ACLGIM Leadership Forum

Like Food, Health Care Is a Commodity 

05-24-2023 08:53

Healthcare Economics

Like Food, Health Care Is a Commodity 

Dr. Yunyongying (pete3y@yahoo.com) is clinical professor of medicine, Carle Illinois College of Medicine, and assistant medical director, Primary Care Access Carle Foundation Hospital, Champaign-Urbana, Illinois.

Noma, the world’s best restaurant, shocked everyone by announcing that it would close its doors; Executive Chef Rene Redzepi said that the fine dining industry could not sustain the balance between affordability, high-level quality, and a workforce treated fairly. This news came while nurses went on strike at Montefiore Medical Center and Mount Sinai Hospital. These are not just any hospitals, but long-standing healthcare institutions with a reputation for quality. Mario Cilento, president of the New York State AFL-CIO, said nurses are forced to work in “unimaginable conditions.”1 Is this coincidence? Are these two industries that different? Or are they suffering from the same affliction?

The business model for the restaurant industry is based on commodity—something to be bought and sold. But for a place like Noma, it’s not as simple as selling food. No one is going to pay $500 for just food and drink; instead, it is about marketing and selling a memorable experience where innovative food is served with impeccable service by a doting waitstaff in attractive surroundings. The closing of Noma highlights the conundrum for fine dining. To sustain a high-quality product at a price affordable to its customers, they must sacrifice fair working conditions and wages for their workforce.

Quality, workforce, cost—Noma realized you can only have two of the three to survive. So, they decided to close and change their business model.
Many of us see this same conundrum in health care. Porter, et al, JGIM’s article showed that it takes more than 26 hours a day to deliver the highest quality care to a typical outpatient primary care panel.2 In other words, we are already sacrificing quality to meet other priorities. Nurses are striking in New York and physicians, nurses, and other healthcare staff are suffering from burnout at higher rates because we are sacrificing the workforce to meet other priorities. Despite any debate to think of health care as a human right, or any mission statement that says that quality health care is our raison d’etre, health care is managed as a commodity and run as business with cost (and budget, and margin, and profit) as the top priority.

Noma decided their untouchable priority was quality; but they realized that the sacrifices to the other priorities were unacceptable, so they decided to change the business model to find a different way to deliver the highest quality at an acceptable cost with a sustainable workforce. They closed their doors to the public to focus on research and development.

The signs are growing that the current business model for health care is just as unsustainable as Noma’s. But what solutions lie ahead for us? Unlike Noma, hospital systems closing their doors to the public adversely impact the health and wellbeing of their communities, as is being seen in the rural health crisis we are facing presently. Do we, like Noma, decide that quality, and not cost, is the unassailable priority? And if so, how will we innovate? This, of course, is the premise that has led to the growth of concierge medicine, for example. Do we accept that health care is a commodity with cost as the top priority and continue to innovate along alternative payment models? Health care isn’t facing just any challenge, it is facing an existential crisis, just like Noma. 

References

  1. Kakatos M. More than 7,000 nurses go on strike across 2 New York City hospitals. ABC News. https://abcnews.go.com/US/7000-nurses-strike-2-new-york-city-hospitals/story?id=96310355. Published January 9, 2023. Accessed May 15, 2023.
  2. Porter J, Boyd C, Skandari MR, et al. Revisiting the time needed to provide adult primary care. J Gen Intern Med. 2023 Jan;38(1):147-155. doi:10.1007/s11606-022-07707-x. Epub 2022 Jul 1. PMID: 35776372; PMCID: PMC9848034.

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