 I'm Alice Nobri of NPR News. Welcome here. On behalf of the World Economic Forum, I'd like to get started, introduce our panel. For the next hour, we're going to be talking about this idea of feel better or your money back. This past year, GlaxoSmithKline introduced a one-shot gene therapy for a rare disease. The cost of the drug was about $500,000. And the idea was that if it didn't work, you'd get your money back. It's an example of new models, new ways of pricing healthcare. The question we're really going to be focusing on here today is, what are the other innovations that are nudging us to sort of a pay for performance model or to value-based medicine? So I'd like to begin by introducing panelists one by one. Lloyd Dean here is President and Chief Executive Officer of Dignity Health. He's been named one of the most influential people in healthcare by modern healthcare. Give us a start out by giving us a sense of examples from what you see from the dignity side. What are the triggers that make it happen that lead to innovations and more nudging us towards pay for performance? I think a lot of the impetus is really coming from the consumer patients and from the community. The formal question was, is this time right for us to be talking about pricing versus value? And I think that that horse has already left the barn. I think that when we talk about a concept called value-based, that what that to me says is that consumers, patients, payers are questioning for the dollars that are being expended, are we truly getting a yield on that or is that proportional? I think that, but in order for us to talk about price, we have to talk about payment. And one of the things that we certainly have in the United States is a misalignment at times, and I think to some extent exists as we sit here today. Under the old fee-for-service model, it would drive us down one path. But I think when we talk about value and when we talk about payment systems that truly get at, are we achieving what we set out to achieve? And is that measurable? And is that happening in the eye of the user, which in my world is patients and consumers? So tricky to implement but the way of the future. Next I'd like to introduce Omar Ishrak. He is the chairman and chief executive officer of Metronik, the world's largest medical device company. How do you see this, Omar? What do you think are the triggers for innovation? Well, first, in our view, which has really been the mission of our company all along, you know, we're a technology company aiming to change outcomes, both technology and outcomes. Therefore by definition, all our innovation is geared and measured by the impact that we have through changing outcomes. Well, value-based healthcare is in fact the improvement of outcomes at a given cost. So from our perspective, how can it be bad if you actually get paid for what we work to do, which is to improve outcomes? And in fact, the entire healthcare system, if you broaden it, in the end that is the goal to cure somebody either by prevention of escalation or by treatment to improve their outcomes. And I don't think there's a choice in the long run but to gravitate the entire healthcare ecosystem to a mode where the payments are based on reaching certain outcomes at the lowest possible cost. But both have to be in the frame. So the task really becomes one of how do you operationalize it and that's where it starts to get difficult and although everyone can agree on the overall philosophy when it comes to implementing it, we found that the fee per service system has been structured in a way and institutionalized in a way that almost makes it difficult to break and move to a system where one gets paid for an outcome because the sorts of collaborations that are required are sometimes even prohibited because the assumption is it will always be a fee per service system. So those barriers have to be removed. I think the other things, a few of the things that Lloyd touched on, the clarity of definition of outcomes. If you're going to be paid for it, you've got to be able to define it and measure it in a way that you can put money down on the line, your ability to measure cost, to baseline cost, to equate, to estimate what improvement you can make and therefore say that this is what it's worth. So you know there's a lot of operationalizing, there's a lot of elements here to take care of as you operationalize. I think the one thing that I'll say is that you've got to do this in a granular fashion. It's not a magic light switch that it can be done through one sweeping change. I think you have to take this thing element by element and operationalize. So we'll get back to this sort of the obstacles of overcoming this fee-for-service model. I want to introduce Joseph Jimenez, he's the chief executive officer of Novartis here in Switzerland. Joseph, how do you see this? What do you see as the key factors in nudging health care towards a more break from pay-for performance and more towards value-based medicine? Well, I don't think we're going to have to nudge the health care systems because if you just look at basic demographic trends and you look at the numbers of people that are coming in terms of that 50-plus age group, that's going to be a crushing financial burden on health care systems around the world. So the way that at Novartis we think about this is it is inevitable that the market has got to move to a value-based system because the health systems aren't going to be able to afford to pay for the elderly that are coming in the next 10 to 20 years. So when you think about pharmaceuticals, the shift from, we at Novartis think about the shift from transaction to outcomes-based where we will get paid at least some element of our payment based on the way that our drug performs. So did we deliver the agreed outcome for the patient? And a perfect example is our drug for heart failure called intresto, which is clinically proven to reduce hospitalization by 20 percent. Well, that's a huge expense in the health care system. And yet intresto can help reduce that by 20 percent. So we've entered into a number of contracts with payers in both the U.S. and Europe where we get paid on that drug's ability to deliver on what we said. And I think that's where it's going. We'll talk about more examples of that. I want to introduce Risa Liviso Mori, she's Chief Executive Officer and President of the Robert Wood Johnson Foundation, and I should acknowledge that RWJ is also a funder of NPR, the organization that I work for. Risa, you have an MD and also a business degree. So you have an interesting or a different perspective. How do you see this going forward? Well, I'd like to widen the aperture just a little bit and think about this from the perspective