The Diversity Blog

From North America the stage now moves to the UK. In her ‘Letter from London’ (ET of 21/10/13), titled “No Country for Old Men and Women”, Sudeshna Sen talks about Brits being rapped for not taking care of the elderly. India should start worrying.

She cites the Health Secretary Jeremy Hunt saying it’s a “national shame” that Britain’s society is not taking care of its elderly people, and that the Brits should “learn” from oriental societies where putting old grandma in a home is the last resort and not the first.

Apparently, his research tells him that about 800,000 people in the UK suffer from loneliness. This comes in the wake of a series of scandals about private care homes that neglected their patients to death. The author also quotes BBC according to which 15% of old people live with their children – and most do not want to.

Loneliness is a side effect of a larger problem every ageing society is grappling with: care for the elderly in an era of increased longevity – says the column. By just saying that people should be nice to their old folks and the problem will vanish – the health secretary has only trivialized it. The column reminds him that those same oriental societies he wants to emulate are struggling with the same problems – as in the rest of the world, and if you leave out the Scandinavian societies, nobody’s found any decent answers.

In China, with its four grandparents to one child syndrome, the authorities are worried about elderly care. In India, the problem is even worse, because it’s just not recognized. The onus of elderly care is squarely on the shoulders of the family. The state, the larger community and even charities don’t consider this a burning issue. While over 20% of its population is lonely in China or Europe, that’s not the case in India, yet. If we were to account for the rising labour and real estate costs, costs of living and chronic medical support, availability of trained geriatric carers and urbanization as a few of the factors. India isn’t there yet, but we’ll get to this point in a couple of decades.

The author goes on to warn India not to repeat the mistakes that Britain made. In the welfare / nanny state of mind, UK’s elderly problem was solved by the care home industry. It was financed to some degree by the government but with vast contributions from families and individuals. Even care homes that are now charged with close to manslaughter cost about GBP 3000 a month. Usually they take your life savings or your home, and promise to take care of you in your dotage. Somewhere down the line, like everything else, they privatized it all.

It led to the Southern Cross debacle financed by PE firm Blackstone, Southern Cross was UK’s largest care home chain. They expanded, took on huge corporate debt, went real estate ballistic and went bust; leading to dodgy practices and deaths from negligence. Says the author – In India, I increasingly hear about care homes or what real estate developers call ‘retirement’ projects. What she says I don’t hear is any regulation or standards, or monitoring, or binding long-term legal parameters that will ensure that when I’m gaga, they still have to deliver what they promised.

A very strong message and a loud wake-up call indeed!             

View one:  “The Supreme Court’s decision to award around Rs 11 crore as compensation to the plaintiff of the 15-year-old Anuradha Saha medical negligence case is welcome. The judgement and the compensation amount – the highest in India – highlight the problem of increasing medical malpractice in the country and should serve as a deterrent in similar cases. There is no denying that India’s healthcare sector is in poor shape. While public hospitals and clinics suffer from a woeful lack of infrastructure, private service providers have been accused of profiteering and other exploitative practices. A weak regulatory regime has led to the rise of an unholy nexus between doctors, hospitals and diagnostic services. Hence, patients are left at the mercy of a venal system with few alternatives.

In such a scenario, it becomes very difficult for victims and their kin to prove cases of medical negligence. Given the technical nature of the medical profession, negligent acts of omission or commission need to be verified by fellow doctors who hardly ever support the patient. Besides, victims fear that reporting cases of malpractice will deny them treatment in future. Thus in this skewed doctor-patient relationship it’s the duty of the system to protect the latter. Enhanced monetary compensation for proven cases of medical negligence is a useful way of balancing out the power equation between health service providers and ordinary citizens.”

Counterpoint:

“The Supreme Court’s landmark judgement in the medical negligence case pertaining to Anuradha Saha is being spoken of as a watershed development. It is, but not in the way people imagine. The judgement may trigger the introduction of some of the worst aspects of American healthcare to India, marrying  it with the worst aspect of India’s legal system  – namely judicial delays.

