US healthcare is often derided for being unfair and primarily profit-focused but, asks Peter Mills, is there anything that the UK can learn from the world's most expensive healthcare system?
The majority of Americans have an unshakeable belief that theirs is the best healthcare system in the world. However, the evidence all points to the contrary, with life expectancy and disease outcomes no better, and often considerably worse, than the rest of the developed word. The propaganda from the powerful insurance and physician groups certainly seems to have done its job; at least within the confines of the US national boundaries.
However, the wholesale dismissal of the US healthcare system as being unaffordable, fragmented and underperforming misses some key initiatives and trends that could potentially be of benefit here in the UK.
To understand this better it is probably worthwhile providing a brief overview of how the American system differs from ours.
The US healthcare system is an insurance based model. The majority of working Americans have health insurance policies that are paid for, at least in part, by their employers. Retirees and those on low incomes are ‘insured' by the government Medicare and Medicaid schemes respectively. It is worth noting that in many states the criteria for qualifying for Medicaid are extremely stringent and as a consequence a sizeable number of citizens have no or inadequate healthcare cover.
Proactive roles
Because the burden for funding health insurance for their employees falls to the employer it is not surprising that companies play a far more proactive role in the health of their workforce. Like the rest of the world, the US has seen significant healthcare cost increases over the last decade. Double digit premium inflation means that the average employee costs their employer something in the region of $7,000 (£4,500) per year.
The last decade has seen an explosion in the popularity of employer sponsored health management programmes to the extent where most organisations now fund at least one initiative to help their employees improve their health status. In the late 1990s and early 2000s these initiatives tended to focus upon disease management. These programmes concentrated upon supporting individuals to better manage existing diagnosed medical conditions and were, and still are to a large degree, delivered via the telephone through a series of outbound coaching calls.
The initial popularity of this approach saw a number of disease management companies spring up in America that either provided their services directly to employers, or latterly via the health insurers.
The greater penetration of the internet in the general population in the early 2000s, together with a realisation that telephone delivered services are expensive, saw the development and launch of increasing numbers of online programmes and services. Initially these also focused upon disease management, but through the latter half of the last decade there has been a greater emphasis on ‘wellness' and health promotion.
This has stemmed largely from the economic fact that focusing solely upon the ‘sick' is unlikely to deliver any sustainable impact upon overall healthcare costs. Many of these services were delivered by small, innovative companies and it did not take the health insurers long to start acquiring them so that they could rebrand and deliver them directly to their clients.
Despite this more proactive approach to employee health insurance, costs have continued to rise, which in turn has forced many companies to rethink how such programmes should be implemented. To date, participation has been largely voluntary, but it is clear that this approach falls short of the desired population wide impact. More recently, increasing numbers of organisations have been mandating some degree of participation in order for employees to receive their full healthcare benefits.
Popular tools
One of the most popular mandatory tools is the annual health risk appraisal (HRA). This usually takes the form of an online or paper questionnaire that employees complete and is usually provided by either a health insurer or by a third party vendor. Many organisations now track completion and either provide incentives for participation or withhold certain benefits for non-completion. The latter usually takes the form of a higher excess on health insurance claims.
HRA data is then analysed to help employers understand the prevalence of health risks within their employee base as well as to model the impact these health issues are likely to have on future healthcare costs. In addition, depending on what programmes and services have been purchased by the employer, employees are directed to appropriate initiatives based upon their HRA data.
Fragmentation of the system
Although the fragmentation of the US healthcare system undeniably leads to some inefficiencies it also provides a platform for innovation that is just not seen here in the UK. From the vendors of telephonic and online solutions to data analytics organisations and incentive providers there are many small organisations that provide ‘value-added' services and products to the providers of care (hospitals and doctors practices), the insurers and the purchasers (the employers).
One of the main areas where the US is more advanced than the UK is that of collecting and analysing data. Data feeds of healthcare utilisation and pharmacy spend are frequently amalgamated with HRA data and programme participation data to get a multi-faceted, 360 degree picture of the health of a population. From the findings borne out of such analysis, HR health strategies can be targeted to those who would most benefit from better management of existing medical conditions, or reduction of lifestyle risks.
US employers increasingly expect insurers to not only provide their employees with comprehensive, yet affordable, coverage, but also to provide insight and interpretation of generated healthcare data, including outcomes. UK employers are far less demanding, which in turn has meant that private medical insurance companies have not, as yet, been called upon to really justify the value of the services that they provide.
In a large part this is undoubtedly due to the existence of the NHS as both the major ‘insurer' and provider of care, but the PMI providers must also shoulder some of the burden in favouring the status quo, rather than leading the way by working in partnership with their clients (the organisations that purchase private medical insurance) and driving forward a better understanding of the true value of health.
With the changing healthcare landscape here in the UK, and a greater emphasis being placed upon outcomes rather than outputs, now is the ideal opportunity for providers of private medical insurance and private care to lead the way in creating an outcomes focused service.
In summary, the key initiatives that could be ‘imported' from the USA, and that would seem to fit within our very different funding system are as follows:
- More emphasis being placed upon prevention and proactive healthcare.
- Better healthcare data collection and analysis to drive true understanding of the health related issues in populations.
- The innovative use of technology to engage individuals is better self management of existing conditions as well as reducing lifestyle related risks.
- Ensuring employers understand they have a vested financial interest in the health of their employees to encourage greater involvement in understanding how the health issues of their workforce are impacting their business.
So with all of this activity on the other side of the Atlantic, why is it that the health of Americans appears to be declining rather than travelling in the opposite direction? This is a tough question to answer; undoubtedly the fragmented service delivery model and sparse primary care provision has a big part to play.
In addition, the US, like most other developed and now some developing counties, has many ‘anti-health' competing forces at work - the endless supply of cheap energy dense food, the lack of an alternative to motor vehicle transportation for most citizens, a culture of long working hours and short vacations and possibly even a laziness that derives from being too far along the ‘civilization continuum'?
Dr Peter Mills MD is director of medical consultancy Glasslyn Health Solutions
