You all know I mentor at Rock Health, the San Francisco-based accelerator for health care startups. I am very impressed with the energy and passion with which the startups there address the broken health care industry.

So it is with total conflict of interest , but also a lot of pride, that I announce the merger of Health in Reach, a member of Rock Health’s first class, with PriceDoc.

Health in Reach helps consumers get greater insight into fees for medical services. The combination of Health In Reach and PriceDoc will let consumers  control  their out-of-pocket expenses by providing a single destination where they can research the costs of specific medical and dental procedures, save up to 50 percent or more on service fees, and conveniently schedule appointments online.

Today, more than 130 million Americans do not have dental insurance and pay billions of dollars out-of-pocket without knowing the prices in advance or having the ability to comparison shop.

“The promise of consumer-directed healthcare starts with an empowered consumer. The marriage of Health in Reach and PriceDoc is a perfect fit because we share the same mission – to help consumers become more proactive in their medical decisions,” said Scott Sangster, founder and CEO of Health in Reach. “When people go to the doctor or dentist, they rarely know how much the treatment will cost, or what’s included, until after their appointment when the bill arrives. By preventing surprises, we believe people become confident enough to visit doctors more often, which improves patient care.”

Health In Reach now offers more than 1.6 million appointments  every month. The site also offers descriptions and prices for nearly 50,000 specific procedures. Consumers can easily schedule appointments online, receive appointment reminders, and lock-in fee discounts before they arrive at the doctor’s office.

“Health In Reach is addressing the lack of consumer confidence and affordability prevalent in our current healthcare system, which is a major market problem,” said Halle Tecco, CEO of Rock Health, the San Francisco-based digital health startup accelerator sponsored by partners including the Mayo Clinic, Harvard Medical School, UCSF, Accel Partners, NEA, Nike and Mohr Davidow.

From the Health In Reach website, consumers can search a proprietary database of medical, dental and vision providers around the country, and using its patented technology, can find and schedule the providers who best match their criteria. After an appointment, users can leave reviews and other comments about their experience.

Together, Health In Reach and PriceDoc have raised over $6 million from investors.

Health In Reach offers a nationwide dentist and doctor marketplace connecting consumers and healthcare providers. Consumers access descriptions and prices for nearly 50,000 specific procedures, save up to 50% or more on service fees when paying out of pocket, and schedule appointments online instantly and securely. Health In Reach was founded in 2009 and in 2011 was selected as one of the inaugural companies for Rock Health’s startup accelerator program. 

Bad news for young physicians coming out of school with big debt, and for people who are worried about an upcoming physician shortage.

“Physician income declined in general, although the top-earning specialties remained the same as in Medscape’s 2011 survey. In 2012, radiologists and orthopedic surgeons topped the list at $315,000, followed by cardiologists ($314,000), anesthesiologists ($309,000), and urologists ($309,000). Previously, radiologists and orthopedic surgeons led the pack, at a mean income of $350,000 each, followed by anesthesiologists and cardiologists (both at $325,000). The bottom-earning specialties in 2012′s survey were pediatrics, family medicine, and internal medicine.
For employed physicians, compensation includes salary, bonus, and profit-sharing contributions. For partners, compensation includes earnings after tax-deductible business expenses but before income tax. Compensation excludes non-patient-related activities (eg, expert witness fees, speaking engagements, and product sales).”

This is too important not to share. I’ve been reading the newspaper articles about it, but here’s the ABIM Foundation’s original list. What do you think?

Nine United States specialty societies representing 374,000 physicians developed lists of “Five Things Physicians and Patients Should Question” in recognition of the importance of physician and patient conversations to improve care and eliminate unnecessary tests and procedures.

These lists represent specific, evidence-based recommendations physicians and patients should discuss to help make wise decisions about the most appropriate care based on their individual situation. Each list provides information on when tests and procedures may be appropriate, as well as the methodology used in its creation.