of patients. And particularly when I, and I'm a geriatrician. So when I think about older patients and how they define what's of value to them, it's not just whether their immediate condition has been alleviated. It's whether they feel better, they're more functional. They're able to stay at home and stay out of the hospital. And if we're going to try to achieve that kind of value, we're going to need to expand not just the integration across the health care system and not just including public health systems that address prevention and disease prevention. We're also going to have to include social supports that will help with transportation and housing. I can tell you, as a geriatrician who used to make house calls, the thing that was best able to help me keep someone out of the hospital was the conditions of their home, whether they had food security and their social network. So I think those are some of the things we're going to need to include if we're really going to have accountable care organization, health care organizations and accountable care communities to support those health care organizations. Got it. So, Lloyd, I want to go back to you. You mentioned the sort of misalignment and talking about how tricky to implement, but clearly moving away from fee for service is the way of the future. Talk a little bit about what you've done at Dignity over the last decade. When you started there, it was a very different place. You've driven a lot of change there. Reorganized structures, gotten rid of managers to try to drive efficiencies. Talk a little bit about how you bring this new model into dignity. Because one of the things that we've tried to do is to expand the definition of outcomes. Because it's relative to what lens you are looking through. An example, cost is one lens. If it's, you know, how do we get to the lowest cost environment, that's going to put you on one pathway. From a patient perspective, we all know that everybody wants good clinical outcomes. But I'll contrast my daughter and my wife. My daughter, when she accesses healthcare, she wants to be close to her. She wants it to be quick, and she wants in and out, and that's it. My wife, her definition of a good outcome, she wants time with the physician. She wants to understand what's happening to her. I would further expand the definition to think about, you know, again, where you sit within our equal system. We take care of a lot of patients in their definition of a good outcome. Certainly is clinically related, but if they can get to the care site, can they get there safely? Can they be treated in a way that's kind and just? Will somebody take the time to explain not what's happening today, but what's this journey that they're going on? So what we've tried to do is look at the totality of this thing we call outcome. And we've tried to be able to dissect what are the value opportunities within that context. And what are the value opportunities? I think there are a lot of value opportunities. Number one is, yes, we need to be efficient. So one of the things that you were alluding to when I came to our organization was that we had an abundance of different layers of management. And it got a lot of press that I collapse those levels of management. That wasn't just to collapse and to disrupt people. It was to try to get our cost of, if you will, the management side down so that we can invest in capital, invest in our employees, and also create the systems and the various underlying systems so that we could move down the journey of quality care. Elmar, I'm trying to understand. I'm thinking about the kinds of things that Medtronic produces. You make all kinds of medical devices and diagnostic tests. So give me a sense of a way in which the way the healthcare system uses your products could alter the way that your products are paid for. I mean, if your diagnostic devices can change outcomes and lead to better care, better outcomes for patients, does that influence what the healthcare system pays for your diagnostics? Well, it should. I think the diagnostics one is one step removed because you need to change an outcome you can't just do the diagnostics. You need to do the treatment and the follow-up as well. So as the diagnostics are integrated in that entire chain, I think first we'll be motivated to have more and more pieces of that continuum and then get paid for the overall result. I think the example that Joe gave is very pertinent and we've got lots of examples where we have therapies rather than diagnostics, where we put some things like stents in or joints in, for example, or very, very clear treatment mechanisms for which we'd sign up for exactly the same sort of thing. I mean, almost the same model. But just like what Joe said, the outcome definition has to be clear that if you didn't do it, this what you'd get. If you do it, this what you're going to get. Here's the difference and pay us the... We'll share the savings or some kind of thing. And that's how you price it. You don't talk about the pricing. You say, we'll share the savings and the pricing gets built into it. That's the kind of model that eventually we'd like to get to across everything. Because if what we do doesn't achieve something like that, then why are we doing it? If we were spending several billion dollars a year in R&D and I get a stack of proposals every month saying, we're going to fund this program and that program. And all of them say that this is what it does. Well, let's get paid for it. But to do that, you need to be able to articulate and quantify what the expected result will be and then stick your neck out. Let me ask you, Joe, give us an example or tell us a little bit more about how Intrasto is working. How is it that you're measuring that the drug is working? Who is it that gets to decide or declare, yes, this has worked? And what have you found so far? Well, the first thing we would do is we would sit down with the payer or with a payer provider. And many times it works better with an integrated health care system because they control not only the payment, but also the care. And that's when it works the best. We agree on what the outcome will be because that's critical. So will it be a reduction in hospitalization for a certain cohort of patients? And then we measure that. And this is one of the key barriers. You can't move to an outcomes-based system until you have the data so that it's easy to collect. For example, many payers that we approach say, we love the idea. We'd love to try to eliminate waste and pay you on the outcome, but we don't have the systems to be able to collect that data in an easy way. Therefore, we're out. So we've got to work really on building a data infrastructure that will enable us to read real-world