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Leading Healthcare to a Better and Sustainable Future

This post is a complement and response to the post by Michael Greeley entitledBet the Jockey…Bet the Horse…and Bet the Track’ (hyperlinked).


Michael Greeley is one of the nicest people I have met in the investment sector. The above well-written blog post is a ‘must read’. Michael periodically writes these nice blogs with well compiled information and passion. This particular post talks about changes in healthcare and how he and his firm have chosen to invest in a company and entrepreneur who are going to be in the midst of a fascinating market vortex, and extrapolates to the rebuilt healthcare system we are striving for.

These are great points from the perspective of an investor – but not always of the ‘consumer’. Being passionate about health reform and working to ‘Build an efficient and healthy world’, I want to shed light on alternative perspectives that need attention. In that process, I borrow many words and perspectives from Michael’s blog to connect the two views.

If we further incentivize tiered and ‘branded’ healthcare delivery system, WHILE moving more towards B2C rather than B2B – bulk of the population will be forced to get substandard care – because they cannot afford it. One may argue that is better than many not getting healthcare coverage at all – true, but is that what we are striving to build? It is like telling those consumers: ‘you want to buy from the branded tier, but you can’t afford it’. Healthcare is not a nice to have feature, but a necessity and a significant population of people not getting a good one will affect the others who can afford branded tier – including health of the latter and societal wellbeing.

The other argument about the healthcare cost drop due to ‘insurance cost-sharing initiatives like expanded deductibles and …’, again points to shifting the burden to the consumer. The other part of the statement ‘and the proliferation of innovative healthcare technologies’ include using big data (like EHR/EMR) to justify with data that low cost alternatives work as well on majority of population. Whereas majority of the cost result from a couple of percent population who suffer from illness that cannot be easily ‘cured’ to whom these low cost alternatives may not be the right choice, and subtle differences in effectiveness hurt them a lot. Now, using this population data and depriving the seriously ill (especially ones who cannot afford ‘brand’) who need the higher cost alternative is going to have serious negative consequences to real consumers (not investors) in the not so long run.

Here are few examples:

  1. An example is insurers saying that expensive medicine is excluded from coverage in your tier – the ‘brand’ effect.
  2. Another example is a doctor entrepreneur – whose qualifications cannot be questioned (but motives can be) – building and promoting a model writing that the patient does not need some specialized care or specialized medicine, depending on where they are on the tier and brand.
  3. To those who do not follow this closely, there are enterprises being built with an alternative business model whose sole purpose is to cover medicines and treatments when denied due to circumstances exemplified by above two points.

Most people who go to McDonalds and equivalent rather than more healthy and other ‘brand’ alternatives (of course they cannot live on apples) do so because they cannot afford the latter.

Yes, we all agree that current healthcare model needs a major overhaul that many are working on with lot of passion, and money from institutional investors like VCs (and return for them) is an essential part of this transformation.

We should be more careful in thinking out the healthcare system beyond the five year VC models, lest we end up with another broken healthcare system that needs to be fixed by another ‘New President Care’ (or ‘NACA’ – new ACA) in place of the just implemented ‘Obama Care’ or ‘ACA’. The point is not just about cutting cost but about making the system efficient in a sustainable way.

You can share your thoughts on solutions below comment section, or go on and build the system without these major pitfalls.

*Picture depicts the state we do not want to get to – where sole reasoning driving decision is cost.

Why I am indifferent to the effects of sequestration on research funding

In the recent nine months we have been reading about the impact of sequestration on various aspects of life – from defense spending to basic biomedical research. Some articles highlight dramatic consequences.  I write this from the region of the USA (Boston/Cambridge area) that attracts the most amount of research funding from governmental sources per capita.

Peer Review
Peer Review*

Despite having been in the academic system for most of my career, it does not bother me – not the least because I am not in academics anymore and am an ardent learner and practitioner of capitalism. That does not mean I don’t care – that is a reason why I am writing this. I am more concerned about a bigger problem that plagues the efficient use of federal resources, our review system. Peer review is hailed to be the best system we have so far to evaluate work of significance that gets funded or published. But, in fact, peer review is what is failing us consistently from achieving greater things, largely favoring incremental progress. Thus, our system needs to develop ways to improve the peer review system, as we explore other models of review and evaluation. That is notwithstanding the fact that the US research leads the world in progress through cumulative incremental progress.

Here I propose one solution: Our peer review system needs a way to penalize poor peer reviewers who are outright wrong and have no vision whatsoever, and can’t recognize a good idea when presented to them – even if we have to determine that fact post hoc. This will get us to promote innovation faster and get beyond just largely incremental progress. This will also weed out the substandard grants and publications that take away the bulk of our resources and leads to repetitive, largely non-reproducible and incremental publications. In addition, this will weed out the PIs (Principal Investigators) who are holding back important advances in our research endeavors that are largely built on these research grants.

Share your thoughts. Can use comment form or comments option by title (or at end of the page) and can use Facebook, Twitter or WordPress account.

An exemplary case from the recent past in my career:

I have been a consistent predictor of important mechanistic breakthroughs in the life sciences and the real world significance of these discoveries based on a limited amount of disparate data (hence some statement in my LinkedIn profile summary). You can find some of my past work released here.

I highlight my above concern and the proposed solution using one of my three grant applications that I put in public domain: (i) application referenced below; (ii) reapply of the one referenced below; (iii) another application on a different topic – for view and download, that I submitted to US National Institute of Health (NIH) between 2008 and 2009. Though my case is certainly not the first in history that a good idea was not funded, I highlight the problem with the peer review system with one compelling example (of many) from my past career and propose a solution. I am sharing them with the hope that these will help researchers in academia and industry get different thought process with respect to those topics and beyond.

