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In a time of great need for our nation during the pandemic, Americans saw and celebrated an army of physician heroes. And in doing so, they overlooked an unforeseen reality that true heroism by physicians has actually yet to be realized. In the coming years, heroic physician leadership will be the crucible for the kindling of imagination to reshape our nation’s healthcare system through economic reform. However, for physicians to lead they will need an educational guide for navigating the business of medicine to optimize their leadership potential. Fortunately, for them, Dr. Ellis “Mac” Knight and his book “Healthcare Economic Reform: How and Why Physicians Must Lead Change Within Our Evolving Healthcare Economy” is their guiding light in the darkness!
Dr. Knight realizes that the time for physician leadership is now to salvage our economy, improve our nation’s health and wellbeing, and restore the humanity of medicine. To do this, physicians must provide more than just healing patients in front of them; they must be a reservoir for reimagining a system that can emphasize prevention over treatment. They must call for changes in a way that will lead to transparency, redesigned care delivery processes, lower costs, and improved patient outcomes. The call for physician leadership has never been higher, and the stakes have never been greater. For true healthcare economic reform to occur, we need physicians to demand change from both an economic and moral imperative.
Are you ready to take your first step in your hero’s journey as a physician leader? Or will you stay on the sideline, hoping for a top-down, political, all-encompassing solution to healthcare reform? After hearing this podcast, you will come to realize that building an idealized system can only occur via a bottom-up methodology that honors the voices of skilled clinicians on the frontlines to design care delivery. And it is Dr. Mac Knight that will be your North Star!
01:45 Heroic physician leadership will be the crucible for reshaping our nation’s healthcare system through economic reform
02:15 Dr. Knight’s new book: Healthcare Economic Reform: How and Why Physicians Must Lead Change Within Our Evolving Healthcare Economy
04:25 “Physicians must be a reservoir for reimagining a system that can emphasize prevention over treatment.”
07:00 “The entire healthcare economy is in need of vast redesign”
08:40 What are the goods and services traded for in the healthcare economy?
09:30 Growing up seeing his dad as a solo practitioner and realizing how different that system is from today
11:00 “The healthcare economy is corrupted. It is selling the wrong goods and services and charging way too much for those things.”
13:00 The “glass wall” that is created in large health systems between physicians and administration.
14:00 The lack of accurate Cost Accounting in healthcare as a barrier to creating value (referencing the work of Michael Porter and Robert Kaplan)
16:00 The relentless pursuit of profit within the fee-for-service based healthcare economy
17:00 “The COVID-19 pandemic has really pulled back the veil and revealed the perverse nature of the healthcare economy.”
19:00 Moving the emphasis from profit maximization to value-based care is really going to require a change to the payer paradigm
22:00 The value equation and how definitions and measurements of quality create the perception of “cookbook medicine”
23:00 The Price-Cost disconnect in healthcare and the need to connect pricing to the actual true costs of providing services.
24:00 The flawed negotiation model between health plans and hospitals and how that leads to pricing variation in the marketplace
25:00 Accurate costing and the elimination of waste as an opportunity to drive value in healthcare
27:45 Payment reform is needed. Value-based reimbursements need to become real!
29:00 The movement to value-based payment driven more by CMS than on the commercial side and the possibility of “Medicare Advantage-For All”?
31:00 Is the clinical integration of providers the best vehicle for delivering value-based healthcare?
32:20 FTC Guidelines for clinical integration and the need for physician leadership and governance
33:30 The lack of incentives for specialists to participate in many value-based payment models
34:30 A silver lining of COVID pandemic in creating the realization of the flawed healthcare economic model
36:00 Estimates are that anywhere from $760-$935 Billion of cost expenditures in healthcare is waste!
38:00 How do we optimize EHR systems so they can better serve as a vehicle to support population health and create interoperability amongst providers?
39:30 “Monstrosities of technology” – the flawed design of EHRs and how being built on a FFS chassis creates waste and prevents workflow efficiencies
43:00 Referencing Adam Smith’s “Invisible Hand” as a model for free market healthcare
44:00 Dislocation of buyers/sellers from production of services and profit-seeking maximization of the shared premium dollar
46:30 Negotiating on the basis of global services provided (instead of the procedure itself) obscures price transparency and true cost accounting
48:45 Parallels between healthcare and the luxury goods market and how that negatively contributes to the economy as a whole
50:00 The flaw in the Relative Value Scale Update Committee (RUC Committee) and the over-valuing of technical over cognitive services
54:20 The role of Advanced Practice Providers (PAs, NPs) and interdisciplinary team members in addressing gaps in primary care delivery
55:30 Physician compensation based on RVU production detracts from the provision of high quality care delivery
57:00 Dr. Knight shares his thoughts on how we can more effectively design and implement bundled payment models to improve cost and quality outcomes.
58:00 Referencing the RAND Corporation Analysis of Bundled Payment Models
59:00 Dr. Knight describes the “four player model” of care delivery in a bundled payment model
61:00 The flaws in the bundled payment model concept, i.e. the bundling up of fee-for-service payments and then taking savings out of that
63:00 Dr. Knight provides parting thoughts to physicians looking to develop new high-value business models within the healthcare economy