Fellow, MIT Center for Digital Business, Tom Davenport
It’s no secret that health care in the United States is too expensive and not cost-effective. Most of the attention to health care reform has gone to those who lack employee health care, but half of Americans get health care through their employers. Their care is also too expensive—employer health care costs rose 191% between 1999 and 2016, compared to 44% non-healthcare inflation. Many employers want to find ways to make it less expensive, and also to improve the quality of care and health of employees.
In pursuit of these objectives, fifty large companies—from American Express to Weyerhauser—joined together in 2016 to create the Health Transformation Alliance (HTA). Together they comprise over seven million covered lives. The core of the alliance is technology, data, and analytics; companies who are members agree to share data and solutions with each other. There are, of course, other such alliances—the one between Amazon, JPMorgan Chase, and Berkshire Hathaway has received substantial attention —but HTA is much larger and further along, and both JPMorgan Chase and one Berkshire Hathaway business unit are also members of HTA.
Most discussions about the state of the U.S. healthcare system start with the problem of unsustainable cost growth. One reason costs have been rising is that we (as a society and as consumers) find enormous value in health improvements and are willing to pay for them. The real question is how to identify value vs. waste in healthcare so we can increase efficiency to bring costs down.
Over the years, we’ve seen many attempts to revamp the healthcare system, but they have been insufficient to be transformative. A good example is the HMO model in the 80s and 90s, which was notorious for restricting access to care. During the healthcare reform debate, voters balked at the U.S. government coming anywhere near restraining spending on healthcare. Read More »
Picture yourself going to the doctor. You arrive by car, park nearby, and when you enter a receptionist greets you and checks your information on a computer. You’re led into a comfortable, well-lit office; the cabinets are fully stocked. Your records are on hand. The nurses and doctors are well educated and knowledgeable, their equipment at the ready. If they can’t help you, they refer you to someone who can.
Now try to picture the same scene in sub-Saharan Africa. If you’re wealthy, your experience may be similar. But if you’re not, it’s altogether different. The roads are unpaved and riddled with potholes; it might take all day to get to the clinic by public transport. The queue to see the doctor is long–an eight-hour wait is not unusual–and there’s nowhere to sit. You might have to bribe someone to be seen. The electricity is unreliable; the clinic’s supplies are running low. Your medical records are incomplete, perhaps even non-existent. The doctors and nurses, while trained and dedicated, are not up-to-date on current treatments, and lack access to the tools they need.