Why Innovation Is Missing From Healthcare And How To Change That
An economist I respect, Veronique de Rugy, wrote a little while ago at the Wash Ex:
Imagine a world where everyone, not just the mega-rich, has access to modern, affordable, high-quality care. In this world, doctors don't need to beg bureaucrats and insurance administrators for permission to save lives. Entrepreneurs here actively compete to lower prices and innovate novel solutions. Imagine, in other words, a world in which our health care system is dragged out of the Stone Age and into a modern, competitive market economy....Robert Graboyes, our resident health care expert, believes that the health care debate produced the wrong diagnosis. While most health commentators focus on the demand side and service provision, Graboyes says the real sickness lies in the outcomes of those services. He asks, "Why is there no Steve Jobs of health care?"
That's a good question. Where are the visionaries of vaccination innovations, the capitalists of cost-cutting care provision, the impresarios of imaging technology?
Grayboyes notes that recent advances in "[g]enomics, 3-D printing, nanobots, wearable sensors, social media, telecommunications, imaging, artificial intelligence, state-of-the-art data mining and other new technologies" have not been substantially integrated into health care provision despite their obvious benefits. These kinds of cutting-edge applications are not only possible, they are necessary to break (not just cut!) the health cost curve.
Over the years, Graboyes has collected many exciting examples of innovations that have been quietly occurring under the radar across the health care world. The solutions that will fundamentally improve health care provision come not from legacy corporate mega-labs, but from those great incubators of American innovation: people's garages.
De Rugy goes on to say:
Graboyes coins an apt metaphor to explain the problem: the frontier of innovation is being quashed by the fortress of entrenched interests.The frontier's innovation in healthcare is the solution, but the fortress will not give up its control without a fight.
Here's where my second colleague, Adam Thierer comes in. His excellent new book, Permissionless Innovation, makes a passionate case for knocking down these barriers to innovation erected by governments and special interest groups. Thierer argues that the creators of new technology shouldn't have to seek the blessings of skeptical, out-of-touch regulators before being allowed to develop and deploy innovations.
Compare this permissionless innovation to the stifling "precautionary principle" norm favored by public officials. This principle allows regulators' imaginations to run away with them: Any perceived threat of a low-probability, worst-case scenario is a good enough excuse for these officials to stifle technological developments. The Frontier is strangled so the Fortress can keep its power for another day.
An example of this "precautionary principle" is genomics testing company 23andme, recently shut down by the FDA.







If you do not realize that paying doctors and medical technicians is Job #1, mandatory, compulsory, etc., then you will NEVER get a health care system to work.
"Obamacare" does not do this, and this is why it is an abject failure.
Radwaste at June 18, 2014 10:47 PM
The name you want to damn is Nestor.
You should damn his name in your own generation, and damn his offspring unto the forth generation.
The man was despicable, and he typifies Washington's contemporary patterns of "public service."
Crid [CridComment at Gmail] at June 18, 2014 10:48 PM
Technological progress in the U.S. has pretty much stopped. The only areas where it is currently continuing are in entertainment, and surveillance/policing. The former is in part due to the control of the content by the big, politically connected companies who have found it in their interest (at least right now) to allow tech progress to continue. There's also the fact that the entertainment/media sector is pretty much the only part of the private sector that is still essentially unregulated. For the latter, there's the obvious government interest.
Pretty much everywhere else, progress has stopped. The cars for sale now are essentially the same as cars built five years or so ago; the only difference is that current models have more built-in entertainment features. The airplanes being built now are, by comparison to the progress that was made throughout the 20th century, tiny incremental improvements. All of those radical ideas for future airliners that were being kicked around back in the '90s -- none of them are being seriously considered now.
We build houses today using pretty much the same methods and materials that were used back in 1970; the only differece is, again, the inclusion of more entertainment features. Most of our clothing is made using materials and methods that were worked out in the 19th century, with many of the 20th-century innovations having been abandoned. Once-available useful pharmaceuticals (example: Vioxx) are being banned, and others are becoming very hard to obtain. There have been some tech innovations in the financial sector, but most of those have grown out of the govenrment's hunger for surveillance; tech that would improve financial or communications privacy is explicitly not being worked because it's too politically risky.
