Health Care Industry

Now that Google has finally launched its long-awaited Google Health service, it’s hard not to sense a kind of boredom across the blogosphere. So much has been written about the service in advance — including a fair amount by yours truly — that there’s probably no way the real thing could live up to all the hype, at least among the health and IT geeks who’ve followed it obsessively.

For a full review of the service, see Deepak Singh’s take over at business|bytes|genes|molecules, as he seems to be one of the few observers still willing to dive into its details. My own take is pretty simple: Google Health is underwhelming in what it actually offers people who want to store their health history and medical information online, and without Google’s name attached to it, it might well have already vanished without a trace. (Which, oddly enough, is more or less what I thought the first time I saw leaked screenshots of the proposed service almost a year ago.)

A more important question, however, is how Google Health and services like it will change health care and the business of running hospitals and medical practices. While it’s still awfully early to say for sure, it looks pretty likely that for all the hoopla, the answer is, “not very much.” Here are seven reasons such “personal health records,” or PHRs, aren’t likely to transform the healthcare business any time soon:

1. Patient input of medical information is cumbersome and error-prone. Google Health essentially asks people to build their profiles by picking medical conditions, drugs they take and procedures they’ve undergone from scrollable menus. This is a big problem for people who, like me, don’t know Parinaud Syndrome from Paraquat Lung. The situation is a little better for drugs, since Google Health allows users to input their prescription history from Walgreens or Long’s Drug (pharmacies are way ahead of doctors when it comes to digital information). Still, anyone not a customer of these two chains is out of luck, and Google Health places a big burden on these individuals to navigate medical terminology correctly — which is not a winning proposition.
2. Few medical providers use electronic medical records or allow record export to PHRs. Only 14 percent of U.S. doctors use electronic medical records in the first place, and even fewer are set up to transmit that data to a PHR like Google Health. (For an alternate perspective, see John Halamka’s description of Google Health from the perspective of Beth Israel Deaconess Hospital, one of two medical systems to partner with the service at launch.) Unless and until this roster expands dramatically, the Google PHR is little more than a vanity system for most people.
3. Doctors have little reason to take Google Health information seriously. Doctors are already notoriously bad about trusting other doctors — it’s common, for instance, for a doctor with a new patient to re-run tests that have already been performed, just to be certain. They have even less incentive to trust patient-entered — worse, patient-edited — information from a PHR like Google Health, particularly given the likelihood that the information stored there may be medically erroneous. This is especially dangerous where someone’s prescription-drug regimen is concerned, because seemingly small mistakes in drug names or dosages could have catastrophic effects if, for instance, an ER physician doesn’t catch them.
4. Privacy concerns at Google are real. My colleague Larry Dignan got a lot of attention for pointing out Monday that Google Health isn’t covered by the privacy protections of the grab-bag federal law known as HIPAA. This is true, although of course it isn’t exactly a new concern — almost none of the new “Health 2.0″ Web services are covered by HIPAA, largely because they were barely imaginable when the law was passed 12 years ago. As Deepak notes, HIPAA is a pretty good proxy for patient trust, so if I were Google, I’d think seriously about lobbying for HIPAA reform that would explicitly cover online services that handle sensitive medical information.
5. Privacy concerns at Google’s partners are worse. Part of Google Health’s selling point is the way it lets people share their records with third parties that will, for instance, provide personalized schedules for taking prescription drugs, check their vaccination history against federal guidelines or send health records to a doctor prior to an appointment. Google takes no responsibility for what these third parties do with patient data, which means reading through a new, dense privacy policy for each new service. Worse, these services might well market to patients based on their medical history, something Google itself has sworn not to do. And while Google promises to wipe personal data when a user deletes his or her profile, third parties aren’t necessarily bound by the same pledge.
6. Google Health locks in users. The service doesn’t offer any way to export its data, despite its embrace of various open medical-record standards, so anyone who spends a lot of time inputting profile information is sort of stuck. Once word gets out, savvy users are going to be wary about committing too heavily — and without early adopters, innovations like this one typically go nowhere.
7. Getting Google Health data to doctors is anything but easy. With no export function, the easiest way to get data out of the service is… to print it. In such cases, the supposedly game-changing PHR ends up as yet another piece of paper in a color-coded file folder somewhere. And, of course, if a patient is critically injured or seriously ill, they’ll have no way of printing out that information for the emergency-room staff in the first place. (Neither will family members unless they happen to have access to the patient’s Google account, since there’s no provision for sharing information with other trusted individuals.)

