0/0/2012
Health care and the a/b/c logistical system.
by C. Vitali
Frequent ongoing debates among eminent scholars, scientists and politicians try to envisage “sustainable solutions” for a national system of a universal benefit in health care. Such systems suffer of a deep crisis today even in Countries of a dated “welfare state” traditions such as Sweden due to their costs.
Most of the health care systems’ costs are due to the territorial distribution of centers manned by high cost skills and equipment needing alike high cost skills of maintenance. A revolutionary approach of health care centers linked by ICT services and image-handling, medical tests and a hierarchical network of first care units closest to the patients manned by lower cost paramedical professionals and assisted by consulting regional centers linked by due flow of information and manned with higher skilled professionals would minimize the overall costs shrinking the urgent treatment of critical cases at central centers specialized in each of the highest cost personnel and equipment.
The media debates are generally centered upon the measurement of quality and on the definition of criteria and the control of standard-costs while the key-subject of any health care system should be an approach of economical sustainability of the overall organization. That is the key prerequisite to any further handling of sophisticated intellectual debate of the technical parameters ensuring the necessary capacity to produce effective economical and quality controls.
The true problem of any universally accessible health-care system resides in this fundamental attribute (the economical controllability) that imposes a coverage through general fiscal measures and financial transfers likely to render equal in practice the service delivered to any citizen. Instead, the concept of welfare state is inevitably pushing the health care industry-sector (as well as any other types of invalidity assistance such as impairments on the job) under the political power subtracting its responsibility (and its balance of costs) of spending and control far away from the criteria of a healthy industrial management. The unique that proved being able to promote a growing technological-organizational progress. Progress that is the solid foundation to offering wider choices and wellbeing to the widest market size in any industry-sector there-included the health-care and rehabilitative one. Without this growth of the technological progress health care and rehabilitation would still be the remedies invented by Hippocrates and Galen.
The concept of “welfare state” loses therefore the only criteria needed to ensure a correct management of costs and the constant interest to invest funds in research in order to produce better technologies to innovate field applications in several industry-sectors (pharmaceutical, medical-surgical, prosthetic, primary and secondary preventative, rehabilitative) through appropriate new organizational approaches fit to expand the consumers’ market of the related goods and services. The concept of “welfare state” leads, besides those nasty consequences, to unify within the sole political interest the roles to: 1) procure the necessary resources to fund the system (via fiscal laws), 2) fix the criteria to measure costs and quality of the offered goods and services (via ineffective administrative-bureaucratic regulations), and finally 3) design the criteria for system-fairness control (via legal litigation and bureaucratic jurisdiction). The coincidence of different roles into a unique actor inevitably subtracts the taxpayer the capacity to influence both control and system-effectiveness of his health care system, shrinking the taxpayer’s role on the mere selection of the political hierarchy of his political representatives limited just upon their presumed ethical integrity.
The resulting principle is in evident conflict with the basic criteria of the industrial liberal-democracy that relies instead on the assumption that the “government” of any system should presume the possibility that producers, consumers, electors, controllers and political representatives could even be ethically imperfect but, that non-withstanding, the free-market system of balanced interest among consumers-taxpayers, producers-vendors and elected-electors (the industrial free-market) thanks the building of opposed interests turns its game into an self-regulating system characterized by: 1) constant growth of quality, 2) costs reduction and 3) growing accessibility(notwithstanding the universal inclination to personal greediness).
This said, the industrial solution of a universal health-care industry-sector can be reduced to emulate one among the many other industry sectors of a public interest already experiencing constant success and economical sustainability transferring it too to the insurance health-care and rehabilitative industry-sector.
We can mention here the industrial criteria of a private character likely to offer a field solution along the free-market direction. A solution respecting its peculiar ethical nature but firmly respecting as well the principles of enforcing a correct self-regulated management and the natural quest to collect constant improvements of the technical and organizational aspects aimed to reduce the costs, to facilitate the accessibility and to improve the offering of better goods and services.
The basic principles of an industrial free-market solution shall be easy to understand by all electors-taxpayers to permit them of choosing between the corrupt and bankrupt “welfare state” solution (born with the obsolete Nation States of the XIX Century) and the industrial free-market alternatives that have hitherto produced any type of scientific and technological progress “non withstanding” the permanent corruptibility of the political and industrial protagonists. Any solution’s basic criteria, risks, costs and potential benefits shall result easy to understand by both users’ and management’s sake.
