Article: The Healthcare Cost Problem

Long, very interesting New Yorker article that pinpoints physician-driven over-utilization as the primary cost driver of our expensively broken national healthcare model. Almost everything in it makes sense to me.

Regarding "Single Payer"

Activists and policymakers spend an inordinate amount of time arguing about whether the solution to high medical costs is to have government or private insurance companies write the checks. Here’s how this whole debate goes. Advocates of a public option say government financing would save the most money by having leaner administrative costs and forcing doctors and hospitals to take lower payments than they get from private insurance. Opponents say doctors would skimp, quit, or game the system, and make us wait in line for our care; they maintain that private insurers are better at policing doctors. No, the skeptics say: all insurance companies do is reject applicants who need health care and stall on paying their bills. Then we have the economists who say that the people who should pay the doctors are the ones who use them. Have consumers pay with their own dollars, make sure that they have some “skin in the game,” and then they’ll get the care they deserve. These arguments miss the main issue. When it comes to making care better and cheaper, changing who pays the doctor will make no more difference than changing who pays the electrician. The lesson of the high-quality, low-cost communities is that someone has to be accountable for the totality of care. Otherwise, you get a system that has no brakes.

I might even take that point a step further. It can be hard for government to provide tough love and take a hard line on benefits (look how Social Security benefits have broadened over the years). So I think a national government single-payer might be less successful in focusing on "evidence-based" medicine than are private insurers. (Disclaimer: I work for a health insurer.)

HSA

The third class of health-cost proposals, I explained, would push people to use medical savings accounts and hold high-deductible insurance policies: “They’d have more of their own money on the line, and that’d drive them to bargain with you and other surgeons, right?”

He gave me a quizzical look. We tried to imagine the scenario. A cardiologist tells an elderly woman that she needs bypass surgery and has Dr. Dyke see her. They discuss the blockages in her heart, the operation, the risks. And now they’re supposed to haggle over the price as if he were selling a rug in a souk? “I’ll do three vessels for thirty thousand, but if you take four I’ll throw in an extra night in the I.C.U.”—that sort of thing? Dyke shook his head. “Who comes up with this stuff?” he asked. “Any plan that relies on the sheep to negotiate with the wolves is doomed to failure.”

So does this mean that Consumer-Driven Healthcare (aka, High Deductible / HSA plans) is just the latest fad, likely to go by the wayside just as HMOs did? Well, much of that quote rings true to me, but I think having consumers more directly feel the price signals from the market can at least help around the edges.

Systems

Congress has provided vital funding for research that compares the effectiveness of different treatments, and this should help reduce uncertainty about which treatments are best. But we also need to fund research that compares the effectiveness of different systems of care—to reduce our uncertainty about which systems work best for communities. These are empirical, not ideological, questions. And we would do well to form a national institute for health-care delivery, bringing together clinicians, hospitals, insurers, employers, and citizens to assess, regularly, the quality and the cost of our care, review the strategies that produce good results, and make clear recommendations for local systems.

This is a really interesting point, and provides the article's concluding thesis. It makes me think about the success of Japanese automakers such as Toyota and Honda. They established a dominating cost and quality advantage not by deploying more advanced technology, but rather by creating an entirely new system for manufacturing automobiles.

NYT Article: Credit Card Industry Aims to Profit From Sterling Payers

It is only rational for the industry to make the kinds of changes mentioned in this article, that will hit those who pay on time. Businesses should always seek to drop unprofitable customers, or turn them into profitable customers. But because the gross profit margins in credit cards currently are so great, the credit card issuers find it effective to cast a wide net. If a few unprofitable "dolphins" are caught up in the net, that is a tolerable inefficiency, so long as they can trap many more customers who will eventually be filleted by the high fees and usurious interest rates.

Now where all this leads is an interesting question. As a pay-in-full person, while I can tolerate trimming around the edges (maybe small annual fees, losing the 1% cash-back), if they make it so that it costs me to use a credit card (surcharge, zero grace period), then I will drop the card like a hot potato. So the ultimate question is where the credit card industry can find its profit. The fact is, there is absolutely no rational reason that anybody should be willing to pay 20-30% interest. None.

