Doctors as Engineers

There are two fundamentally different ways of thinking about complex social systems: the economic approach and the engineering approach.

The social engineer sees society as disorganized, unplanned and inefficient. Wherever he looks, he sees underperforming people in flawed organizations producing imperfect goods and services. The solution? Let experts study the problem, discover what should be produced and how to produce it, and then follow their advice.

Social engineers invariably believe that a plan devised by people at the top can work, even though everyone at the bottom has a self interest in defeating it. Implicitly, they assume that incentives don’t matter. Or, if they do matter, they don’t matter very much.

To the economist, by contrast, incentives are everything. Complex social systems display unpredictable spontaneous order, with all kinds of unintended consequences of purposeful action. To have the best chance of good social outcomes, people at the bottom must find that when they pursue their own interests they are meeting the needs of others. Perverse incentives almost always lead to perverse outcomes.

In the 20th century, country after country and regime after regime tried to impose an engineering model on society as a whole. Most of those experiments have thankfully come to a close.  By the century’s end, the vast majority of the world understood that the economic model, not the engineering model, is where our hopes should lie. Yet there are two fields that are still completely dominated by people who steadfastly resist the economic way of thinking. They are health care and education.

Take education first. A quarter of a century after the publication of A Nation at Risk, we have made almost no progress toward the engineer’s goal: figure out how to teach, figure out how to train teachers to teach that way and then go tell everybody what to do. In fact, two whole generations of students have passed through schools we were told are awful while the technocrats pursued this impossible pipe dream! Alex Tabarrok summarizes where we are now as follows:

Unfortunately, we have little idea how to train good teachers. The best we may be able to do is to throw a bunch of people into the classroom and measure what happens but for that strategy to work it needs to be followed up with firings. Indeed, one recent study (see here for another explanation) found that the optimal system — given our current knowledge and the importance of teacher effects — is to hire a lot of teachers on probation and then fire 80% after two years, yes 80%.

As in education, health care is a field that can be described as a sea of mediocrity punctuated by islands of excellence. The islands always spring from the bottom up, never from the top down; they tend to be distributed randomly; they are invariably the result of the enthusiasm, leadership and entrepreneurial skills of a small number of people; and they are almost always penalized by the payment system.

Now if you think like an economist, you will say, “Why don’t we reward, instead of punish, the islands of excellence and maybe we will get more of them?” But if you think like an engineer you will reject that idea as completely unacceptable. Instead you will want to 1) find out how medicine should be practiced, 2) find out what type of organization is needed for doctors to practice that way, so 3) you can then go tell everybody what to do.

Here is Atul Gawande, explaining how medicine should be practiced:

This can no longer be a profession of craftsmen individually brewing plans for whatever patient comes through the door. We have to be more like engineers building a mechanism whose parts actually fit together, whose workings are ever more finely tuned and tweaked for ever better performance in providing aid and comfort to human beings.

Here is Karen Davis, explaining (in the context of health reform) how medical care should be organized:

The legislation also includes physician payment reforms that encourage physicians, hospitals, and other providers to join together to form accountable care organizations [ACOs] to gain efficiencies and improve quality of care. Those that meet quality-of-care targets and reduce costs relative to a spending benchmark can share in the savings they generate for Medicare.

The Affordable Care Act (ObamaCare) was heavily influenced by the engineering model. Who, but a social engineer, would think you can control health care costs by running “pilot programs”?  What’s the purpose of a pilot program if not to find something that appears to work so that you can then order everybody else go copy it? Pilot programs are a prime example of the social engineer’s fool’s errand.

More on this in a future Alert.

Comments (20)

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  1. Ken says:

    Brilliant. You’ve out done yourself this time.

  2. Larry says:

    Okay, now what. Thanks for laying out the two paths. Seems to me that a hybrid solution is in order. But you stopped in mid thought. http://www.hcbn1.com

  3. Larry C. says:

    I ‘ve never thought about it this way, but you’re right. A large part of the health policy community does want to turn doctors into engineers.

  4. Vicki says:

    Nicely done. You can’t find this kind of analysis anywhere else. That’s why this is my favorite health blog.

  5. Mo says:

    Superb article that explains a lot. However, one must question if the real goal of those who want to tell doctors what to do is quality medical care, cost savings or…power and control.

    My contention, which may sound conspiratorial, is that the goal is power and control. That extends even to the bureaucrat doctors in the system.

