The Wrong Legacies

 I read two articles this week that got me thinking, Robert Charette’s “Inside the Hidden World of Legacy IT Systems” (IEEE Spectrum) and Douglas Holt’s “Cultural Innovation” (Harvard Business Review).   Both deal with what I’ll call legacy thinking. 

It’s a particular problem for healthcare.

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If you work in a large organization, especially one that has been around for at least a few decades, the words “legacy system” probably strikes angst in you.  If you’ve dealt with such an organization, legacy systems probably contributed to problems you may have had with them.  Think about health insurance claims systems, hospital billing systems, financial institution account records, or practically any government system. 

Dr. Charette points out:

Though these systems run practically every aspect of our lives, we don’t give them a second thought because, for the most part, they function. It doesn’t even occur to us that IT is something that needs constant attention to be kept in working order.

Because they usually work OK, management often doesn’t want to risk the potential disruption of replacing or modernizing them, so they get older and older, with more and more layers built on them, and with the people who originally built them or understand the language they are written in (e.g. COBOL) gone. 

The problem is that not only might legacy systems start breaking down, but, as Tony Salvaggio, CEO of Computer Aid, Inc., told him, new technologies are “going to blow up 30 to 40 percent of [existing] business models.”  Companies reliant on outdated legacy systems may find themselves not able to compete.

I spent several years working in a large Blue plan trying to bring it into the digital era.  Legacy systems were the bane of our efforts.  Legacy system thinking limited how developers approached our projects, what skills they brought to them, and how the projects were managed.  I like to think we won the war, but we lost more battles than we won, settled for more compromises than we should have had to, and always had to design knowing those legacy systems would limit what we could deliver to our customers. 

And my Blue plan was considered one of the most innovative Blues.

Healthcare is limited by legacy systems not only in how it can innovate but how it can think about innovating.  Which bring me to the second article.

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Dr. Holt, a former Professor at the Harvard Business School and now a consultant on branding and innovation, distinguishes between incremental innovation – “build a better mousetrap” – and “cultural innovation” --  reinventing the market.  As he says:

Cultural innovation operates according to qualitative ambitions: Change the understanding of what is considered valuable.

He walks through some examples, using them to explain five steps to cultural innovation:

1.     Deconstruct the category’s culture

2.    Identify the Achilles heel

3.     Mine the cultural vanguard

4.     Create an ideology that challenges the Achilles heel.

5.     Showcase symbols that dramatize the ideology

As he reminds us, “Markets are belief systems embraced by those who participate in a category: companies, consumers, and the media.”  I’d never thought of healthcare as a belief system, but it’s a good a mental model as I’ve heard. 

If I get sick, I go to the doctor.  I may ask a few questions, have some preferences, but the doctor is the expert.  If I’m sick enough, I go to the hospital, where they do more expensive things to me.  Oh, and, to the extent possible, someone else should pay for my care.  I wait a lot for things to happen.

That’s a fragile belief system.

Healthcare doesn’t have “an” Achilles heel; it is almost nothing but Achilles heels.  There is no shortage of “cultural vanguards” nibbling away at the margins of healthcare, such as DIY, biohacking, or even SDoH.  But none of them has -- yet -- made the case for a new ideology that truly challenges our existing status quo.  None of them are – yet – forcing us to examine healthcare from the outside.

Dr. Holt goes on to say:

Even if they don’t think in such terms, companies are masters of their category’s existing culture. They have to be to excel at their current business. Their metrics and planning focus on it. As a result, managers come to perceive the category as an immutable reality, even though it’s actually built on a fragile consensus. If you’re trapped in the present tense, it is extremely difficult to examine the category from the outside and identify its emerging flaws. 

Healthcare is built around doctors, hospitals, insurance companies – but that’s our existing belief system.  Those doctors, hospitals and insurance companies are built on legacy systems – but, again, they don’t have to be.  Healthcare is trapped in the “present tense.”   

Dr. Holt warns:

Incumbents are so intent on winning the category as it’s currently defined that they fail to identify cracks in its foundation. Cultural innovators outmaneuver them because they look for opportunities to blow up the dominant ideology in favor of a new regime.

As I’d previously suggested, First, Let’s Blow Up All the Hospitals.