outcomes in a real-world setting. Some payer providers that are integrated have it today, particularly in Europe. There's a great use of data. And that makes an outcomes-based system much more viable because you've got that basic infrastructure in place. Got it. Steve Raskowski, I want to move to you, Chairman and President, Chief Executive Officer of Quest Diagnostics. I want to talk a little bit about how this new model could change the way you do business. So Quest is really sort of moving towards this, empowering health with diagnostics. Give us an example of how your model is changing. Sure. Sure. So the business we're in is the business that's the beginning of what happens in health care. So we represent in most markets about 2% of health care cost. But the other 98% is very dependent on the diagnostic workup that happens. And with that diagnostics comes treatment of the device or a pharma or some other treatment informed and also management of that patient. So when you talk about pay for performance, that diagnosis, the right treatment in the monitoring of performance versus whatever outcomes measure you might have is instrumental in all that. And we're moving away from trial and error fee for service world, particularly in the United States, the one that has much more precision. And this conference and other conferences is a lot of talk about precision medicine and personalized health care. And by way of an example, we're delivering today to the world a product that we've worked with Memorial Sloan Kettering, one of the cancer centers in North America, one of the best in the world, that they have 34 actionable genes that are made up of those drugs that will work with those genes. And if there's not a match for a patient, we'll also identify the clinical trials that can roll that patient in. So you're guaranteed, if you're against that match, if you will, that the drug will work. And so we're taking it out of New York City and moving it to the rest of the United States and throughout the world. A great example of meeting up the measurement to make sure what you're delivering does work. Got it. And I'm imagining that this is a completely new model for you when you think about quest diagnostics you think about. I mean, I think about having your blood drawn, right? Those tests can be sent back to your doctor. So they're doing something as simple as diagnosing simple diseases. You're talking about moving into a completely new era. All ends in spectrum, from the most basic to the most sophisticated. Genetic testing versus the most simple. And the most simple is keeping people healthy. We work with a number of organizations. We're selling it to providers, selling it to employers, selling it to insurance companies. A wellness product where annually you get checked up. You have a biometric screen and also full battery of test. And it gives that individual a good baseline. And actually employers, the people in most cases in the United States that are paying the bill, are actually incenting their employees to make progress against those numbers. And if they make progress, there's a performance incentive. They'll have less expense for their health care benefit cost going forward. So on that side of the equation too, it's actually engaging in empowering the consumer, or the patient in this case, in their health and looking at the measurements of their health information going forward to make progress in their health and prevent problems from happening. Reese, I want to talk a little bit about this. We talked about, you were talking about health and wellness being the doctor-patient relationship is a key part of it and has been a key part of it for a long time. But as we think about a new paradigm, we think about all the other actors in society that can sort of promote wellness or empower wellness. So Steve just gave us this example of working with employers to have people to have wellness checks. Do you see this as a big part of moving forward or innovation in terms of empowering people to be well outside of the relationship they might have with a doctor or health care system? Of course. When you think about how much time we actually spend engaged with the health care system, it's actually a very small amount of the days of a year. And many of the decisions about how we can help people be healthier occur in boardrooms and in Congress and in other places where the policy actually meets the ability to give people healthier choices. And so I think that that's one part of it. The other part is, as I was saying before, expanding how we can keep people out of the health care system. And a good example is what's gone on in Camden. Camden in the US, for those of you who know it, is one of the poorest communities. And there are some people who are very high utilizers of the health care system. When you look across all of the hospitals there, they can identify who those high utilizers are. And many times the things that keep them going back to the emergency room, keep them using health care services are things like an inability to get transportation or an inability to have access to housing that's going to be conducive to them being healthy. So I think when you put those two concepts together, yes, health and I like that you describe health systems as opposed to health care systems becomes a much broader concept for us. Lloyd, I want to go back to you and just pivoting off this point that for people to be well and to have a health care system, it's broader than what happens in the hospital. It matters. Do they have transportation? It matters what employers are saying to them about wellness. Is this a threat to the traditional hospital model where you need people to be sick and to come in to get care? Or can you partner with other organizations so that you all benefit by promoting wellness? And I think that's one of the theories behind the health care systems that we put in place certainly over the last eight years. I think the day where, as a provider, that our incentive is to get more people coming through the door have passed. We have to go in to the community. Certainly we need acute care facilities. But when you think about future payment systems, we have to make sure that we're delivering care not just in a cost-effective way, but in a way that's meeting the needs of the patient. One of the things that deeply concerns me when we talk about value-based or when we talk about pay for performance is really the heart of your question. And that is, what's behind that? I mean, everyone comes to the table understanding the simple that when I pay X and I have an expectation, I expect to get that. I do something. I expect something over here. That's not a complex concept. But why we're having this