JOHN BRUMMETT: Health-care hope

Posted: February 4, 2018 at 4:30 a.m.

At the risk of sounding doctrinaire conservative, please indulge me as I write hopefully about what might have been the nation's biggest news last week.

It was that Amazon, Warren Buffett's company and J.P. Morgan Chase are forming a joint venture to try to do something smarter--currently wholly vague, I admit--in their self-insurance systems for employees on health care.

I believe health care will be reformed in this country by innovations of the private sector, not remotely by the increasingly silly politicians in Washington. They, on both sides, are too beholden to special interests, paralyzed thereby, and plainly unwilling to do the sensible thing and impose a single-payer government system akin to Medicare for all.

So, let's turn loose Amazon and Walmart, among others.

If you can remake American retail in the way they've remade American retail, then you become my nominees to come up with better ways to get health care delivered and paid for.

People scoff. They say Amazon and Walmart don't know diddly about health care. But they know how to amass myriad products, price those products competitively for a consumer-driven age, and sell and deliver them efficiently and conveniently.

Some of that know-how surely can be adapted to health care.

I'm not saying your aorta is akin to merchandise on a shelf or dropped in a box in a warehouse and trucked to your stoop. I'm saying there are principles common to mass markets and mass transactions. I'm saying let's apply some Walmart discount principles and go all-in on Amazon-like digital advancements and consolidations.

Otherwise, contemporary Americans threaten to bankrupt us all--thinking they can live spryly forever if they take enough pills and undergo enough elective surgery, then paying for it passively through middle-men insurers at whatever amounts the insurers and providers agree to pass through in our premiums.

I wasn't the only one seeing potentially big news. The Dow promptly dropped more than 300 points the day the joint venture was announced, with losses pronounced in the health sector.

When folks that big and rich go together to come up with ways to save money on health care, some of the barons of inertia in the current health-care infrastructure become less-appealing investments, apparently.

It's also possible, I guess, that investors were concerned that Buffett and Amazon founder Jeff Bezos, both seemingly inclined toward the Democratic Party, would emerge from this joint venture embracing government health care. But I'm seeing the opposite--competitive market principles.

Lacking any detail on what Amazon, Buffett and J.P. Morgan may do, let's focus for the time being on the potential examples of what Walmart is already doing, or trying.

First are the in-store, walk-in medical clinics. A Walmart employee can use his coffee break to stroll down the way and get his vitals checked and his blood drawn.

Then there is the concept of consumer-driven care utilizing so-called "centers of excellence," as Walmart calls them. The program began slowly in the late 1990s but only recently has been accelerated.

At risk of oversimplification, it can work this way: A Walmart employee covered under the group self-insurance plan gets referred to an orthopedic specialist for his hip pain, then told he needs a joint replacement and has surgery scheduled for him at the local hospital.

The employee can acquiesce per usual to that if he wishes. But his company also gives him this option: He can permit his employer to refer his case file to a hospital that Walmart has declared a "center for excellence" for joint replacement, and with which Walmart has contracted on a bundled-payment basis that saves it and the employee money. The company will then pay mileage and lodging so that the employee and a loved one can travel to that "center of excellence" for a second opinion and conceivably the surgery itself.

Sometimes these higher-regarded hospitals will recommend a non-surgical approach. If the surgery proceeds, then these "centers of excellence" will bring to the operating table what Walmart considers a higher likelihood of success that will produce a better outcome for everybody--a healthier, happier and more mobile employee walking on those hard big-box floors, and long-term savings for both the company and the employee.

The underlying principle is a familiar one. It's that consumers should make informed buying choices based on provider transparency and accountability, indeed--dare I say?--competition.

A Walmart spokesman told me last week that the "centers of excellence" program has expanded so much so recently that he had no valuable data yet on whether savings were being realized or cost trends turned downward.

I offer the Walmart example because it's in place, local, and the kind of thing I'm talking about.

Now let's see what this coalition including Amazon, which seems to like trying to outdo Walmart, can come up with.

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John Brummett, whose column appears regularly in the Arkansas Democrat-Gazette, is a member of the Arkansas Writers' Hall of Fame. Email him at jbrummett@arkansasonline.com. Read his @johnbrummett Twitter feed.

Editorial on 02/04/2018