Paul Keckley PhD
The Keckley Group

Context: The U.S. Health industry is big business -- $4.8 trillion in 2023. It accounts for 17.6% of the GDP and employs 18.3 million -- the biggest private employer in the economy. It's highly regulated, complex, fragmented, expensive and profitable for most. Per the Congressional Budget Office, total spending will increase at 5.6% per year through 2032 -- well above inflation, wages and GDP increases. Compared to other countries that operate western-medicine (allopathic) care, the U.S. has significantly higher costs and poor outcomes at or below others.

Overall, dissatisfaction is high and user experiences poor. Access, outcomes and costs vary widely for consumers: rural, uneducated, minority and low-income populations pay more and get suboptimal care compared to others. Two-in-three Americans believe the system puts profit above patient care and four of ten households have medical bills they're unlikely to pay.

My beliefs:

U.S. healthcare is broken: there's plenty of money, but it's used to perpetuate its structural flaws i.e. lack of integration between public health and local health systems, inadequate investment in primary health services, inadequate personal accountability by individuals and households, workforce stagnation and suboptimal productivity, mal-designed incentives and more. It needs systemic, structural, comprehensive reform to lower costs, improve its effectiveness, stimulate competition and raise outcomes. The status quo is not sustainable.

Incumbents in the current system--hospitals, insurers, physicians, drug & device manufacturers--do not want systemic changes. It's threatening. Executives are rewarded for short-term financial results that Boards are not inclined nor equipped to challenge unless short-term targets are missed. A long-term
perspective on the industry -- its focus, structure, funding and barriers -- is lacking in most C suites and trade groups that represent its interests. Systemic changes will be in response to external pressure unwelcome by incumbents.

The system operates in the dark: transparency is virtually nil. Consumers are not knowledgeable nor equipped to engage the system effectively. Nor are most elected officials. While the majority believe healthcare is important and a fundamental right, most live unhealthy lifestyles and believe the system puts its financial self-interests above their wellbeing. Distinctions between not-for-profit and investor owned are not understood. Access to current, valid and reliable data/information about prices, underlying direct and indirect costs, supply-chain business relationships, payer-provider contracts and terms of payment, drug efficacy and effectiveness, outcomes, community benefits and tax exemptions, adherence to evidence-based best practice by care teams and patients, staffing, safety, executive and physician compensation, Board effectiveness, medical error and other performance indicators are shielded from public scrutiny to protect insiders and sustain funding increases. The system prefers less scrutiny and more money.

A system of health built on whole-person care (physical, emotional) and value-based design is necessary. Key elements include integration of social determinants (social services) with traditional care giving, integration of financing (insurance) with delivery and public policies that facilitate technology (Gen AI) enabled care management by individuals and caregivers. It requires independent governance to set global budgets that advance access, affordability and effectiveness short and long-term. It needs an independent bureau to decipher evidence and align care management with processes and desired outcomes. It requires a primary-care front-door accessible to all that integrates nutrition, prophylactic dentistry, health coaching, behavioral health and self-care. And it needs elected officials to facilitate changes void of partisan brinksmanship.

Adequate public and private funding is necessary: total costs of care (spending) should align directly with economic growth and be capped at no more than GDP + 1%. Current funding -- public and private -- is adequate: using it strategically for the system's long-term sustainability is the issue.

Final thought:

The status quo in healthcare is not working except for insiders who benefit financially. Incumbents appear more concerned about protecting their financial interests than the greater good. As a result, the health status of the population is declining, costs are soaring and dissatisfaction is palpable.

Solutions are obvious. Left unattended, the system will devolve to a large public utility that serves most Americans and a small private system for the few who can afford it.

Unless and until employers, consumers, elected officials and community leaders step up, nothing will change. §

The Kepley Report | LinkedIn last edited 1325 cdst

EDITOR'S NOTE: 18 December 2024: Prompted by Paul Keckley's comments during a September 2024 healthcare conference in Nashville, Venture Nashville requested Keckley elaborate on some U.S. health-industry issues he considers among greatest priority. With the permission of the author, his response is presented verbatim above, with formatting adjustments only. In reporting via VNC, my experience suggests that, while there may be disagreement on particulars, many in Nashville and in the nation-at-large recognize engagement on these issues is insufficient, leaving many professionals, policymakers and consumers keen to hear more straight talk about rational and potentially powerful solutions. Reader comments on the substance of this piece are welcomed via VNC's LinkedIn post here, or via email to Milt at VentureNashville dot com.-Milt Capps VNC