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Sink Some Boats

Jim Molpus, for HealthLeaders Media, July 11, 2008

One of the more misleading sayings is that "a rising tide lifts all boats." Reportedly this is an adage that Navy man and yachtsman JFK was fond of saying in his presidential speeches on the economy.

I have heard it pop up more than once recently as industry leaders try to imagine a scenario where a major healthcare reform shift will somehow preserve and strengthen all current players. If only the spectacularly backward reimbursement system were fixed, then everybody would get better, or so the group-think follows.

No one who actually understands the interconnected nature of the healthcare web and its ties to American politics believes that the true path to a better healthcare system would include everyone. To borrow the saying, a rising tide strands some ships and swamps others. And there are some we should scuttle.

Go back and consider the industries that have gone through an era of systematic disruption that did not see significant shakeout. Whether new technology, changing customer expectations, or a government shift in regulation causes the disruption really does not matter. In the end, industries get smaller and the parts of it that were not offering the best service at the best price lose and die off.

The national healthcare expenditure as a percentage of the gross domestic product is $2.3 trillion, eating up an unhealthy 16% of the GDP and rising like a bloated yeast roll. Nothing less than significant cuts and consolidation are going to drive that number down. Certainly the healthcare industry lobbyists and opinion influencers know which way the winds of change are blowing. They are paid to keep their ships—and their ships only—afloat. An article in the Washington Post last month and one from the Associated Press this week identify that the lead players on the hospital, health plan, employer, union and medical sides are lining up funds and communications campaigns for the coming fight. The discourse at this point is still quite civil, and glossed toward some sense of finally fixing underlying flaws in the healthcare economy. None will dare admit that for the kind of drastic change necessary (see 16% of GDP above), someone is going to have to lose and lose big.

If you were to chisel a monument to how dysfunctional healthcare politics are currently, this week's vote to delay again a reduction in Medicare physician fee cuts should be carved in white marble and left on the mall in D.C. Whatever your position on the merits of the proposed cuts, there is little disputing that the vote is one to sustain a payment structure that is broken beyond repair.

It will be interesting in the coming post-election months to see whether there is any linkage between the eventual winners of the debate/PR/lobbying scrum that is brewing and the true flaws that are actually sinking healthcare. Will the ones who eventually sink be the ones that should?


Jim Molpus is Editor-in-Chief of HealthLeaders Media. He can be reached at jmolpus@healthleadersmedia.com.
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