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Redefining Health Care: Creating Value-Based Competition on Results | 
 enlarge | Authors: Michael E. Porter, Elizabeth Olmsted Teisberg
Publisher: Harvard Business School Press
Category: Book
List Price: $35.00
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Rating:  27 reviews
Sales Rank: 8165
Media: Hardcover
Edition: 1
Pages: 506
Number Of Items: 1
Shipping Weight (lbs): 2
Dimensions (in): 9.2 x 6.3 x 2
ISBN: 1591397782
Dewey Decimal Number: 362.1068
EAN: 9781591397786
ASIN: 1591397782
Publication Date: May 25, 2006
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Product Description
The U.S. health care system is in crisis. At stake are the quality of care for millions of Americans and the financial well-being of individuals and employers squeezed by skyrocketing premiums-not to mention the stability of state and federal government budgets. In Redefining Health Care, internationally renowned strategy expert Michael Porter and innovation expert Elizabeth Teisberg reveal the underlying-and largely overlooked-causes of the problem, and provide a powerful prescription for change. The authors argue that participants in the health care system have competed to shift costs, accumulate bargaining power, and restrict services, rather than create value for patients. This zero-sum competition takes place at the wrong level-among health plans, networks, and hospitals-rather than where it matters most, in the diagnosis, treatment, and prevention of specific health conditions. Redefining Health Care lays out a breakthrough framework for redefining health care competition based on patient value. With specific recommendations for hospitals, doctors, health plans, employers, and policy makers, this book shows how to move to a positive-sum competition that will unleash stunning improvements in quality and efficiency.
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| Customer Reviews: Read 22 more reviews...
 A Flawed Solution to a Real Problem August 31, 2006
Neil S. Calman MD (New York, NY United States)
31 out of 50 found this review helpful
Porter's analysis of the health care system and its problems is right on yet his solutions could not be farther from the direction that the health care system must move to become a real system that serves all Americans. There are so many flaws in the logic of the book and it is so impractical in its recommendations that I am not concerned that anyone will see it as a route to solving the ills of the US healthcare system. Here are some of the main flaws.
1) Most people have very limited choice of providers - specifically the uninsured, people in rural areas, people in managed care plans, people whose employers offer only a limited selection of plans/doctors/hospital. In order for "results" to drive increases in market share - one of Porter's main theses, people have to be able to choose where they will go for care.
2) Competition related to outcomes will slow down progress in medical care dramatically. Hospitals and doctors, rather than rushing to share their newly discovered procedures with others - or share "best practices" for improving surgical outcomes will be incentivized to keep this "results" producing findings to themselves so they can publish better outcome statistics and attract more business. Is this what we want? Don't we want physicians and institutions to openly share best practices to help everyone achieve better outcomes?
3) Porter believes that people should get care from the "best" specialists - even if this means travelling to another city or state for that care. Ridiculous! Once again this will increase the disparities in health outcomes between the rich and poor, the insured and the uninsured, people who have lots of medical knowledge and those who have little medical knowledge. People better equipped, educationally or financially or through insurance coverage may travel to places to get better outcomes while the others get inferior care. Is that what we want from our new health care system?
Porter's logic is seriously flawed. It is the result of a profit-oriented mind trying to create solutions for a system that cannot be driven by profit but one which must be driven by concern for all Americans - a desire to achieve excellence wherever people go for care - and a need to raise the level of performance of all doctors and all health care institutions. Porter's solutions create an elitist model where care will improve for a very small number of people at the expense of the general population. It is a non-solution to a complex problem.
If any proof is needed concerning how wrong Porter's model can be one must look at the data concerning the degree to which the poor and the uninsured go to hospitals doing low volumes of procedures and therefore, by implication, have worse outcomes. These are the very places where the uninsured, people of color and others of limited means get a majority of their care in urban areas. Just ask how Porter's solutions purport to help these underresourced institutions "compete" and as they loose resources to others, how they will maintain and improve the standard of services they now provide.
If you read this book, think about these issues and ask yourself if these are real solutions that serve all Americans. I think you'll see what I mean.
 Redefining Health Care - Highly Recommended October 29, 2005
Kip Piper (www.kippiper.com)
30 out of 43 found this review helpful
The world's leading guru of competitive strategy, Michael Porter, Ph.D., has turned his sights on explaining the fundamental cause of high costs, poor quality, consumer dissatisfaction, uneven access, and skyrocketing premiums in American health care.
In Redefining Health Care, Dr. Porter and business innovation specialist Elizabeth Teisberg, Ph.D. provide a thoughtful, groundbreaking framework to use genuine, value-driven competition to drive dramatic increases in quality and cost effectiveness.
Unlike many wonks who foolishly believe that health care is not a market, Drs. Porter and Teisberg see competition "of a sort" at work - namely, zero-sum competition that adds little value, fosters inefficiency and poor quality, and often harms patients. Why? Because the current competitive environment is dysfunctional; serves to "shift costs, accumulate bargaining power, and restrict services;" and is ultimately misplaced - focusing on the business dynamics of providers and health plans, rather than on the diagnosis, treatment, and prevention of illness.