    We recently had JACOH come do their dog-and-pony inspection of our facility. A nice man, a doctor, walked around, giving out sage advice and bad jokes. Everyone nodded at every word as if it were diamonds out of his mouth. The jokes were truly awful, the suggestions were unrealistic and had nothing to do with quality care, just bureaucratic drivel.

    But here was a man with absolute power over us. And, I’m sure, a nice expense account! I wouldn’t even begrudge him a nice restaurant meal, but the power he exuded bothered me, as well as the sycophantic head-noddings, laughter and murmurings of assent, as if this Wizard of Oz had some substance and no curtain to hide behind.

    I am not really addressing your article directly, but it’s one reason why things can’t change; too many people with too much control, plus too much money floating out there, not being given to clinicians (or, for that matter, to anyone entrepreneurial, whether physicians or not), and too many hide-bound opinions. Cui bono comes into play as the operative question why things can’t change.

    But clearly, what you say makes SENSE. That goes against the motto that most bureaucratic systems follow: If it makes sense, we won’t do it!

  6. Brant S Mittler MD JD says:

    You are correct in observing that medicine is going the way of education. Doctors will soon be like teachers in public school: poorly paid and hampered by a vast bureacracy. But there won’t be any private school equivalents in medicine where Medicare patients can get care. As for figuring out the right way to practice medicine, you are brilliant to quote Atul Gawande. You may recall that he was a Clinton health care “whiz kid,” who knew the right way to practice before he even completed his medical training. Ditto for Bobby Jindal and Sara Bianchi – who were experts with no medical training at all. Practicing medicine is apparently so simple that these 20 something whiz kids in their prime knew how to do it better than the greedy incompetent people who actually did it for a living. And the political class knows how to spot them and annoint them as experts. And then there is the former editor of the New England Journal of Medicine, Dr. Arnold Relman, who defined the right way to practice as “what good doctors do under the best of circumstances.” Of course good doctors usually have an academic or at least a Harvard pedigree. Being successful at medicine is about complex problem solving which very few schools at any level know how to teach. As for most medical academicians, they are very good at politics and usually pretty poor at medical problem solving in real patients — the kind who get sick in the middle of the night and whose families ask a lot of quesitions that annoy the professors.

  7. Earl Grinols says:

    The book Commanding Heights (from which a PBS series was later made) documents the thinking of the social engineers and the complete failure in the 20th century of the “engineer” economic model.

    So, why do we still find profoundly naive individuals such as our president and others who want to engineer society in this failed way? There are two answers. For some the answer is
    1) lack of education and understanding (Someone said “a fool is born every minute.” Thus, every generation refreshes the pool of the naive.), and for others
    2) the wannabe social engineers do not care about the damage they cause because they imagine that they will be permanently in charge and will not personally be harmed.

  8. Devon Herrick says:

    One problem with delivering medicine as an engineering problem is the question of who gets to design the process. The old Soviet system is an example of using top-down engineering to solve the problem of producing and distributing goods and services. Compare that to the U.S. model where numerous producers fail or thrive based on experimenting with new techniques; while retailers like Walmart run less competent competitors out of business. Competition creates a system that is far better than a top-down system –- which could never have been designed by a bureaucracy. Health care would face similar problems if a bureaucracy tries to engineer the process.

  9. steve says:

    A couple of problems here. Our current system, which is really no system at all, has produced the world’s most expensive health care with inconsistent outcomes. The facilities that act as islands of excellence do it by working together. They engineer, seems like the right word, a system that is integrated and works well together. What I se people suggesting is that we emulate those centers. The claim that people want to engineer a complete top down new program is a strawman argument.

    Our current system has plenty of incentives. It incentivizes people to do more, especially more procedures. There is little competition. Given the geographic and time limitations of medicine, there will not be for most major expenditures. There is certainly place for competition in pharmaceuticals and, maybe, some primary care, but not so much for the big ticket items.

    The alternative is doing nothing and maintaining the status quo.

    Steve

  10. John Goodman says:

    Steve makes a good point that is potentially distracting. Efficient medical practices often adopt a way of doing something, and because they do the same thing over and over again and usually do it the same way each time it may be tempting to call this an “engineering” approach.

    But that’s not what I mean by the word. What I mean is the (usually implicit) assumption that you can take an efficient medical practice, write down how it works on paper, and then (successfuly) get every other doctor to follow the script.

    If this approach worked, the Soviet economic system would not have failed. It obviously doesn’t work for steel or cars or any other manufactured product. For the same reasons, it won’t work in health care either.

  11. Jim Morrison says:

    John,
    Did you ever stop to think that if the free market you prize so highly was working, there would be no place for the social engineers in healthcare?

