Health care needs its Gutenberg press


Mar 13, 2015

Once again, the fate of the Affordable Care Act (ACA) is on the line. The Supreme Court is currently hearing oral arguments in the King v. Burwell case over insurance subsidies. Challengers argue that the wording of the law makes ACA subsidies on the federal marketplace illegal. If the court rules in their favor, many fear the ruling will essentially “kill Obamacare.” For starters, some 8 million people would become uninsured, and more aspects of the ACA law would be reversed over time. And if the challenge fails, fresh lawsuits are likely waiting on the wings, so the stakes will only get higher.

How did we get here? For decades, politicians have proposed and counter-proposed top-down fixes for a health care system widely regarded as too expensive and not accessible enough. Unfortunately, competing interests can’t seem to agree on any measure of what those fixes ought to look like. President Obama pushed through significant changes via the ACA in 2010, but the law has proved just as divisive as prior measures, as it has been met almost exclusively with either fierce partisan support or fierce partisan resistance. And while the insurance mandate is the ACA’s most recognizable fixture, the law as a whole is very complex and multifaceted. Therefore, uniform opposition or support shouldn’t be so easy.

In the heat of the judicial and legislative fights that King v. Burwell represents, our question is whether cooperative policy resolutions exist. The debate is inherently centered on economic trade-offs, where financing for one method leaves less for others. But instead of focusing on differences, we start here with key problems in health care that are largely agreed upon. We posit that bipartisan support can be generated around solving the three core problems in health care:

  1. Prices are just too high. Almost all health care products and services—even basics, like bandages and checkups—cost a whole lot more than they should. Whether an employer is paying, Medicare/Medicaid is footing the bill, or individuals are paying out-of-pocket, someone is being charged too much for care.
  2. What we get isn’t good enough. The quality isn’t great. People pay good money for cars that Consumer Reports rates as best. But in health care, the more we pay for treatments, the less we know about their effectiveness (think cancer drugs). And experts can’t even begin to agree on what makes a hospital good or bad.
  3. Accessing care is too difficult. It shouldn’t take a two-hour wait at the family doctor’s office to get a five-minute procedure or running the proverbial bureaucratic rungs to get an appointment with a specialist. So while smartphones are making everything from takeout food to beach houses more accessible than ever, health care is still using fax machines.

Not coincidentally, disruptive innovations (and creating environments to nurture them) have a long history of fixing all three of these problems in other industries, including automobiles, consumer electronics, and media. The core engine of disruptive innovation is to create more affordable products and services for more of a population. They guide the macroeconomic force that keeps economies and social systems lean and healthy.

For example, Gutenberg’s moveable type printing press was disruptive to handwritten books. Disrupting the manuscript business undoubtedly had its downsides (mostly sentimental), but printing press innovation was overwhelmingly positive for humanity. Gutenberg gave exponentially more people access to more ideas—and at a much lower cost. Initially, printed books weren’t as beautiful as handwritten books, and many manuscript makers lost their jobs, but the printing press industry generated millions of new jobs for the ensuing centuries.

Over the long run, whether the ACA survives or dies may be less relevant. Instead of focusing on a tree named the ACA, let’s focus on the forest of macroeconomic force. Let’s use Gutenberg’s innovation to discuss and debate how disruptive innovations can guide this force and deliver us the virtuous solution to our desperate problems. Let history repeat. Let the real discussion begin.

Spencer researches disruptive innovation in the healthcare industry. He has over 15 years of professional experience working with U.S. and international healthcare enterprises, most recently as an equity research analyst covering medical technology companies.