TCS Daily

James K. Glassman speaks with the former Speaker of the House

By James K. Glassman - July 10, 2000 12:00 AM

Author of the Contract with America and the Republican take-over of the House in 1994, Newt Gingrich shook the American political system to its foundations. Now he wants technology to do the same thing to American health care. TCS host James K. Glassman recently spoke to the former Speaker of the House.

Glassman: Mr. Speaker, you've been involved with some very interesting projects since you left Congress and one of them involves health care and technology. Can you tell us exactly what you're working on?

Gingrich: Well, I believe it is possible to use new science and new technology to improve the health of the American people, improve the quality of their health care and lower the cost of the health care by applying modern management and modern technology in ways that nobody has applied. And in the last eighteen months, it has been astonishing to me how big the gap is between the kind of health system we could have given modern technology and the kind of system we are currently trapped in.

Glassman: Now, let's talk about some of the things that we could be doing and then talk about why we're trapped in the current system. For example, could we be doing more with distance diagnosis and distance treatment?

Gingrich: There is no question you can be doing a lot more long distance. Emory, for example, has a system for diagnostics for somebody with a skin problem, which actually allows you to use a telephone so the distance is really not limited. It's a telephone with a video camera, which has a high enough quality that a specialist in dermatology could actually interview you. So that, for example, people in the rural areas won't have to drive 300 miles to a metropolitan area to get to the right kind of specialist.

There is also no question that if you take, for example, MRIs and x-rays and put them in a digitized form, rather than just have them as pictures, that they can be sent anywhere. I don't know how often you see people who are carrying the x-ray pictures or carrying the MRI picture from one city to another. But that is a totally obsolete model of how to transfer information.

Glassman: Let's just talk about some of the reasons -- public policy reasons -- we might not be seeing this right now. Are there problems, let's say with certification, to start with. Can the VA certify a doctor to treat a patient somewhere else using telemedicine?

Gingrich: Well, one of the real challenges we are going to face is that the divisional organizational structure of medicine has been at the state level. So if you're in Georgia but you would like to be reviewed by somebody, say at the Mayo Clinic in Minnesota, historically what you did is remove the patient so that the patient moved from Georgia control of their health to Minnesota control of their health and the doctor who had certified under Minnesota law then looked at them because they were physically in Minnesota. Now, you have the potential of the person sitting in Atlanta, or sitting in rural Georgia... and be in effect at the Mayo Clinic by telecommunications. But then the doctor in Minnesota is practicing medicine in Georgia.

Now, we don't really have today the kind of either state compacts or federal preemption we're going to need in order for this to happen. But the truth is we ought to be able to find a way to have cross-certification, some kind of ability to have certified experts, you know, universally available without having to get involved with that kind of re-certification.

Glassman: How much of a problem is, what we at Tech Central Station like to call, the revenge of the middle man -- the idea that physicians might lose out in telemedicine and in the kinds of advances that you're talking about?

Gingrich: First of all, Adam Smith wrote in 1776 in Wealth of Nations about the absolute pattern of guilt to block the future by using their political power, and nothing has changed in that since. There are auto dealers trying to stop you from getting to the lowest-cost car or a local ophthalmologist trying to stop the optometrist from being able to prescribe, for example. I think some of that is absolutely the case.

The other part of that though is that the insurance companies, to a degree that frankly startled me once I had the time to go out and interview people (I did not really understand this when I was the Speaker) -- the insurance companies are almost entirely cash-flow institutions. They have none of the management production attitudes of say, Deming's quality system or Drucker's management that have created most of modern corporations. And the result is, ironically there is no managed care anywhere in America. What you get at most is managed cost...

At the same insurance companies who you would think would have the aggregated wealth to do it have no interest in investing in the future. Their only interest is in minimizing costs. Let me give you a very specific example. There are two very interesting firms in the Palo Alto area, I-Scribe and Hippocrates who are both developing, in competition with each other, a hand-held device for allowing doctors to prescribe medicine.

Glassman: Right.

Gingrich: This is important for a couple of reasons. First of all, they can put a formulary on their screen, which would tell the doctor what the counter-indications are for not prescribing a particular drug... Second, they can actually put on one screen all of the insurance companies that bill the doctor's office so that they know immediately which ones will pay for which medicine, which turns out to be a very major factor in making health care more inefficient.

One thing we discovered in this process was that forty percent of all prescriptions lead to a pharmacist calling the doctor's office, either to clarify the handwriting, point out to them that the patient is already taking a drug and it means they should not take the second drug, or point out that the patient's insurance company won't pay for that drug and asking if they can substitute a drug the patient's insurance company will pay for. That's forty percent of all prescriptions that take the doctor's and the pharmacist's time in clarifying things.

In addition, prescriptions are the third-leading cause of malpractice. And there's already one insurance company that has indicated to I-scribe that it will lower the cost of malpractice insurance for any doctor who uses this kind of hand-held device to use this kind of prescribing.

Now, that is an example. When you look at that, it took a group of very smart entrepreneurs to figure out that doctors walk around all day. The reason they don't use the PC on their desk is that they are not at their desks. But some kind of a Palm Pilot or a Casio is a terrific asset for doctors and both I-Scribe and Hippocrates, who have different strategies but with similar products -- both of them I think are having very substantial success now and beginning to change a significant piece of the medical process.

