Primary care health, USA: the 401(k) model?

I have been spending a lot of time recently exploring Health 2.0 (digital health, quantified self, wireless health, etc) and trying to read the tea leaves about how the US healthcare system is likely to change, as total costs continue on a seemingly unsupportable long term trajectory. I see an interesting analogy to the history of retirement finance in the US over the last 50 years. If I am right, this has some intriguing implications.

Retirement finances

It used to be that most white-collar workers in the USA worked hard, and then retired with some type of pension. They did not worry about managing their pension assets. An “expert” did that on behalf of a pool of people.

Unless you work for the government, that probably does not describe you today if you live in the USA, though. Most of us these days have total responsibility for our own retirement funds: saving, managing the assets, worrying about withdrawal rates, and so on. And statistics suggest that most Americans have not saved enough and are not doing such a great job at becoming expert pension managers.

I don’t mean to suggest this is all bad. For example, we now have a “portable” retirement plan rather than one linked to an employer. But it definitely shifts the responsibility from a benevolent third party to us. And why did this happen? I believe the primary driver was a desire to shift costs and risks from employers to individuals.

And here is where I see the first parallel with healthcare. There is always a tension in healthcare between improving the quality, and managing the costs. Right now, in the US, I would argue that the people paying the bills (mostly employers or the government) are pretty heavily focused on looking for ways to slow down the rise of costs, or shift the risks of these out-of-control costs to someone else. And the rise of Health Savings Accounts, and increased co-pays, are examples of ways in which responsibility is (very gradually) moving toward individuals.

To set the stage for my speculations about the future of primary care, let’s consider the change in roles of the people involved with retirement finance. To generalize broadly,  pension managers (who used to worry about optimizing the risk/return ratio over a large population, and ensuring people’s pensions would exceed some minimum required amount) have morphed into/been replaced by asset managers (who focus on a particular investment theme (value, growth etc), and worry about how to increase assets under management (linked to compensation)). And there is a whole new class of individuals now, “financial advisors”, who have sprung up to try and compensate for our individual lack of pension management expertise, and to help construct suitable portfolios made up of components managed by asset managers (eg mutual fund managers). [Yes, I know about index investing, and “target-date” funds, but I wanted to keep the post simple].

Further on, I am going to speculate about the changing role of physicians, and the emergence of a new class of individuals that parallel financial advisors, but for health.

Primary care medicine is changing

I would argue that cost pressures have already changed primary care medicine significantly.

It used to be that you went for an annual checkup to your friendly primary care physician. He took the trouble to get to know you, and worried about your health, as well as “fixing” any problems that arose, and referring you to a specialist if need be. Sort of like that pension manager worrying on your behalf about making sure there would be a pension for you when you retired. Well this sort of still exists today. But you can see it going.

Primary care physicians spend less than 10 minutes on average per visit. They are harried and rushed. Many of the older ones are retiring. New physicians prefer to become specialists. And getting in to see a primary care physician becomes harder and harder. And try finding a new one who is good and available? Challenging.

Exciting new primary care opportunities, but more work for someone.

At the same time, there are all sorts of “emerging” new opportunities for better disease prevention and for better disease management, ranging from remotely managing chronic diseases using telemonitoring technology; to the use of an individual’s genetic profile to select the right pharmacological intervention; or the use of behavior-modifying tools (eg game-ification) to reduce obesity.

And what is really promising is that many of these techniques seem to have the potential not only to improve outcomes, but also to reduce overall healthcare costs. For a good primer to all this, and its implications, I recommend Eric Topol’s new book “Creative destruction of medicine“.

But, there are some obstacles to grafting these new tools onto our current healthcare system. Someone needs to understand genomics and pharmacogenomics and how to integrate results from the new tests that are available from companies like Navigenics into a (personalized) preventitive medicine practice. And there are now all sorts of complex blood tests (often not reimbursed) that ideally should inform health management. And the rise of direct-to-consumer advertising by drug companies adds a lot of noise that someone needs to cut through.

So who will do these new tasks in the future? As yet, most primary care physicians have not been trained in new techniques like pharmacogenomics. And can we really expect busy primary care physicians to become experts about which clinical trials mean what, and which drug-marketing claims might be a bit exaggerated? And the current reimbursement system is structured in a way that makes it economically unattractive for fee-for-service primary care clinicians to incorporate many new approaches (especially in the area of disease prevention rather than treatment).