There appears to be an unbeatable triunvariate at work: the politically connected elites who want to suppress the disrupting effects of tech advances, the policers with their quest for universal surveillance, and the entitlement classes who don't care about any of the above as long as they get their subsidies. Between those three things, I see a very dark time coming, when the availability of tech to the average person will be sharply scaled back, and what tech will be permitted will be very strictly controlled by the government, and will contain unbeatable surveillance features.
Cousin Dave at June 19, 2014 7:05 AM
Part of the problem is that the FDA has made it such convoluted and costly effort to get any drug or device approved that the inventor in the garage can't really afford to do it on his own.
Then there is one nutritional medicine that is hung up in la-la land. I can't remember the name or bowel illness it treats; but it is mainly children that that won't live to grow up without it. It can only be approved if the doctor who invented it runs a double blind trial on it. The problem with running a double blind study is that it would kill half the children by giving them a fake drug. For some reason the doctor doesn't want to do that.
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A man complained to his friend, "My elbow hurts. I better go to the doctor."
"Don't do that," volunteered his friend, "there's a new computer at the drugstore that can diagnose any problem quicker and cheaper than a doctor. All you have to do is put in a urine sample, deposit $10, then the computer will give you your diagnosis and plan of treatment."
The man figured he had nothing to lose, so he took a sample of urine down to the drugstore. Finding the machine, he poured in the urine and deposited $10. The machine began to buzz and various lights flashed on and off. After a short pause, a slip of paper popped out on which was printed:
You have tennis elbow. Soak your arm in warm water twice a day. Avoid heavy labor. Your elbow will be better in two weeks.
That evening as the man contemplated this breakthrough in medical science, he began to suspect fraud. To test his theory he mixed together some tap water, a stool sample from his dog and urine samples from his wife and teenage daughter. To top it all off, he masturbated into the jar. He took this concoction down to the drugstore, poured it in the machine and deposited $10. The machine went through the same buzzing and flashing routine as before then printed out the following message:
Your tap water has lead. Get a filter.
Your dog has worms. Give him vitamins.
Your daughter is on drugs. Get her in rehab.
Your wife is pregnant. It's not your baby. Get a lawyer.
And if you don't stop jerking off your tennis elbow will never get better.
Jim P. at June 19, 2014 8:29 AM
There is also the fact that drug patents are being ignored by many countries around the world.
A company (or a group of individuals) spend their money and time on developing new drugs or new techniques expecting to make money off their investment.
Too bad, some governments (here's looking at you India and China) claim that the drugs are too expensive and people's lives are worth more than someone trying to earn money from their own innovations. As it is most drug patents expire after 10 years anyway; but, some claim they need those drugs NOW and intellectual property rights be damned.
So, guess what, no one is willing to invest in innovation if governments will simply come along and steal your profits.
Charles at June 19, 2014 8:29 AM
Charles is right. Plus, in many countries, the manufacturers are compelled to sell at cost or less. The drug companies basically make all of their profits in the U.S. market.
Cousin Dave at June 19, 2014 12:41 PM
"Grayboyes notes that recent advances in "[g]enomics, 3-D printing, nanobots, wearable sensors, social media, telecommunications, imaging, artificial intelligence, state-of-the-art data mining and other new technologies" have not been substantially integrated into health care provision despite their obvious benefits."
You know, social media. Like AI (which doesn't exist), and "imaging".
This is a laundry list of things the speaker seemingly doesn't understand, or he wouldn't a) group them and b) talk like AI was "a thing", or that social media is really relevant.
Telecommunications? How's it either missing or relevant to almost any health outcome?
3D printing is being investigated by lots of people for healthcare uses right now, because it has obvious likely benefits.
Robert Graboyes is an economist of healthcare, but it seems like he doesn't actually pay a lot of attention to the thing he's talking about - research.
(Christ - he's wondering why "nanobots" haven't been "substantially integrated" into healthcare?
Because they don't actually exist yet, man.
That's why. They have to be made to work at all before you can even try using them in healthcare.)
Sigivald at June 19, 2014 1:02 PM
Here's your "innovation"...
Remember: "If you like your health care plan, you can keep it."
Radwaste at June 19, 2014 7:47 PM
Wearable sensors + telecommunications can be vital actually. You can have a sensor to tell if someone who has chronic heart conditions is having a heart attack, stroke, extremely high/low blood pressure. A nurse can then call to make sure you are okay and can send an ambulance if it seems necessary or set up a doctor's visit for non-emergency checkups.
The rest of the stuff, he was just using buzzwords for attention.
Nakkinyan at June 20, 2014 1:28 PM
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