Glassman: So then the question becomes who benefits from that? Since it is basically health insurance companies that are footing the bill, are they going to make the decision to ...

Gingrich: No, I think what's happening in this case is, doctors benefit by saving time, doctors benefit because they have lower malpractice insurance cost -- potentially if this company announces and follows through on that proposal. Pharmacists benefit because they don't have to spend a lot of time calling back to clarify things. And in fact, one major drug store is considering subsidizing this process for the doctors that work with the drug store. They figure that they would more than repay the cost of the Palm Pilot or the Casio just in the first months of reduced telephone calls.

Glassman: That brings up another issue. There are many on-line sites that give consumers the ability to order prescriptions on their own. Are there dangers in that?

Gingrich: I think that's actually a very large public policy debate. There are lot of countries around the world that do not have the American model of controlled prescription. And I think it's actually what we're looking at, how many of the drugs that are currently prescribed really need to be prescribed? And how much of that is simply a hold-over from an earlier era where we assume people were too ignorant to learn about them? I am not disputing that we ought to have some kind of efficacy and safety for drugs. But I do wonder whether the process of prescription is now too tightly held.

Glassman: Another public policy issue is privacy. Patient's records are more and more being sent out into cyber- space. Who should own those records and is there a way to be sure that they don't fall into the wrong hands?

Gingrich: Yeah, this is an area I think where you're going to have federal preemption because of the nature of the problem. I personally believe that you should own your own record; this is not just a property right, but it is also just a matter of practical control.

In a free society, you ought to be in charge of your own record. But in addition, I think that we ought to have a federal law that basically says: You control the record; it's yours. People can get access to the record with your permission or in an emergency, a medical person, doctor or nurse can get access to the record, if they register who they are and what the reason for this is, so that we can track who actually has been there. And I think you can build a privacy tracking component that will pretty well know who has gotten access to your record and you could track what they did with it and why there were there.

But I think there are three big reasons for [allowing some access to] the records. The first is, in an emergency, let's say, you're in a car wreck and you're unconscious. It will be dramatically better if the doctor could immediately access your record, find out who you are, what you're allergic to, and what your prior problems have been.

Second, probably 30,000 to 35,000 Americans a year die because of inappropriate prescriptions. We would eliminate most of those if we combine doctors prescribing online with an expert system that searches your medical records to make sure that the prescriptions you got conform with both your allergies and any other medicine you're taking. I know in mother's case, for example, at one point she had 17 different drugs and she had two different doctors prescribing them and they weren't coordinating what they were doing. And it can be frankly a serious problem.

Third, think about the number of times in your life you filled out various forms, occasionally with a slight inaccuracy or with a faulty memory. You know, it ought to be possible for you to have an ongoing process where we know with remarkable accuracy what your health record has been, what has been done to you, what have doctors said about you. And today that does not exist, but I think that the argument about technical secrecy or technical security is nonsense... We all know from using ATMs that, you know, you put a code across to open up your checking account and nobody I know refuses to do it out of fear that somebody else will hack into their account. And the fact is that ATMs now have a pretty long record of being relatively safe in terms of personal privacy.

Glassman: Okay, so the key change is really that you should be able to own your own records.

Gingrich: You should own it, it should be permanent, it should be stored on the net in a way that people can access it in an emergency. And there probably does need to be a federal law that is clear and simple that makes it clear that this is a medical record and cannot be accessed by your employer or by your insurance company or any anybody else without your permission.

Glassman: Now, in "The Age of Transition," you talked about some important public policy changes that are necessary before, I guess before any of these technological changes really can have an impact. And one of them is changing the insurance system.

Gingrich: First of all, the big technological waves occur sooner or later almost without regard to the system. Politics and government can slow them down, but they have a tendency to keep coming. They will be accelerated dramatically if we have a personal purchase of insurance and a personal control of your own health system. Individual consumers make the transition much faster in a marketplace than bureaucracies do and in that sense I very much favor, first of all...expanding the flexible savings account so that every person who has a flexible savings account could carry it over to the following year. I favor over the long run, meaning the next 5 to 10 years, a transition to allow you to have access to your own tax deductibility, so if you don't like the insurance your company buys or you don't like the HMOs your company hires, you could take your share of the tax deductibility and go buy something for yourself. And I think when we get to a market like that, we will see a dramatically better and more efficient health system with greater customer satisfaction.

Glassman: What technological changes are necessary immediately, let's say in the next year or two, before we can move ahead on the kinds of changes you're talking about?

Gingrich: Well, let me say first of all, that if anybody does care to look at this, they can see the full paper on the "Age of Transition" at, and I try to outline there in about 30 pages the way of thinking with this kind of change. I think the biggest single change in the near future that will dramatically reshape everything is to get... broadband... I don't think in the long run, that we're going to have a twisted copper 56 Kilobit system. I think we're going to find a way to get, certainly several megabits and probably within 15 years, a gigabyte of information into people's homes. When you get that kind of capability in your home and you'll be able to order real-time movies, you'll be able to interact whether it's telecommunications or telemedicine or distance learning, I think you're going to see a really dramatic change, probably at least as big as the Internet, if not bigger.

Glassman: So broadband is really the key?

Gingrich: Expanding the amount of information you can get to every individual in their home is probably the biggest single breakthrough of the next ten years.

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