discussion is there is a perception that there's been a disconnect that consumers, patients, don't understand why in one environment I can have a knee replaced at $5,000. Why can I go across the street, and that's $15,000? From their standpoint, that's an issue. Doesn't make sense. Transparency. I want to understand what are the elements that I'm paying for, even whether I'm insured or not. And as was said, what are the social determinants that are driving it? So of course, we want to make sure that those who come to our facilities that, on all levels, they're of their health, that we fulfill that. But there is no incentive for us to have people coming into our EDs and having people have bad experience and continually coming back. And that's some of what has been tried to be addressed through this thing we call pay for performance. And again, I can't say enough that we have to make sure that when we talk about pay, that we have that corollary discussion about payment methodologies, because there certainly is a disconnect. When I bill most of the payers that we work with, I know that I'm going to build them at X. I'm going to be paid X minus. And that's the way we, our system, operate. And of course, as a consumer, know none of this. If I have insurance, then this is worked out between you and the payer. So there is a lack of transparency for that person who wants to know why there's $5,000 for having knee replacement one place and 15 at the next. And that's where that consumer movement is coming from. You ought to know. Yeah, Steve. So what you just said is changing considerably. Many of us around here are large employers. And this is a US portion of the discussion. In the US, a large portion of the health care system is played by employer-sponsored health care. And those that are in that marketplace have pushed more the cost to our employees. So 40% to 50% of working Americans are now paying for a large portion of their health care cost. So increasingly, every day, they're becoming much more aware of the costs they're paying and the variations and the differences in quality and costs associated with different care options and their making choices. Sure, the more I pay, the more I need to know how I can bargain. So in the past, you were not aware. Today, you're becoming increasingly aware. And there's a wide variation. And it's changing. It's changing. So health care systems in the future, to Lloyd's point, will compete on the basis that the rest of us could be on quality and cost. And in quality costs, we typically have warranty periods. If it doesn't work, you can go back, we'll fix it. And we have performance guarantees. And we compete with competitors based upon outcomes. So that's where health care is headed. It's much more of a commercial-oriented model than what we typically have had. And it seems transparency is really key to that. Yes, you have to have the data, both on quality and cost. And then the consumer at a rapid pace is becoming educated around this and understanding when they get those bills in the mail from the payer what they should be paying or not paying and where there might be some other choices they can make. Yeah, go ahead. And I wanted to ask you also, I know when you were General Electric and your work now with Metronic, throughout your career, you've done a lot of work in China, India, developing countries, bringing affordable care there. And I'm wondering when you're starting from scratch in countries that don't have health insurance systems and you're bringing new technologies to these places, have you learned anything about the models there that could help, that could be used in the United States to sort of drive efficiencies? Well, let me first make the initial comment I was going to make, which is to the discussions that we just had, I think let's not trivialize the outcome portion of that because a consumer or a patient understanding what to expect is important. And the payment that we're talking about is just some degree tied to reaching that expectation. And whether the payment, patient gets the benefit of that plus or minus on the expense is a different discussion of the payer or the healthcare system gets it in an insurance environment, it's a little more complex. But in the end, you're trying to reach a certain expected level of outcome or performance that the patient can perceive, which will then have an effect on the total amount of cost that is spent to get there. And only when all of that is put together to get a complete picture. So a value-based system or an outcome-based system has to have all of those components. And that's why I say you need to do this thing condition by condition, otherwise it gets too complicated and averaged out. But I'm just thinking through how you build that. I mean, I've never had the experience where I've gone to the doctor and six months later, they say, hey, how did you like that ACL repair I gave you? I mean, who's keeping track of. No, but that's what has to be built. And that's what we're all saying that that does not exist today. But in Joe's example, someone's measuring that that person didn't go back to the hospital. And if they did, there's a consequence because Joe had committed that you're not going to go back to the hospital. And we have examples like that, which I went to a lot, but we're very similar. But I think Joe will agree that this is not a natural act for payers to agree to or the systems. This is a lot of work and granular, detailed, legal agreements and all on the rest. So it's not only the data that has to be put in place. It's also regulatory. So for example, we're not even able to contract with payers on quality of life. Some of the quality of life benefits that we know our drugs deliver because it's not in the label. And that's considered off-label promotion if we did a contract. So I think organizations like the FDA and the EMA are starting to understand that that's the case. And if we have to move to value-based health care, we're going to need to change the regulatory system, the data system. And then also, as a manufacturer of a drug, if I'm going to be paid based on the outcome, I want to control more than just the drug delivering to that patient. So we're looking at things like... You want to know the compliance and... Right, so we're looking at how do we enter remote patient monitoring, ensuring that that patient is taking the medicine because we're going to be paid at the other end. Because so you're much more integrated into the delivery of the drug. We will have to become. And that's similar. I've got the same kind of things. And in our case, when you actually put an implant in, the surgeon put an implant in. How will they do that? So all of those become variables. And in