Personalized health vs Population health

A lot of the exciting new developments on the horizon involve a more personalized approach to wellness and to therapy. Whether it be drugs designed for specific genotypes, or games targeted at behavior change in people with specific personality traits, the idea is to replace pathways based on population studies with pathways tailored to an individual (See Dr. Topol’s book for much more on this theme).

But if this is really to happen, primary care will need to change, with an increased emphasis on characterization of the specific patient, and on patient-specific prevention and therapeutic pathways. In our current (US) healthcare system, many clinicians lack the time, the financial incentives, and the necessary skill sets to make this transformation realistic.

I think these emerging personalized medicine opportunities represent the second strong driver (in addition to reducing cost) that will  shape changes in the healthcare system in the coming decade.

Managing your own health

Today, if you want to take advantage of emerging personalized medicine options, it is pretty challenging. You can find that rare primary care physician who is on top of the latest in genomics, nutrition, blood tests, and emerging digital tools for managing exercise, and remote monitoring etc, and put yourself in their hands. Most likely (because of the way fee-for-service reimbursement works), that individual will be practicing concierge medicine, or perhaps be part of one of the systems (Kaiser or Veterans Affairs) that worry about the totality of health.

And over time, perhaps all primary care physicians will add these skills to their armamentarium. And perhaps the reimbursement system will change to make doing so economically attractive to the average primary care physician. Or maybe accountable care organizations will emerge and dominate the healthcare landscape, and maybe these new entities will somehow (care teams?) deliver quality personalized medicine to all of us.

But somehow, I am a bit skeptical about these changes happening soon enough, and to a sufficient degree, to take care of the average american as well as we would like.

This post contemplates an alternate scenario, in which each of us individually becomes the focal point for managing our own health. This is what I think of as the 401(k) model of primary care, with selected advisors (eg the primary care physician) available to help with specific challenges. But at the end of the day, the overall responsibility reverts to you and not to a friendly clinician.

Just to be clear, I am not advocating this idea. I am just saying that I see it as a “likely to happen” scenario.

Implications of the 401(k) approach to health

Here are some potential implications of my analogy between retirement finances and health. I hope they are thought provoking, but I am the first to admit my crystal ball is cloudy! Time will tell if I am right.

  1. At the end of the day, the buck (for managing your health and preventing disease) will stop with you, and not with a friendly clinician. Maybe this means becoming an expert yourself, the same way that some of us manage our own financial assets and retirement plans. Or maybe it means outsourcing the job.
  2. There will gradually arise a new cadre of supporting individuals who do some of what today’s primary care physicians do (nurses and physicians assistants of course, but perhaps other individuals too (nutritionists) as part of some type of team practice). Hopefully, this will allow highly trained physicians to focus on high value tasks.
  3. It seems to me there will be a need for a whole new class of “help”. The equivalent of the financial advisor. Will it be people who are trained as “health advisors” (eg genetic counsellors)? Or will there be new tools that synthesize the results of blood tests, genetic tests, population studies and clinical trials, and tell us what our future holds for us if we add or don’t add one more medication, or add or don’t add one more exercise session per week?
  4. Increasingly, there will be a “disease treating” industry, and a “disease prevention industry”. Today’s healthcare system is pretty good at treating disease, and I see that continuing. Some parts of the disease treating ecosystem will also get good at disease prevention (Kaiser). But I think there will be room for some new models.
  5. Most of us are going to be pretty terrible at managing our own health. How many “average joes” will be able to understand their genetic fingerprint and decide based on that whether or not to go on that statin that they heard about on TV and for which their doctor wrote a prescription? This is depressing. I have the impression that we are on the verge of great human suffering as a result of a generation who is unprepared for retirement. Will we be seeing a generation in 30 years that has been equally bad at managing their wellness?


Maybe this suggests a role for technology, in the form, for example, of intelligent “health advisor tools”, perhaps similar to those created by a company like Financial Engines for asset management and retirement planning.

If we are lucky there will be turmoil and lots of new ideas and models that will be tried, and eventually some valuable new businesses will emerge (if regulation and government do not apply too heavy a hand).

I hope to look back in a decade and see whether or not I am thinking about this correctly. I would love your comments and thoughts.


  1. […] The idea that health insurance might follow the trajectory of retirement finance, with employer-covered insurance moving toward a defined contribution, 401(k)-style approach, rather than the current, defined benefit, Pension-like approach is one I have written about before. […]

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