Michael Barbouche is the founder and CEO of Forward Health Group, a population health measurement company based in Madison. A native of the Twin Cities, Barbouche, 45, earned degrees at the University of Wisconsin-Madison in history and math, and did graduate work in health services research at the University of Minnesota. After slogging through messy data, he founded Forward Health Group to help doctors, administrators and health care organizations better track what they are doing, what is working and what isn’t. Headquartered downtown at 44 E. Mifflin St., the company has 36 employees and targeted revenues of $5 million for 2015. Prior to starting FHG, Barbouche played a central role in the evolution of the Wisconsin Collaborative for Healthcare Quality (WCHQ), a pioneer in the public reporting of health care quality measures. Barbouche credits everything he knows about health care to his wife, Ellen, a general internist at the UW. They live in Madison with three kids.
Why is health care so much more expensive in this country compared to other nations? The latest number I saw was the U.S. spends $8,500 per person versus No. 2 Norway at $5,700.
We just fundamentally have a broken incentive model; something that rewards the wrong activities and the wrong outcomes. We have a transactional system where the sicker you get, the more money (providers) get paid and that was putting the country on the brink of bankruptcy. We had a presidential election that talked about trying to find a way out of this mess and without commenting pro or con on the Affordable Care Act, it’s happened. We’re not going back. Where we stand now is that care is incredibly expensive and a lot of the work done over the last 20 or 25 years reveals that the care isn’t very good and the quality is kind of poor. You’d be hard pressed to find the leader of any hospital or health care system that wouldn’t tell you deep down, we could all do a lot better.
So where does this perception come that Americans are getting the best health care in the world? Is that just the result of the money the hospitals spend on advertising, all those billboards with smiling people?
Any public health metric you would look at, any mortality metric, any infant mortality metric you look at would tell you the exact opposite. We’re barely middle of the pack.
Why the disconnect with reality, then?
Well, we are the U.S. We build and produce a lot of wonderful things. A lot of the innovation occurs here and we’ve made amazing breakthroughs in imaging, diagnostics and tools and devices they can insert in our bodies. But this occurs after the disease has progressed. We don’t do a lot to prevent the disease in the first place.
For example, we have this great focus on heart attacks. But we really don’t want people to have heart attacks. We do a great job rescuing people who do have heart attacks, which is important work and something our company supports. But the end goal should be less heart attacks, less strokes.
Will we ever see costs come down?
I am increasingly saying this, and I get a mixed reaction at best when I say this, but we are entering an era where we might start to see the insurance companies, the payers, as the good guys.
The simplest way to explain it is in the past, the insurance company was the entity that took risk. We are now entering a new era where the doctors and the hospital will be serving as the risk carrier. So if they provide good care and are efficient, they will make money. If they are over-utilizing tests and sending people off for services they don’t need, they’re going to lose money.
Who is the arbiter of that then?
The arbiter will be the insurer. They will say, “Here is a fixed sum of money. You can provide as many or as few services as you want. But if you want to get more money, you will have to hit these performance targets.”
Will government have a role in that?
It already is. Government via Medicare is aggressively headed there and with Medicaid, which is a huge part of the Wisconsin budget, states are now saying “We’ve got to get to a new place to pay for this stuff.”
I heard you speak recently at a Wisconsin Innovation Network event and the example of Target stores offering low cost mammograms (which it is doing in pilot markets elsewhere) was brought up. Is that the future?
I think the future is that we as patients are going pay first dollar coverage or more lump sum amounts for our care and there are going to be many new entrants into the care continuum that come more from the customer service, hospitality side of the spectrum rather than the pure health care delivery system. So if you are paying full freight for a colonoscopy or a mammogram or the like, where are you going to go? If there is an app on your phone that tells you can get it done here for that amount of money or you can look at a customer service rating, are you going to look at that or just go to the default and your local hospital and get it done there?
That is the challenge facing a lot of the traditional health care entities and that is why companies like Exact Sciences are selling an at-home test. But it’s cheaper than paying for a colonoscopy with a $5,000 deductible. What makes better sense for your household?
Where does Forward fit into all of this?
We really sit in the middle. We can work for the hospital or the insurance company or the researchers. We can count the number of doctors, count the number of patients and then really look more toward the outcomes. We provide, in a space called population health, the ability to measure a baseline and then come back in a month or a quarter or six months or a year and see if they have moved the needle.
It’s hard to believe all of that isn’t being done now.
This is the hard part of anyone coming new to health care because the foundation of every single American enterprise has been the cost accounting and basic tracking of inventory along the supply chain. We work in the healthcare data supply chain. We are helping actors of that data supply chain understand where things are with the patients they are interested in. Many insurance companies, for example, are keenly interested in learning how to truly provide support to the physicians and hospitals. How do they do that? Do they do it by providing incentives or do they provide people with a counter so they can track their steps or do they pay for membership at the health club? All these things have been tried but which of them really work to help people lower their blood pressure? We really don’t know because a lot of that basic data, that correlation stuff, hasn’t been figured out.
Will we get to a point where healthier people will pay less for insurance and sicker people pay more? Is that fair if you have something like high cholesterol which you inherited?
Absolutely (sicker people will pay more). There a genetic component which speaks to fairness. There is a lifestyle component to it. But what we can say with certainty is this risk which has borne by the insurance companies will come across to sit atop physicians and the story that will be written 10 years from now will be all about patient adherence and patient compliance. We’re going to see a huge transference of power and wealth, a lot of fingers will be pointed, and it’s safe to say a lot of fingers will be pointed at the patient saying “It’s your fault.” You’d have to pretty naive not to think that is what is going to happen.