Proponents like to argue that PHRs give people more control over their health information and help coordinate medical care for those who regularly see multiple doctors, such as snowbirds who head to Florida or Arizona for the winter. That may well be true eventually, but it’s awfully hard to figure how the service is going to make much of a difference without a lot of maturing — not to mention a huge amount of catch-up on the part of the U.S. medical system.

One of insurers’ uglier tactics — so-called rescission, or the practice of revoking the policies of people who start racking up big medical bills, often on technicalities — is finally coming back to bite the health plans that pushed the envelope on this front.

Late last week, California regulators won agreement from Kaiser Permanente and Health Net to restore health coverage to 1,200 people whose policies they’d unfairly dropped. The state is pursuing similar agreements with Anthem Blue Cross, Blue Shield and PacifiCarethat would affect another 4,000 Californians.

The rescission scandal presents a major challenge for embattled insurers, many of whom have promised Wall Street that they’ll boost earnings by hiking premiums and restricting claims payments. Given the black eye they’ve suffered so far, most of these health plans will have to figure out how to cut their medical expenses without reliance on one of their most potent — if unfair and probably illegal — tools.

It’s also a big deal because it exposes the shakiness of the individual-insurance market (people in employer-sponsored health plans can’t have their coverage revoked this way). Given the speed with which employer-based insurance is unraveling, increasing numbers of people basically face the choice of braving the individual-insurance market or going without. And some reform ideas would just make that dynamic worse — John McCain’s health plan, for instance, essentially amounts to forcing most people to buy individual coverage, with all the additional risk and expense that entails.

As Matthew Holt notes over at the Health Care Blog:

Do you think that at some point the Democratic attack machine will wake up and put a few of the individuals with canceled policies on TV to warn about Americans about the individual market that McCain wants everyone to join?

My sources point to yes.

What’s more, the recission scandal almost certainly isn’t over. The California regulators in question only have jurisdiction over HMO-style health plans, so investigations into more traditional insurers continue. Plaintiff lawyers are also still lining up cases against the insurers — Health Net already faces a $9 million judgment won by a woman whose coverage was cancelled while she was undergoing chemotherapy for breast cancer.

In other words, it’s hard to see how the insurance industry could have suffered a more serious self-inflicted wound had it tried. I guess that’s one of the major downsides of an industry that basically can’t talk honestly about exactly how it really conducts its business.

Photo by Flickr user TheeErin, CC 2.0

Although most hospital patients are admitted at night or on the weekend, they’re much more likely to die, experience surgical complications or suffer from medical errors than patients admitted during the day. Which is what led David Shulkin, the CEO of Beth Israel Hospital in New York, to begin prowling the corridors of his institution at midnight in hopes of better understanding — and correcting — what he calls the “stark discrepancy” between daytime and nighttime medical care.

Writing in the New England Journal of Medicine, Shulkin first blames stinginess by Medicare and private insurers:

Shrinking reimbursements from government programs and third-party payers make it economically prohibitive for many hospitals to fully staff their facilities 24 hours a day. (And that’s before one takes into account the millions of dollars in uncompensated care that hospitals provide.) Instituting longer hours for care providers is not a reasonable solution to the problem, since medical professionals who work for too long at a stretch become fatigued and make more errors. Another major obstacle is the nursing shortage. More-experienced nurses understandably choose desirable day shifts. As a result, night and weekend shifts are filled with a greater percentage of temporary or agency nursing staff, many of whom have less training and less familiarity with the hospital.

