Health care politics could jeopardize health care business opportunities

The American healthcare industry is poised to take advantage of the growing global population and expanding global middle-class, if we take five steps to save the industry here, a new book argues.

???We are the No. 1 world innovation leader, in healthcare products and services, and the world population will increase by 1.3 billion people between now and 2030, during the same time the global middle class will grow from two billion people today to five billion people in 2030,??? said Edmund L. Valentine, author of  Healthcare, Will U.S. Politics Kill Our Politics? He is the CEO of the Stamford, Conn.-based MMC International, a health care consulting firm.

Another opportunity for the American health care industry is the expansion of the senior citizen population, which will grow by one billion people worldwide by 2030, he said.

???Health care is a skyrocketing opportunity, not a burden,??? he said.

???They are all customers for our products,??? Valentine said, who has spent the last 27 years as a consultant to health care businesses. Valentine???s firm spent $1.8 million researching the state of the health care industry today.

Because of country???s industry leadership and a market that is about to explode, America must not do anything that will disrupt exploit that opportunity, he said.

???The issues we dig into have nothing to do with politics,??? said the consultant, who has been the editor of multiple editions of MMC International???s Trends Shaping U.S. Pharmaceutical Industry Strategies.

???Most of our people in the health care industry, in manufacturing, are fighting to retain their leadership???and politics is the cost of doing business, so we don???t spend time on politics,??? said Valentine, a decorated Green Beret veteran of Vietnam.

The author said he wrote a non-partisan book from the perspective of someone inside the health care business out of frustration with how serious issues and problems are twisted, distorted and condensed into sound bites. ???It is a reaction to all the misinformation out there from both sides.???

Valentine said there are five steps to take, some of them have already started, and others need to start right away.

???The first thing is it to digitize all medical records and medical information,??? he said.

???The second thing is something that was started by the Mayo Clinic, the Cleveland Clinic and our best institutions, and that is shifting compensation from procedures to outcomes and from fee-for-service to wellness,??? he said. In this model, the medical facility charges a flat fee for an incident, such as a broken arm, and in this case all services associated with the broken arm are covered by the one fee.

Edmund L. Valentine

Fee-for-procedure gives the facility the incentive to heal the patient quickly, whereas fee-for-service creates an environment where the facility is paid for each service, thus the incentive is to prolong and expand treatment wastefully.

America???s current health care insurance system is a legacy of federal wage controls during the Second World War. Kaiser Shipyards on the West Coast and the auto companies in Detroit, unable to raise wages to attract and keep workers, offered generous health insurance plans.

The plans were not expensive because in the 1940s there was not a lot doctors could do for someone, who was seriously ill, he said. ???Today, our medical knowledge has exploded and our costs have exploded.???

Valentine said the third step is to treat health insurance as a commodity, where companies only compete based on their reputation and price.

The fourth step is the further industrialization of healthcare, he said.

???Industrialization created our great economy,??? he said. ???Allow the market and competition can fix the inefficiencies in the system.???

If America spends $2.8 trillion every year on healthcare, $1 trillion is wasted and adds nothing to the actual health of patients, he said.

The fifth step is that we need to have financial incentives and tax policies that encourage the retention in the United States of high technology, innovation, as well as high technology manufacturing, he said.

Other helpful reforms would allow insurance companies to compete across state lines, maintain America???s education system, and reform the country???s immigration priorities, so that talented people from the around the world can work here, he said.

Regardless of  whom won the election, the changes brought by President Barack Obama???s 2010 Patient Protection and Affordable Care Act will not be reversed, he said.

Valentine said he is convinced that President Obama will modify parts of the ACA, but for the most part, it will continue towards full implementation.