Focusing on how to move American health care to positive-sum competition based on economic and clinical value for patients, Redefining Health Care provides a series of specific recommendations for the key players - notably, providers, health plans, employers, and Medicare / Medicaid policy makers.
Drs. Porter and Teisberg challenge assumptions, think out of the box, expose the roots of health system failure, and, most importantly, provide a practical agenda for change. Redefining Health Care is an excellent piece of work, with fresh and fascinating insights.
First we start with a mistake... September 15, 2006
Patricia Fitzpatrick (Moultrie, GA)
26 out of 84 found this review helpful
Having observed the healthcare industry for the last couple of decades, I would like to point out a flaw in the author's recommendations:
Poor people are ignorant people. Ignorant people have no idea what are the appropriate "outcomes" in medicine. Telling a four hundred pound diabetic that the magic of good health can't start with making Big Macs disappear down his gullet, is the kind of strategy that produces massive and profound good "outcomes". Finding more efficient ways for the poor to avoid the consequences of this behavior and other truly stupid life choices is a way to more bad outcomes.
Middle class people are moving into the poor people category where wishful thinking and immaturity reign supreme in large numbers. (if someone's giving things away, it's best to get in the head of the line, not the end) Telling someone that they have caused a health problem makes them angry and resentful rather than relieved. Logically, one should rejoice that if they caused a problem and can then solve the problem, they can save a whole lot of time, money, and worry. Instead, they doctor shop and demand more and costlier diagnostics/treatment to avoid facing a life-style choice. So we should find more ways to let them? And make them happier about it?
Getting people to be happier with the healthcare industry means giving them more of what they don't need and hiding more of what they do; the truth.
We moved recently from a major metropolitan area with a high population of upper income earners to a small, rural place with a high number of minority and welfare recipients. The local hospital, which is in the county seat, rates a consistently higher level of satisfaction among patients than the rich area.
Richer people have far less time, desire, and need to use the facility than the poor. Richer people pay more of the bill and have a better idea of the real value as related to cost although even their understanding is truly pitiful in relation to what they should know. And there's more incentive to stay away from it; they have jobs taking up some part of the day. Poor people careen from one self-inflicted crisis to the next and have plenty of time to swamp the hospital resources.
But more importantly, the hospital administration is hell bent on patient satisfaction surveys. In order to maintain their high rating, they are literally giving away health services to the poor (with taxpayer dollars, naturally). The more they give away to people, the more people line up to get it. Knowing that health care is being handed out more efficiently and with a smile is a recipe to put a bullet in the heart of the system now in place. Make it a silver bullet and promote a movie showing the gory end is the best way to get this whole thing settled, once and for all. But I don't think that's what the author intended.
Just one example, although I could swamp this site with more and still not run out; patient is a chronic substance abuser well known to the community. He gets on a bike at two in the morning because the bars are closed. With no protective or reflective gear on, wearing dark clothes, biking along a route with minimal lighting, and sporting a blood alcohol four times the legal limit, he swerves into the street where a hapless motorist hits him.
A few hundred thousand dollars and a week later, there's a disposition hearing at the hospital on what to do about a bum that is never going to pay this huge bill. Decision? Keep him in this acute care facility for the next thirty days so that the hospital can charge the state from its indigent fund.
How does the bum like free room service and drugs. A+++
When all is said and done, is our customer, the bum, well served by a facility providing for his every possible need? Just ask yourself how do you think he can afford to be a bum? (BTW, Mr. Bum turned down the motorist's auto insurance based settlement of $10,000. Even though the driver wasn't at fault, the company knows the cost of the nuisance lawsuit. But even that won't cut it nowadays for our liability lottery.)
Give the bum a better deal? No. Give him the true deal; patient, heal thyself. Now that's a good (and cheap) outcome!
How to create cost-effective benefits for everyone's health and health care June 7, 2006
Robert Morris (Dallas, Texas)
20 out of 28 found this review helpful
Those who have read Porter's previously published On Competition no doubt recall the excellent material on which he and Teisberg collaborated in Chapter 12, "Making Competition in Health Care Work," originally published in Harvard Business Review (July/August 1994). They collaborate again on this volume in which they examine health care issues in three broad areas: "The first is the cost of and access to health insurance. The second is standards for coverage, or the types of care that should be covered by insurance versus being the responsibility of the individual. The third is the structure of health care delivery itself." Porter and Teisberg explain why the only way to truly reform health care is to reform the nature of competition itself. More specifically, to transform health care by realigning competition with value for patients."How to do so is the central focus of this book."
How to explain dysfunctional competition in health care? Porter and Teisberg suggest several which include "misaligned incentives and a series if understandable but unfortunate strategic, organizational, and regulatory choices by each participant in the system that feed on and exacerbate each other. All actors in the system share responsibility for the problem....The problem is that competition does not take place at the medical condition level, nor over the full care cycle. Competition is the current system is at the same time too broad, too narrow, and too local."
