Now it seems obvious in retrospect that health care, finance, politics, and society are circling the same drain. Now there has been enough time since the beginning of the great recession/ global financial collapse for some people to describe the larger problems.
The Anechoic Effect
We have frequently discussed what we called the "anechoic effect" in health care. In short, this meant that discussing the big problems in health care, particularly those involving leadership and governance, was simply not done, particularly by the academics who could have addressed the problem. Lots of examples of the anechoic effect are here. We have postulated that this has to do with fear of offending the rich and powerful who now lead and govern health care organizations, and the benefits, which may be produced by conflicts of interest, of maintaining good relationships with these rich and powerful.
Charles Ferguson in Predator Nation on the Anechoic Effect
Meanwhile, the anechoic effect was a big reason that finance became such a big mess. Charles Ferguson, as we have previously discussed, has been one of the most insightful commentators on the great recession/ global financial collapse, starting with his Academy Award winning documentary Inside Job.
This year he published Predator Nation (Ferguson C. Predator Nation: Corporate Criminals, Political Corruption, and the Hijacking of America. New York: Crown Business, 2012.) a more complete account of our financial disaster. It has a section on what we on Health Care Renewal would call the anechoic effect, and how it is driven by perverse incentives (pp 81-82) :
You see a horrific train wreck in the making, with all your coworkers contributing to it. But they are all making a fortune, and their manager - who is your boss too - is making even more money by keeping it going. Quite obviously, they're going to keep doing it whether you participate or not; so even if you refuse to participate, the firm will be dead anyway. You can try to stop it by going over your boss's head to the CEO; but your boss won't like that at all, and he and the entire department will tell the CEO whatever they need to tell him in order to keep it going. And if - speaking purely hypothetically - your CEO is an oblivious, selfish, obnoxious egomaniac nearing retirement age, heavily focused on his golf game and art collection, with a few hundred million in cash already stashed away, scheduled to rake in another $50 million this year, whose contract guarantees him another $100 million if he loses his job - well, then he probably won't be very sympathetic to you either. You could try going to the board of directors, but even if you could reach them, it will turn out that they are old pals of the CEO, often stunningly clueless, picked largely so that they won't rock the boat.
So if you try to stop the party, you'll probably get marginalized or fired, as happened to a number of serious, ethical people who tried to warn their management and curtail unethical and illegal conduct in Merrill Lynch, Lehman, Citigroup, AIG and elsewhere. So you'd gain nothing by acting ethically - quite the contrary, you'd ostracize yourself and lose your chance to build (or rather, transfer to yourself) some real personal wealth - possibly once-in-a-lifetime opportunity.
Summary: the Application to Health Care, and What Must be Done to Change Things
So consider how much of this might apply to a) serious, ethical employees of large health care corporations, and b) health care professionals who are employees of large health care non-profits, and/or have major financial relationships (conflicts of interest) with large health care corporations.
Regarding the latter, think of the health care professionals who worked at the Allegheny Health Education and Research Foundation (AHEF) back in the 1990s, and who were told by their multi-millionaire CEO, "Don’t cross me or you will live to regret it." How inclined would they have been to blow the whistle on his supposedly "visionary" leadership? On Health Care Renewal, we have posted lots of relevant newer examples of bad behavior by wealthy leaders of drug, device, biotechnology, health care information technology, and health insurance companies. We have also posted lots of relevant newer examples of bad behavior within hospital systems and academic medical centers. Yet most of these generated little resistance from within the organizations at the time they were occurring, and those who did try to blow the whistle often did not fare very well.
The biggest issue is clearly that if you are in a system which may hugely award clueless, or bad behavior (i.e., that has perverse incentives), then those who might protest will be effectively silenced by those who are profiting from the status quo.
Combating this would require serious outside regulation to discourage perverse incentives and conflicts of interest, serious law enforcement to prosecute any resulting fraud, bribery, etc, and serious protection of whistleblowers, just for a start. All are currently lacking in finance, and in health care. But if we do not put such measures in place, the downward spirals in health care and finance will just continue.
Do not expect to see much discussion of these issues in health care or finance in the current political debate, unless those currently outside of the debate break the anechoic effect and inject them into the debate.
