Healthcare Conference Explores Changes of Healthcare Reform
The presence of capital in an industry or market is not usually controversial. Capital fuels new companies and ideas; it is the engine of innovation. But healthcare isn't like other sectors of the economy. As he stepped to the podium at the Yale Healthcare Conference, Dr. Robert Galvin, CEO of Equity Healthcare, acknowledged that because of the nature of healthcare, which is about caring for people more than producing a commodity, an influx of investor money into the sector is going to strike some as a mistake. "Capital is amoral—it goes, like electricity, where it's going to go," he said. "Out of a pure profit motive, a lot of things are going to come out that are, maybe, not so good."
Galvin moderated the executive panel at this year's conference, the seventh edition of the pan-Yale event, which was titled "The Change Imperative: Navigating the Post-Reform Era." Students from the Yale SOM Healthcare and Life Sciences Club, as well as the Yale Medical School and School of Public Health, organized the series of speakers and sessions, which was held April 1 in downtown New Haven. With over 30 speakers in 16 breakout sessions, the conference sought to explore where healthcare will go now that healthcare reform is law, asking the 400 participants to consider how the system will integrate millions of new insured citizens, how the future markets for pharmaceuticals and medical devices will develop, whether it's possible to decrease costs without sacrificing quality, and how innovation will continue in the face of new regulations. Two keynote speakers—Dr. Louis W. Sullivan, chairman of the board of the National Health Museum, founding dean of Morehouse School of Medicine, and former secretary of the U.S. Department of Health and Human Services, and Carmen Hooker Odom, president of the Milbank Memorial Fund and former secretary of the North Carolina Department of Health and Human Services—added their viewpoints to the discussion.
Joining Galvin for the executive panel discussion of capital in healthcare was Dr. Giovanni Colella, cofounder, president and CEO of Castlight, Dr. David Himmelstein, professor of public health at City University of New York and an associate professor of medicine at Harvard Medical School, and Ann Lamont, managing partner at Oak Investment Partners. For an hour, the panel argued over whether the profit motive in healthcare leads to better outcomes or poor care. Underlying it all was the question of whether healthcare is a right or merely a privilege. "I have one question for you," Colella said. "I've read the Federalist Papers and never have I found anything to show me that healthcare is a right and not a consumer good."
Colella, whose company is working on software to allow patients to better understand exactly what they are paying for care, is a strong proponent of encouraging the profit motive in healthcare. "We generate a lot of wealth, create a ton of value, and thousands of jobs," he said.
Himmelstein, on the other hand, argued that for-profit companies produce worse results than nonprofit or government entities. He took the audience through a bunch of charts showing that death rates at for-profit hospitals run six to eleven percent higher than at nonprofit hospitals. "What the market has inflicted on us is the pattern of extreme waste, extracting profits, and inflicting real pain on patients," he said.
After Himmelstein stated that recent years have shown that the "drug company pipeline is empty," Colella shot back that it is only through individual entrepreneurs taking personal risks that real medical innovation will take place. "[Entrepreneurs] are the engine of the world, of the American healthcare industry," he said, adding that he had to fly his Italian father to the U.S. for a CT scan after waiting eight months for one in Italy. "And you want to stop the flow of capital?"
Lamont argued that the issue wasn't as simple as her two counterparts were making it seem. As a venture capitalist in the medical field for nearly 30 years, she said that there is both good and bad when it comes to capital flowing into healthcare. Private companies work with nonprofits, as well as the government. The ultimate goal, she said, is to make a difference. "If it doesn't improve quality and lower costs, we won't do it," she said.