The WSJ reports that Atul Gawande is to head the Amazon-Berkshire-Morgan health venture.
In addition to running the new venture, Dr. Gawande will continue to practice surgery and keep his position as a professor at Harvard, as well as retain a role at Ariadne Labs as chairman, according to Ariadne Labs.
I smell a nothingburger. You don’t disrupt an industry with a part-time CEO whose claim to fame as a health care reformer is advocating that doctors use checklists.
On the same day, Scott Alexander writes,
Cheap-O Psychiatry wouldn’t have an office, because offices cost money. You would Skype, from your house to mine. It wouldn’t have a receptionist, because receptionists cost money. You would book a slot in my Google Calendar. It wouldn’t have a billing department, because billing departments cost money. You would PayPal me the cost of the appointment afterwards
If you want political cover, you pick Gawande, who is revered by all. If you want to have an impact, you pick someone like Scott Alexander.
I could never figure out how Dr. Gawande has time to practice medicine, with enough surgical cases to maintain his skills (even general surgery requires some skill), have a family, research and write books and papers, and do all these other side gigs. Either he’s on speed, is hypomanic, is a really bad husband/father, or someone else is doing most or all of his work for him.
I tend to agree with Professor Kling. I am not at all familiar with Dr. Gawande’s views on the future of insurance. I wonder if he is intended to be a front man to lend credibility to the venture and to facilitate access to potential partners, regulators, etc. It will be interesting to see the rest of the executive team.
Amazon-Berkshire-Morga’s venture isn’t trying to disrupt health care, it’s trying to disrupt health care intermediaries and in effect become health care’s Deep State. Gawande’s hiring is a shout out and promise to the existing Deep State that *they* won’t be disrupted.
I would tend to agree with the assessment that this signals a lack of seriousness, but who knows? A handful of insightful initiatives could result in major improvements relative to the larger, mostly dysfunctional sector. At least they have a large insurance budget under their control. It isn’t their responsibility to fix healthcare. They are looking to use their bulk and their concentrated control to save money and make some improvements. Maybe they will pull that off.
I’m a little sad about the cynical reaction here. I definitely agree that the task of reimagining our healthcare system isn’t a part time job, and it’s concerning that Dr. Gawande wasn’t willing to commit to the project full time (hopefully if they start to get any momentum with this project he will revisit that decision). But I still think he was one of the best possible choices to lead this effort.
Folks like Scott Alexander are great resources for ideas on how to reform the system, but that doesn’t mean they’d be an effective CEO. This kind of project needs thoughtful practitioners able to design new approaches to delivering health care, but it also needs leaders that can navigate the political and bureaucratic systems to get approval for trial runs for these kinds of experiments. And I’d think Gawande would have as much ability to do this as anyone outside the current system, and I’d have been more worried about this if they’d hired an executive from one of the legacy managed care organizations or something.
Honestly, when I heard that he was taking this job, one of my thoughts was that he should try to recruit Dr. Kling to join the team. It seems like your open-mindedness to new approaches, history working with governmental and quasi-governmental agencies, and previous research on health care policy checks a lot of the boxes for what I’d want in a senior staff member (no idea if you have any desire to do such a thing, but I’d think it would be a fun project to work on as long as Amazon/Berkshire/JPM are putting serious resources into the effort).
Don’t successful businesses need both? Everything that is dollars and cents have limited impact and, especially, with health care you need doctor face to ‘sell’ the program. Also you need to be effective a health care provider and Alexander program is all cost focus on some of the parts of the cost.
I am also dubious of Scott Alexander as a lot Psychiatry are not using receptionist and Skype may have limitations on effectiveness. Wasn’t technology suppose to remake colleges in 2010 – 2012 and these changes have been very modest so far.
Seriously? Alexander has never run anything? He writes articles that make some people happy, but are not generally well informed on medical topics outside of his area of expertise. Gawande is actually pretty well known for stuff other than checklists. Your ignorance is kind of stunning.
Steve
Scott Alexander’s Cheap-O Psychiatry has the additional virtue of having been pre-lampooned
https://www.youtube.com/watch?v=1r-bjD2y95M
Imagine we still had travel agents, and that travel agents were about 100 times richer and 1,000 times more politically powerful as a rent-seeking special interest group – as powerful as the AMA (or even, gulp, the real estate lobbies!)
All of a sudden, public access to reservation systems (I remember when Prodigy and Compuserve first opened up Sabre to the public) wouldn’t be so easy and automatic.
Let’s say you were trying to start Expedia or Orbitz or Travelocity or Kayak back then, under those kinds of constraints.
The thing stopping you from immediate, massive disruption, the elimination of a whole class of middlemen, and cost-savings derived thereby, wouldn’t be a matter of lack of technology or an eager market. It would be the lobby, the union of travel agents.
For example, Redfin (and to some extent Zillow and Trulia, etc.) has kind of disrupted real estate transactions. But frankly, not very much. Not nearly enough, and not nearly as much as could be done tomorrow, if one wasn’t starting down the NAR and other groups.
So, maybe the big idea just isn’t really that big at the end of the day. That doesn’t mean it’s a ‘nothingburger’: it could still be worth a ton of cash at the end of the day. It’s a kind of obvious move, that could save a lot of money, and will end up eating a lot of the lunches of a lot of unnecessary, if still quite politically powerful, intermediaries.
For that, it seems to me, a part time, famous, universally beloved, CEO figurehead / spokesman is exactly what you need. It would help if you had your own major American newspaper and a strong DC presence and unlimited money and, oh, what’s that again, you say Bezos is a player in this game?
Well, even if at the end of the day it’s just Redfin for health care, the savings and improvements could still be noticeable. Maybe just the threat will awaken some sectors from stagnation and complacency, like Google’s Fiber threat tends to get broadband companies to take notice regarding providing value instead of resting on their laurels. We’ll see.
With all due respect for Scott Alexander, it seems you are underrating gawande’disrupting potential. His book on death could imply much bigger changes than psych consultations via Skype.
If it were Berkshire, Morgan, and anybody else I think the skepticism would be not merely justified but beyond question. In Amazon however Bezos has arguably proven himself to be the deepest systems thinker of this era.
Unlike Google or Facebook who essentially got one very big thing right and then managed to not screw that up (which are no small things to be sure), Amazon is a much more complex business that is in many ways unrecognizable from what it was at the start. It seems pretty clear that many if not all of the really hard strategic calls were made by Bezos. Morgan and Berkshire provide bodies and cash but if Bezos provides the script then anything is possible. I consider it a near-certainty he is thinking about running for president (if not already decided to do so) and you can put the WaPo, this, and the HQ2 (which I suspect will go to Pittsburgh or another rust-belty/non-coastal city) as parts of that plan.
Non controversial pick of a credentialed individual. Who know if the pick is a good one?
In any event he will need a competent COO with “boots on the ground” operating experience for this to be more than another academic like exercise. Writing about what should be is far different than executing particularly in healthcare despite the sponsorship of Buffet, Dimon, and Bezos.
The other Scott (Gottlieb) is the one to watch in health care.