Health Care Services - What's Really Propping Up The US Economy

Marc

Fully vaccinated are you?
Leader
I have wondered for a while why the ASQ was heading hard into health care, but I had never really seen any numbers or reasoning given. This may be part of the reason.
Business Week said:
If you really want to understand what makes the U.S. economy tick these days, don't go to Silicon Valley, Wall Street, or Washington. Just take a short trip to your local hospital. Park where you don't block the ambulances, and watch the unending flow of doctors, nurses, technicians, and support personnel. You'll have a front-row seat at the health-care economy.

For years, everyone from politicians on both sides of the aisle to corporate execs to your Aunt Tilly have justifiably bemoaned American health care -- the out-of-control costs, the vast inefficiencies, the lack of access, and the often inexplicable blunders.

But the very real problems with the health-care system mask a simple fact: Without it the nation's labor market would be in a deep coma. Since 2001, 1.7 million new jobs have been added in the health-care sector, which includes related industries such as pharmaceuticals and health insurance. Meanwhile, the number of private-sector jobs outside of health care is no higher than it was five years ago.

Sure, housing has been a bonanza for homebuilders, real estate agents, and mortgage brokers. Together they have added more than 900,000 jobs since 2001. But the pressures of globalization and new technology have wreaked havoc on the rest of the labor market: Factories are still closing, retailers are shrinking, and the finance and insurance sector, outside of real estate lending and health insurers, has generated few additional jobs.

Perhaps most surprising, information technology, the great electronic promise of the 1990s, has turned into one of the biggest job-growth disappointments of all time. Despite the splashy success of companies such as Google (GOOG ) and Yahoo! (YHOO ), businesses at the core of the information economy -- software, semiconductors, telecom, and the whole gamut of Web companies -- have lost more than 1.1 million jobs in the past five years. Those businesses employ fewer Americans today than they did in 1998, when the Internet frenzy kicked into high gear.

ATTITUDE SHIFT

Meanwhile, hospital administrators like Steven Altschuler, president of Children's Hospital of Philadelphia, are on a hiring spree. Altschuler has added the equivalent of 4,000 new full-time jobs since he took over six years ago, almost doubling the hospital's workforce. To put this in perspective, all the nonhealth-care businesses in the Philadelphia area combined added virtually no jobs over the same stretch.

Altschuler plans to add 3,000 more employees over the next five years as the hospital, one of the nation's leading pediatric centers, spends $1.7 billion to expand. Next up is a new 1.2 million-square-foot research facility that will be packed with well-paid scientists and support staff. "Health care is the major engine for the economy of the city of Philadelphia," says Altschuler.

The City of Brotherly Love is hardly alone. Across the country, state and local politicians, desperate for growth, are crafting their economic development strategies around biotech and health care. California will pour $3 billion into stem cell research over the next 10 years, and other areas are on the same path. "Our downtown business leaders and politicians have traditionally considered health care as a cost center, not as an economic engine," says Baiju R. Shah, a former McKinsey & Co. consultant who runs Cleveland's BioEnterprise, a nonprofit founded four years ago to stimulate the local health-care and bioscience industries. "But people are waking up."

What they're waking up to is the true underpinnings of the much vaunted American job machine. The U.S. unemployment rate is 4.7%, compared with 8.2% and 8.9%, respectively, in Germany and France. But the health-care systems of those two countries added very few jobs from 1997 to 2004, according to new data from the Organization for Economic Cooperation & Development, while U.S. hospitals and physician offices never stopped growing. Take away health-care hiring in the U.S., and quicker than you can say cardiac bypass, the U.S. unemployment rate would be 1 to 2 percentage points higher.

Almost invisibly, health care has become the main American job program for the 21st century, replacing, at least for the moment, all the other industries that are vanishing from the landscape. With more than $2 trillion in spending -- half public, half private -- health care is propping up local job markets in the Northeast, Midwest, and South, the regions hit hardest by globalization and the collapse of manufacturing.

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Helmut Jilling

Auditor / Consultant
You might be right, Marc. The numbers are certainly impressive.

However, I am pressing into it for a different reason. The numbers of errors and injuries they cause due to poorly executed quality are also impressive. Incredible amount of damage and suffering.

There isn't another industry with a death rate approaching healthcare. They desparately need what the quality field has developed. It fits awfully well, and we have to improve their performance.
 

Jen Kirley

Quality and Auditing Expert
Leader
Admin
You might be right, Marc. The numbers are certainly impressive.

However, I am pressing into it for a different reason. The numbers of errors and injuries they cause due to poorly executed quality are also impressive. Incredible amount of damage and suffering.

There isn't another industry with a death rate approaching healthcare. They desparately need what the quality field has developed. It fits awfully well, and we have to improve their performance.
I agree.

Let's look at it another way. If the health care industry follow's Juran's estimate that 15-20% of sales is eaten up in quality costs (help me out here--did he say costs of poor quality or all quality costs?) then the drain is...potentially enough to insure all of the U.S. uninsured? Yowsa.
 

Jim Wynne

Leader
Admin
The numbers of errors and injuries they cause due to poorly executed quality are also impressive. Incredible amount of damage and suffering.

There isn't another industry with a death rate approaching healthcare.

That's mainly because there isn't another industry that approaches offering a similar number of opportunities.

