The possibility of a recession soon is certainly a concern for everyone. I thought I would share how a recession impacts your health and the hospital you use. The concern for a shortage of both nurses and doctors is real, however as we saw with the last recession many caregivers delayed their retirement. Any recession may do the same and force some physicians and nurses to continue working beyond any currently planned retirement date and help slow the shortages we expect to see over the next decade. Patients are also impacted by any economic downturn, elective surgeries would be expected to decrease, screening procedures would decrease, and the impact of these delays may show a cost in the future.
Hospitals survive and advance on very small margins, and new technology is very expensive, any speedbump in this industry has a big trickle-down effect. Hospitals in many communities are the largest employer and support the community. Even though many hospitals are non-for profit and tax exempt they still make a major impact in each local economy.
Many hospitals survive on philanthropic donations. Many Children’s Hospitals and Cancer Centers could not continue to provide the care they currently do without donations. With any recession philanthropic giving declines dramatically now couple that with the fact that pediatric healthcare is thought to be recession proof and a potential disaster looms. For example, we are blessed here to have Lurie Children’s Hospital in Chicago with a great CEO in Pat Magoon. They provide care to many patients who have no ability to pay, and they continue to provide cutting edge pediatric care. One of the reasons they can do this is a large donor base, including many working class individuals who believe in the cause. Recession may cause this portion of their financial need to go away and place many institutions in a precarious position.
Is Traditional Medicine coming to an end? The impact of Millennials
Are we seeing a major change in health care going on? We try to talk about the newest changes in disease rates, identification or treatments. If we take a look from a higher view on what is happening overall in healthcare is there a big change coming? Many will argue that there are huge changes right around the corner, some are technology driven changes, some are business changes and some are actually generational changes. Many think the way healthcare is delivered will be drastically different and occur a lot sooner than we think. Historically the business of medicine has moved at a glacier like speed, which has allowed for inefficiencies, cost increases and a focus on the cost of healthcare. The science of medicine has increased dramatically in the past 20 years as technology is now allowing us to treat more conditions with better outcomes.
I thought we might take a quick look at some of the business changes that are forming and speculating what these may actually lead to, and discuss the generational impact that we are seeing with Millennials now coming to an age of needing more health care.
Before we discuss the changes that businesses are making in health care, let’s take a minute and discuss how millennials are impacting healthcare and how this is in direct conflict with baby boomers, where it will lead is a big question. Millennials are defined as individuals born between 1981- 2000, so these individuals are in their 20’s and 30’s and some are approaching 40. From a healthcare point of view these individuals are demanding more healthcare on their time, at their convenience and are actually concerned and interested in price and what the deem as value. They also will switch jobs and locations a lot more than the current generation.
This mindset has driven classic medical care from the traditional doctor’s office to the urgent care or immediate care setting. I would bet many of you have noticed the proliferation of immediate care centers that are opening almost daily, the care clinics that are being set up in local pharmacies. The rise in these centers has been welcomed by patients and seen as a convenient way to receive acute care. Unfortunately what is happening is that this generation is not setting up relationships with primary care physicians and the longitudinal care is being lost. Now I am not saying that Family Doctors and General Internist are not busy, in fact it is the opposite, however this increase is being filled by the generation of baby boomers who are now in need for more extensive medical care as they age. Most of these individuals went the traditional route and had a patient doctor relationship as they went thru their 20’s and 30’s, received longitudinal care and now are in need for more intensive management as they age.
Now some may say that we have been told that average life expectancy is not increasing in the US and in fact dropped this year so we are not living longer. This a fact, but you need to look beyond the raw number to see why this is occurring. The facts show that we have many more younger individuals dying from overdoses and suicides and thus lowering the overall life expectancy. We have had a 137% increase in opioid related deaths in the past 15 years with no end in sight as we are seeing close to 120 deaths a day from opioid overdoses alone. Many of these are younger adults. Now compare it to the increase in the live senior population, the number of individuals over the age of 100 has gone up nearly 50% in the same time frame. It is expected that the number of individuals over the age of 90 will approach 5 million in the next 5-10 years. Every day we add 10,000 baby boomers to the Medicare age of 65. This generation alone will keep the doctors busy for the next 30 years with patients they know, have cared for and understand.
What happens after that? No one is sure as the foundation for future care with many millennials is not being set with a primary care foundation.
The Impact of Disruptors
What is probably more interesting is what is happening on the business side of medicine and the increase of possible disruptors to health care enter the field.
Microsoft, Apple, Amazon, JP Morgan Chase, Berkshire Hathaway – These are not typical companies that you would equate with healthcare. You would look at each of them as disruptors in their own industries, but over the past year they all have jumped into the healthcare market. They each have their own focus on healthcare but certainly we will see some disruption from each of these.
Amazon- remember when they only sold books? Well now you can buy a “smart” hospital room from Amazon. The cost of the room is $285,000 and it includes a bathroom, a bed and other customizable options. The service thru Amazon is called MedModular. Their target market is some hospitals as this cost is more affordable than traditional construction. Some other businesses are also making the purchase including companies that are using it for simulation labs as well as urgent care centers.
Amazon has also applied for a patent that will allow Alexa to notice the change in our voice when we have a cold or cough. It would use this to push ads about cough syrup or recommend a recipe for chicken soup. It also has a partnership with the UK’s National health Service to diagnose symptoms for medical conditions thru Alexa. Tell Alexa your symptoms and she may give you recommendations on what to do next, make an appointment or suggest some OTC meds for you to order and they will deliver.
Amazon is also starting a company that will mine data from medical records, this will do a few things. They say it will help correct inaccuracies, will identify opportunities or missed opportunities. It will mine the data from the medical records of all of your doctors and look to see if you are on the correct medications and if your dosage is correct. This is a concern for all doctors as patients go to multiple doctors and often do not know their complete medication list. It is hoping to use AI from the data gathered to predict illness and optimize screening times
Apple- they are focusing on how their products will help patients manage and monitor their own health. They have embraced the world of wearable devices and have probably just scratched the surface of what technology can deliver to self-monitoring. It was not that long ago that the only thing a wearable device could do is count our steps. New technology like e skin wearable smart apparel will change how we monitor our own health and the timely and accurate information we can provide to our healthcare team. This would certainly decrease the need for a physician – patient interaction and will most certainly increase the concept of “e-visits” Don’t be surprised to see Apple take the “e visit “ concept to a new level.
Amazon, Berkshire Hathaway and JP Morgan- they look to have a different focus, they are looking initially at their own employees healthcare with a goal to increase satisfaction and decreasing the cost. They plan on doing this by building a new company that will use technology and also eliminate the need to make a profit thru this venture. The group also is looking into ways to combine other vendors’ products to boost value for the group and then market it to others. This is brilliant as many vendors do not think about the synergies of their product with others. This group will be looking at healthcare from a different angle and will come up with some great unique thoughts that will add value or decrease waste while enhancing their employees’ healthcare experience.
Microsoft and Walgreens- This partnership looks to combine big data, artificial intelligence and retail space to impact healthcare delivery. They feel that they can make health care more personalized, more affordable and more accessible by using the combination of the data and the pharmacy local sites. This venture is really focused on using data and artificial intelligence to impact the care of individuals. Look for them to increase services and data collection at their retail sites.
You will notice in each of these that the concept of the patient – physician is not discussed. Each is looking to see how the patient can manage their health themselves with better information and technology. They are not removing the doctor but they are certainly trying to decrease the use of the traditional healthcare model
It is impossible to ignore when Amazon and Apple say they are entering the healthcare field, as disruptors