Of course, Shulkin can’t help working in the obligatory reminder that hospitals also spend a lot to cover the uninsured — for which, by the way, elite medical centers like Beth Israel are handsomely compensated by their nonprofit tax breaks.

Shulkin goes on to note a variety of measures that have improved matters somewhat:

Some teaching hospitals have mandated 24-hour coverage by attending physicians in key clinical areas, such as intensive care units — a move that has led to improvements in the supervision of residents. And off-hour coverage by hospitalists — salaried physicians who specialize in providing inpatient care — is more common than ever. System improvements, such as the deployment of rapid-response teams, are becoming more common, making lifesaving interventions accessible throughout a hospital. In addition, technological advances have led to improved outcomes and reductions in medical errors. Electronically monitored intensive care units and other strategies for remote monitoring create safety nets and permit better medical supervision, even when attending physicians are not present. Many hospitals have begun using digital and Internet-based methods to have imaging studies read during off-hours by radiologists in different time zones, and experienced physicians can now provide their medical-imaging expertise from home.

But even these steps haven’t done a whole lot to close the gap between daytime and nighttime hospital service. Shulkin endorses pay-for-performance measures that would reward doctors, nurses and other hospital staffers for improving patient outcomes during off-hours, as well as “consumer-friendly” steps such as a recent Massachusetts program in which 80 hospitals agreed to disclose their staffing levels at all hours.

Still, the best advice Shulkin offers to his fellow hospital administrators is a simple one: Get up and walk the wards at night. “There’s still a lot to learn and accomplish, but we can do it,” he writes. “We just have to be willing to get a little less sleep once in a while.”

Lots of people are down on the prospects for many big U.S. health plans, which have been battered by declining enrollment, bad claims management, poor investment performance, and continued run-ins with state insurance regulators. But uber-investor Warren Buffett sees a silver lining somewhere in all that bad news.

On Thursday, Buffett’s investment firm Berkshire Hathaway revealed in an SEC filing that it boosted its holdings of two of the worst-off insurers, WellPoint and UnitedHealth Group, in the first quarter. The expansion of Berkshire’s stake in the two companies wasn’t huge — 6.7 percent in each case — but it came during a quarter in which the market value of its WellPoint holding plummeted by almost half while UnitedHealth fell by roughly 40 percent. Such is the esteem in which Buffett’s judgment is held that both stocks rallied on Friday.

Neither Buffett nor Berkshire appear to have commented on their decision, although Bloomberg recycled a Buffett quote from earlier this month:

“If a stock goes down 50 percent it doesn’t bother me in the least,” Buffett told reporters earlier this month after Berkshire’s annual shareholder meeting in Omaha. “If we’re going to be buying things, we want to buy them on sale.”

Which is probably about as good a description as you’re going to find of WellPoint and UnitedHealth these days.

On one level, of course, Buffett’s probably making a smart move. Markets do overshoot, and the odds are good that both insurers will eventually manage to bolster earnings through a combination of premium hikes and offering less-generous health plans as they’ve both promised. But what makes a good investment in the short-to-mid term doesn’t necessarily count as a vote toward the long-term survival of either company, despite Berkshire’s vaunted reputation for holding stocks over the long haul.

In other words, as long as the insurance industry remains wedded to its current business practices, its future is likely to grow steadily darker as its customer base — i.e., individuals and employers who can actually afford the policies it’s selling — steadily shrinks. And if the Sage of Omaha really sees a bright future for companies who are frantically trying to grab larger slices of a shrinking pie, then he’s looking at a different industry than I am.

UPDATE: Over at FierceHealthFinance (now that’s a mouthful of a title), editor Anne Zieger is even more skeptical that insurers can dig themselves out of their current financial mess using their old bag of tricks.

Hat tip: WSJ Health Blog

Photo: Wikimedia Commons

Well, this is certainly a new frontier in personalized medicine. The Denver Business Journal is reporting that Kaiser Permanente doctors in Colorado are visiting potential members in conjunction with Kaiser sales associates in order to talk up the big HMO’s advantages:

Last August, the health maintenance organization (HMO) launched a program in which doctors would join sales associates to tout Kaiser’s services and provide guidance and medical expertise on the well-being of their members’ workforce.

