Somebody on the Orient Express gets killed (referring to Agatha Christie’s mystery – Murder on the Orient Express), and the question is, who killed him? The answer is, everybody on the train killed him. And the answer about who killed healthcare is: the status quo.

Regina E. Herzlinger – Nancy R. McPherson Professor of Business Administration at Harvard Business School



Womenetics: You are known as the “Godmother of Consumer-driven Health Care.” What exactly is consumer-driven health care?

Herzlinger: In Switzerland, people buy their own health insurance. They can choose whichever policy they want. If they are poor, rather than be forced to Medicaid, like in this country, they receive from the government an amount equal to the average of what each Swiss spends on health insurance.

So, the Swiss program has a cost-controlled health care system because people are paying out of their own pockets.

They also have terrific health care, again, because people can switch if they don’t like what they’re getting. And third, they have great equality between the poor and the rich.

It is the best system in the world, and they’ve had it since 1996.

Some people may say that you can’t compare the small country of Switzerland to a country as large as the U.S., but Switzerland is based on the U.S. constitutional system. It’s a confederation of states, so it is very responsive to local needs. Also, with four languages and cities as diverse as small Alp towns and Zurich, it is a very diverse country. And, unlike what you hear about in some countries, the Swiss don’t have to wait for medical tests and surgeries.

Womenetics: Is the U.S. system of health care going in the right direction?

Herzlinger: It’s good that more people are being covered by health insurance. Right now 20 million people don’t have coverage. But the cost is worrisome. The U.S. spends 50 percent more of its GDP on health care than any developed country and still not everyone is covered. You can’t say our heath care is 50 percent better. The newest health care law didn’t address costs, just coverage, and we still won’t have universal coverage.

Womenetics: How would you describe the Medicare system in the U.S.?

Herzlinger: For every $3 spent on health care, the patient pays $1 and the taxpayer pays the other $2. It’s very unfair. The politicians say to the elderly, which is a big voting bloc, “We will give you more benefits but at no more cost.” Medicare is a very poor system. What would be more fair is if you paid in $100,000, you would get $100,000 worth of benefits. But who would pay the rest? People tend to use things that are not necessary.

The reason Medicare hasn’t changed is because too many politicians, big hospitals and academics have a stake in the status quo. I wrote my latest book, “Who Killed Healthcare?” based on Agatha Christie’s “Murder on the Orient Express,” and I answered the question that everyone killed health care. The reason the insurance companies don’t want to have the system changed is that they’d have to change their business model.

The 2012 Election: Policy Advice to the President

Topic for 10/31/12: Health Care Cost Containment