Physician Practice in the Dynamic Health Care Environment Physician Practice in the Dynamic Health...

Physician Practice in the Dynamic Health Care Physician Practice in the Dynamic Health Care EnvironmentEnvironment

Edward O’Neil, Ph.D. MPAProfessor Family and Community Medicine and Dental Public

Health Director of the Center for the Health Professions, University of

California, San Francisco

HTTP://FUTUREHEALTH.UCSF.EDUHTTP://FUTUREHEALTH.UCSF.EDU

Current Drivers - Demographic - AgingCurrent Drivers - Demographic - Aging

Source: U.S. Census Bureau

Current Drivers - Demographic - AgingCurrent Drivers - Demographic - Aging

13

24.5

12.5

21.4

1113

0

5

10

15

20

25

Perc

enta

ge

MT NC CA

Percentage of State Population > 65, 1995, 2025

1995 > 65 2025 >65Source: U.S. Census Bureau, U.S. Bureau of the Census, Population Division, Population Paper Listing #47, Population Electronic Product #45

Current Drivers - Demographic - DiversityCurrent Drivers - Demographic - Diversity

0

10

20

30

40

50

60

70

80

Perce

ntage

White Black Hispanic Asian/PI Am Indian

Percentage Ethnicity of US Population, 95, 05, 25

199520052025

Still Assume Mainstream

• From diversity to multicultural

• New consumer demands

• Serious mismatch Latino and Black populations

Current Drivers - Demographic - DiversityCurrent Drivers - Demographic - Diversity

0

10

20

30

40

50

60

70

80

Perce

ntage


Percentage Ethnicity of NC Population, 95, 25

1995

2025

0

10

20

30

40

50

60

Perce

ntage


Percentage Ethnicity of CA Population, 95, 25

1995

2025

Changes in Cause of Death, Changes in Cause of Death, 1900–19991900–1999

Source: Centers for Disease Control and Prevention. Control of infectious diseases, 1900–1999. Morbidity and Mortality Weekly Report 1999; 48:621–629.

30

32

34

36

38

40

Per

cent

1997 1999 2000 2001

Limitation of Activity Casused by Chronic Condition, >65

Current Drivers- EpidemiologyCurrent Drivers- Epidemiology

SOURCE: Health US, 2003, USHHS, CDC,NCHCS, October 2003, 56.

23

31

20

30

40

Per

cent

1990 2000

Obesity Rates, >20

Current Drivers- EpidemiologyCurrent Drivers- Epidemiology


National Institutes of HealthFunding Streams FY 1988 - FY 2003

(dollars in millions)

9.8%7.7% 8.4%

8.6% 3.2%5.6% 3.9% 4.8%

14.3%

13.9%

14.1%

$6,000

$11,000

$16,000

$21,000

$26,000

$31,000

FY1988

FY1989

FY1990

FY1991

FY1992

FY1993

FY1994

FY1995

FY1996

FY1997

FY1998

FY1999

FY2000

FY2001Est.

FY2002 Est.

FY2003 Est.

Fiscal Years

7.5%7.5%

14.9%

15.7%

7.2%

Current Drivers – Technology - BiotechCurrent Drivers – Technology - Biotech


US owns 85% of intellectual property in bio-technology

Only “industrial policy” followed consistently by both political parties

Consumer demand and expectation growing

Morph from bio tech to care management technology

How the market is betting:

Market Capitalization

•Biotech, Pharma, Equipment = $1,300B

•Rest of Health Care = $169B

156 164256

357

595

840

1317

1848

2467

-300

100

500

900

1300

1700

2100

2500

MIL

LIO

NS O

F DO

LLAR

S

1992 1993 1994 1995 1996 1997 1998 1999 2000

Spending for Direct to Consuemer Prescription Drug Advertizing

Source: Conlan, M, In Your Face Pharmacy: Will the Boom in Rx ads aimed at consumers continue, Drug Topics 140 (13): 92-98.IMS Health Promotion Service and Competitive Media Reporting , 1994-2001.

