Toby Cosgrove, the former surgeon and current CEO of one of the largest healthcare systems in the U.S., the Cleveland Clinic, cites redundancy: "What we need to understand is that not all hospitals can be all things to all people." The Cleveland Clinic, for example, has become expert in cardiothoracic surgery, drawing patients from across the country. In Cosgrove's model, there might be only one hospital in the country that does a certain complex procedure—but it does the procedure extremely well, efficiently, and on a scale that is maximally cost-effective. Drawing on his experience in Vietnam evacuating injured soldiers, Cosgrove argued for moving patients to expert physicians, rather than trying to have sub-sub-specialized experts everywhere.
So the future of U.S. healthcare will not come in the form of more hospitals. As Cosgrove noted, we already have plenty. Hospital occupancy in the U.S. right now is 65 percent. "Twenty years ago [the U.S.] had a million hospital beds, Cosgrove said. "There are now 800,000, and we still have too many."
Bush recognizes that the core of healthcare is the relationship between the doctor and the patient. He says that any successful health-business model will be predicated on maximizing the act of total presence during a doctor visit. Ancillary staff will do the busy work that might keep a physician away from her patients. The doctor's undivided attention is what patients want, and giving it is what makes a doctor's job meaningful and effective. Despite demand from patients and doctors for more time together, Bush notes, the average visit is eight minutes.
When large hospital systems leverage their market position and brand names to overcharge for basic services, they not only subsidize research, but they perpetuate inefficiency. A cornered market favors complacency and maintenance of the status quo. In every other industry, if you're still using a pager in 2014—as many doctors are—your business fails when your clients go to Iora Health, where they can video chat.
In his book, Bush calculated the fortune that could be made if a person wanted to start their own MRI business. At Massachusetts General Hospital, an MRI can be billed to an insured patient for $5,315. Bush proposes that an industrious person could rent an MRI machine for around $8,000 per month, a suburban park office for $1,000, two technicians for $6,500 each (including benefits), and around $3,000 for taxes and fees. That's $25,000 per month in cost. If you can do three scans per hour and run twelve hours per day, you'd break even at $28 per MRI.
"The biggest lie that we baked into our thinking," Bush said in Aspen, is that "starting in 1958, in the wake of World War II, the government wanted to control wage inflation, so they let employers provide healthcare as an incentive (What could go wrong? It's 1958!)—was this idea that healthcare itself is just a monolithic, identical thing. That there's no value in price shopping. That there's no value in choosing whether or not to get [a certain health service]. We act, as a society, on the unconscious level, like we're not in charge. This is a massive problem. Not just because we utilize expensive things, but because we give up the opportunity for those things to get better."