  12. John Goodman says:

    Jim, I think you mean “if the free market were allowed to work.” Were that to happen, the social engineers wouldn’t go away, they would just be less relevant.

  13. Linda Gorman says:

    Although people often claim that the costs of the US health care system are high due to its lack of integration, would someone please provide data to support that claim? In other words, where is the evidence that social engineers have ever produced a more efficient productive system in health care?

    Some work seems to show that managed care costs more without any particular measurable improvement in health. People left free to do so have fled tightly managed care over the last decade. In the controlled world of Medicare, the chronically ill seem to choose choose fee-for-service over managed care, apparently to get better access.

  14. Dr. Francis Kendrick says:

    The economic model is exemplified by consumer driven health care. In contrast, traditional health care insurance in the United States has given us overutilization, opportunities for fraud, and virtually every visit to a doctor generating an insurance claim that results in unnecessary overhead for both doctors and insurers.

    For a risk to be insurable, a potential claim should be substantial, a potential claim should be rare, and both insured and insurer should be committed to avoidance of a claim. Traditional health care insurance often fails to satisfy those criteria.

  15. Virginia says:

    I have a completely unrelated comment: Dr. Goodman, I have noticed that you write these really good and thought-provoking posts only to have them disappear below new posts less than a day later. Why not turn so of your most controversial posts into on-going discussion board topics? That way, we can keep the conversation going for a week or two before going on to a new topic?

    Perhaps you could do it as another tab at the top of the page so that the blogging could continue unharmed.

    Just an idea from your local policy wonk.

  16. Chris Ewin, MD says:

    Well-said Dr. Mittler.

    To John’s points…
    1. How should medicine be practiced?
    We have standards and evidenced based treatments…All physicians have different sets of skills and levels of competency. It takes a long to program the computer b/n our two ears. And, we are all wired differently..coming from different backgrounds, training and personal sets of core-values/ethics. Most have the desire to practice to the best of their abilities and continue on a life-long path of learning.
    It is something that can’t be reproducible like franchises (McDonald’s burgers and fries around the world comes to mind)..
    The “organizations” we use are guided by our specialty and our abilities to stay current by maintaining our board certification.
    Our state medical boards do the best they can to ensure that really out of line Docs (substance abuse/inappropriate behavior with patients,etc) are penalized or lose their licences.

    Unfortunately, we are seeing the graceful decline of medicine do to the regs/restrictions and payment system problems we face. Much like college where we are seeing less and less tenured professors teaching our students by less experienced teachers.

    I just got off the phone with an internist who is 59 and makes $125,000/year. His partner makes $50,000/yr. They work with different styles and at different paces. Unfortunately, that community may be losing two great physicians who don’t want to quit but may have to. A tragic example….

    You simply can’t replicate this because all health care is local.

  17. artk says:

    Well, Dr. Ewin, I don’t know about that doctor and his partner, but his income problems are of their own doing. According to the BLS, the median income for an internist in 2009 was over 166,000 a year. In addition, in a time of close to 10% unemployment, unemployment for physicians is close to zero. If he can’t make it private practice, he can just take a job.

    The small physicians group of one or two or three doctors may a thing of the past, but that’s a good thing. Pretty much every survey shows that multispeciality groups give better care.

  18. Dormilona says:

    So it looks like Virginia wants to engineer John’s blog. :D

  19. Chris Ewin, MD says:

    Art,
    Now your getting it. He must be in the range of $40-60/hour according to BLS.
    Out of 95,000 practicing fp’s…65,000 work in doctors offices. with an average salary of $174 k.
    Only 4000 work for state and local governments with an average salary of $131,000 with their salaries determined by the government.

    How many medical residents would want to do that???
    Especially with $250k in loans to pay back and not getting into the workforce until your early 30’s.

    If you had the opportunity to take better care of patients and get paid 3-5x’s more working the same hours, which would you choose?

    I had a 24 yo girl 10 minutes ago diagnosed with cervical cancer yesterday. Her parents flew in immediately from San Antonio. All scared. I spent 45 minutes with them explaining the options and got her into a gynecologic surgeon tomorrow.

    You can’t get that kind of service with the direction we are going in this country. If you are not on the front lines with patients that face this every day, then it’s understandably more difficult to understand patient flow in the present system.

    It will be compounded with the increasing rules and regs that Obamacare will place on those that deal with the reality of patient care.

    John is correct. It’s the marketplace that will improve (not fix) the system.

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