What tests and procedures should patients and physicians talk about? Read the lists:

• American Academy of Allergy, Asthma & Immunology
• American Academy of Family Physicians
• American College of Cardiology
• American College of Physicians
• American College of Radiology
• American Gastroenterological Association
• American Society of Clinical Oncology
• American Society of Nephrology
• American Society of Nuclear Cardiology

Related articles

• Physician Groups Call for Fewer Medical Tests (news.health.com)

Every once in a while I find that America’s acclaimed free market health care system (it’s a joke, folks, just a joke) has hit a new bottom. Today I found a piece in Health Business Blog that asked

Are you commercially insured with cancer, heart disease or an orthopedic problem? If so, you are a juicy marketing target for hospitals, which drool over the prospect of high fee for service reimbursements. USA Today (Hospitals mine patient records in search of customers) explores how hospitals are combining their own data with information from consumer marketing agencies to pinpoint likely customers for their services.

Give me a break! It’s one thing to mine data for its public health implications, or for clinical trials, but IMHO it is quite another to use my personal health data for marketing purposes. The original article from USA Today told the story of a middle-aged smoker who got a targeted postcard offering him a lung cancer screening. Other people in the service area of the hospital did not get the same postcard.

The non-profit facility is one of a growing number of hospitals using their patients’ health and financial records to help pitch their most lucrative services, such as cancer, heart and orthopedic care. As part of these direct mail campaigns, they are also buying detailed information about local residents compiled by consumer marketing firms — everything from age, income and marital status to shopping habits and whether residents have children or pets at home.

Why, because in our current system, employer-based insurance foots the bill for uncompensated care (the poor) and Medicare/Medicaid patients. That’s the Great American Cost Shift, in which because we don’t have a universal health care system, some of us pay sky-high premiums to insure the rest of us. If I were part of the commercially insured segment,  wouldn’t fight for the continuation of this system for a single minute more.  You are not fortunate, as your premiums go up and your co-pays increase: rather, you are paying for every senior and every poor person whose care is not reimbursed adequately by the government.

I’ve never understood why people whose employers offer health insurance are not in favor of universal health care. Do they think they will lose the ability to choose a physician? I didn’t when I went on Medicare, and my foster kids who are on Medicaid can also choose their physicians.

In the mean time, the system deteriorates and becomes more expensive for those who pay. The hospitals are not forced to change their business models; they are only forced to become better data miners and targeted marketers. But is that what we want our hospital to be known for?

Image by mariachily via Flickr

I was fortunate enough to be able to attend the Rock HealthHealth Innovation Summit onJan.20th. It was the third day of a conference that highlighteddevelopment, design, and business issues around the potential for health care transformation through technology. The room was full, and the audience stayed until the end, even on a Friday afternoon.

Why? Because they knew something big was up. What’s up is the awareness of the Rock Health accelerator and the move to change a system only a young person from outside the industry could even hope to change. For three days, enthusiastic developers listened to cynics like me talk about business models, chasms, and challenges. I hope our doubts didn’t make a dent in their drive.

A year ago, there was no Rock Health, but more important, there was no community pulled together around the cause of health care innovation brought about by young people largely focused on digital and mobile technologies. A scant one year later, there is a vibrant health tech community in San Francisco, supported by large hospital systems, insurance providers, VCs, angels, entrepreneurs and mentors. The need is recognized, but until Rock Health, there hasn’t been a community. Health 2.0, another wonderful step in the direction of change, focused more on showcasing change than on financing or mentoring change.

The second class in the Rock Health program kicks off this week. Some of the grads from the first have already received additional funding or gotten to revenue.

They won’t all succeed. They have no concept of how complicated this industry is. But here’s the most important point: Rock Health has drawn together all the people inside and outside the system who want it to change, who are willing to take chances, and willing to support the effort to move the needle.

And thus I feel like 2011 was a tipping point for health care as an industry. After last year, for many reasons, it can’t remain the same. The larger providers and payers have already begun to circle the wagons around Obama’s health care reform law, because they are realists and know it’s not going to be repealed completely no matter who gets elected. So they’ve begun the journey toward bundled payments, Accountable Care Organizations, medical practice acquisitions, and better electronic health records. The battleships are slowly changing direction.

And the best part, Rock Health was founded and is run by women — the very people who make most of the health care decisions anyway.

Related articles

• A Dozen New Health Care Startups at Rock Health (ushealthcrisis.com)
• Rock Health Gathers Healthcare & Technology Stars: A Photo Gallery (xconomy.com)

The difficulties that health technology innovators will have breaking into the health care industry were no more clearly illustrated than by the talk given by Dr. Sam Ho, Chief Medical Officer of United Health Benefits Group, on the third day of San Francisco-based health incubator Rock Health’s  Health Innovation Summit. After two days of exciting stuff about design and development, CEO day presented the cruel reality of the market .

