In the first issue of Conversations, we focused on the data supporting the viewpoint that our healthcare system is quite broken and delivers poor value with high costs and unsatisfactory health outcomes.
One could also take the perspective that the medical industry is doing extraordinarily well.
Certainly the healthcare employment increases1 are impressive.
Also, the high 2015 and 2016 return on investment in the medical technology sector2 is quite remarkable.
This hefty margin in healthcare technology isn’t a new phenomenon.
Twenty years ago I attended a half-day session with the competitive strategy guru, Michael Porter. His presentation focused on the return on investment from 1960 to 1990 in major U.S. industries. Over those thirty years, pharmaceutical firms had an average annual ROI of 18%, shattering the 4.5% average ROI for all other industries.
So healthcare has attributes of great performance or poor performance depending on how you look at it. To create successful change for employers, the paradox between great ROI in the healthcare industry on the one hand and the relatively poor health outcomes on the other, must be understood.
How does this Dr. Jekyll and Mr. Hyde scenario affect our approach at Switch?
It may not seem self-evident, but understanding the realities of this paradox helps direct our focus to improve the value of healthcare, as well as to provide a few maxims on what works and what doesn’t:
- No current institution has the power to successfully confront the self-serving aspects of the medical industrial complex head-on,
- There is little leverage in the retrospective evaluation of an individual’s medical care,
- Good personal decisions can create enormous improvements in health, and
- Guiding better decisions requires a balance of expertise, self-reflection, trust and accountability.
Our employers will quickly learn that our approach is better than just hoping that the status quo healthcare in healthcare is going to change anytime soon.
Breakthrough To Better,
Carl
PS – Our Conversation #3 answers the question, “What is absolutely, hands down, the best marketing slogan of all time?”
1Role of healthcare in economic recession and recovery
2The most profitable industries in 2016
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Switch Conversations is a bi-weekly blog exclusively for potential employer partners.
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ALL POSTS:
Edition 1 – Solving a Well-Entrenched Problem
Edition 2 – A Case of Dr. Jekyll and Mr. Hyde
Edition 3 – Best marketing tagline of all time?
Edition 4 – Post-Truth Killed a President
Edition 5 – What’s an employer to do?
Edition 6 – Profiting From the Opioid Epidemic
Edition 7 – The Keys to Unlocking Better Decisions
Edition 8 – When Difficult Things Need to be Done Well
Edition 9 – Fixing Healthcare
Edition 10 – Beware of a Singing Cow
Edition 11 – Wise Reflections
Edition 12 – Warning: Reader Discretion Advised
Edition 13 – Can AI save healthcare? (Part 1)
Edition 14 – Can AI save healthcare? (Part 2)
Edition 15 – Can AI save healthcare? (Part 3)
Edition 16 – Embracing Reality to Improve Healthcare
Edition 17 – Everything I Needed To Know…
Edition 18 – The Eighth Circle of Hell
Edition 19 – So… What’s Our Solution?
Edition 20 – Protecting Integrity as a Core Strategy
Edition 21 – An Unadorned Legacy
Edition 22 – Time to Grow Up
Edition 23 – Against All Odds
Edition 24 – When Everyone Has Stopped Listening
Edition 25 – Focusing on What’s Important
Edition 26 – Don’t Give Up Your Shot
Edition 27 – Join the Goodhood
Edition 28 – Fixing Healthcare (Recycled)
Edition 29 – Taming the Healthcare Beast
Edition 30 – Leadership
Edition 31 – Better Health Requires Good Sense
Edition 32 – Little Decisions With Big Consequences
Edition 33 – Transformational Courage
Edition 34 – Transformational Courage – Part 2
Guest Post – Happy Thanksgiving! By Jeff Novick, RD
Edition 35 – Transformational Courage – Part 3