The concept is the brainchild of Dr. Jandel T. Allen-Davis, associate medical director for Kaiser’s Colorado medical group, who started accompanying the HMO’s sales teams on calls during open-enrollment season when she accepted an administrative job with the company in October 2006.

Kaiser has recruited 23 of its Colorado doctors — who, unlike most medical professionals, are salaried –  to its “sales ambassador team.” The main purpose is to put a face on Kaiser’s medical care and to answer employees’ questions about it, which Allen-Davis claims are more common than queries about premiums or benefit details.

Oddly enough, it seems to be working:

Barker estimates that enrollment among employees of participating member companies has increased 50 percent since the program was launched. Kaiser is Colorado’s fourth-largest managed-care plan, serving 482,917 people according to a 2007 report.

It all sounds harmless enough, and there’s no particular reason to think other insurers will adopt similar tactics. For starters, most big health plans have relatively few doctors on their payroll — instead, they tend to contract with independent doctors or medical groups, whose members are unlikely to travel around singing the praises of companies many of them despise.

Still, it’s got to be disconcerting to see sales people and doctors working the crowd as a team, in a dogs and cats living together sort of sense.

Photo by Flickr user Waldo Jaquith, CC 2.0

Medical devices are kind of the Rodney Dangerfield of medicine’s high-tech armamentarium. Sure, companies like Medtronic, Guidant and Stryker make artificial replacements or supplements for body parts ranging from hearts to bones (OK — joints), but for whatever reason, devices don’t seem to inspire the popular imagination the way, say, stem cells or gene therapy or even more conventional drugs do.

Which is why I’ve thought for a while that device makers could do a lot worse than to rebrand themselves as the Cyborg Industry. These companies, after all, have built their businesses around devices designed to take over the functions of aging and failing organs. In effect, that means they’re creating human-machine hybrids with improved strength and quality of life — at least by contrast with, say, the infirmity of a heart patient prior to something like a mitral-valve replacement.

Of course, cyborgs are pretty scary to most people, despite the fact that my fellow California residents seemed to have no problem re-electing one as governor. So I doubt we’ll see the industry adopting this suggestion any time soon, even though the sorts of device advances some experts project — “nanobots” that could cruise through your bloodstream, zapping viral invaders and cancer cells, or networks of microscopic sensors that might let you monitor detailed vital signs via your cellphone, or memory-enhancing brain implants — could turn their eventual recipients into something a lot closer to actual cyborgs than anything we’ve yet seen put into practice.

So it was fascinating to see the NYT on Sunday note how some artificial hip joints made by Stryker seem to have developed audible squeaks, much to the annoyance of the folks who have them. The NYT’s Barnaby Feder focuses on the entirely proper and serious question of whether the frequent and high-pitched sound of mechanical stress suggest the possibility of more serious problems with ceramic hip replacements, which are intended to be more durable and longer-lasting than older — and non-squeaking — metal-and-plastic joints.

But the underlying theme of the story seems to be that many people would just as soon do without constant reminders of their cyborg status — particularly when that reminder comes in the form of noises that convey a sense of age and disrepair. Dozens of patients, Feder tells us, have already undergone painful and complicated surgery to replace their noisy hips, and some have sued, complaining that the noises make it impossible to live a normal life. A few examples of that annoyance:

• Nutritionist Susan O’Toole now squeaks when walking up and down stairs, and even when walking normally.
• Michael Mueller, a software executive in Scottsdale, Ariz., found the noise from his hip — which resembles the sound of a rusty bearing or the wheels of an old red wagon — so perturbing that he made his own video and put it up on YouTube. (The NYT, to its credit, linked to the video in its story, the first time I can recall seeing the newspaper of record link to an external source in the text of one of its own online stories.)
• One anonymous Stryker hip recipient told Feder that the noise “can interrupt sex when my wife starts laughing.”