I’ll give an example from yet another article, Alex Voight’s Tesla Introduced A Business Model the World Has Not Seen Before (Clean Technica).  Tesla, which is now the largest car manufacturer by market capitalization despite far fewer actual sales, is playing a different game.  Mr. Voight argues: “Tesla is the only automaker worldwide that continuously improves the vehicles it has sold, and for free.”  If you are an automaker that doesn’t do the same, “you won’t be in business for very long, or will shrink until you are unrecognizable.”

We don’t have a “Tesla” for healthcare…but someday we will.  The status quo is not an “immutable reality.”

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If you are in healthcare and rely on legacy systems, you’re in trouble.  If you are in healthcare and are not acutely aware of what your Achilles heel is, someone else is going to exploit it.  Even if you are a new healthcare entrant with more modern technologies but still based on the current ideology, your impact is going to be limited.

We usually think of “legacy” as something we want to pass to future generations, but there are too many of healthcare’s legacies that we shouldn’t.  We spend too much time talking about innovation culture when we should be thinking more about cultural innovation.

Steve Downs, formerly at RWJF and now at Building H, talks about “building a culture of health” -- designing health into our daily lives.  That’s a good start.

Thriving in COVID-19 Times

 These are, no question, hard times, due to the COVID-19 pandemic.  In the U.S., we’re closing in on 180,000 deaths in the U.S.  Some 40 million workers lost their jobs, and over 30 million are still receiving unemployment benefits.  Hundreds of thousands, if not millions, of small businesses are believed to have closed, and many big companies are declaring bankruptcy.  Malls, retailers, and restaurants have been among the hardest hit. 

Yes, these are hard times.  But not for everyone. 

Last week Target announced what CNBC called a “monster quarter.”  Sales for online and stores open at least a year jumped 24% for the quarter ending August 1 – peak COVID-19 days – and profits were up an astonishing 80%.  Its CEO specifically referenced the pandemic, as shoppers sought safe and convenient shopping options.

It is not just Target doing well.  No one should be surprised that Amazon is doing well, as more turn to online shopping and Amazon’s quick delivery, but The Wall Street Journal reports that Bog Box stores generally are doing well, including not just Target but also Walmart, Home Depot, Lowe’s, Costco, and Best Buy.  The efforts they were taking to compete with Amazon, such as increased online sales and curbside pickup, served to help them survive the pandemic’s effects. 

Similarly, if you’re a streaming service like Netflix or Disney+, the pandemic has been great for business.  Video conferencing services like Zoom are booming.  Car dealers are struggling, but not online car sales. 

And, of course, if you’re a cloud computing service supporting all these shifts to online, the world has become even more dependent on you.  “Many customers are scaling beyond their wildest projections,” Carrie Thorp of Google Cloud told WSJ. 

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In healthcare, everyone seems to agree that the big winner has been telehealth.  In the early days of the most severe lockdowns, everyone from CMS to commercial health insurers to hospital systems reacted with unprecedented speed to allow and encourage the use of telehealth – anything to keep people away from doctors’ offices or hospitals, where they might catch or transmit COVID-19. 

It worked: telehealth use “skyrocketed.”  Industry leaders TelaDoc and Livongo merged, while rival Amwell got a $100 million investment from Google.  No one is quite sure how much of the flexibilities introduced during the pandemic will persist once it recedes, but no one wants to miss out on what McKinsey predicts could be a $250b opportunity.  “The window to act is now,” the report declares.

Of course, the pharmaceutical companies are doing fine in the pandemic.  They’re the cockroaches of healthcare; they’re always going to survive.  Some are even getting the federal government to directly pay for their vaccine research or therapeutics. 

Health insurers are also proving to be big winners despite – or because of -- the pandemic.  Due to all those delayed/avoided treatments, they’re racking up huge profits so far in 2020.  Some of those will have to be returned due to ACA medical loss ratio restrictions, some of that may due to their having diversified (e.g., CVS/Aetna, Cigna/Express Scripts, and United Healthcare’s Optum), and others may prove illusionary if long-term impacts of having coronavirus prove widespread, but right now they are doing well.    

The big loser is employer sponsored health insurance – or rather, the people who lost it.  Kaiser Family Foundation estimates that 27 million people lost their health coverage due to losing their jobs in the pandemic.   Some may qualify for Medicaid, others will buy Marketplace plans, with or without subsidies, but millions will be uninsured.  Our reliance on employment for health insurance has never seemed so short-sighted. 