So from the standpoint of macroeconomic efficiency, I think it would be a good think for the credit card industry to contract substantially. Any product that has tremendous gross profitability--credit cards, pharmaceuticals--will expend large sums in aggressively marketing to seek new customers. While some amount of marketing is necessary economic lubrication, it does not follow that more is better. So in the end, even if I lose some of my credit card perks, the world will be a better and more rational place if the credit card industry is cut down to size.

Article: Bursting the Higher Ed Bubble

This is a great article.

"Will Higher Education be the Next Bubble to Burst?" So asks a recent op-ed in the Chronicle of Higher Education. The question is powerful. Data points:

• Over the past quarter-century, the average cost of higher education has risen at a rate four times faster than inflation—twice as fast as the cost of health care.
• Tuition, room, and board at private colleges can cost $50,000 per year or more.
• The market crash of 2008 inflicted terrible damage on college endowments. The Commonfund Institute reports that endowments dropped by an average of 23 percent in the five months ending Nov. 30, 2008.

I particularly like this idea:

Maybe tough high school exit exams would serve the needs of employers who currently insist on a BA not for its own sake but as proof that a student was not too lazy or aimless to get one. Indeed, it could be that when the job market attaches less value to a piece of parchment, universities will at last lay aside their often ugly political preoccupations and rediscover their true mission: the pursuit of knowledge as a good in itself.

Lance Armstrong Dis-Intermediating Journalists?

The idea of using your own printing press--weblog, twitter, etc--to communicate, and not allowing reporters to deliver your "message" is something Dave Winer writes about a lot.

Lance Armstrong, who stopped talking to the news media without explanation or comment nearly two weeks ago, is not the first star athlete to tire of answering questions from reporters, but he does seem to be the first to embark on a drive to put them out of business entirely, by simply reporting, in multimedia blog posts and tweets, on his own exploits.

As my colleague Juliet Macur reported earlier this week, Philippe Maertens, a spokesman for Mr. Armstrong’s cycling team, “said that Armstrong was at first upset with reports that he had been the instigator of a rider protest last week in Milan. Now, Maertens said, he was not sure why Armstrong continued his boycott of the news media.” According to the spokesman, the seven-time Tour de France champion told him simply, “I don’t need them.”

Validation on Dishwashers

I have always been a proponent of "let the dishwasher do the work"--don't pre-rinse your dishes. The dishwashwer manuals and Consumer Reports have always given that instruction, but this article takes it to a new level. It is amazing how ingrained and widespread certain habits become in a populace.

Google Maps Multiple Routes Feature

Google maps has a nice new feature, where they give you second and sometimes third choices for possible routes.

Microsoft Word Overtype *Finally* Fixed

MS Word has an overtype feature. You toggle it on and off via the Insert key. If you look very closely at the status bar at the bottom of the screen, it will say OVR when you in overtype mode. In overtype mode, each character you type causes the current character to be, well, overtyped.

As far as I know, this feature is not used by anybody. I'm not sure, but I think it probably harkens back to pre-PC, terminal days. I suppose there may be some niche uses, involving forms, but I have personally not encountered them--and I have been using Word for Windows since 1989.

This one gets people all the time, and if they don't have a rudimentary model of how Word works, it completely flummoxes them. It most recently happened to my 12-year old son, who is usually pretty sharp with software features. As soon as he ran upstairs, cursing about Word deleting his characters, I recognized the problem.

This feature bug has been around forever. It is just so easy to hit the INS key by accident, and there is only the very subtlest visual cue that it is turned on. It is really criminal that, for lo these 15 years, Micro$oft has stuffed feature upon bloated feature into Word, but has not corrected this small nuisance.

I just noticed, in Word 2007, they have finally done so. Overtype mode has an option setting, and it is OFF by default. It's about time!

Too Windy to Ride

Today is the first time I have canceled a bike ride solely due to wind. There have been times, early or late in the season, when it is chill, that wind has been a factor in talking myself out of riding. But this was the first time that I really, really wanted to ride, but had to call it for wind. The gusts were SO high, probably 45 mph, like in a strong thunderstorm (even though there was zero chance of storms). I've ridden plenty of times when the guests are into the 30s, but the 40s is just too much.