fact, in our analysis of the value-based models to prioritize are ones in which there are the fewest variables. That means that the easiest to put in and the patient needs to do the least, and you'll see a result. And then scale that, because that's the easiest to put in place. The moment you get into five, six variables where you're depending on the scale of the doctor, you're depending on the adherence of the patient to a certain regimen, multiple drugs, measurement gets tough. I mean, let's kind of put those aside for a while till the models get cleaned up, till some of the more basic regulatory challenges get overcome. And then we can implement the very complex models. And that's why a step-by-step approach to this is very important. I would add too, you know, because I think if you listen at this conversation, one might think that slitting their wrist is the best option here. Slitting the wrist? Yeah, but my point is that all is not lost. I pray every night that one of the things that's not perfect but that we don't lose in this country is this concept called bundle payment. What is bundle payment? What has it done? Really, it forced kids who didn't like playing together to play together. From a consumer perspective, it said, you know, for that issue, we're gonna pay you X. And statistically, we've arrived at that X. So for people in the room who might not know the term bundle payment, give an example of... What that basically is to keep it simple is that you've got the hospital, you've got the physician, you've got all of the various touchpoints that as we go through the health system, there are in that historically, you had to deal with them as independent entities. And you as the consumer or the patient rightly or wrongly would get caught up in the middle of dealing with all of these entities. But from a regulatory and a policy perspective, what we moved to was, you know what, we're gonna pay for that episode of care. You folks, the physicians, all of the various pieces, you figure out how to divide it up. It incentivized us to understand those different elements. It incentivized us to look at the value of that and to figure out what do we really need versus what can we have. So all is not lost. It's not perfect, but I think this issue of value-based and this issue of pay for performance, there are models, policies, practices that can move us in a systemic way to that. Steve. And part of this is when you get to that mindset of you're thinking about the output, which is patient outcomes for a specific episode, you then think about all your different elements of the value you're delivering. And then you start to ask the question, is it better for me to do that or someone else? And what we're engaging in conversations with integrated delivery systems on the laboratory side of things, is it best for them to continue to operate some of their laboratories or go to someone who has much more volume, much more efficiency and apply that to the problem of getting better output at lower cost. And then they start competing on the basis of output, which changes the way of thinking about healthcare from the past. So this, and what I hear you saying is that, we shouldn't be thinking of drug companies and diagnostic companies and device makers. We should be thinking about- The whole value chain. And in integrated ways. Who's in the best position to build the system, Risa? Well, I don't know that anyone is in the absolute best position to build it, but certainly the providers of care, whether they are integrated systems or integrated systems that are connected to community-based organizations and the like, I think have the longest view. And probably are the ones that you can, and already have in many ways, the platforms and the relationships to augment the systems that they have. So I think that's a reasonable starting place. Now, I just wanted to make one other point related to what Omar and Joe were saying about having these models be relatively simple to start. And certainly as a scientist, you would wanna do that. But what we're trying to get to is so complex that I think we're gonna have to push ourselves to put some of the messiness in early on and be willing to fail and to acknowledge that we aren't gonna get it right the first time. But if we don't start putting in some of these functional status measures, some of the other more complex areas like medical problems as opposed to surgical problems that have a simpler model, I think we won't get there. Certainly in my lifetime or anyone's lifetime in this room. So we're gonna have to push ourselves. Yeah, and we've sort of slipped into talking about the US healthcare system. Yeah, sorry. So let me, I can go back to your question if you want me to. Well, it made me think when we talk about an integrated system, there's the National Health Service. Are we moving, do we move towards something like that? No, but you see the National Health Service and I think people from the UK probably won't disagree with me, but it is more of a label. It's still a fee per service system within the National Healthcare System. So I think there's some attempts at integrated care, but by and large their payment mechanisms is by procedure. And so they're not really using the fact that there's a single payer, whatever value that may have them, we have single payers too, and insurance companies are single payer and integrated healthcare system is a single payer with substantial populations. So I don't think, just labeling something as single payer solves the problem. I think you have to do the hard work of doing all of the things that we talked about, simple ones and the more complex ones. Well, it gets down to who's gonna take the risk for the population. Right. And today I take the risk for my employees. So I'm the population health ban. I'm paying all the bills. And I see this fragmented system and wide variation in the system. And I look at all the claims data and I have 60,000 people I'm looking at. So a lot of the providers are now integrating. So they're buying physicians, they're getting into the healthcare insurance business and eventually they might be the people providing that population health for me. Some of the insurance companies in the United States are moving into the provider business. They might be the people that are providing in the case of California, Kaiser, represented here, does that for me in California as one of the systems that we use. So that's the model is somebody has to take responsibility for that life and start to re-engineer the value of delivering healthcare and compete on the basis of how well they do that every year, like any business, like our businesses. But I would just say, you know, we tried not to go there on the discussion