Daily Archives: November 17, 2006

The Dismal State of US Health Care

One of the things that I learned at both the Fourth Annual International Symposium on Supply Chain Management and the 2006 Informs Annual Meeting is that the current state of US Health Care is dismal. I’ve been tempted to avoid the topic since most of the problems, and solutions, are plain ol’ Operations Research (OR) problems, and not sourcing (or even supply chain) problems per se, but I think it’s one’s duty as a good citizen to point out potential solutions if ever given the opportunity, and with the significant OR skills we need to succeed as Supply Chain Professionals, I feel that we could make significant contributions just by pointing out the basics of non-discipline dependent processes and best practices we use everyday and opening up medical practitioner’s and administrator’s minds to new possibilities.

Many of you are probably thinking US healthcare is probably better than the rest of the world – after all, as one of the most prosperous countries in the world you attract all the best doctors, right? Moreover, it should be.  But it is not. What really drove the point home for me were the following statistics:

  • approx. 16,500 Americans die each year from AIDS
  • approx. 42,200 Americans die each hear from Breast Cancer
  • approx. 43,500 Americans die each year in motor vehicle accidents
  • approx. 44,000 Americans die each year as a result of medical errors

In other words, your chances of dying from a medical error are almost three times worse than dying from AIDS. And if you think that’s bad, you’re only three times more likely to die from an overdose as a heroin addict than you are to die from a central line infection you develop in ICU. (On average, over 2% of patients in an ICU will get a central line infection and over 1% will die. Your chances of overdosing as a heroine addict are roughly 3%.) In other words, your chances of dying from medical error are worse than dying from an epidemic and almost as bad as dying from an overdose as a drug addict.

The worst part about it is that there is absolutely no reason (well there is, but it’s not a good reason*) why American healthcare cannot be the best in the world. For example, Paul H. O’Neill, in his INFORMS plenary, described a study where an ICU that served 1750 patients a year, of which 37 contracted central line infections and 19 died, took a page from an OR handbook and adopted standardized best practices and trained everyone involved on those best practices. (In medicine, every school trains their medical professionals differently, which often means that different doctors and nurses will perform different procedures differently. One example is that some schools tell you to scrub while others swab. Although scrubbing is good at removing macro level particles and loosening them, it tends to spread certain micro level virii and bacteria around. Thus, sometimes you should swab, possibly in addition to scrubbing.) After adopting standardized procedures and optimizing the treatment rooms and contents for those processes, in the second year, there were only 6 infections and 1 death, and 4 infections were identified as the result of a breach in standard process. In the third year, there were only 3 infections and 0 deaths. (And each year added about a hundred patients). In other words, although medicine is not a perfect science, and sometimes a patient will develop infections or die for reasons beyond your control, it can be a lot better than it is. Six sigma may not be possible, but with good six sigma processes, five sigma should be attainable. And since that would be ten times better than it is on average today, I could live with that.

And medical care in the US is bad across the board. One in fourteen individuals who visit a health care facility contract an illness they did not have. Prescription errors injure 1.5 M people and cost billions of dollars (at least three or four by some calculations) annually (and that’s just what we know about). And some estimates state that almost half of the approximately two trillion dollars spent annually on healthcare is wasted. Paul H. O’Neill believes that the proper implementation of good operations research best practices could cut the annual spend almost in half with better outcomes. If you add good supply chain and sourcing best practices on top of that – that’s probably not too far off! I don’t know about 50%, but I’m willing to guess costs could be trimmed by at least a third with center led procurement and simple best practices.

What do you think?

* The implementation of new systems and processes costs money up front, and most hospitals and insurers don’t want to spend money today unless they see an immediate return tomorrow. No long term thinking.