Iron Triangle of Healthcare

There is a common term in consulting that highlights there is a triangle relationship between resources, time and scope.  If you want to decrease resources, you need to subsequently decrease either quality or scope.  If you increase scope, you need to also increase resources to maintain quality.  It is an age-old adage that also rings true with healthcare.

A recent article in Journal of the American Medical Association highlighted a similar triangle within healthcare that included access, cost and quality.  The similar examples hold true.  If you increase access to all, you must also increase cost which may adversely impact quality.  If you want to increase quality, you probably will impact cost. 

After reading the article several weeks ago, something didn’t seem right but some a simplistic example.  We often recognized that new tools or processes within consulting/implementation could dramatically increase quality and overtime would be more cost effective with fewer resources.

As usual, I was not alone in the thinking and came across a compelling article by David Liu, MD.  The article highlights that disruptive technologies and innovative solutions will transform the industry over time as it did for personal computers, air travel and many other industries.

The question that this all begs me is what will that solution be?  As Dr. Liu points out, who will lead the charge?  We have many different stakeholders in the industry and each has a perspective on what that solution should be and how to drive it.  Who wins?  For the point of discussion, let me throw out some of solutions that have been explored in recent years.  I would be interested in hearing which of these is truly transformative and which are just ‘re-packaging’ the old.

  1. Cash-carrying/bartering:  Back to the days of Dr. James on main street doing house calls and being paid by a quarter cow.  Will removing the bureacracy of insurance claims, payments, coding and other components, dramatically improve the industry?  Will it not only be more cost effective but also increase the quality of care?
  2. ACOs:  Is moving the risk closer to those that manage the care truly going to revolutionalize the industry?  Can it be implemented in a cost effective manner?  Are there only certain organizations, regions, etc. that make these viable?
  3. Health Benefit Exchanges: Are the regulations around these exchanges worthwhile and effective in driving down cost and expanding access?  Will those efforts reduce the quality of care? 
  4. EDI/EHR Integration:  Technologies that integrate clinical data could revolutionize the industry.  But what if these systems do not holistically integrate?  What if you ATM card only worked at your bank’s ATMs?  How would that help with access?  And does the cost reflect the improved quality gained by these innovations?
  5. The convergence of the physician and payer organizations.  Cutting out the middle men should reduce costs, right?  And the integrated care should improve quality right?  But what about access?  And what if the integration creates a monopoly? 

I am sure there are many other options.  But if nothing else…food for thought.

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