Dr. Ho began by admitting the system was broken. Payments, he admitted,  didn’t align with objectives, and outcomes were an afterthought.  But now things are in the process of change, partly because of the passage of Obamacare (although he didn’t mention it by name), partly because of the too-temporary tenure of  Dr. Donald Berwick at CMS, and partly because in a worldwide recession, we can’t afford our health care costs any longer.

So the big players, fearing innovation from without, have decided to try to innovate from within, and came up with a slogan called “The “Triple Aim:”  a slogan that embraces how to improve the individual experience, improve population health, and control inflation of per capita costs. Dr. Ho believes these three aims are separate now, but they must be aligned  to succeed.

For United Health, this means Care Management Programs, Transparency and Premium Designation Programs, Hi Performing Preferred Networks, Value-Based Benefits, and Value-Based Contracting. These can be read as forms of rationing and cost shifting by the more cynical among us. However, for him,  it mans developing more and more incentives for changing consumer behavior. For example, patent premiums will get lower and benefits richer if consumers enroll in a diabetes plan and stick to it. If they manage their blood pressure or lipid levels, they will also have richer benefits. But what if they try and fail? I’m all for outcomes-based medicine, but we have to be careful we are measuring things that are within the control of either patient or provider. And how do we judge?

Here at Health 2.0 there is definitely an air of transformation. Several initiatives that I had been following have come to fruition, or at least to critical mass, among them implementation of EMRs and patient communities. MedHelp now has over 12 million visitors a month, while millions of women annually visit the women’s social health site EmpowHER.com

On the electronic medical records side,  physicians have finally begun to implement EMRs in large numbers, because they are now subsidized by ARRA, the stimulus bill (you remember, the one that didn’t work?) to do so. In order to receive $50,000 to deploy an EMR, a physician need only buy one and demonstrate its “meaningful use” in his practice. For this year, to qualify for the Medicaid meaningful use incentive, all you had to do was purchase the software and go live in your practice. In the future, there will be other, more important qualifiers, such as the health outcomes of your patients. But for this year, just buy the product and begin to use it.

As a result, companies like Practice Fusion, which always made its software free, and is a (private) cloud-based platform have begun to grow by leaps and bounds. Founded in 2005, Practice Fusion grew by 400% in 2009 with the passage of ARRA now has 100,000 users and 21,000,000 patient records online. Next year, it is projected to have  100,000,000 records. Its iPhone app will launch soon, and its iPad app is being designed by one of the country’s top designers, who will speak at Practice Fusion’s user conference in November.

As part of an “exclusive” interview  with Practice Fusion’s founder and CEO, Ryan Howard, in which we took a pedicab ride around downtown San Francisco, I found out that within the next few years, users of EMRs like Practice Fusion will be able to choose physicians based on whether they have EMRs and allow the patient to have access to his or her data. After five years of waiting for the market to catch up with his innovation, Ryan has found himself sitting pretty, with open data ready for the new wave.

[ Aside: I also found out that in the early days of the company, Ryan actually took an insurance settlement check for an automobile accident and used it to make payroll instead of having his torn rotator cuff fixed. Yes, he's a hard core entrepreneur]

However, if you are a patient of the VA, of Medicare, or of any other insurer that is part of the Blue Button initiative, you can get your data today, by logging into VA.gov or Medicare.gov and registering online. Once you prove your identity, you will be given an opportunity to use the Blue Button  to download your data as a text file, or view it as a .pdf . You can save the data to your hard drive or send it to a PHR, such as Health Vault.

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Health care, long ignored by VCs who didn’t understand it, is now so obviously broken that it can’t be ignored, Rock Health, the crusading seed incubator inSan Francisco where I’m a mentor , has done a  study ofVC-funded healthcare startups. According to Rock Health’s survey, which is admittedly incomplete, 35 companies have received $2 million or more in funding in 2011 alone. But that’s only 2% of the startups. The rest, we can assume, are bootstrapping in one way or another. And although 2011 shapes up to be a record year in venture funding for the segment,  surpassing the previous record year 2010, much remains to be done.

Of the interviewees, 51% are in the business-to-business area (business to consumer health sites such as Wellsphere and WebMD having sprung up ten years  ago and already consolidated that space). This year, I see a great emphasis on personal health monitoring, on remote patient monitoring, and on connections between doctors for clinical decision making. There’s also a push to be mobile.

