Reforming Healthcare: A Key Emerging Market For The 21st Century

Reforming Healthcare: A Key Emerging Market For The 21st Century

Healthcare is becoming as important to the vitality of businesses, governments and nations as it is to the well being of individuals. Soaring healthcare bills add $1,500 to the cost of every car made by General Motors, for example, compared to $200 per car for the company’s nearest foreign competitor.

In fact, higher healthcare spending does not guarantee better delivery or outcomes. America spends 16 percent of its GDP on healthcare – the highest in the world – but ranks only 37th in the overall performance of its healthcare system by the World Health Organization. Moreover, more than 100,000 Americans die each year from preventable medical errors. This adds up to more fatalities than from AIDS, homicides, and traffic accidents combined. Meanwhile, 45 million Americans have no healthcare insurance and 15 million are under-insured.

Many factors contribute to this healthcare crisis, from changing demographics to the spread of “diseases of affluence” and chronic illnesses. But perhaps the most treatable disorder is underinvestment in healthcare information technology. Lifesaving medical advances have not come accompanied by improvements in the way members of the healthcare ecosystem (from public and private payers, to providers, researchers and consumers) use IT to work with one another. As a result, the “system,” such as it is, functions much like a fragmented cottage industry. This IT failure has been well documented in a recent study by the Rand Corporation, which concludes that a modern healthcare IT infrastructure could save up to $165 billion per year by reducing hospital stays, encouraging tests and early treatment, and cutting administrative costs.

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