They desparately need what the quality field has developed. It fits awfully well, and we have to improve their performance.

I agree, and disagree. They need what we have, but we can't improve anyone's performance. We can offer the tools, and training in their proper use, but what's built with them is generally out of our control.

In a related note, I recommend this New Yorker article by Atul Gawande. Gawande is a surgeon and great science writer. He does an excellent job of describing the problems that health care professionals--especially surgeons--face, and is brutally honest in a way that no other physician writing for the lay public is. In a wonderful piece of his a few years ago he described the phenomenon of doctors inadvertently killing patients, and how all surgeons of any appreciable experience have made errors that resulted in dead patients. He also discusses the reasons that this sort of thing isn't discussed much, even "within the walls."
 

Marc

Fully vaccinated are you?
Leader
I'd bet one of the largest wastes in medicine is insurance. I know several people in the industry who specialize in medical billing medical insurance companies that make over US$60K a year and all they do is make sure insurance companes are billed 'correctly' and fight for coverage in many cases.

My father was a physician. He had 2 office people - One did scheduling and worked with the patients and such. All the other one did was the billing.

My brother is a physician, my other brother is a dentist. Both of them are in the same boat. The cost of dealing with insurance companies is very high.

Yes - Errors in practice are expensive, but there is quite a lot more than just errors in the cost of medicine in the US. I know if I had to undergo a major medical procedure and had time to get there, I'd go to the Phillipines, India or Thailand. And as Jom points out, medicine is just about the only 'job' where a human life is immediately at risk. You can't plug into a a computer and have it spit out a correct diagnosis / procedure. At best, it is a Best Guess.

My father left neuro-surgery early in his career and went into neurology (staying away from surgery) because, according to him, the emotional drain was too much for him when patients died.

None of this is to say medicine, especially hospitals, cannot 'profit' from quailty assurance. I'm not convinced they are not already on the train, so to speak. I am relatively convinced that the ASQ has to look to medicine, in part because manufacturing in the US is going away taking the ASQ's historical base supporters / members with it.
 

Wes Bucey

Prophet of Profit
That's mainly because there isn't another industry that approaches offering a similar number of opportunities.



I agree, and disagree. They need what we have, but we can't improve anyone's performance. We can offer the tools, and training in their proper use, but what's built with them is generally out of our control.

In a related note, I recommend this New Yorker article by Atul Gawande. Gawande is a surgeon and great science writer. He does an excellent job of describing the problems that health care professionals--especially surgeons--face, and is brutally honest in a way that no other physician writing for the lay public is. In a wonderful piece of his a few years ago he described the phenomenon of doctors inadvertently killing patients, and how all surgeons of any appreciable experience have made errors that resulted in dead patients. He also discusses the reasons that this sort of thing isn't discussed much, even "within the walls."
Even after many years of experience, diamond cutters occasionally smash a diamond to smithereens when attempting to cut a facet on the gem. The situation is a result of the individual variety of faults and occlusions within the gem, compounded by a combination of hubris and haste on the part of the diamond cutter and pressure by bosses, customers, and competitors to do more jobs in less time. Similarly, hospitals, insurance companies, patients, and doctors competing for those patients create pressures resulting in skilled workers being overworked to the point they make errors because of exhaustion. Lesser skilled and lesser experienced workers frequently get short shrift on training and oversight from the overworked and tired senior workers and thus make "dumb" errors.

Many healthcare providers suffer from a cultural blindness which prevents mistake proofing and root cause investigations - nearly incredible to believe when one considers the underlying "scientific method" of many of the healthcare disciplines. Thus, they hire folks from within the discipline, refusing to take in outside consultants without the cultural bias and so perpetuate the mistakes, telling themselves (and us patients) they are "inevitable." (These are the same folks who complain bitterly about Quality when the Mercedes or Lexus breaks down.)

There are several organizations trying to change these biases from the inside. One I belong to (free registration) is the Institute for Healthcare Improvement ((broken link removed)) - perhaps reading through its pages may give you some ideas you can contribute to the Institute.
 
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Jen Kirley

Quality and Auditing Expert
Leader
Admin
I hear so much growsing about "government run health care" when what I imagine is a single payor insurance plan.

I heard a news story today how Medicare needs to start paying more though, so we can continue to attract people to the field.

Burrow down toward the root of that problem and somewhere we're bound to find the high cost of going to college. Cha-ching!

In a society where almost everyone has to make a profit, and I can scarcely imagine more layers of profit than health care (including insurance, as Marc said), and salaries/costs being what they are, even on top of inefficiency and errors I can begin to imagine why it's so expensive.

Yes, I'm one of those who couldn't find placement in a health care organization because they want an RN. If something happens to my job and I get back into a retraining program like last time, I'm going for nursing so I can get a QA job in health care.
 

Marc

Fully vaccinated are you?
Leader
A gal I knew had a good job with the post office here in the US, and about 10 years ago - Maybe 15 - She quit and went to school and got her RN. I haven't seen her in years, but I'm betting she isn't regretting the move. But then again, a government job typically has excellent retirement benefits....

My cousin married a gal who worked in QA in a healthcare company based in Louisville, KY (he met her in Alaska). She is paid VERY well, but travels a lot.
 
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