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What the health care system can learn from McDonald’s Add to ...

I’m convinced there is enough money in the current model to fund an excellent health care system.

Issues of private financing and user-pay feel a bit phony to me when the outrageous cost structures in the system are glaring at us.

Will Falk at the Mowat Institute wrote a piece for the Star recently on cataract surgeries.

“The procedure now takes a lot less time to perform than it did a decade ago. What once took an hour now takes just 15 minutes. Yet taxpayers see no benefit because the fee paid to the surgeon has remained the same — about $420. Ophthalmologists now make $28 a minute for this procedure, and top surgeons can do 40 on a good day. Nice work if you can get it.”

The ability to lower costs in health care is almost unlimited.

In India, the Aravind Eye Care System has become the largest provider of eye care in the world. They perform hundreds of thousands of cataract surgeries a year, restoring sight to millions of people.

For the poorest of the poor, their services are the difference between starvation and a job, misery and dignity, death and life.

The inspiration of their model is not the Harvard Medical School or Johns Hopkins. It’s McDonald’s.

Dr. Venkataswamy was inspired by the fast food outlet’s ability to train thousands of people all across the world to provide a standardized product that was the same every time.

Applying the McDonald’s strategy to the business of cataract surgeries, they were faced by a huge under-serviced population, scarce resources, a dispersed population, low affordability and terrible logistics.

They began by getting the community invested in the problem and engaging with them as a partner. Clinics are able to be thrown together quickly and locally.

Diagnostic service is provided quickly, in batches, but maintaining high quality through the skill that comes with repetition.

There is limited ability to customize. For instance, people can pick the frame of their glasses because those are seen as a personal statement. But the types of lenses are codified and purchased in bulk.

Those with more serious conditions are transported immediately to hospital on a bus. Surgery is done the following day.

Again, treatment is in huge batches to increase volume and quality, while lowering costs. While one patient is being operated on, the next patient is being prepped right next to them. This resulted in a quadrupling of output.

This mass production approach was able to provide eye sight to thousands, but was unable to address those with rare conditions.

The clinic adapted by bringing in “mass customization.” They were able to tailor treatment while maintaining high volumes. Tele-medicine became the primary method of working with a physician for those with rare problems.

The result kept costs down, making it affordable for patients while giving them the individualized treatment they needed.

The number of treatments was four times that in comparable clinics.

And the high volumes lead to improved quality. Aravind – a series of clinics and hospitals in rural India -- have less than half the complications seen in the United Kingdom.

Because of their efficiency, they were able to simply charge the market rate to the 45 per cent who could afford to pay, and then give away the service to the majority who had no ability to pay. The inefficiency of their competitors made this model sustainable.

The amazing thing is that Aravind wants to take this model worldwide.

Their cost advantage for treating the same number of patients is incredible.

For Aravind: 13 million pounds.

For the U.K. health system: 1.6 billion pounds.

The Aravind model offers half the complication in outcomes at less than 1 per cent of the cost of the U.K. system.

And this difference isn’t simply “one is India and the other is the U.K.”

The Aravind model is more efficient, the clinical process is superior, and there are cost efficiencies in the scale.

But there are also the high regulatory costs in the U.K., and the turf projecting and nest feathering from doctors.

The Aravind system is not the perfect fix for Canada’s health care system.

But it shows what is possible when we are willing to innovate: radical reductions on costs with an improvement in quality.

This is where the debate on health care should be, not a phony war about LHIN’s or two-tier.

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