about today's healthcare system in this transition. But I'm gonna let you into a little secret to the answer to your question about who best to bring all of this together. And I agree with my colleague, it's not a single entity that I think, but contrary to some folks' views, I think that the providers do have an opportunity because of the relationship and frequency with the patient. I think that the physicians have an opportunity to be a part of that or play that integrator role. But when you look at this a little broader, there is a policy piece of this, particularly when you talk about scale, particularly when you talk about Medicare, particularly when you talk about a Medi-Cal and Medicaid. Yes, there is an element of, quote, the free enterprise system in competition. But this is not like, you know, other business segment. There does have to be, yes, even a role for government. And I know we're about to go on a journey to debate that. I don't, and I'll even scale it up to the federal and national level, we cannot leave this to all only the states. We cannot leave this just to the government, but you need each of those pieces in the consumer and employers for all of us have to be in the game or the game doesn't work. I want to open it up to questions around the room. Raise your hand if you'd like to jump into the conversation. Yeah, right over here. Thank you, really amazing session. I am curious about some of the models that you see that provide value in the system related to informal care giving. So family and friends and others who are playing an important role as healthcare moves more into homes and how that kind of plays into some of the things you're talking about today. Thank you. Well, the topic we're intending to talk about is how do we guarantee healthcare? And so we deliver something and we spent a lot of time on acute care in the discussion and less time on the other elements of healthcare delivery system and preventative care and wellness is an important part of this and management of chronic disease is an important part of this. And so going back to the example I used, we could have a perfectly healthy person today. And if you had your laboratory work done or some type of diagnostic, you could find out that you're pretty diabetic. If we could find you soon enough and if you have the proper programs in place with weight reduction or coaching programs and your family's involved in that, you can move from a place that's moving in the wrong direction to the place you need to be. And we actually are working with small startups that are providing that service and they will guarantee that in this case, your glucose will come down, your hemoglobinate will see will come down over the 12 month period of time that move you from that risk to not at risk. And very much part of the program is getting your ecosystem, your family members and the participants in your system, your health system involved in this and they're guaranteeing that work. So it's much more of a holistic approach to general health. I think if I can also make a comment on that. In many ways, building a value-based system depends on cohort selection, on what to expect from whom. And in the definition of the cohort are not only clinical parameters, but also socioeconomic parameters. So if for example, two people with an identical clinical condition, one has a family and one does not for whatever reason. I think the care pathway for them in many ways would be different because of their condition at the end. Back now, if I'm responsible for the outcome, I better know that because I don't want to overtreat and someone to the family, I keep calling and telling them to do the same thing that the family is doing and wasting money. And I don't want to undertreat that someone without a family gets the attention of someone that I assume has a family. So it is that level of granularity that we've got to work the value-based system in all these different dimensions if you're going to be responsible for the outcome. And I think that's the way to force this behavior. So treatment protocols very much based on the profile on these very many dimensions. Other questions around the room right behind me? Bob Garrett from Hackensack Meridian Health. I appreciate the points of view from the panelists. And certainly I think it's fair to say there has been over the past few years since the Affordable Care Act in the U.S. has passed. There's been a lot of innovation which has brought us into value-based healthcare and achieving some outcomes that are all desired. But in spite of that, certainly most of healthcare is still delivered in a FIFA service environment. So my question really is with the debate going on now, particularly in Washington about what might come next for the Affordable Care Act, is that a threat in terms of the innovation that has already occurred? Or is it perhaps an opportunity, as was suggested, maybe to lessen some of the regulatory environment, maybe encourage more collaboration and integration of care? So rather than just say that we're going to change the entire system, rather maybe let's not throw out the baby with the bathwater. Is there that opportunity in the discussion today in your collective opinions? I would, first of all, I think it's an excellent question. And within your question was an observation, which I agree with 100%. I think that within the ACA, while it's not perfect, there are elements that we absolutely, no matter what you end up covering it, no matter what system you put in place, it's gonna kind of look like a duck, quack like a duck, and it's gonna be a duck. But you might call it an owl. So because the system doesn't work if there's not some incentives to play or to get into the system. So I think that there's opportunities to go where you suggested in some of these other payment models, but I think to wholesale throw out any single element is going to be problematic. And I'm using my voice, our voice in every way that we can, because this is too big, too consequential to get wrong. We have tens of millions of people that get up every day in our confronted with health issues. We have to have some stability for them because if we don't, the entire society pays for that. So I just, I'm hopeful that we take the best of what we have, we tweak that, we add to it, but let's not go backwards because I don't think we have the luxury to wipe the slate clean. Can I just add? Sure. A lot of people talk about the Affordable Care Act in broad strokes and they're not really specific about some of the elements. And the Innovation Center that was part of CMS is part of the Affordable Care Act and is one of the reasons that we've had as many innovations and studies of innovations in the healthcare