Given the apprehension among doctors following this decision, don’t be surprised if India soon sees its version of defensive medicine. This occurs when diagnostic measures do not prioritise the recovery of the patient, but seek to treat the patient from the standpoint of protecting the doctor from malpractice litigation.

There’s another way in which the recent development can make the system poorer. The Saha judgement exceeds Rs 11 crore in damages when interest charges are added. With this kind of mind boggling figure, doctors will inevitably look to insure themselves against potential liability. The cost of insurance will surely be passed on to patients. Healthcare in India is not inexpensive. Expect it to get more expensive.”

One need to have a close look at the fine print of the judgement to understand as to what extent the quantum awarded is a function of the victim being an NRI and how far would this potentially bump up the multipliers for claims by resident Indians? The fundamental issue however is the crying need to get a regulator in place to mind the space. The space is everything to do with healthcare including health and medical malpractice insurance.

Physicians are not part of society’s elite and other graduates have higher salaries, says Patti Waldmeir in an FT column of 7/10/2013.

The story quotes a survey last year conducted by MyCos education consultants in Beijing. According to it the average monthly salary for clinical medicine graduates was Rmb 2,339 (USD 382) within six months of graduation. Average income for all graduates was Rmb 3,051 nationwide, with doctors and nurses the lowest.

Many doctors it says complain that disgruntled patients increasingly turn to violence when doctors are unable to cure their ills, even though there is no malpractice.

A plastic surgery patient used a knife to attack three nurses, one pregnant, in the central Chinese city of Changsha in September. Doctors, says the report, often have to pay out of their own pocket when patients sue them.

According to state media reports attacks on doctors are becoming more frequent. The average number of assaults rose to 27.3 per hospital in 2012, compared with 20.6 in 2008 according to Chinese Hospital Association quoted by Xinhua.

Xinhua reported that the violence is starting to chase doctors out of the profession: nearly 40 per cent of medical personnel surveyed at 316 hospitals nationally from December 2012 to July 2013 said they planned to give up their profession because of greater violence in hospitals.

Hospital administrators and medical students point out that the situation is not uniformly bad. In the poorer areas where other professions may not be available, the best students are willing to risk long hours and possible violence to study medicine.

With 78 per cent doctors not preferring their children to don a white coat, is this together with poor salaries and threat of violence a recipe for an overall poor quality of professional standards? Thereby, all the more reason for violent behaviour on part of the patients and their relatives? Perhaps all the more reason for the Law of Torts to hasten taking roots into the Chinese soil?

Glancing through the editorial page of Calgary Herald I am face to face with the stark realities of ageing in Canada. Not one but two stories bring out the challenges, that ‘healthcare’ segment ought to address in India and China, sooner than later.

“Standoff with dementia – Montreal case foreshadows baby-boomer crisis”: is about Havis, 71, the owner of estimated 180 guns, fired a handgun at police during the tense, 20 hour confrontation. It started with Havis mistaking workers from a utility company for intruders. There’s just one catch, reports the paper, Havis has dementia. It goes on to highlight that there is grave cause for alarm when one factors in the prediction that, with baby boomers’ demographic bulge moving through its senior years like a gopher through a snake’s stomach, cases of dementia are expected to double by 2030 and triple by 2050.

The Alzheimer Society of Canada has been quoted saying that by 2038, there will be 238,000 new cases of Alzheimer’s and other types of dementia diagnosed in the country, a rate of one every two minutes.

“Rx: No to assisted suicide”

This is a stark reminder of the fact that doctors are the forgotton ones in the heated debate over assisted suicide. A new Canadian Medical Association survey shows only about one-quarter of doctors would be willing to participate in an assisted suicide. The edit points out doctors do not want to help kill people.

They likely feel it violates the Hippocratic Oath; they may also personally not want to be responsible for killing anyone. Perhaps they simply cannot stomach the idea of going through the procedure that would lead to someone’s death. Regardless, it says, the results of this survey need to loom large in any parliamentary debate about whether assisted suicide should become legal in Canada.

