Human Health Project
Human health is a fundamenal asset...
and the largest component of human and societal capital. Without health, an individual cannot fully participate in the richness society has to offer and society is robbed of the full potential of its human capital.
The importance of health contributes to some degree to the inelasticity of pricing health care products and services. But inelastic demand is only part of the problem.
We have a system that easily values the consumption of heath care but not the creation of health itself. The incentive is to provide more care with little countervailing market forces to control costs. In most developed countries, the solution has been to create a single payer, the government, that controls costs and utilization.
The U.S healthcare system, in contrast, has grown to a Frankenstein’s Monster of disconnected parts and incentives. The system is built on an insurance foundation. Insurance originally developed as an “all you can eat” promotion to increase healthcare utilization in the 1930’s. A monthly fixed price for services was the first step in divorcing market forces from health care decision-making. Adding a risk-sharing component did little to control system costs but allowed individuals to be further isolated from the costs of illness care.
WWII price controls introduced health care via insurance as an employer benefit, which further disconnected purchaser from provider, increasing consumption and cost opacity. Starting in the 60’s government programs, Medicare & Medicaid, began to fill in the gap of employer-based insurance but without the direct cost controls of most government payer systems. The Affordable Care Act still relies on insurance as its core structure and has faced strong opposition.
In total, policy has combined with incredible technological advances to produce the costliest health care in the world. Unfortunately, one that does not deliver the best outcomes.
An Alternative Approach
The Intrinsic Value Exchange (IVE) approaches health care from a completely new direction. We are creating a financial instrument and care delivery system that values human health as an asset. The goal is to price health, rather than the provision of sick care, and create a mechanism for transforming the intrinsic value of human health into financial capital to fuel a new, innovation-based health care model that can operate outside of the current systemic logjam.
The IVE Model seeks to:
- Transforms the intrinsic value of human health into financial capital providing a means for individuals and other stakeholders to fund health care;
- Flips incentive. Instead of providers being financially rewarded only for provision of services and sale of goods, they are rewarded for delivering an increase in health and minimizing sick-care costs;
- The asset is universal and thus the financial incentive is to deliver care to all.
- The individual is central to the purchase decision making process, which reintroduces market forces into the health care system;
- All stakeholders, individual, public, corporate and government entities can participate in the market and create additional financial tools to suit their needs.
Advances in the understanding of health coupled with new technological tools can combine with financial creativity to create a system that actually delivers health care rather than ever higher costs of treating illness alone.