delivery system that we've had. And if we take that away as part of adjusting or repealing the Affordable Care Act, we're not gonna have the same laboratory to move forward as quickly. And it's very clear, we've got to figure out how to get better value for our healthcare dollar. We just can't keep going in this way. So I think there's some very specific elements that we have to create that opportunity, as you suggested, to have the conversation. Steve. This is called the Affordable Care Act. Come back to Bob's question and a large part of what has been worked on is better access. And we talk about the better access. So three years ago, it was about 45 million people in the United States that did not have health insurance. That number's done the 25 million, roughly. We agree about 20 of those million that now have insurance and have B4 came through the expansion of medicated about half the states and the other came through the exchanges. So get back to Bob's question. What we forget is half of this population in the United States gets their healthcare through Medicare and Medicaid. And actually, Bob's question, a large part of that that's paid for by the government has moved to much more of a population health model with managed Medicare and managed Medicaid models. So healthcare insurance companies are taking risks for a population. In those models, it's all about value. Your contract with healthcare insurance company is US government and you are taking the risk. And we actually work with those organizations to improve the quality care of lower costs. That, if you go through the math, is 45 million people that are covered on their Medicare, 120 million under Medicaid. You have an under 60 million people in that population. That's half of the US population. The other half of the population is employer-sponsored health plans. And as a large employer, that's health insurance. 60,000 people. I'm all for competition and get a better healthcare. So I think employers and consumers are gonna drive that other half of the equation despite what we put in place. We're gonna be shopping for better healthcare. And by getting better healthcare, it's gotta be some quality of measures of quality and also cost and efficiency. And the exchanges are a good example. It was a good experiment of competing based upon output. What is the quality of care and what's the cost of that care? And that was the beginning of that model. So that piece of it, I think, will continue. I wanna get a few more questions and right over here. Yeah. I'm from Saudi Arabia. I feel like having value-based healthcare or getting value for your health, we need to have two different things because few optimize in every part of the value chain. We are in the distribution and value chain. Then you cut out the costs. Diagnostics more than 50 years ago and 15 years ago were doing reportable testing for all diagnostics. And it was introduced in Saudi at the time because the government wasn't running efficiently. There was a lot of expiry. So we took it over and get paid on the reportable testing. We give consignment. But that concept was with a purpose to get value. But it's a knife with two edges. When you start to go for, get your money back with healthcare. Some people don't make it after an operation. How do you give them their money back? On other points. So I think when somebody's providing a healthcare from end to end and knows that there's part of the cost is not gonna be paid, they will build that cost to someone else. Like in bariatric surgery when somebody doesn't get a false health, it's one per mil. And he pays for the cost tomorrow that will be built on the cost of someone else. So I really believe we need to separate getting your value for health, moving the entire industry into giving health with a solution would be a big challenge. And it's gonna be a complete quantum change and the whole value chain. I don't see it happening as easy as, maybe you can explain more to me. Well, I'm not saying it's easy. I don't think we have a choice. I don't think we have a choice. I think otherwise the system gets so fragmented. Look, I give this very simple example. Many of you are business people. If I paid our sales people based on the number of sales calls versus the amount of sales they bring in, I think I'd have a disaster in my hands. And that's essentially what we do for healthcare. We pay people for an activity as opposed to the results that they achieved. And I don't mean any single sort of an institute in that whole chain. It's all of us. We get paid, we put a device in it, we get our money and we go home. And now ethically we all care. They're all works. Doctors do care, but no one gets paid on it. And so you build up these systems which reward activity and incentivize activity. And I think you just gotta get over that. It's not easy, but it has to be done. And I think it's a moral imperative. I don't think that sometimes we talk about these concepts as if we're gifting them to people out there and we're bestowing this great thing upon them. I mean, the idea or the proposition of that I come to you understanding at least a little bit, hopefully, what's about to happen and here is the probable outcome. And if because of inefficiencies or whatever, I get a different outcome, the idea that there would not be some reconciliation of that when you're talking lives in many cases is, I mean, it's not even conceivable, but it's not the what as we talked about earlier. It's the how and that's our challenge socially, emotionally, clinically, it's the how and bringing it all together. I'm gonna take a question right back here. Steph Alorsen from the Boston Consulting Group. I'd like to broaden or add a comment to the discussion. We've had many years where physicians are increasingly dissatisfied with being doctors. The choice of profession is increasingly seen as maybe not the right one. It used to be people were really pleased that I've made the choice. Now that is falling down. We've defined quality for many years as compliance guidelines. And for a medical doctor, that's a pretty boring way of doing your profession. You're not autonomous anymore. The payers tell you what to do. They limit your choice. In a world where you define success as outcomes, you're actually encouraging innovativeness. If quality is compliance to guidelines, you actually ask not to be innovative, not to come up with ideas that would give better results for your patients. But if you define success for the clinical teams as better outcomes, you're encouraging them. Of course, the basics right. That's following the guidelines, but in addition, please think. And if we had international standards for measuring outcomes, we would have the entire clinical community across