The public is urged to take charge of their health and their healthcare. When they have a problem, ask the doctor questions. Do research. If they need a procedure, shop around to get the best deal. Adopt good habits. Eat more fruits and vegetables. Stop smoking. Maintain a healthy weight. Exercise regularly. These will improve health and be less costly in the long run.
But is this what Americans really want? Do they want to be empowered patients? Can they be empowered patients?
Americans don't want to be empowered patients anymore than they wish to be experts in retirement planning or IT gurus. Life is already too busy. Both parents are working, sometimes two jobs to make ends meet. Children's schedules are packed with so many activities that simply having playtime to be a child is almost seen as being lazy (even though it might be the right thing to do). People know they should exercise, lose weight, and eat fruits and vegetables.
But the problem is in adopting both healthy habits and having patients shift their behavior to be more engaged in healthcare is that it is more than the result of poor individual choices or lack of knowledge. People are not particularly rational even when it is in their best interest and even when it makes economic sense. In fact, it is incredibly hard to make those right choices unless the system is tweaked to promote the right behavior. Shifting the system requiring patients to have more financial responsibility in medical care through higher deductibles and copays won't do it. History has already shown how this failed in retirement planning.
In the 1970s when employers started shifting from pension plans (defined benefit) to 401(k) plans (defined contribution) for cost reasons, the theory was employees would do better in retirement planning. No one would have more incentive than the individual employee to thoughtfully research and invest their money for retirement than the person directly benefiting from it. Employees would deduct money from their paychecks, determine an appropriate asset allocation and rebalance their funds to maintain a risk level they were comfortable with. It was thought to be a win-win.
Decades later, however, it became clear what people should have done and what they were actually doing was vastly different. Observed behaviors were not consistent with academic theory. Too many people didn't participate in their retirement plan. Those who did often had funds in a money market plan which never kept up with inflation and cost of living increases. Others didn't diversify at all putting their dollars at high risk for failure. These discoveries led to the rise of behavioral economics which began asking the right question - why don't people do what is in their best interest?
It's because we aren't as rational as we think we are.
As a result, over the past few years employers and the financial services companies having been changing retirement planning to nudge employees to make the right decision. Employees are now automatically enrolled into a 401(k) plan and no longer need to sign up. A small portion is deducted from their salaries automatically. The dollars are invested in target date funds. Target date funds invest money among a variety of assets to promote diversification to mitigate risk. More importantly, the funds are shifted automatically over time to more conservative assets as the employee gets closer to retirement, the financially prudent thing to do. The rate of return typically is higher than the money market accounts and ahead of inflation.
As a result of these changes the number of people not participating in 401(k)s fell from 25 percent down to 5 to 10 percent. More importantly, they are invested correctly for their retirement. It is what they would have chosen to do anyway. If they had time or the desire to do so.
For the minority of individuals who were far more motivated, these programs did not hamper them to invest as they saw fit.
This is a true win-win.
Yet in healthcare, the same troubling trends are occurring again. The risk of making the wrong choice is much higher as are the consequences.
Much like pension plans decades ago, healthcare costs for companies are increasingly a larger financial burden. As a result, more insurance premiums are being shifted to employees with increasing copays and now deductibles. The theory goes if patients have more responsibility for their care that they will make the right choices to stay healthy and well. Because they have more financial responsibility, they will be more thoughtful when they need to see a doctor and if testing is required they will ask questions, shop around, and do research. After all, it's their life and their money. Who else would be most vested in making the right decision than the patient? It would be a win-win.
Familiar and flawed. It's about improving the system and not relying on individuals to be heroic to do the right thing.
A recent USA Today article about the decline death rate from motor vehicle accidents reminded me of how powerful improving the system is in nudging the right behavior. It also reminded me how experts continue to wrongly attribute either success or failure to the individual.
The number of people killed from traffic accidents in 2009 was the lowest in 60 years despite the fact that
in 1950 there were about 45 million cars for 150 million people while today's numbers are 256 million cars for a population of 310 million.
NHTSA Administrator David Strickland contributes the drop in fatalities to increased seat belt usage and a strong anti-drunken driving campaign nationwide.Both of which are individual behaviors. Now Mr. Strickland may be talking about the year to year decrease in fatalities. He doesn't address or acknowledge the system improvements that have allowed six times as many vehicles on the road with a population that has doubled in size. There is no mention of better highway design and signage, rumble strips, crash zones in front of highway off-ramps, guardrails, red traffic light cameras, safer cars with airbags, anti-lock brakes, and better engineering with crumple zones and stronger passenger cages to protect occupants as reasons for a death rate that is the best in sixty years.
Perhaps understanding the importance of system to help the individual, this blurb from the article shouldn't be surprising:
More people die from car crashes in rural areas, with urban areas a distant second, according to NHTSA's data. Driving off the road is the largest type of fatal accident. That's followed by accidents at intersections.
It's not just about individuals making right choices but about the system enabling them to get there. Rural areas probably don't have sophisticated road design or some of the above system improvements. Driving off road causing a large number of fatalities makes sense. In that situation, it really is simply the individual and the car against the wilderness.
So it isn't I'm against the empowered patient movement. I wrote a book giving them the same tools many others have.
It's a fundamentally different view of the world. Does enabling good health and providing the right care at the right time boil down to either asking the individual to make the right choices or making the system to enable her to easily get to the right choice?
The former won't work. With my colleagues, I'm working very hard on the latter.