Dr. Jay Parkinson might seem like your typical young Brooklynite–he’s on Twitter, voted for Obama, dabbles in photography, and attends the SXSW music festival. But he’s also heading up what might be a free-market solution to America’s health care crisis–and folks far outside Williamsburg, the fabled hipster ‘hood in which Parkinson practices, are taking note.
“We’re witnessing the death of old business models,” wrote Parkinson, creator of the primary care practice Hello Health, in a blog post titled “my take on the economy.” “Monolithic, centralized, non-transparent, boomer-based, last century, industrialized, inefficient, pre-Internet, business processes. Something new and better will replace them. I’m super excited to be alive and able to witness this.”
Parkinson, of course, is no mere witness. The 33-year-old physician and entrepreneur is at the forefront of the movement to transform those old models–at least as far as health care is concerned. With Hello Health, Parkinson hopes to combine the best of 21st century technology with the localism and personalized care of the pre-HMO era.
“If you want a glimpse of what health care could look like a few years from now,” wrote Carleen Hawn in the policy journal Health Affairs, “consider Hello Health … [which] is fast becoming an emblem of modern medicine.”
Started in August 2008 in Williamsburg, Hello Health has attracted roughly 300 members. For $35 per month, members gain access to Hello Health’s website, a platform developed by Parkinson and partner Sean Khozin with the help of Canadian software company, Myca. Unlike most health IT platforms, Hello Health looks more like Flickr or Facebook than, say, Windows 95. Members can IM and email with their doctors, make appointments online, and access their digital health record, which includes blog-post style, doctor-authored summaries of each appointment.
Members are guaranteed appointments within 24 hours of scheduling, and can choose between visiting the office, receiving a house call, or, for minor illnesses or follow-up sessions, videoconferencing with a doc. Hello Heath doesn’t take insurance (though patients with coverage are free to submit bills to insurers on their own), and all appointment fees are set in advance–$100 to $200 depending on the complexity of the visit, with lab tests and generic meds included in the price.
David Auerbach, owner of the design and electronics store Dijital Fix, became a member in February, drawn in by Hello Health’s “simple branding,” its “tech-savvy operation”–and a case of the flu that needed attending to. The whole process of joining, scheduling, and seeing a doctor “was so easy,” says Auerbach. “I could do everything on my own before even entering the office. When I got there, they already knew my [medical] history…and if I had any questions after the visit–and I did–answers were a simple click away.”
Much of Hello Health’s membership comes from people like Auerbach–the freelancers, consultants, artists, and entrepreneurs who make up the so-called ‘creative class,’ and who earn enough to avoid the free clinics but not enough to afford expensive insurance policies. Parkinson says Hello Health is intended for “anyone who needs a doctor,” but the pay-per-service model works best for those already in good health. “I don’t tend to need doctors’ advice all that much,” says Auerbach, “so while $35 is not a lot to pay to have access to a doctor if I need one … visits still cost in the end, so if you don’t use the messaging service much or at all, the $35 monthly is pretty hard to justify.” Adding to the cost, Parkinson recommends that Hello Health members keep a high-deductible catastrophic care plan in case of emergencies.
Hello Health is not out to overthrow the ancien health insurance regime, which uses risk-pooling to cover the costs of catastrophic expenses–cancer treatments, hospitalizations, long-term injuries, and so forth. In order for a few such cases to be covered, many more people need to pay more money into the system than they take out in health services, so that the surplus can be shifted over to someone else’s cancer treatment or kidney dialysis. Hello Health doesn’t provide long-term or catastrophic care; its efforts are more narrowly targeted at reforming the everyday care that people use the most, and, for which, under the current system, they frequently overpay. In that respect, Hello Health is more like the Park Slope Co-Op than traditional insurance–the fees that each person pays cover exactly the care he receives, plus a small premium to keep the place spruced up.
Hello Health’s membership fees are significantly lower than other “concierge care” health practices, which can charge hundreds or thousands of dollars per year in membership fees. Part of what allows Hello Health to keep its fees low is that by choosing not to deal with insurance companies, it’s able cut down on overhead (less paperwork, no administrative staff). For Parkinson, though, opting out of the whole insurance cycle is as much a philosophical decision as it is an economic one.
“We’re trying to cater to the real customers of health care, the patients, and ignore the current customers, the insurance companies,” he says, noting the perverse incentives the current system sets up for providers.
“Fifty percent of office visits are unnecessary,” says Parkinson. Instead, many minor or follow-up issues could be taken care of via telephone, email, videoconferencing, or IM. But physicians don’t get reimbursed by insurers for these virtual visits–only when patients walk through the doors. Office visits exist “because doctors get paid for office visits,” says Parkinson. And because physicians get reimbursed based on the number of tests or procedures performed–not on the quality or totality of care–”they don’t really care about efficiency, except when it comes to decreasing the amount of time for each visit.”
It’s not just the insurance industry’s reimbursement system Parkinson objects to–he’s upset by the lack of transparency in pricing, which he says discourages competition among health care providers. “There’s no free market [in health care] at all, it’s just … three or four large groups contracting with three or four other large groups,” says Parkinson. “These groups want to keep the prices hidden, because their profits depend on keeping people in the dark.”
Parkinson adamantly rejects any health care solution that involves government-mandated insurance coverage, which he says changes the demand side without addressing supply.
“In Massachusetts, they mandated insurance, and brought 99 percent of their population into the insurance pool, but they didn’t fix how many doctors there were to deliver those visits. Now there’s a 52-day wait [to see] a doctor. Having insurance doesn’t mean you have access to a doctor.”
“The insurance people are salivating at the possibility of Obama mandating health insurance,” Parkinson adds. “They’re the next auto industry. But we can’t afford to have another 100 percent increase in premiums in the next eight years, which is what happened in the last eight years.”
For Parkinson and other health care digerati like him, mixing new technologies with free-market solutions to health care delivery problems looks like one possible way out. Some have taken to calling it “Health 2.0,” which Ted Eytan, a Washington, DC-based physician and medical director for delivery systems operations at the Permanente Foundation, defines as “participatory health care.” “Enabled by information, software, and community that we collect or create,” he writes, “we the patients can be effective partners in our own health care, and we the people can participate in reshaping the health system itself.”
The Health 2.0 revolution may be just around the corner. Hello Health will soon be opening a second location in Manhattan’s West Village, and Parkinson has stopped seeing patients to focus on managing and promoting the Hello Health brand and philosophy.
“We’ve had about 1,000 doctors so far ask to be a part of [Hello Health],” Parkinson says. But he doesn’t want to simply bring on more staff in more locations. Instead, Hello Health is selling customized versions of its software platform and planning to open the platform to other physicians and practices on a commission basis.
“We don’t really want to be a brick-and-mortar doctor’s office,” says Parkinson. “We want to be the technology that allows other doctors to do this in their practices, across the country.”
Source: AFF Doublethink Online | Jacob Hayutin
Source: AFF Doublethink Online | Hadley Heath