A likely ‘popular’ debating theme-to-be in times to come, closer home?

My belief in the subject matter of the last piece was further vindicated, thanks to what I found (and did not find) during recent explorations in and on China. The revival of Tort in India and its emergence in China will, together, create the largest playfield in the space of everything to do with health, in the times to come.

The new China tort law needs to be viewed in the sweeping social and legal changes since the great revolution that brought an end to the Maoist era and the slow evolution of a capitalist society, says Richard H. Murray (Chairman of the Geneva Association Liability Regimes Programme) in his paper “The Social and Insurance Implications of the New China Tort Law”.

Under Chairman Mao, there had been no concept of private property. Consequently there had been no need for property insurance. Similarly, there had been no recognition of private rights, and so no need for product liability. There was no property and casualty insurance industry. Much has changed in the succeeding decades, with the formalization of tort liability as the most recent development, he adds.

The China tort law is more focused on the injury and resulting loss than on causal event or behaviour. It blends the relative ease of recovery found in civil law with the unlimited potential for recovery found in common law. It is designed as a mechanism to combine broad protection of businesses and individuals with the capacity to act as a private sector regulator.

While use of the law is growing slowly, it is in place while the growth of a massive middle class with costlier claims is developing. It is an anticipatory provision to deal with emerging social conditions and the effects on Chinese society of an internet linked world in which compensation for injury is becoming universal expectation.

The relatively under-developed legal profession and untrained judiciary are consistent with the law’s objectives. Those conditions foster flexibility of outcomes, with Chinese judges functioning in a manner similar to US juries, says Richard Murray in his paper.

During a recent visit to attend the 2013 China International Conference on Insurance and Risk Management, I did take the opportunity to ask several academics present about this development. There was very little forthcoming. The concept of Tort still sounded alien. Interestingly, what came out quite vividly were some facets of the rapidly changing society. One look at the itinerary and you will find some presentations like:

• “Protect Institution” or “Protect Elderly”? A Discussion about the Choice of Risk Transfer Technology for Endowment Service Institution
• Welfare effects of compulsory liability insurance
• The Liability Risk Pressure on Pension Institutions and Release Route Analysis in the Population Aging context
• A Countermeasure Research on Doctor-Patient Disputes and Medical Malpractice Insurance – Aspects of Local Policies and Regulations

Liability seems to be getting into the consciousness and the context can often be potential liability arising from the needs of old and elderly. Healthcare cannot be too far apart.

Quite coincidentally on my way to the host city Kunming, I was reading this story on China’s drug pricing crackdown! The WSJ report said that China signaled a tough new stance on healthcare as it unveiled a litany of bribery and misconduct allegations against a leading multinational. A move, it said, that could presage a broader crackdown in a lucrative market for pharmaceutical and medical companies.

The report highlights that health care is a fast growing business in China, where increasingly affluent consumers demand better care and the government is under public pressure to widen a skimpy social safety net. China’s health-care spend is poised to triple to $ 1 trillion by 2020 according to McKinsey & Co. Sales of pharmaceuticals in China reached $82 billion in 2012, up 18.2% from a year earlier according to Business Monitor International.

Industry insiders say, according to WSJ, that China’s health-care sector is mired in systemic corruption. Many medical companies operate through intermediaries to reach more corners of a diffuse market, while doctors often look to buffer low salaries with perks. ­­­The seeds therefore seem to be already embedded in a fertile soil and the early triggers are visible, too!

Published in July 2013 issue of Asia Insurance Review

There is a plethora of diverse threads in the entire gamut of the ‘health space’ within India and China. They will continue to multiply, as these markets mature. The resulting fabric could well turn out to be a riotous chaos unless ‘tamed’ in good time. Together, these two could add up to a significant chunk of the global ‘health’ space. Many of the things unfolding and the scale, in these markets, may be a first time in the history of mankind. Yet, there is something they can learn say from the recent proactive measures in the tort space rearing in the US of A.

