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Why the future of health lies in thinking small

General Practice in Australia is a private business. There are 7200 GP businesses in Australia, with a revenue of $10bn per annum. Each practitioner is estimated to earn $200,000 on average. 95% of the income for these businesses is derived from government rebates, mostly from 10 to 15 minute consultations. The concerns of the practitioners in this context are said to be:

1. Threat of litigation

2. Too much work to do in a limited time

3. Earning enough money

4. Patients who are difficult to manage

5. Paperwork

6. Intrusion of work on family life

7. The cost of practice overheads

8. Time pressure to see patients

9. Unrealistic community expectations

10. Negative media comments

Increases in the Medicare rebate have failed to keep pace with the rise in the costs of running a GP service with increased patient throughput often used to make up the shortfall. Where this and other barriers exist, it may not be feasible for patients to be offered additional advice or services beyond their original reason for presentation unless a strategy is negotiated and agreed between the relevant players.

We know that the healthcare needs of patients are set to change in three important ways:

1. The population is aging.

2. There are more effective, albeit ever more expensive treatments available.

3. Poor lifestyle choices, linked to obesity will generate greater demand for medical appointments.

We are therefore relying on private businesses to respond to growing need in the knowledge that they are already working to capacity.

Under the central set of assumptions used in this study, total health and residential aged care expenditure is projected to increase by 189% in the period 2003 to 2033 from $85 billion to $246 billion—an increase of $161 billion….This is an increase from 9.3% of gross domestic product (GDP) in 2002–03 to 12.4% in 2032–33. Increases in volume of services per treated case are projected to account for half of this increase (50%). Projection of Australian health care expenditure by disease, 2003 to 2033

Another unique aspect of the business of medicine is that despite its technical and scientific basis, medicine is most effective when the human interaction between practitioner and patient is at its heart. Efforts to interfere in the process through the revision of payment schedules are only partially successful if not actually harmful.

The commercial reality is that without innovation, primary care as a business will not keep up with demand. To date evidence in practice is that researchers in primary care often fail to engage with clinical partners and innovation is stymied. Government investment in innovation in primary care is on the one hand conservative and limited. Ninety percent of government funded healthcare is delivered by small businesses and yet over 90% of government investment in research and innovation is targeted elsewhere. What little is funded is usually awarded to competing tertiary institutions whose performance is measured on academic outputs rather than impact on practice.

These are the foundations for a lean, agile, creative, approach to innovation  based on commercial reality and factoring in three key elements:

1. The most expensive component of innovation is establishing the problem and creating a value proposition that  factors in the perspective of end users.

2. Innovation only ever works when it is driven by a champion willing and able to re-engineer multiple prototypes to solve the problem.

3. There are opportunities for commercial partnerships if the key performance is reframed in the metrics of sales.

The conditions already exist for this approach to innovation in the business of primary care. Primary care in many countries, like Australia, is led by highly creative, intuitive problem solvers, many invest their insights and energy on small projects that have the scope for substantial commercial returns but more importantly to deal with the coming tsunami of health related problems. The final word is to Paul Graham:

People are bad at looking at seeds and guessing what size tree will grow out of them. The way you’ll get big ideas in, say, health care is by starting out with small ideas. If you try to do some big thing, you don’t just need it to be big; you need it to be good. And it’s really hard to do big and good simultaneously. So, what that means is you can either do something small and good and then gradually make it bigger, or do something big and bad and gradually make it better. And you know what? Empirically, starting big just does not work. That’s the way the government does things. They do something really big that’s really bad, and they think, Well, we’ll make it better, and then it never gets better.


  1. Great article! I couldn’t agree with you more on the importance of focusing on small things. After all, in the words of Vernor Vinge, “Even the largest avalanche is triggered by small things.”

    Unfortunately however, there is a disconnect between that truth and what is actually transpiring in the healthcare field here in the United States where sheer economics dictate greater degrees of group merging and the dwindling of solo practice.

    • Thanks for the comment Vicor. If we agree that general practice/ family medicine is a business then it must innovate or lose revenue, probably to alternate medicine practitioners, such as chiropractors and naturopaths. Their income is growing. In coming posts I will develop the case for innovation by the practitioner for the sake of their own business. The cavalry aka the government isn’t coming.

  2. While acknowledging the list of 10 gripes above, I personally think some of the answers are very simple.
    A lot of the overwork can be avoided by having trained nurses employed to triage calls, as is done in hospital emergency departments. This could be encouraged with government subsidy for the nurses and would save money by reducing unnecessary doctor consultations (now apparently 95% paid for by govt.)
    There is a major imbalance in the areas now covered by readily available free post graduate education. It is skewed by the payer of the piper towards pharmaceutical interests. This is driving up costs for often precious little benefit to the community.
    I would like to see CME compulsory for all doctors, but not more of what happens now. The RCH used to teach medical students by us observing real life psychiatric consultations from behind a dark glass wall of the consultation room. This could be combined with video recording/playback later to allow detailed discussion. This would be vastly more effective than the case histories we are served up at sponsored meetings. This training should involve the same small group of doctors who meet regularly over an extended period, like current Balint groups. Two hours once a month out of anyone’s busy schedule should not be too onerous.
    My field of musculoskeletal medicine is a bit of a Cinderella because it ideally shouldn’t involve much drug treatment. It is very poorly managed in GP currently. People will come to doctors with their pains, so doctors should be trained to deal effectively with them, rather than leave it all to the chiropractors and osteopaths.
    Thanks for the opportunity to blow off steam.

    • Thanks James. In earlier posts I make a similar case for the core business in medicine- the consultation. Our role, as dictated by society, is to facilitate healing. What others, who don’t share our perspective think is that our role is limited to prescribing, referring and ordering tests. The problem is that sick humans are not disordered machinery.

  3. Moyez, thank for a stimulating article. I have worked across two countries (UK and Australia) and am very mud him touch with primary care in other health care systems. I think the need for innovation in primary care is present in whichever of these health systems we look at. The challenge is to be responsive as a practice to the healthcare needs of patients and unfortunately most of primary care is generally reactive rather than proactive. I’ve been involved in developing capability for improvement in the NHS and wrote a paper for the King’s Fund on the subject. A number of programs including the Productive General Practice, that applies Lean to General Practice can assist. I agree the ingredients for innovation are present but what needs to develop is culture for innovation. Until organisations and practices are will to take calculated risks, try out those small tests of change and empower their staff to do so in a controlled way then innovation will be not occur. General Practice has the potential to transform healthcare but we need to want to and if we do, a redesign of how we work will be inevitably required. I strongly believe that General Practice can address may of the problems of healthcare systems if it is empowered to do so AND if it in turn empowers its workforce.

  4. Thanks Paresh. I feel your pain. There may be an opportunity here. I think it will take very little to persuade practitioners of the need to foster the culture you mention. I recently organised a lean medicine masterclass in Perth. One weekend, 8 stellar ideas, investors, technicians and practitioners ( not all of them GPs) in one room. The results were inspiring. We have founded the Peel Health Innovation Institute- supported by a community foundation- a little money, lots of networking, access to technical expertise and a focus on what matters to local practitioners- chronic pain, diabetes, obesity….more soon.

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