Another big loser may be primary care practices, especially those not yet owned by health systems.  Financial losses are predicted to be staggering, as patients stayed away in droves.  As late as July, nearly 90% of primary care practices said they were still struggling due to COVID-19, according to a survey done for the Primary Care Collaborative.  Clinicians reported that in-person visits were down, salaries were being skipped, and many did not feel safe at the office.

Ann Greiner, president of PCC, said the report “is a clarion call to move to a new payment system that doesn’t rely on face-to-face visits and that is prospective so practices can better manage patient care.”  Farzad Mostaskari, MD, CEO of Aledade, agreed, saying that the most important thing we should do to help primary care is: “Change how we pay for care.”

Hospitals also took a big hit, with the American Hospital Association predicting that losses would top $300b in 2020 due to the pandemic’s impacts.  Some of these losses will be offset by the various federal bills (CARES and PPE), others by the rebound in the stock market, but some hospitals will continue to struggle – especially the already struggling rural hospitals.   It doesn’t help that payments aren’t necessarily related to the number of COVID-19 cases hospitals treat.

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During the pandemic, it has repeatedly struck me as a particular indictment of our healthcare system is that a health crisis causes so much disruption and so many financial losses.  If a sick care system – which, let’s face it, is what we have -- doesn’t do well when lots of people are sick, what are we doing? 

In April of this year, Microsoft CEO Satya Nadella talked about the growth of its virtual platform Teams during the pandemic and declared, “In this era of remote everything, we have seen two years’ worth of digital transformation in two months.”  Healthcare has also made some significant strides, but if all we take away from the pandemic is that maybe we should keep doing more telehealth, we’ll have missed the opportunity for real change. 

Just as Amazon and the Big Box stores are proving that the pandemic changes where people shop, how they shop, what they shop for, the pandemic has important lessons for healthcare.  We shouldn’t rely on employment for health insurance.  We shouldn’t rely so heavily on elective procedures for health care revenues.  We need to be more flexible about where and how people get their care. 

This pandemic will eventually pass, in some form and with great damage.  The healthcare system will survive, at least most of it.  The challenge for us is to start making the changes needed for it to thrive even in the next crisis. 

An Epic Fight For the Metaverse

 You might have missed it amongst all the headlines about the U.S.P.S., the 2020 elections, and, of course, that little thing we call the pandemic, but Fortnite got kicked off Apple's App Store (and subsequently Google Play).   

I'm not a gamer, but I am fascinated by gaming, because, as Steven Johnson put it, "The Future is where people are having the most fun."  Tim Sweeney, the founder and CEO of Epic Games, Inc., which makes Fortnite, seems to be having a lot of fun.  And he thinks the future is the Metaverse.  

Credit: Epic Games

Healthcare, take note.

The tech giants were reacting to Epic allowing "permanent discounts" on developer fees for in-game purchases made directly, rather than going through Apple or Google.  Developers thus avoid the 30% commission charged in those Stores.  Mr. Sweeney has been railing about the commission level for some time, leading to the recent decision.

Apple tried to justify its action:

Today, Epic Games took the unfortunate step of violating the App Store guidelines that are applied equally to every developer and designed to keep the store safe for our users. As a result their Fortnite app has been removed from the store. Epic enabled a feature in its app which was not reviewed or approved by Apple, and they did so with the express intent of violating the App Store guidelines regarding in-app payments that apply to every developer who sells digital goods or services.

Epic had, not surprisingly, already gamed this out: it immediately sued both Apple and Google in federal court, charging:

Apple’s removal of Fortnite is yet another example of Apple flexing its enormous power in order to impose unreasonable restraints and unlawfully maintain its 100% monopoly over the” market for in-app payments on iPhones.

Even better, they rolled out a slick ad, its own version of Apple's iconic 1984 ad attacking IBM:

Mr. Sweeney charged: "We must all choose to fight a painful battle now, or accept an all-powerful middleman with unbounded ambition to extract tribute and limit innovation in the decades to come."  

All this is happening, of course, when regulators in both the U.S. and Europe are eying tech giants warily for monopolistic actions, so kicking off a major app because it wouldn't say a tribute -- umm, "commission" -- means they feel there is a lot at risk here.  In just three years, Fortnite has accumulated some 350 million users worldwide.  