Sometimes you need to digress from the mainstream and then converge. In the process you achieve diversity. My suggested way forward ­­­­does not tantamount to diversity for the sake for diversity. It is just that we are conditioned to see these disparate parts as silos.

Let us take a stock of some very well known facts relating to the two of the world’s largest healthcare markets in making:

• More than half the world population lives in Asia
• More than half of that resides in China and India
• Both practice very diverse forms of health-care and often lack thereof
• Larger numbers are outside modern practices than in
• Millions will move from outside in
• Millions too will move from alternate practices to western/ allopathic medicine
• There is a big divide between healthcare and insurance
• Healthcare insurance is still largely around hospitalization
• Insurers are struggling to balance challenges of coping with volumes and pricing
• Regulators are dealing with ensuing challenges and trying to lift the game
• Rising numbers of ageing population and nuclear families pose further challenges
• Raging health inflation
• Not only local population to be addressed, emerging health tourism too
• More and more childless seeking surrogate mothers in here
• Growing bio-pharma industry and emergence of local brands
• Significant M&A in the space
• Increasing clinical trials activity
• Spurt to medical education. Evils of supply demand mismatch. Long way to professionalism
• Consumerism on rise
• Social media; nothing to hide
• Governance; fervent call
• Litigious societies, in making­­­
• Urbanization
• Quackery aplenty
• Money-lending menace
• Ageing population
• Life style diseases due to excesses
• Diseases due to deficiency and starvation
• Wellness emerging

Writing on another wall:

With so many threads, not all though, to weave into a meaningful form; here is a recipe for a potential chaos if not disaster. Take for instance the rapid migration of populations from rural to urban areas; demise of public healthcare and joint families into nuclear and rising lifestyle conditions there will be a huge mismatch between supply and demand of health care services. On the supply side, some of the providers may have questionable standards and experience. There will be lots of positive and negative energy flying out of these developments.

At this point, I am tempted to digress from the current stereotypic approach and dip into some ongoing debates in the US. Not that India and China are headed the American way. But the only way wherever these two countries are headed for, in their unique ways, they can future proof themselves is learning from the USA today. Thanks to some eye-opening debates at the American College of Surgeons:

New approaches to liability reform: The current medical liability system in the US is broken. It is costly, draining health care system of approximately USD 55.6 billion per year and accounting for 2.4 percent of annual health care spending. An estimated USD 45.6 billion is spent on defensive medicine. Of the money spent within the medical liability system itself (excluding defensive medicine), administrative costs comprise 54 to 60 percent of total costs, including attorney’s fees and other overhead.

Furthermore, fewer than 3 percent of patients who are injured as a result of medical errors ever seek compensation for their injuries. Additionally, nearly 25 percent of awards are not factually supported by the merits of the case. Fear of litigation leads practitioners to modify their practices to focus on specialties with lower risk and avoid procedures and patients perceived as higher risk.

At the heart of the very costly and inefficient liability system and the inaccurate process of compensating injuries related to medical errors is tort law. Again, something that differs from state to state. The American College of Surgeons has a vision to ensure that the ultimate goal of physicians and hospitals is to deliver safe high quality patient care. That requires a liability system integrated with health care infrastructure to promote those ends. A system that manages risk through the creation of a just culture of safety and quality improvement. A system that provides just compensation when patients are injured as a result of medical errors, and movement away from the “lawsuit lottery”. A system that is efficient in which the majority of money is spent compensating the injured patient, and frivolous claims are dismissed early to avoid wasting resources. Injured patients should not have to wait an average of five years to receive compensation. This would require more than tort reform.