And yet the bulk of the work in transforming the industry has yet to be done. In the early days of electronic health records, a few major players — Cerner, GE, and McKesson — became entrenched in hospitals, providing ERP systems that did things like bar codes and inventory management, critical care bedside monitoring systems and claims processing. Those players, already in the hospitals,  also developed the early EHRs.

Those few players, with their expensive, proprietary systems, are still in place in most hospitals. As a result, patient data is siloed inside the hospital. When I had my hip replaced in 2006, I had to check into the hospital in advance. I filled out a series of paper forms at one end of the hospital. I was then required to take some preliminary blood tests, and I had to walk to the other end of the hospital, where the labs were located, and fill out the same forms. I filled them out again in the surgeon’s office, and again at the physical therapist.

My surgeon had to use the same costly EHR software the hospital uses in her office to make it possible for her to communicate with the hospital, and then another piece of software to read my outpatient X-rays, and still another software product to get the lab results.

When I returned to the care of my family doctor, who didn’t have any of the same software,  so the information transfer reverted to fax machines and hand carried X-rays.

Why? Because the Amazon and the Google of health IT don’t exist yet. Google tried and failed to get into the health care market, and Amazon is smart enough not to try.

As a general rule, hospitals buy separate pieces of software that don’t talk to each other. The problem is intensified by privacy regulations that few people fully understand. These regulations were designed to protect the patient, but the net effect is to make the transfer of information between health care providers almost impossible without paper files. In his day and age, that’s shameful. Even Kaiser Permanente, one of the pioneers in integration within its own hospitals, doctos, and patient population, has a system that can’t talk to the outside world.

Here’s what that means for you:

You go to your family doctor, and he will now have an electronic health record, because the government is incentivizing him to put one in.

His electronic health records software may or may not “talk to” the hospitals he practices at, or the labs he sends you to

If you are referred to a specialist, he may not even have an electronic health record, but if he does, odds are it’s not the same one your family doctor has, and—you guessed it — the data doesn’t transfer from one system to another.For you, it means your doctor will receive a copy of the specialist’s records by fax, or hand carried by you.

If you go to a hospital, when you leave, you will have paper discharge instructions, and your doctor may or may not get a report. Chances are, he will have to ask the hospital for one, and you will have to fill out forms to give him access to the reports. In fact, you will have to sign multiple forms just to get your OWN report, and when you do, it will probably be paper.

Lack of information sharing leads to redundant data entry, which takes up critical time.

Can you see the opportunity here? Health IT experts call it “Continuity of Care,” and are trying to set up regional “Health Information Exchanges,” so that if you happen to move from one city to another, change insurers, or change providers, your data can go with you.

But these are in the dark ages, because the acceptable standard, HL7 (or maybe by this time is is HL8) doesn’t do the job. The big entrenched players appear to have done everything they can to protect their market share my making it as difficult as possible to export or import information from their systems. Even at Rock Health, where awesome innovators are committed to changing the system, everyone is touching only a piece of the elephant.

So where’s the big opportunity in health care these days? I think it’s in data transfer and data sharing. If you think about how the internet has made it possible to share all kinds of other data, such as consumer sentiment, political opinions,  even energy use through the common TCP/IP standard, you realize how far health care has fallen behind.I am anxiously awaiting the day when your own health data moves with the same fluidity as data about your car, or data about your spending habits.

We appear to have “bent the curve” in health care spending last year; national health spending grew at a historically unprecedented low of  3.9%. That’s including all national health expenditures — private insurance, Medicare and Medicaid, and out-of-pocket expenses.

You would think this was a good thing, right?

But according to Deloitte’s new survey, not necessarily:

• In the United States, three in four (75 percent) consumers say the recent economic slowdown has impacted their health care spending.
• Forty-one percent are more cautious about spending, 20 percent have cut back on spending, and 13 percent say they have reduced their spending considerably.
• Sixty-three percent say their monthly health care spending limits their household’s ability to purchase other essentials, such as housing, groceries, fuel, and education.
• In an effort to save money, 36 percent of prescription medication users say they asked their doctor to prescribe a generic drug instead of a brand name drug.
• One in four (25 percent) U.S. consumers skipped seeing a doctor when sick or injured.