I certainly don’t mean to minimize the potentially serious consequences should the artificial hips in question prove to be defective. Stryker, of course, denies that, even though the company is also clearly engaged in classic damage control by working to minimize the scale of the problem.

Still, the bigger issue here is one that most device makers will have to face sooner or later. As their plans to augment “natural” body functions — even those that result from age or injury — grow ever more ambitious, intrusive and touch the lives of more people, these companies are going to have to think a lot more seriously about how to cope with the unanticipated consequences of implanting mechanical and electronic devices into the body– no matter how trivial those consequences might seem. The industry is going to have to live with this Cyborg Effect for quite some time.

Photo by Flickr user Garrette, CC 2.0

As we start a new week, here’s a quick wrapup of important healthcare stories that you might have missed in the week that was:

1. Retail health clinics — often staffed by non-physicians and set up in big-box retailers or drugstores — have been touted as one way to provide affordable care for the uninsured. While they’ve expanded rapidly over the past three years, the clinics have recently hit a rough patch, with some stores closing scores of outlets and others scaling back their growth plans, according to the WSJ. Investors apparently thought the clinics would break even in as little as six months, when instead it might take more like two years; they’re complex to manage to boot.
2. Preventable medical errors remain a huge problem for most hospital systems, but a few are making progress against the problem. Health Data Management reports that a Blue Cross and Blue Shield-sponsored project helped 14 New Jersey hospitals save $6.4 million over the past two years by using data-mining software to identify patterns of hospital-acquired infection and to put countermeasures into place. Similar programs are underway in New York, California, Pennsylvania, Texas and Alabama.
3. Hospital chains, like insurers, are under increasing financial pressure these days. Not HCA, which says it’s on the prowl for additional hospital acquisitions, according to Modern Healthcare. The for-profit hospital chain says it would like to snap up a large, urban non-profit system that leads in a fast-growing market.
4. Fears of a nursing shortage and a sagging economy have sparked new interest in nursing as a career — and have also led some shady operators to enter the nursing-school business, where students can find that their schools aren’t actually accredited after they’ve paid thousands of dollars in tuition, the WSJ reports.
5. Doctors have drawn up a gut-wrenching list of criteria that would dictate which people would get priority for medical treatment in case of a virulent pandemic. Among those at the bottom of the list: The very elderly, those with severe injuries or burns, and anyone with serious dementia.
6. Medtronic said it will cut up to 1,100 jobs from its 39,500-strong workforce. Although the medical-device maker was vague about its plans, calling them part of a “global restructuring,” it said the cuts would fall on businesses that have matured.
7. Identify thieves are starting to prey on medical records, USA Today reports, in the latest scare story about the “peril” of digitizing medical information. Although the story offers a few anecdotes from court cases — for instance, one man was convicted in Florida for stealing patient information and submitted $2.5 million in fake medical bills — broader statistics on the problem are, unsurprisingly, scarce. An earlier but more interesting USA Today story notes the difficulty many patients have getting access to their existing records, particularly after something has gone wrong medically.

Photo courtesy of Flickr user Môsieur J, CC 2.0

This Fortune interview with Aetna CEO Ron Williams is a few days old, but as it just popped up in my RSS reader, it is, as they say, new to me. Since it’s pretty rare to see someone like Williams candidly discuss the health-plan business, its problems and some intriguing — if not always entirely plausible — ideas for how both health insurance and the broader American healthcare system might be improved, I thought I’d take a moment to touch on some of the highlights.

Williams starts off with some fairly doctrinaire views on escalating healthcare costs, which he suggests — echoing Harvard economist David Cutler, who’s also an adviser to Barack Obama — are largely a reflection of Americans’ insatiable appetite for more medical care and more high-tech treatments. That’s a debatable proposition, to say the least, given the distinct possibility that as much of a third of U.S. healthcare spending is wasted on overtreatment that doesn’t make people better and may well make them worse.

Still, once Williams gets past that point, he enters some interesting territory. For instance, he claims that Aetna has devoted a tremendous amount of time and effort to address what he considers the “real cost drivers” in healthcare — namely, poor-quality healthcare and the lack of evidence-based medicine and dissemination of “best practices” throughout the medical profession.