the world as a basis for innovation. Not the university hospitals to tell everybody else what to do, but in fact, broader range of innovative teams in Calcutta and New York and Cairo. And I think this is where we would get not only faster innovation, but faster adoption of new tools because it would be encouraged to do things better. So you would take innovations and bring them in and try them. So I think that we would not only have more enthusiastic clinical leaders, but we'd in fact also have faster rate of adoption of innovation. I see an enormous opportunity for healthcare to move away from limiting the autonomy of clinicians, making them dissatisfied with their work, to encourage them to innovate, drive improvement for what they're trained for. Health for patients. Any place? Go ahead and jump in there. Yeah, just to add to where I started. I'll give you an example. So if you recall where I started, I talked about precision medicine, the work we do in Memorial Sloan Kettering, it's one of the top cancer institutes in North America and in the world. We use 34 actionable genes, we made it up with drugs, we can say which drugs will work well now. But what we found as we launched that and tried to sell it to where most of cancer care happens, which is in community cancer centers around the United States, it was very hard for us to have oncologists use that. And what we also found is it has to be a learning tool. And so augment that, we actually have now teamed up with IBM Watson. And IBM Watson is for genomics is actually good with the learning cognitive computing system that helps us train over time. It's never intended to replace the physician. But it's helping the physician. It's empowering better health with diagnostic insight. And it's what we're talking about a quest. It's giving them the tools, giving them the benefits of the world's knowledge at their fingertips to make better choices in cancer care. It's gonna be very difficult given the real time nature of knowledge building in this world to stay up to date and give a moment, but more tools that the fingertips can make better choices that can lead to better value. Yeah, question right back here. Thank you for that wonderful discussion. I'm actually an academic and I study guarantees as it turned out. So I'd recommend a few things. One, I think you should all read an article called The Power of Unconditional Guarantees written by one professor C.W.L. Hart at the Harvard Business School published in HBR probably in the mid 80s and we kind of reinventing some of the material he's already talked about. I won't talk about my own work in the area now. If you look at Federal Express absolutely positively overnight, it doesn't say absolutely positively maybe overnight. And my question to you is what can we learn from Federal Express? Let me answer it. Cincinnati Children's Hospital Medical Center publishes all of its outcome data including its process measures on the website and aspires to be a Six Sigma organization. I don't see why any other healthcare organization cannot do that starting tomorrow. You have the data, publish it and let's see what happens. So why does Cincinnati do that and others don't? Is there something? But do they get paid for it? Yeah. Do they get paid for the? They do get. They get paid. So there was Six Sigma level of performance and basically there's no failures? Yeah, exactly. So they get very low failures. They've shown improvement over time and furthermore they actually get paid by more clientele. Customers come to them. And that is spreading to other children's hospitals as well. And the other connection I would make to how you can improve the quality of job satisfaction or joy for physicians is that they will tell you that one of the things they like about that is improving the quality of these children's lives actually is why they went into medicine. And I would just say on behalf of physicians, there's physicians in the room and on the panel, one of the things that I've learned is that physicians ultimately want the best outcome possible for their patients. That's what they get up to do is to take care of people to be helpful. So I think, the second thing that I've learned over these 30 years is that evidence is important and data is important. And that if you have the data, if I am showed Dr. Dean that to do a hip replacement, if you, we've got the data to show globally that if you use this protocol and follow this procedure, you're gonna get the best outcome. It's not even debatable. There's that proof. What physician would not want to use that data? And we have 10,000 physicians. So I know what some people are thinking, what planet are you from, Lloyd? That there would be those that don't. But I think that would be more the exception. And I would say I agree with you, but I worry about not enough data, too much data. Okay. We've got to sort down to impact. And last question back here. Hi, I'm Natalie, J.C. Hobber. And I'd like to just throw in something that probably shouldn't be discussed right now. I'm not sure. But I, we've talked a lot about the US and other parts. And I have got West African roots. And I'd like to talk about, or perhaps if the panel has any thoughts about the influence of external factors such as fake drugs that are being produced and how that may affect the trust of patients in the hospital, especially in third world countries. Any thoughts on that? Big topic. Yeah, I would say we recognize that there is a significant issue with counterfeit drugs, not just in third world countries, but in today in the developed world, because there is potential money involved. And so you're always going to have that issue. So we're working on ways to ensure the integrity of the supply chain. One of the things that the pharmaceutical industry is doing now is looking at ways to use technology to ensure that from the time that that drug leaves the manufacturing site until it is consumed by the patient, that there is a trackable mechanism so that we can avoid, or we can try to eliminate counterfeit drugs. Right now, our way of eliminating it is we all have large anti-counterfeit forces that go in and try to track down where the source is. And that work is going to continue, but I think the long-term answer is technology. With that, I want to try to make some closing remarks and jump in here. The sort of take-home thoughts for today is, as I listen, I hear that value-based medicine or pay-for-performance models are the way of the future. They're tricky to implement. We need an integrated system. It's not clear how to form that system, but it has to happen. It's the way of the future. Agree? Agreed. All right, thanks so much for joining us, all of you. Thank you. Thanks for coming. Thank you.