In Health Care, Complexity Costs and Kills. ObamaCare Will Increase Complexity: You Do the Math

Complexity is considered bad in most business activities because it reduces efficiency and therefore costs money. In health care it is worse because it also kills. Anything done to health care that increases complexity will waste money and lose lives.

Operations experts in successful businesses such as Toyota, Ford and Intel spend most of their time simplifying processes. "Simpler" translates to faster, cheaper, better quality and fewer errors.

In health care, complexity is now threatening to swamp the whole system. Roughly 40% of all the dollars going into health care never come out. They are consumed by the middle: by millions of pages of rules and multi-layered organizational charts; by regulatory compliance that leaves too little time for patient care; by contradictory and perverse incentives; and by centralized command and control that is highly inefficient. This is waste -- pure and (not) simple.

Compared to the cost-of-complexity, the costs of the uninsured are a drop in the bucket.

Before you shout "single payer," make damned sure the process you choose to implement is much simpler, less bureaucratic, and more user-friendly than what we have now. Single payer is not automatically cheaper or more efficient.

Adding over a thousand additional pages of ObamaCare to our current incomprehensible "system" for health care financing is guaranteed to do one thing: increase costs. (As proven over and over and over but apparently ignored in Washington, you can only reduce true costs by treating root causes not by palliating symptoms.)

I can also hear some people rationalizing that, "Humans are infinitely complex and the system simply reflects their nature." As individuals, humans are exceedingly complex but the system need not be. Indeed, it must not be. The degree of simplicity and user-friendliness is the measure of how well planners, regulators, and politicians do their jobs. You draw your own conclusions about health care.

• In one large medical Center, it requires 57 separate steps to submit a bill for payment.
• At Vanderbilt, it requires 87 separate steps - each involving multiple committee meetings - just to approve a research project. The flow Chart offered below is courtesy of David Dilts, PhD.

• HIPAA's draconian regulations prevent me from emailing letters to my referring doctors. Its security restrictions prevent nurses and doctors from learning how to provide better care and to deliver more efficient service.
• The book that lists medical billing codes is over 600 pages long (10 point font) and the codes are constantly being changed.
• Prove for yourself the excessive complexity in healthcare: just access the FDA or HHS web sites and look at the organizational charts or the procedures for approving a new drug.
• In the name of protecting us and serving us, bureaucratic complexity is consuming hundreds of billions of dollars each year.
• What I wrote one year ago unfortunately gets truer every day: "We're drowning and you're all coming with us."

The more complex a system, the more steps and people involved, the more chances exist for miscommunication and errors. In business, this produces waste and reduces profits. In healthcare, miscommunication and errors due to excessive complexity can cause death.

Anecdotal experience, usually dramatic lawsuits, can be found almost daily of some medical disaster, such as an overdose of the correct drug causing death. Dosing errors are usually simple, preventable miscommunications. Hard scientific evidence abounds. The Bristol Report from Great Britain showed that complexity-causing-death was not a personnel issue but a system indeed cultural problem.

The time (and money) it takes to get a drug through the FDA delays new treatments and discourages innovation. Effective new treatments are not researched and/or are not made available in time for seriously ill patients.

Over and over we hear, "The system is broken." Those who say this are dead right (pun intended). The system IS broken and we need to fix the system not rearrange dollar flow or deckchairs on the Titanic. One of the most broken parts of the system is the middle. It is bloated, wasteful and pulling us under with its massive complexity.

It is much less satisfying to identify the system as the culprit rather than to lay the blame on an individual or group. Nonetheless, complexity is a system problem; it is the system that is "broken;" and therefore, it is system that must be fixed.

If you want to start to fix (cure?) health care, SIMPLIFY -- make things much less complex. What will ObamaCare do?

Follow Deane Waldman on Twitter: www.twitter.com/systemmd

Comments

[Idytme]

As a patient, I don't care how many steps it takes to get a research project going. As far a billing goes, is this for the insurance companies or is this Medicare? A doctor who takes multiple insurance policies has to hire someone just for billing, and they can take a year to get payment. So you want simplicity? Every company from Medicare to private insurers charge the same amount for the same procedure. They all use the same billing codes. They all have the same co-pay for drug prices. They all have to abide by the same code of standards, like not dropping people when they get cancer or increasing a group rate when one person in the group gets very ill. Then anyone can buy extra insurance (supplemental) to pay for all the things that the basics do not cover. Opps! Does that sound like a single payer system with enough extra private incentive?
The insurance companies certainly don't want that and I doubt the AMA does either.

