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A Reinvented — and Better — Healthcare System Built from Scratch

By Marcelo Cruz - Elery.co


By Melina Cruz | CEO & Co-founder - Thu, 06/08/2023 - 13:00

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The concept of medical specialties is more recent than what many people realize. It is believed that modern specialties in Mexico originated in 1924, with the establishment of the Médico-Quirúrgica (Medical-Surgical) units at the General Hospital of Mexico. However, if we delve into history, we find that the concept of hospitals can be traced back to ancient civilizations.

In ancient times, hospitals often served as religious institutions or healing centers affiliated with temples. Their main purpose was to provide care for the sick and offer basic medical treatment. The foundation of the modern hospital system took shape during the 18th and 19th centuries, when hospitals underwent significant transformations driven by advances in medical knowledge and the rapid growth of urban populations. As scientific medicine flourished and the Industrial Revolution took hold, the demand for medical care skyrocketed. Hospitals evolved into large-scale institutions, even as specialization began to spread worldwide. This prompts us to ponder: If we possessed a magical wand capable of rebuilding the entire healthcare system, how would we shape it in today's world?

Before we embark on reinvention, it is crucial to grasp the current healthcare landscape. Across the globe, three predominant healthcare systems prevail: the nationalized or socialized model found in Europe, the market-driven approach seen in the US, and the hybrid system we have here in Mexico. Each of these systems possesses its own distinct merits and demerits.

A socialized healthcare system strives to extend universal coverage to all citizens, ensuring that essential medical services are accessible to everyone, irrespective of their financial circumstances. This approach champions fairness by narrowing the gap in healthcare access and outcomes, as medical care is provided based on medical necessity rather than financial means. Moreover, it places significant emphasis on preventive care and public health initiatives, fostering early interventions that aim to bolster the overall health of the population. Nevertheless, it does come with its own set of challenges. Patients may find themselves with reduced autonomy and limited choices, as the government assumes control over resource allocation and service provisions. Additionally, stringent government oversight and cost containment measures can inadvertently stifle innovation by discouraging investments in research and development, which hampers the introduction of new treatments and medical breakthroughs.

A market-driven healthcare system presents individuals with a plethora of healthcare providers and insurance choices. This model holds the potential for stimulating innovation, as competition acts as a catalyst for the development of groundbreaking treatments, technologies, and healthcare delivery approaches. Furthermore, market forces can foster efficiency, as healthcare providers strive to offer cost-effective services while enhancing quality to entice both patients and insurers. This system encourages individuals to assume responsibility for their healthcare decisions and expenses, potentially promoting healthier lifestyles and preventive care. Nonetheless, it is not without its drawbacks. Some individuals may find themselves without access to healthcare coverage if they lack the financial means to afford it. The profit-oriented nature of market-driven systems can lead to soaring healthcare costs, as providers may charge higher prices for services and medications. Additionally, it can result in fragmented and disjointed care, as healthcare providers may prioritize maximizing profits over delivering comprehensive patient-centered care.

Considering the merits and pitfalls of each system, many countries, including Mexico, opted for a seemingly straightforward solution: a hybrid model that incorporated elements of both approaches. The intention was commendable - to harness the advantages of both systems. However, in practice, it fell short of expectations. Rather than segmenting care based on medical necessity, it inadvertently segmented care based on wealth. Those who have the means to avoid the public system often do so, perpetuating a divide between two inefficient models that compete with each other, rather than working in synergy. It is evident that a better approach is needed to achieve a truly effective healthcare system.

In my previous article, I wrote about how specialty care enables the implementation of a product-portfolio strategy in healthcare. My thesis centered around the idea that such a strategy could revolutionize access, affordability, and outcomes by strategically aligning resources to meet specific needs. Building upon that foundation, I now invite you to explore a novel approach to designing a healthcare system—one that breaks away from the traditional reliance on hospitals and instead embraces value-adding specialty clinics.

Allow me to present my proposal: Let's segment the system based on the type of care required by each individual. This way, we can harness the best of both worlds. Picture this: The same person receives certain essential care from a government-funded system, while also having the option to pay or secure insurance for another type of care. One person, two systems. The underlying premise here is that certain aspects of healthcare should not be subject to market forces, while others can benefit from them. When a person's life hangs in the balance and immediate treatment is crucial, there is no time to explore alternatives. On the other hand, if the perceived benefit of preventative care is not apparent, patients may overlook its importance. Such facets of healthcare simply cannot follow a market-driven model. However, there exists a realm within healthcare that can indeed thrive under market forces—elective healthcare that primarily encompasses specialty care.

Elective healthcare presents an ideal opportunity for the implementation of a product-segmented healthcare system. Patients seeking elective procedures have the luxury of time to research their condition, explore alternatives, and make informed decisions about their care. For providers, this approach brings a multitude of benefits. By segmenting services based on specific products, healthcare providers can specialize in particular areas, fostering expertise and elevating the quality of care in those specialized fields. Moreover, focusing on specific products or procedures allows providers to streamline operations, improve efficiency, and optimize resource allocation. This specialization can lead to cost savings and facilitate the establishment of standardized protocols and best practices, ensuring consistent quality across various healthcare settings. Additionally, product-based segmentation stimulates innovation by driving research, technological advancements, and treatment options related to those specific products.

By embracing this differentiated approach, we can prioritize and tailor resources based on the specific needs of each individual. It would allow us to allocate vital resources to critical and time-sensitive situations, while also leveraging market dynamics to enhance the delivery of elective specialty care.

However, it is crucial to address a potential downside: the risk of fragmented care. While segmentation offers advantages, it must be balanced with a patient-centered approach to ensure comprehensive, coordinated, and accessible healthcare. It is essential to strike a harmonious balance between specialization and integration, prioritizing patient needs, preferences, and overall well-being. Achieving this delicate balance necessitates the implementation of technology and the effective utilization of coding systems such as CPT/HCPCS, ICD-10, or their local equivalents.

Undoubtedly, transforming the healthcare system is a monumental undertaking that may span years, if not decades. Nonetheless, we can all contribute to the betterment of our health system by embracing unconventional ideas and implementing small yet meaningful changes. At elery.co, we are committed to driving innovation and contributing to a healthcare landscape that prioritizes patient-centered care, efficiency, and improved outcomes. Together, let us embark on this transformative journey toward a brighter and healthier future.

Photo by:   Marcelo Cruz

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