How to fix healthcare? Start with carrots for consumers!

March 16/13
Patti Ryan

This week the Harvard Business Review took a stab at redefining the healthcare business model in What is the Business of Healthcare? It was suggested the focus should be on health rather than healthcare, an honourable ideal. Far be it for a simple goat to butt heads with HBR but I’m going out on a limb (goats actually can climb trees – google it) and take issue with this seminal magazine and its lofty school of higher learning. The challenge with HBRs concept is, there isn’t any profit to be made in ‘health’ and healthcare in the US makes up 17.6% of GDP at a cost of $8,233 per person per year (highest per capita cost in the world).

The problem is, if people don’t get ill, the economy will and that is simply messed up.

Too much of our economy is built on profits derived from an ill population and not enough is built on profiting from a healthy population. And, since money is in the driver’s seat, we won’t see significant change until consumers change their spending habits.

North America has created the gold standard for a business model that profits from illness. We have a society with relatively high longevity rates for a population as unhealthy as it is which means people are living a long time with chronic illnesses. The North American food and transportation industries create products that negatively impact health and market them as lifestyle necessities. Consumers adopt these unhealthy consumption behaviours and inevitably develop risk factors that lead to chronic illnesses such as diabetes and cardiovascular disease. The healthcare industry then steps in to manage illnesses at great cost while continually improving interventions that allow citizens to live longer with their illnesses. It’s insane. Incentives are continually thrown in the wrong direction.

Why do we as consumers put up with it? We have the power to change this unhealthy cycle with our purchasing power and lifestyle decisions. But we need help; we need a little carrot to incent us in the right direction.

In a recent article Patients need pay for performance too, Matt Patterson, makes the sensible case for incenting the consumer to achieve positive health goals. “We need to build models that show patients the impact of making good health decisions now.” Governments have spent years and millions on incenting healthcare professionals and institutions to create efficiencies and what we have to show for it is staggering growth in healthcare costs and record rates of poor health outcomes. The reality is consumers have to participate in creating the change needed … so why have we not provided incentives to them?

This is not rocket science, its common sense. First, start at the source, we know that there are a handful of risk factors that increase our chances of developing a chronic disease and they are ALL avoidable and they are all measurable. If we all maintained the following behaviours we would save the healthcare system billions:

  • Consume a healthy diet of whole foods
  • Participate in daily physical activity
  • Reduce or quit tobacco use
  • Moderate alcohol consumption
  • Maintain a healthy weight

How do we incent people to adopt these behaviours? Start by encouraging individuals to measure their behaviours in order to track participation and allow a reward based system. We have to start somewhere and the early adopters are providing an environment to test an incentive program.

The timing couldn’t be better for consumer engagement and incentives. The digital/mobile health industry is rapidly growing with an estimated 1.7 Billion to download health apps by 2017 (that’s a lot of people tracking health indicators and governments didn’t have to spend a dime). Why can’t we encourage more of that, why can’t we offer individuals incentives to meet their healthy lifestyle goals and maintain them. Let’s encourage people to consume health products, and avoid consuming healthcare and let’s reward those choices.

Wouldn’t it be great if a portion of the GDP currently spent on healthcare was spent instead on healthy food and active transportation? Or what about a realignment of personal consumption from those unhealthy options (tobacco, processed food, alcohol) into healthy options (fresh foods, active transportation, fitness activities and even mobile devices to monitor our health behaviours). We can succeed if we shift even a small portion of our economy to benefit from a healthy population rather than an ill population? Let’s start with carrots.

It’s your health. It’s your health information. Manage it well.