• Consumers believe that hospital costs (68%), lifestyle

choices (62%), and fraud (62%) are major drivers of

overall health care costs. Administrative costs (57%),

prescription drugs (54%), and defensive medicine

(51%) are also commonly cited.

• Over half (51%) of all consumers believe that 50% or

more of health care spending is wasted

• Of those believing that the system is wasteful,

49% feel that money is wasted because

individuals are not taking enough responsibility

for maintaining their own health.

• Consumers also blame redundant paperwork

(55%), defensive medicine (46%), lack of

adherence to evidence-based approaches (40%),

and extreme measures taken at the end of life to

extend life for a short period of time (35%)

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As the last of the large American industries to undergo forcible automation, health care is currently in a state of prolonged agony. The HealthTech NextGen 2011 Conference, held in San Francisco recently, highlighted this by calling attention to at least six disruptive changes that are still ahead in health care. These range from physician workflow to patient responsibility, to perhaps the overall (again) of the entire system.

1)Conversion of physicians to electronic health records. So far, 83,000 physicians have proven to Federal government that they have implemented electronic health records and are using them to manage patient outcomes. Many of these were already using EHRs, and had only to report in to the government and receive their $44,000 per physician incentive for whatever they bought. If you are a physician and haven’t yet done this, you must be finished implementing your EMR by 2012, or the Medicare incentive will start to decline. This incentive goes away altogether in 2014. For the late adopters, subsidized technical assistance is available. So the gathering of patient information into automated systems is underway, and patients will soon have health care portals.

2)If stage one of meaningful use is to capture information about patients, stages 2 and 3 are about sharing it. Health Information Exchanges are springing up all over the US, designed to ensure continuity of care by allowing your medical records to travel between physicians, hospitals, pharmacies, and labs. The current way of exchanging health information is to export it to the patient, one way or another, and give her the responsibility of carrying it with her. In the future, the patient should be out of this process, except for controlling to whom the record can be sent.

3) The rise of the genomic signature as part of the medical record. Within the next decade, state of the art medical care will include tailoring your therapy to your unique genetic signature. You will have your genes sequenced as a matter of course, because the cost to do this is falling rapidly, and the number of therapies that depend for success on knowing exactly who you are is rising just as rapidly. Over 500 actional geneticSNPs influence treatment in oncology therapy alone today.Over 70,000 SNPS are known to affect disease development, course, or response to therapy Soon it won’t be possible to publish medical research without the genomic signatures of the cohort, and state of the art medical care will rely on a complete chart and comprehensive digital genomic sequence.

4)Perhaps the biggest transformational change to the health care delivery system will be moving the responsibility for health care and outcomes from the provider location to the consumer location through telemedicine, mobile apps, and remote patient monitoring. The patient will no longer go to the doctor’s office; the office will be with the patient at all times via a mobile device. Device integration is happening right now in all the major EMRs.

5) The rise of health avatars, trusted online resources to sort through the conflicting information a consumer needs to manage his own health. Your health avatar will help you do everything from stick to your exercise program to take your blood pressure and report it to a central database. In limited forms, these exist today as products like Fitbit and the Withings Connected weight scales and blood pressure monitors, which send information to central repositories on the internet from devices you can now buy for home use. The Fitbit measures your sleep and exercise, while the Withings weighs you, calculates body fat, and takes your blood pressure.

6) The change in physician compensation from fee-for-service to fee-for-outcomes. Your physician will be paid to keep you well, not for treating you when you are sick. In this ideal future, he will spend more time with you planning out how you plan to stay healthy than fixing you when you don’t stick to the plan, because he will be compensated for your health, not your illness. One of the nation’s largest health systems, Kaiser Permanente, has pretty much ridden the front wave of these disruptions, and after four years of turmoil emerged with a fully integrated and automated system in which all of its 150,000 patients, 15,000 physicians, 36 hospitals, and 454 medical offices all participate. It boasts 100% of patient charts and 100% of its hospitals and clinics online. The online system processes 20,000 emails a day and has a full hot failover between data centers. To accomplish this, Kaiser Permanente also had to deliver 3,000,000 hours of training. But it has saved over 12,000 lives so far, by channeling the vision of Kaiser’s Founder, Dr. Sidney Garfield, who first published his vision of a completely integrated system in a 1941 edition of Scientific American. An overnight success.