The biomedical significance statements of the grant I highlight (submitted in November 2008, and resubmitted in March, 2009 to the US NIH):

  1. I hypothesized an immune response to viral pathogens (RNAi) to be operative but masked due to complexity in humans and other mammals.
  2. I hypothesized that we can identify native viruses using simple model organisms (and by extension in higher organisms) from remnants left by the RNAi related immune system.
  3. I proposed to study cross-regulation of this immune mechanism with other classes of innate immune mechanisms, so we can manipulate them effectively to overcome infection and other immune related disease.
  4. I proposed to study multi-pathogen infections (especially involving bacterial and viral pathogens, that I spent the bulk of my life studying). I hypothesized relevance to HIV and other infections that cause one to become susceptible to multiple pathogens – or even normally innocuous microbes.

This was critiqued by reviewers underplaying the significance with comments implying:

  1. There is no evidence pointing towards my primary hypothesis, and
  2. The intermediate goal of finding viruses native to one of the model organisms is (i) not feasible, and (ii) will not be useful or usable, even if I find them.

Imagine the impact on the microbiome project if we had looked at it in the same light.

My primary hypothesis has been proven recently, October 2013, by way of two papers in the journal Science (considered one of the top two journals by people in various fields, though things that do not belong there slip in at various times), considered controversial by some.

  1. RNA Interference Functions as an Antiviral Immunity Mechanism in Mammals
  2. Antiviral RNA interference in mammalian cells
  3. Two different perspectives written on those articles.;

My intermediate hypothesis of being able to identify new viruses in those model organisms (that is simply a proof of concept for even wider application to other organisms), was proved in Feb. 2009.

  1. Virus discovery by deep sequencing and assembly of virus-derived small silencing RNAs(Feb. 2009).
  2. Six RNA viruses and forty-one hosts: viral small RNAs and modulation of small RNA repertoires in vertebrate and invertebrate systems.(Feb. 2009).
  3. Complete viral genome sequence and discovery of novel viruses by deep sequencing of small RNAs: a generic method for diagnosis, discovery and sequencing of viruses(May2009).

When the intermediate step of being able to find new viruses (using remnants left by this defense system) was proven correct despite being slammed by reviewers,I wrote to the division to which I applied, twice, Sep. 2009, and Oct. 2010, and then called one of the division leaders at NIH to discuss the issue. This gentleman said how sorry he feels and how our peer review system can be unduly penalizing on some people. Further he elaborated that despite extensive efforts we (as a scientific community and society) have not come up with a viable alternative to replace the peer review system.

Here is the solution again: Our grant systems needs a way to penalize poor peer reviewers who are wrong and have no vision whatsoever, so we will not be repeating the same mistakes over and over.  This will promote rapid innovation and go beyond simply incremental progress. Yes, incremental progress is safe, but we are in a position to return more to the tax payers who fund this research.

Share your thoughts. Can use comment form or comments option by title (or at end of the page) and can use Facebook, Twitter or WordPress account.

*Picture based on a reflection captured from subway window in Zurich.

A steady state to avoid while adopting Accountable Care Organizations (ACOs) in healthcare

Healthcare is undergoing a major overhaul. The costs are ballooning and we are resorting to Electronic Health Records (EHRs) and Electronic Medical Records (EMRs), remote monitoring and care, quantified-self enabled by smartphones, wearable devices, etc. to gain better understanding of cost control and sources of wasted resources. This post refers specifically to changes happening in the USA.


With the implementation of the Affordable Care Act (ACA), another major change that will likely be the norm in the near future are ACOs – Accountable Care Organizations , also called pay-for-performance (P4P) in broader contexts. I will use ACO and P4P interchangeably for this post. In this concept the care providers (hospitals, doctors etc.) are reimbursed mainly by metrics signifying quality, appropriateness and efficiency of the health care provided. This contrasts from the current standard where the providers are predominantly paid for each service provided including the number of tests they order during the course of their treatment.

The healthcare industry, while built on compassion and care, still has to control and recover costs and have an operating margin. One major (and welcome) change that is expected with adoption of ACOs is that practitioners of various sub-specialties interact more freely.

Of all the good things that can happen with this change to ACOs, one possible outcome worries me. In this worrisome scenario, the hospitals and care organizations train their staff to achieve the above goal with as much margin as possible and over time reach a steady state that is optimized primarily for the margin, while patient care gets adversely affected. Let us consider the scenario where the patient falls in a socio-economic or other stratification category, or has disease that is not easy to visualize and diagnose – then a couple of physicians independently doubting the patient in their notes can lead to the system claiming that they have provided adequate care and meet the payment criteria, while optimizing the care cost. This patient is unlikely to receive optimal care.

Another example (probably also related to the above) is the 30 day readmission rate as a criterion for evaluation of performance: in this context there will be a strong tendency to compromise patient care if the patient returns for care on day 27, for instance. With all due respect for compassion and care of medical professionals, the need to optimize margin might force them to make decisions that are not optimal care for that day. One evolving trend is highlighted in this article.

To avoid such a scenario, the system: patients, physicians (and other care providers), payers and regulators have to simultaneously achieve their goals of patient care and cost control while balancing everyone’s financial incentives – without burden on one of the players in the equation.

Let us avoid a steady state that compromises patient care while adopting an honorable goal that could forever transform our healthcare system and costs.

Share what you think using the comment option.

Picture based on a reflection captured from subway window in Zurich. It is modified and used to show four major facets in healthcare: Patients, Providers (of healthcare), Payers and Regulators.