Consumer Resolution: Boycott Perpetrators of Pop-Ups

We all know that pop-up ads on the web are evil, and many of us have been blocking them successfully for years. Every now and then, a pop-up somehow evades the blocker. Usually these are for lesser-known companies, for whom there is nearly 0% chance I would ever even think of patronizing. However, NetFlix is among the offenders, which makes me not want to patronize them. Currently that is not a problem, I use BlockBuster online. But I have maintained a soft spot for NetFlix, and if I did not have young children at home, I would have considered switching back to them. But the evil pop-up evasion ads nix that.

Electric Bicycles

Really good article on electric bikes. Lots of potential here. I think one key element to crack is the security factor. If I could secure my bike as quickly as I can park and lock my car, that would greatly increase the appeal.

The folding electric bike could really be the ultimate! Also, for the car replacement, the three-wheel version with larger cargo capacity could be the right form factor.

LinkedIn Sleazy Dark UX Pattern for Contact Spamming

I just went through LinkedIn's process where is scans and harvests your webmail (e.g. Gmail, Hotmail, YahooMail, etc) to create a list of potential invitiess. I only invite existing LinkedIn members--I don't spam spam people who either aren't on LinkedIn, or (more likely) are on, but using a different email address. Of course, LinkedIn insists on compiling a list of everybody, encouraging you to spam all those email addresses.

I can live with that, it is self-serving, borderline sleazy, but totally expected, and it doesn't interfere with my process. What you have to do is Un-Select All, then scroll through the list, only checking off people with icons denoting that that email addresses matches a LinkedIn member. No big deal. When you are done, you click SEND INVITATION. Simple enough.

But what came next totally took my by surprise. Almost instaneously, and clearly chained to the prior SEND INVITATIONS action, the UI automatically populated the remainder of the list--that is, the very email addresses I deliberately un-checked!!!--into the Send Invitations box.

It happened so fast, it was hard to notice. In fact, if you weren't paying close attention, you might think the first SEND INVITATIONS did not work, so you would re-click. And in doing so, instantly, irreversibly (I assume irreversibly, I'm not going to try it and find out!), you would have spammed who knows how many email addresses with that invitation!

Very unacceptable, deceptive, downright sleazy corporate behavior. This is the same mentality that re-checks the "opt-in" checkboxes, every time you make a change to your account profile.

Helping People Find Jobs with "Soft Referrals"

15 months ago, I left a medium-sized company in the mortgage industry. It had been a great place to work, right up until it wasn't, and I really liked and admired many of the people I worked with.

I was one of the earlier people to jump--the writing on the wall seemed clear to me--but many others stayed, for various reasons. The company I moved to, in a very different industry, is a huge employer, and was doing a fair amount of hiring. But it was such a huge company, and I was so new, that there was almost zero chance that I would have any direct contact with the the area doing the hiring for any given posting.

So what I told my former colleagues (the 90% that I would put in the "good person to hire category") was "if you see a posting that you are interested in, send me the requisition number, and I will find out who the hiring manager is, and send them an unsolicited, but internal, reference. Also, while my primary motivation is not the referral bonus, all things being equal, I would like to be in a position to collect it, so give me 24 hours to submit you through the system, then go ahead and assume I have done that, and apply".

This has worked out pretty well for all concerned. This helped 3 job seekers find positions. It helped hiring managers hire good people. And as the referrer, in theory, I should be eligible for a referral bonus. (Well, I guess it only helped me in that it helped the other two ways--2 of the 3 positions were for contractors, so no referral bonus there, and the third was for someone who had already posted before contacting me, so no bonus there either.)

I think for some reason, people are hesitant to send this kind of unsolicited referral. I don't know why. Obviously, you only do it for good people. But even a "cold" internal referral, especially coming from someone obviously in a leadership position, is significant. If I were choosing between 2 hireable candidates that I had no prior knowledge of, and I estimated one was a "7", and the other an "8", and I got a solid internal referral on the 7, I would probably take that "7 in the hand", over an "8 in the bush". So, from the job-seeker's perspective, you may have to "lean on" your contacts to take this step. Feel free to link to this post to help make your case!

Acting as referrer has the added benefit of providing you, the referrer, with a chance to broaden your network within the company.