This year in the United States alone, at least $2 trillion will be spent on health care, and costs will continue to escalate. While conducting their research, Porter and Teisberg concluded that there should be no presumption that good quality of health care is more costly. On the contrary, they learned that "better providers are usually more efficient. Good quality is less costly because of more accurate diagnoses, fewer treatment errors, lower complication rates, faster recovery, less invasive treatment, and the minimization of the need for treatment. More broadly, better health is less expensive than illness. Better providers can often earn higher margins at the same or lower prices...so quality improvement does not require ever-escalating costs."
Porter and Teisberg have a convincing, indeed compelling argument in support of value-based competition on results in health care within a system which is "ripe for change"...and change for the better but not for the costlier if competition in health care is redefined and then conducted as Porter and Teisberg advocate. One of the most important benefits would be that the changes they propose would be self-reinforcing. "Changes by health plans and providers to compete on values will reinforce and magnify each other, and will spur innovation by suppliers. As consumers and employers adopt these principles, providers and health plans will be more motivated, and more able, to improve the value they deliver."
For these and other reasons, it is imperative to redefine health care by redefining the nature of health care competition. The alternatives and, especially, the implications and consequences of those alternatives are unacceptable. As noted earlier, "How to do so is the central focus of this book."
For Fantasy Land Only June 24, 2006
R. Cruz (Danville, CA)
18 out of 59 found this review helpful
Released by the Harvard Economics Professor early in 2006, Michael Porter and his coauthor Elizabeth Olmsted Teisberg attempt to argue for the need to change competitive strategies in the United States' health care sector.
Health Policy has never been so critical. Countless scholars have attempted to suggest remedies for the country's ailing health care system and just about everyone has failed. This book is another example of a failed attempt to show 'what needs to be done.' This work is by no means a blueprint for health care reform.
Neither author comes from the health care setting. Both professors are in fact scholars of economics and business strategy. Neither author has no true bearing of what it is like for patients to be in the acute care setting. For example, the text contains a contradiction as to the importance of the patient's self-awareness and involvement in his or her care. On page 246, the authors mention that the idea that "patients can or should become medical experts and direct their own care is misguided and unrealistic." However, on pages 298, 299, and 436, the authors point out that being an "informed" patient not only requires "greater involvement and responsibility", but also that "patient responsibility" ... "enables treatment to succeed."
This text is truly a disappointment as it leaves out so many of the flaws in this health care system that really need to be revamped. There is no mention of the need for acute care hospitals having patients in private rooms only as opposed to dual-occupancy rooms. The growth of antibiotic-resistant strains of microbes have gotten seriously out of control necessitating the need for facilities to have single-occupancy patient rooms. There is no mention of the impact of the nursing shortage. Nurses have to fight for their wages, face heavy workloads, deal with understaffed settings, and live with an ongoing professional lack of respect. There is no mention of how unprepared hospital settings are for overcrowding or disasters. The demand for competent nursing has been so great that certifications such as pediatric advanced life support or advanced cardiac life support have been made far more easier to pass so that even ill-prepared workers may obtain such certifications. Sadly, despite the fact that individuals may want careers in nursing, clinical instructors at community colleges or universities are sorely lacking. Free market theories fail to apply to the nursing shortage dilemma because of the complexities of this broken health care market.
Another contradiction exists with regard to a lack of a health care system coordinator. On pages 51 and 296, the notion that there is "piecemeal," "disjointed," or "fractured " care is evident in that "there is often no physician to help navigate the system and ensure follow through." Yet on page 251, there is mention that nurses "specializing in the particular disease works with the patient to be sure that the information available is understood" and that on pages 247 and 250, nurse health advisers provides "outreach education to patients before and after hospitalization, guidance on health risk management, and health coaching and referral assistance" - patients are "guided through the process by a skilled nurse who not only supports the initial choice of provider but also becomes the adviser over the course of treatment." Nursing, therefore, helps acclimate the patient into the system to coordinate care. Ideally, this is what nurses do. Not all nurses do this of course, but just like physicians, some nurses are better than others.
I would have expected more from professors of the University of Virginia and of Harvard University. The authors even misspelled and left the 'r' out of the word "stroke" on page 118.
I strongly disagree with the authors' notion that consumers should not be medical experts. People in general need to know how to take care of themselves. They need to exercise, eat right, be in health relationships, and to know how to manage stress. They need to see their physicians and take whatever medications their bodies require. It is a ludicrous argument that consumers or patients know which physician or hospital has the best outcomes. Physicians and hospital workers make mistakes. And "human" mistakes in hospitals or any health care setting will never cease to exist.
Lastly, on page 359, the argument in support of specialty hospitals is a poor one. For example, far too often, patients that go sour in outpatient surgical centers need an inpatient admission into an acute care hospital. Costs increase due to the need for a facility to facility ambulance transfer as mandated by federal laws. Further, the need for staff well-versed in resuscitative methods demands hours of costly training that hospitals are forced to comply with.
This book needs to go the the fiction section of the book store. The book ignores very expensive aspects of health care such as AIDS/HIV, psychiatric care, and ambulance diversion in the midst of emergency room overcrowding. Sadly, only in "Fantasy Land" will their theoretical notions and recommendations take hold.
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