands that unless and until, in a democratic capitalistic society such as the U.S., incentives and rewards are changed, there can be no reform of the current health care system. It is wholly understandable that "the iron triangle" of third parties (i.e. Congress, health insurers, and hospital administrators) oppose consumer-driven heath care, especially given the fact that about $2 trillion is involved and would be at risk if (huge "if") patients were entrusted with the power to decide how that money would be spent.

My concerns, frankly, are these: How many people will read this review and others, then purchase and read Herzlinger's book? Then what (if anything) will they do? All change initiatives inevitably encounter what James O'Toole has aptly characterized as "the ideology of comfort and the tyranny of custom." The power and resources of those who defend the status quo of "the iron triangle" must not be underestimated. All by herself, Regina Herzlinger cannot reform the current health care system. Who will join her in doing everything humanly possible to make consumer-driven health care a reality? If you think you wish to enlist in this "war" and help win it, I suggest you read and then re-read Pages 254-258, then contact your representatives in the House and Senate and insist - not request - that they read this book or at least have a staff member do so. Will that do any good? I have no idea. But I do know that by remaining silent and compliant, we empower "the iron triangle" rather than ourselves.

15 of 16 people found the following review helpful

5.0 out of 5 stars A Good Proposal! June 11, 2007

By Loyd E. Eskildson HALL OF FAME

Format:Hardcover

Herzlinger begins by telling us that she was spurred to write this book after a tax exempt hospital chain (Sioux Valley Hospitals and Health Systems) testified before Congress of the "need" to limit competition from specialty hospitals - "would undermine it's ability to provide care to the uninsured." Unfortunately, the effort was successful in achieving a moratorium, even though the system only provided $5 million (at overstated prices) prior to the moratorium, and then cut that to $3 million afterwards. (A 2004 congressional comparison of non-profits and for-profits concluded that non-profits, on average, provided only 0.6% greater uncompensated care.)

Since 2000, health insurance premiums have risen 73%, vs. inflation and wages increasing 15%. Herzlinger blames:

1) hospital consolidations (# dropped 20% from 1970-2005) - usually without cost rationalization of duplicated costs, aimed simply at reducing the number of competitors. In addition, hospitals have attempted to further reduce competition by buying physician practices.

2)Bureaucratic HMOs and insurance companies, along with their high-priced CEOs.

3)Government: States sometimes limit the number of insurers and the variation in their offerings; meanwhile, the federal government meddles by providing incentives for certain treatment modes

Herzlinger's Recommendations:

1)Provide tax-free grants, adjusted to reflect an individuals' health status (eg. a 55-year-old male with diabetes would be given the average cost of treating such an individual). The individual would be free to save whatever was not spent - would not need to be spent in that year, though could only be spent on health care. Individuals would have to sign up with a provider for a 5-year period - thus allowing providers an incentive for preventive and/or front-end investments such as a transplant. (Providers would be given an "out" for non-compliant patients, and patients likewise for totally non-responsive providers.)

2)Require audited price and outcome data to be published. (This would quickly bring about an increase in smaller, focused-care medical facilities and a major impact - the top five major diseases account for 49% of all costs.)

3)Require the establishment and use of an integrated computer medical record system. (This would reduce duplicated tests and prescription errors due to poor handwriting, as well as catch inappropriate prescriptions.)

The potential "fly in the ointment" here is that Herzlinger's approach to severity adjustment would effectively discriminate between sicker and less-sick patients. In her defense, she offers several examples where this has been tried. Hopefully she is correct - if not, the approach may instead need to be based on measures of compliance with standards of care established by experts (though disliked by Herzlinger).

6 of 6 people found the following review helpful

4.0 out of 5 stars Who Killed Health Care November 16, 2008

By G. Palmisano

Format:Hardcover

Twenty years ago on a cold November night, I was one of two nurses called into the operating room were the team preformed a c-section and delivered a healthy baby boy. While waiting for the mother to recover, I picked up a copy of JAMA in the doctors lounge, there I found an article authored by some PHD entitled: Stop the Charade. It was the authors contention if we made all the non-profit charter hospitals in the country for profit the government would save enough money (eliminating the tax subsidies) to buy every American health care insurance.
Twenty years later author Regina Herzlinger MD PHD echoes this same strategy combined with other comprehensive solutions for curing the health care debacle infecting our nation. In her book: Who Killed Health Care. Dr Herzlinger identifies the culpable players who have brought havoc upon us; government bureaucrats that exorcise legislative powers to manipulate markets, technocrats who employ statistics to homogenize variables into one size fits all diagnoses, and industry lobbyists, special interest peddlers who know how to oil the system with campaign contributions.
Dr. Herzlinger provides a compelling argument in favor of consumer driven health care. She has cut through the complexity of this out of control industry identifying the problems and offering competent solutions to put healthcare back in the hands of consumers, physicians and health care professionals.
Meet Jack Morgan and follow his tragic demise. Learn how our bloated bureaucratic health care system failed him, and how his needless death could have been avoided. Learn how consumer driven health care could have enhanced his quality of life and saved him. Dr. Herzlinger demonstrates how this clandestine industry operates, how knowledge is power in the hands of the few; and a lack of transparency keeps consumers in the fog inhibiting their ability to make informed decisions regarding their own health care. She provides compelling analogies; consumer driven industries not so different from health care that thrive in a free market.
Learn why we dump our hard earned dollars into employer health care plans without question, or benefit of choice. Learn how everyone can benefit in a transparent marketplace, how competition enhances insurance company performance, while simultaneously driving down costs associated with delivery; spurring innovation while simultaneously improving the quality of health care. Learn how transparency growths technology, how risk adjusted insurance plans for specific illnesses aimed at prevention are part of solution.
Consumer driven health care is capitalism at it's finest; encouraging healthy competition between insurance companies, hospitals, and physician groups all vying for our health care dollars. It is this competition in a free market that will resuscitate the health care industry, add value, and drive down cost.