The health-care industrial solution sketched here is related to a technique of industrial logistics that could rule the design of any industry sector with high productivity, profitability and competitiveness: that technique is referred to as A-B-C Logistical and can be illustrated in short as follows.
A-B-C logistics classifies the many noxious events that may require system’s assistance to help restoring their functional levels in any complex system into 3 groups: A) group all rare events of individually highly expensive remedy,C) group the opposite highly frequent events of very inexpensive individual remedy, B) group any other intermediate event in terms of both frequency and individual remedial cost.
A careful cataloguing into these three groups allows the administrators to focus their attention and the available resources to ensure a correct management in three distinct moods inspired by the criterion of “insuring the industrial risk”.
Group A events generally compose the least global-costs and present minimal risks of insurance fraud since they require specialized assistance deliverable only within properly equipped and centralized centers of an easy control. In addition they allow to collect information useful to improve the design and the operations of the monitored system and help sharpening therefore the procedures likely to prevent the future outcome of any Group A event (by means of programmed primary and secondary prevention). In order to reduce Group A costs the management ensuring the functionality of the industrial system receive both the means and the economical-managerial incentives to concur improving the quality of the procedures aimed to reduce the events’ frequency. In the health-care industry-sector a Group A solution would collect events such as rare illnesses or highly risky surgical assistance such as liver-lungs, kidney or cardiac transplants. The scarce numerousness and the high specialization linked to these events allows any industrial insurance system to cover Group A costs upon the general tax system or upon increasing the individualGroup B policies’ costs. The mechanism proves safe to stimulate new research of primary and secondary prevention procedures by eventually rendering them compulsive for all the policyholders to reduce the individual burden of those events. On the other side it is highly unlikely that anybody would fraud the insurance of these rare events by requiring fake heart-lungs transplants or therapies of high-risk for his personal integrity.
Group C events build instead the highest global insurance costs and compose the highest risk of fraud due to their individual marginal effect but numerousness that discourages any cost/effective fraud-control. This type of risk and cost suggests their total exclusion from the insurance coverage leaving their remedies to pure industrial free-market offering enhancing the effectiveness of remedia and their lowest unitary cost. In the health care sector this group of events collects the most usual diseases ranging from periodical headaches, to seasonal flues, to anti-conceptional devices. In addition the pharmaceutical progress produces constant growingly effective solutions against this group of distress.
Finally is left the insurance coverage to assist the intermediate Group B events that compose the highest volume of costs for a general health-care insurance. As mentioned, this group results too numerous to be controlled against frauds and namely the cost presented by the traditional fraud-inspection procedures suggests the health-care insurance industry to rather concentrate the available resources in funding innovative technologies’ research or rehabilitative and preventative procedures likely to transfer the classification of these events into either Group B ones (as of a low cost to allow their autonomous coverage by the consumers) or within Group A (for those cases where the preventative and rehabilitative procedures wouldn’t result sufficient to avoid their outcome into more serious types of permanent risk of personal integrity loss). This approach is focusing the attention upon the development of innovative technologies and of preventative-rehabilitative procedures, besides resulting fully compatible with the criteria of a sound industrial economy management, generate two virtuous effects. The first effect is to avoid that the events would become apparent in their most harmful outcome for the integrity of the policyholder or to avoid him the permanent loss of his functional autonomy (it’s the case of work-rehabilitation thanks transplants or prosthetics instead than compensating for permanent invalidity). The second effect is to stimulate and to address industrial investments aimed to fight specific types of pathology or health-care risks with the result of abating the global costs of the Group Bevents without excluding any consumer from the sanitary benefits independently from his spending capacity (if they accept compulsory insurance and adhere to technological invalidity prevention and rehabilitation services to be regularly updated along medical and para-medical progress).
This A-B-C technique has allowed constant progress in the technological development starting with its applications to the industrial military logistics since the first half of the past century and has been tested successfully by industrial managers in many industry-sectors. It results fully compatible with the industrial free-market and has the merit to reserve the State and the political elected representatives the mere tasks to legislate and to evaluate the service-fairness offered by private industries and insurance companies, staying therefore outside the economical interests partly covered by general tax system (for the eventual fiscal coverage of Group A events instead than leaving their coverage to additional costs charged to Group B policies if funded in a pure “private” approach).