Rapid expansion

Image of what can happen with enlarged consumer role


…and more consumer titillation…

The Most Important Step is to Recognize The Most Important Step is to Recognize that Health Care is a that Health Care is a Knowledge Based Knowledge Based

ServiceService Undertaking Undertaking

The Most Important Step is to Recognize The Most Important Step is to Recognize that Health Care is a that Health Care is a Knowledge Based Knowledge Based

ServiceService Undertaking Undertaking

Current Drivers – Technology – Info TechCurrent Drivers – Technology – Info Tech

Information

Management

Consumer

Clinic

Source of health informationSource of health information

68 66 65 64 64

48

59

010203040506070

Per

cent

Northw

est

Northeast

California

Mountain

Capital

South

Midw

estPercent of on-line adults by region, 2002

Source: Pew Internet and Public Life.

Source of health informationSource of health information

52

2117

12 9 62

0

10

20

30

40

50

60

Per

cent

E m

ail

Hobby

Weather

Finance

Gam

es

Health

Adult

What on-line adults used net to do, 2002

Source: Pew Internet and Public Life, 2002.

Current Drivers – Technology – Info TechCurrent Drivers – Technology – Info Tech

• 33 Million Admissions• 4.8 Billion claims• 505 Million outpatient visits• 1.7 Billion prescriptions

filled

SOURCE: AHA, Hospital Statistics, 2002.Healthcare Infirmities, December 2001, p15.

• Consumer value• More participation• More control

Current Drivers - Values – Current Drivers - Values –

Current Drivers – Health Care EnvironmentCurrent Drivers – Health Care Environment

Stressed care delivery system and institutions– Tighter resources– Lack of direction– Greater demands

• Technology• Quality• Safety

– Job cuts – Uncertainty– Inability to adapt and change rapidly– Half born revolution

• Enormous range in definition of quality

DuplicationDuplication

• Over/under supply of care providers, hospitals, insurers.

• Substitutable inputs

CostCost• Total system costs are

a huge burden

VariationVariation

CapacityCapacity

Current Drivers –Continued Disequilibrium Current Drivers –Continued Disequilibrium in Health Carein Health Care


Increases in Health Premiums, Inflation, Income, 88-03

0

5

10

15

20

1988 1989 1990 1993 1996 1999 2000 2001 2002 2003

Percen

t

Premiums

Earnings

Inflation

Source: HJ Kaisier Foundation, HRET Employer Sponsored Health Benefits, 2003, p21.

CostCost

CPI and CPI Health Care

0

100

200

300

1960 1970 1980 1990 2002

CP

I


Current Drivers- Economic Disparity

All Items

Health Care


• Familiar story of services following reimbursement

Surgeons

Specialists

All MDs

Beds

-26

29

65

31

32

-50 0 50 100

Family MD

Provider Resources in High Medicare Areas

Source: NY Times, 9/13/03, A9;Fisher, Elliot, Annals, February 2002.

VariationVariation


General

Colorectal

Hip Fracture

Cardiac

0

5

2

5

0 2 4 6

Percent Increase Risk of Death

Source: NY Times, 9/13/03, A9;Fisher, Elliot, Annals, February 2002.

VariationVariation

52

59

69

77

0 50 100

Services Received in High Medicare Areas


SubstitutionSubstitution

0

5

10

15

20

Per

cent

1980 1999 2001

US Annual Percent Growth in Expenditures by Input

Hospital MD DrugSource: HHS, CMS, www.cms.hhs.gov/statistics/nhe/default.asp


SubstitutionSubstitution

Spending on Physicians and Drugs, 1999

184.0

375.0

237.0298.0

761.0

218.0289.0 337.0

258.0344.0

0

200

400

600

800

U.K. GERMANY FRANCE CANADA U.S.PER

CAPI

TA D

OLLA

RS

MD Drug

Source: OECD, Health Reports, 2001.