[W]e’ve invested an enormous amount in technology and innovation to get at the real cost drivers in health care, which we believe to be poor quality and lack of clinical decision support. Physicians today don’t have any real decision support tools.

[One example would be] the idea that best practices as determined by, say, cardiac specialists would be available in computers that physicians could access along with your complete medical history, to apply with their clinical judgment to make certain you’re getting the best quality of care. Today that doesn’t exist.

Aetna is trying to create such a system, although Williams acknowledges that it’s an imperfect first step:

In the interim we do believe - and it’s a big part of our strategy - that we can use the information and data that we have. For example, we know every physician that you’ve seen if you’re one of our members. We know that you had lab tests conducted, and we know the actual lab values for those tests. We also know the prescriptions that have been filled and therefore the medication that you’re on. We can apply that to computer decision support rules and determine, for example, that you have a cardiac condition and that when you saw a dermatologist, you neglected to mention that. The dermatologist writes a prescription that interacts with your condition. We have the ability to use that data to reach out to your physician. It’s an imperfect solution. It’s not as great as having the whole system connected, but I think it will have a very significant impact on the quality of health care.

He also embraces the notion that individual patients need better information on how doctors and hospitals price their services, as well as how well they’re doing at treating other patients:

At Aetna, in 35 markets, you can go online and know what your physician will charge you before you see that physician. That’s helpful for a routine service, but when it comes to, say, a serious cardiac condition, what you really want to know is whether this is a high-quality physician. We think there is data available. There’s going to be a huge transformation in this area.

[…]

I think it will be possible [to compare and choose doctors using online quality data] within three to five years. Important efforts are under way, with the collaboration of physicians, to agree on quality standards. There’s collaboration in the industry for all health plans to pool their data to create very rich data sets. So consumers could look at a set of performance indicators that physicians think are appropriate, and be able to judge how their physicians fare.

You’ll hear no arguments from me on the usefulness of all this, particularly as more people shoulder a greater part of their own healthcare costs, typically through high-deductible plans coupled with health-savings accounts. The main problem is that even patients “empowered” this way aren’t likely to bring much market power to bear on some of the biggest chunks of medical spending, especially emergency care, treatment of chronic disease such as diabetes and “heroic” end-of-life measures. (It’s also increasingly clear that most people aren’t really equipped to “become their own doctor” in ways that would really have a major impact on healthcare costs.)

The only other observation I’d offer here is that Aetna’s own online-information systems, while apparently well beyond than those of many other insurers, are still woefully inadequate to the task Williams wants them to take on. Since I’ve been in an Aetna health plan since 1999, I know first-hand that Aetna’s online Navigator system is clunky, slow and often downright user-hostile. (I could explain why, but it’s really a whole other post, and not a short one.) Aetna’s technology is certainly better than nothing, and the insurer is upgrading it slowly — for instance, it now contains the cost data Williams describes, although it’s very difficult to use and not particularly comprehensive — but it’s still well short of where Aetna would like you to think it is.

In any case, the Aetna CEO has a variety of other interesting observations on the problem of the uninsured, why insurers think they can be trusted with your medical information, and how tax treatment of insurance ought to be revised. So if you’re interested in geeking out on the subject, by all means you should read the whole thing. If you still want more, Williams goes into additional detail in an interview he gave to WSJ.com a while back, which you can catch on the Aetna Web site in both video and transcript form.

It’s not just big insurers who are sinking into the swamp these days — hospitals are slipping as well. And while it’s a little early to know for sure, the problems of health plans seem quite likely to make those of hospitals even worse.

Yesterday, Tenet Healthcare and Kaiser Permanente — a major for-profit hospital chain and a big nonprofit HMO, respectively — both reported lousy first-quarter earnings, although for very different reasons. Tenet’s $31 million loss largely reflected costs related to its legal dispute with two USC hospitals as well as an ongoing restructuring aimed at relieving bad debt and slowing revenues from patient treatment. Kaiser, meanwhile, blamed a deteriorating economy for a 64 percent slide in net income, largely because the HMO’s investments produced a $295 million loss in the quarter.