•  AHRQ program promotes patient safety and liability reform: The Agency for Healthcare Research and Quality is a USD 25 million initiative which provides grants to health care organizations that have agreed to develop systems that promote patient safety and medical liability reform. Their goals also include reducing preventable injuries; foster better doctor-patient communications; ensure fair and timely compensation for injured patients; reduce number of frivolous lawsuits and reduce liability premiums.
• Medical mediation: bringing everyone to the table. Growing focus on mediation as a viable form of alternative disputes resolution (ADR) in medical liability cases.
• The University of Michigan’s Early Disclosure and Offer Program (D&O). Instituted 10 years ago, this has served to increase accountability, improve the physician patient relationship, reduce cost litigation, and improve patient safety.
• Health courts: With a broken medical liability system, two schools of thought emerge. Whether to have health courts or strengthen existing systems?
• New directions in liability reform: It calls for reforms that can transform the current medical liability system into a system that is patient focused. In which safety, quality, accountability, and equity are paramount. It recognizes this will require a sustained commitment and iterative efforts from the health care community. The first step is setting up experiments with innovative reforms that are focused on the appropriate goals. The regulatory system must begin to support notions of just culture as well as mechanisms for early dispute resolution.

Furthermore, providers and insurers must publicly demonstrate a commitment to vigorous self-regulation; if liability is no longer the main mechanism of enforcing quality standards, the medical community must assure the public that it can assume greater responsibility for that task. Encouraging this paradigm shift and looking toward reforms that solve shortcomings in the liability system beyond cost containment are paramount to developing a system that truly drives quality and safety improvements.

• Safe harbors: These are designed to protect physicians from liability risk if they provide care that follows approved clinical practice standards. The creation of safe harbors may improve both patient safety and medical liability system performance. Safe harbors have many potential benefits, which include discouraging non-meritorious liability claims, mitigating the unpredictability of settlements and verdicts, reducing defensive practices and bolstering the integration of evidence based care into clinical practice to improve patient safety.
• CRICO way: The largest medical liability insurer in Massachusetts and an internationally known leader in evidence-based risk management. CRICO’s mission is to provide superior medical liability insurance to its members and to assist them in delivering the safest healthcare in the world. To achieve this CRICO is committed to defending good medical practice, offering compensation for substandard medical care, and contesting at trial non-meritorious cases in which no medical fault is apparent.
• Connecticut Center for Patient Safety (CTCPS): The US health care system boasts some of the world’s most sophisticated medical treatment, superior medical education and training, and hundreds of thousands of conscientious and committed health care professionals. Nonetheless, patient safety in the US has been the source of concern for many years now. Patient injury is widespread, and there is little evidence of consistent improvement. The Centres for Disease Control and Prevention (CDC) estimates that up to 10 percent of hospitalized patients develop a hospital-acquired infection (HAI), and that 1.6 to 3.8 million infections occur annually in long-term care facilities. The annual direct costs of these infections may be as great as USD 45 billion.

The CTCPS looks forward to working with and not against the health care sector. By collaborating to improve patient safety, patient advocates and providers can honor the needs and rights of patients, acknowledge the harm that has been previously done, and help ensure that such harm does not occur in future.

 In conclusion

Leafing through a recent issue of the Bulletin of American College of Surgeons, I thought the writing on the wall could not be clearer. It is a special issue on new approaches to liability reform. Very inspiring to see a section of the medical profession determined to address consequences of their own malpractice. Still early days of tort action in India and China, it will neither be forever quiet on the liability front nor will liability related issues be the only ones heating up the health space.

Harmonization of the various under-currents unleashed by the forces of rapid change and coping with consequences of fast growth is what this feature is about. Neither is this an attempt at pushing the realm of insurance beyond known boundaries nor transgressing into others. This is an attempt to take a holistic view and address a not too distant future, far more complex than the current paradigm allows us to believe, that stares us in our face. The big question, therefore, how must we re-visit the architecture for everything to do with health? Should not anything and everything to do with it all be under one roof to ensure a seamlessly coordinated approach?

Note: The author is grateful to the American College of Surgeons’ March 2013 Bulletin; a special issue on “New approaches to liability reform”. He has generously quoted from thought provoking works appearing in this issue.