•Access - 15% uninsured

Current Drivers –Continued Disequilibrium in Current Drivers –Continued Disequilibrium in Health CareHealth Care

Policy and Market Solutions

Changing Role

“When one doesn’t know what one wants or needs, one can never have enough” Eric Hoffer

ChoiceCost Preferences

Current Driver – Changing ConsumerCurrent Driver – Changing Consumer

Consumer

Tower mentality of the guilds

Driven in part by choice of consumers

Prerogatives of incumbents remain paramount

Less of a system more a collection

Current Drivers –Continued Movement to Current Drivers –Continued Movement to SystemsSystems

How did we get here?

Where are we going?

Percentage of Physicians Receiving Incentive, Percentage of Physicians Receiving Incentive, Office-Based and Kaiser Permanente Physicians, Office-Based and Kaiser Permanente Physicians, 20012001

Factors Affecting the Calculation of Incentives, Office-Factors Affecting the Calculation of Incentives, Office-Based and Kaiser Permanente Primary Care Physicians, Based and Kaiser Permanente Primary Care Physicians,

20012001

Factors Affecting the Calculation of Incentives, Factors Affecting the Calculation of Incentives, Primary Care Physicians, 1996–2001Primary Care Physicians, 1996–2001

Physician Income, 1996–2001Physician Income, 1996–2001

Average Work Hours Per Week, Primary Care Average Work Hours Per Week, Primary Care Physicians and Specialists, 2001Physicians and Specialists, 2001

Change in Hours, Primary Care Physicians, 2001Change in Hours, Primary Care Physicians, 2001

Change in Hours, Specialists, 2001Change in Hours, Specialists, 2001

Mean Change in Hours among Physicians with a Mean Change in Hours among Physicians with a Change in Work Hours, Primary Care Physicians Change in Work Hours, Primary Care Physicians and Specialists, 2001and Specialists, 2001

Work Hours Per Week by Physician Sex, 2001Work Hours Per Week by Physician Sex, 2001

Percentage of Physicians Reporting Disease Percentage of Physicians Reporting Disease Management Offered, Office-Based and Kaiser Management Offered, Office-Based and Kaiser Permanente Physicians, 2001Permanente Physicians, 2001

Percentage of Physicians Receiving Practice Pattern Percentage of Physicians Receiving Practice Pattern Information, by Type of Information, Primary Care Information, by Type of Information, Primary Care

Physicians, 2001Physicians, 2001

Percentage of Physicians Experiencing Practice Percentage of Physicians Experiencing Practice Pressures, Office-Based and Kaiser Permanente Pressures, Office-Based and Kaiser Permanente Primary Care Physicians, 2001Primary Care Physicians, 2001

Percentage of Primary Care Physicians Working with Percentage of Primary Care Physicians Working with Non-Physician Clinicians, Office-Based and Kaiser Non-Physician Clinicians, Office-Based and Kaiser

Permanente, 2001Permanente, 2001

For Physician PracticesFor Physician Practices

• Success in the future means:– Vision of practice that understands and delivers on

the needs of key stakeholders: • purchasers, • payers, • consumers, • and operators

– Competitive ability to understand, market and manage patients at population level


• Success in the future means:– Ability to deploy technology and systems against

population problems and/or emergent health markets

– Ability align practice with prevailing reimbursement scheme and adjust as it changes


• Success in the future means:– Ability to deliver safe, affordable, consumer orientated care

that is at or above average on quality indicators

– Create and manage an adaptive culture of practice that can: • Evolve quickly• Create and support collaboration• Sponsor innovation

Center for the Health Professions Center for the Health Professions University of California, San FranciscoUniversity of California, San Francisco

For more information, please contact: UCSF Center for the Health ProfessionsFor more information, please contact: UCSF Center for the Health Professions3333 California Street, Suite 410, San Francisco, CA 94118 Phone: 415/476-81813333 California Street, Suite 410, San Francisco, CA 94118 Phone: 415/476-8181

HTTP://[email protected]

Physician Practice in the Dynamic Health Care Environment Physician Practice in the Dynamic Health...

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