Both healthcare providers insist their underlying business is strong. Kaiser, for instance, said it gained 25,000 members during the quarter and boosted operating income, which is separate from investment-related earnings. And Tenet’s year of cost-cutting, during which it sold off “poorly performing” hospitals and cut employment, have led to two successive quarters of “positive admissions growth,” a measure of the number of patients a hospital system is treating, according to CEO Trevor Fetter:

“Our earnings have steadily grown; our margin has expanded; we’ve now had two quarters in a row of positive admissions growth. Those are the metrics that are most important for assessing that we’re in a growth path,” Fetter said.

“The kind of classic things you would expect to see if you were having a recession right now, we’re not seeing,” he said. […] “Since about the third quarter of 2007 we’ve really been doing very well.”

All this, I suspect, is so much whistling past the graveyard. WellPoint and other major insurers clearly intend to bolster their sagging businesses by raising health-insurance premiums. As insurance grows more expensive for employers, many are likely to scale back or drop coverage. That means hospitals will end up treating a greater number of underinsured or uninsured patients, leading to more bad debt, more aggressive collections procedures, and in some cases, draconian measures such as forcing patients to pay in advance for cancer care and other expensive treatments (along with the resulting bad PR).

All of which suggests, at best, another round of contraction and consolidation among both insurers and hospitals, as they struggle to shift rising healthcare costs onto consumers and businesses that are increasingly unable to pay for them. At worst, it could mean the beginning of a death spiral for the byzantine and inefficient U.S. healthcare system. Nothing seems more likely to precipitate a general healthcare crisis than the continued collapse of employer-provided health insurance, and it’s hard to see how that ends short of some form of dramatic government takeover that could shake all three industries to the core — and possibly even legislate health insurers out of business.

I don’t doubt there’s a better way, but almost no one seems to be looking for one. Instead, everyone’s intent  on rearranging the deck chairs while they can.

Update: At the Health Affairs Blog, Jeff Goldsmith offers a dissenting view, albeit one that mostly suggests increased cost-shifting will hold down overall healthcare inflation — and thus delay what still looks like an inevitable crisis — for at least a few years.

Image by Flickr user thetorpedodog, CC 2.0

Medical costs continue to rise much faster than general inflation, the insurance safety net is fraying as health plans and hospitals push the financial burden of being ill back onto the sick themselves, and even people who get their insurance through work have seen their premium contributions rise ten times faster than their incomes. But it turns out there’s some good news in the healthcare industry:

While the nation as a whole lost some 20,000 jobs during the month of April, employment increases were seen in hospitals and physician offices, according to preliminary seasonally adjusted figures from the U.S. Bureau of Labor Statistics.

Hospitals hired about 9,400 people in April for a 0.2% increase over March, and the roughly 4.61 million people employed at hospitals represented a 2.8% increase from 4.49 million in April 2007. Physician-office employment rose by around 7,600 during April for a 0.3% increase, and the almost 2.26 million physician-office employees represented a 3.1% gain compared with April 2007’s total of just over 2.19 million.

Meanwhile, Aetna has a new strategy for expanding access to health insurance — it will require more than 1,300 of its vendors and suppliers to offer healthcare plans to their employees:

The health insurer has set a goal of having 80% of all its vendors offering health benefits by 2010, and all vendors must offer workers coverage by 2012, Aetna announced in a letter to shareholders in its 2007 annual report.

“As a business leader, we have both an opportunity and an obligation to be part of the solution to the problem of the uninsured,” said Ronald Williams, chairman and chief executive officer of Aetna, in the letter. “We expect nothing less from the companies that do business with Aetna.”

That’s a pretty big-hearted idea, especially since I’m sure none of those vendors or suppliers will be under any compunction whatsoever to offer Aetna plans to their workers.

Anyway, it’s nice to know that not all the news coming out of healthcare is bleak. You just have to know where to look.

Image by Flickr user Betsssssy, CC 2.0