[systemMD]

As a patient you need to care about the # steps (=hassle and cost) of research because enough frustration and roadblocks­...and the research just does not happen. Believe me I know: I have had several offers to direct useful projects and did not do them because the "system" took too much time and energy away from other things. If research were easier and more efficient, more would be done and medical science would know more – to the advantage of patients.

The complexity of coding and billing is very effective.­..at delaying or stopping payment. You should care because you – the patient – PAY both in terms of bureaucratic waste and increasing shortages of people in healthcare. We just get fed up with spending 30-50% of our time doing bureaucratic BS and make-work. The system that is supposed to help us care for you repeatedly gets in the way. It should matter to you that this excessively complex system has caused med school applications to decrease 18% in the past ten years. Soon there will not be any doctors or nurses.

I come from a family of four successive generations of MDs. I was proud to become doctor. I thought it was an honorable, respected profession. By the time I have teenage children, I was relieved that they weren't going into medicine before it had become something totally different and no longer a desirable professional choice.

[BobLablah]

Uh oh. You have just questioned the wisdom of The One. Prepare to be lambasted for your blasphemy.

[dacookson]

A mobile phone needs to be complex in order to work. Complexity is inevitable and one-size fits all ideologies won't work and haven't worked in economic or health policy or anything else. You have to embrace complexity as part of problem solving. Over-complexity, beaurocracy are problems but aren't an inevitable outcome of the current healthcare proposals and its mission to cut costs incurred in the current system should negate many of those concerns. It's right to highlight problems within the current system but to imply that this principle effectively means Obamacare will kill is misleading. A campaign on unneccesary complexity will hopefully one of the next stages in healthcare reform and if it isn't people should campaign for it.

[systemMD]

The programming of an iPhone is incredibly complex but the "system" from the user aspect is simple and easy. Each screen has 3-4 choice options: easy to decide not to mention read. The screen on which I am supposed to sign my consult letters has 74! different items on it. The programmers should have madeit easy not impossible to take in.

The mission to cut costs is, as you write, on target but ObamaCare will do the opposite. Just because the President says he wants to cut costs does not mean his bill will do so. The insurance plan he proposes is another add-on, a patch as the programmers say. How can it not make things more complex? There is no effort to simplify.

Complexity doesn't kill because I say it does. It kills by increasing the error rate. Ask anyone at Toyota or Intel: more steps & more free will individuals produce more opportunities for mistakes. I did not make it that way. That is reality. Complexity costs and kills. If ObamaCare increases complexity, that is what will happen. Not my choice; just my sad responsibility to tell it as it is.

[quietfortoolong2]

Gee, it seems all over the rest of the industrialized world, single payer is not only more efficient, but also cheaper per capita. I agree. Lets go with the simplest system: single payer universal health care.

I also find it funny that we Americans consistently think of ourselves as the best and the brightest in the world, yet there is so much fear that if we try to do a single payer system, we would mess it up. So, even though we are the best and brightest, we are apparently incapable of doing a better job at single payer than everybody else has done. Brilliant.

[seatea1967]

Exactly. All these repubs with their "America is best" faux-patriotism seem so willing to admit that we're the only industrialized country in the world who can't do universal coverage. American's just aren't up to the task, in their eyes.

I say that's c.r.a.p. We should be leaders here, not lagging behind everyone else in the pack.

[systemMD]

Facts: Some single payer systems probably are more efficient but I am unsure. The Canadian system was reported as having a 16.7% administrative cost while ours was calculated at 32%. Yet Their Province of Quebec spends 43% (!) of its total budget on healthcare.

Fact: Most are cheaper - yes. But virtually all use rationing (various different forms and methods; none actually called rationing) to kepp costs down. EVen so, the British NHS is trying desperately to inject some personal responsibility into a system of total entitlement (according to its populace).

We could be the best and brightest, if we put our minds to creating an efficient and effective system. We could but the stimulus and ground rules have to come from US not Washington. I know, I am insane to think that could happen, but I keep working to "make it so." I refuse to give up.

[peterg76]

Corruption and non-competition is what costs and kills. Complexity is simply the smoke screen.