Some view this as just about money, a tech giant battling two bigger giants for more favorite deals.  Mr. Sweeney see it as a fight about platforms and exactly what a platform can dictate to its users.  He tweeted: "We're fighting for open platforms and policy changes equally benefiting all developers. And it'll be a hell of a fight!"   

In an interview with Joseph Kim, Mr. Sweeney said:

...they say something is only a platform when the majority of the profit is made by creators rather than the company that built the thing right? Windows is a platform. Gee, is iOS a platform? Not sure.

It should be noted that Epic offers its own platform, Epic Games Store.  More importantly, Epic is more than Fortnite; in addition to its Store, it has a game development software (Unreal Engine), the game/social network Houseparty, and this spring hosted a virtual concert watched by more than 12 million people.  Mr. Sweeney has made it clear: Epic is gearing up for the Metaverse, which some believe will be "the next version of the Internet."  

The concept of the Metaverse has been around for years -- science fiction writer Neil Stephenson is believed to have first introduced it in his 1992 novel Snow Crash -- but Mr. Sweeney elaborated on it in his interview with Mr. Kim:

But the Metaverse is going to be some sort of real time 3D social medium where instead of sending messages and pictures to each other asynchronously, you’re together with them and in a virtual world and interacting and having fun experiences which might span anything from purely games to purely social experiences.

The other critical element of the Metaverse is it’s not just built by one mega corporation, right? It’s gonna be the work, the creative work of millions of people who can each add their own elements to it through content creation and programing and design. And the other way of adding value.

Apple, he charges, "has outlawed the Metaverse," since it does not permit "cross-platform ecosystems and games," something he has pushed for years.   The Metaverse, he believes, "It’s going to be from more and more companies and brands connecting their products and services until you have a much, much more open thing that everybody participates in...And so it’s in everybody’s interest to really interconnect and standardize over time."  

Mr. Kim put it to him directly:

JK: And you just want to see competition at every point in the value chain, where every component of the value chain that there’s a healthy competition there. Is essentially… Is that what you’re advocating for?

Tim Sweeney: Yeah, exactly. Healthy competition at every point and facilitated by technical interoperability standards. Right

I think of all this in contrast to healthcare.  Oh, sure, healthcare has plenty of middlemen, each collecting its "tribute" and too many of them limiting innovation.  But while Mr. Sweeney and others are looking for the next version of the Internet, healthcare hasn't even gotten to the platform stage, much less platforms with open standards, interoperability, "healthy competition at every point," and real time collaboration, eventually in 3D space.  

Healthcare still works in your grandfather's economy and uses your parents' Internet.  

Look, I don't really care if I can't download Fortnite from either App Store.  I don't have strong feelings about whether 30% is a "fair" commission for Apple and Google.  I do wonder what healthcare's first real platform will be, and worry that, once it comes, it will stifle competition and innovation rather than spur it.  I'm all in on cross-platform products and services, with open standards and interoperability, especially for healthcare.

Most of all, I wonder who healthcare's Tim Sweeney is -- fighting to open up today's "system" and thinking hard about what comes next, whether that be the Metaverse or something else we haven't imagined yet.  

As Mr. Sweeney said: 

I think we should all be advocates for the world that we want. If we aren’t forceful and fighting for the world that we want...then we’re going to get a very different world. And by the time it’s set in stone, it’s going to be too late to change it.

  

Take Your Mom To Work

If you are a working mom, or married to one, or simply know one, you know that it is tough to balance a job and raising a child even under ideal circumstances.  Even if she has a supportive spouse, chances are that it is the mom who ends up providing the most child care, and whose career it impacts the most.

Credit: iStock

But, of course, these are not ideal circumstances.  Prior to the pandemic, women had made great strides in the workforce; more women had payroll jobs than men, for example (although they continued to be paid less for them).  Those gains quickly came crashing down once the pandemic hit.  It is believed to be the first time that job and incomes losses have hit women harder than men.  Some are calling our pandemic-driven economic downturn a "shecession" as a result.   

That's bad enough, but the even bigger danger is that the pandemic could set back women's careers for a generation. 

A recent study by Collins, et. alia confirmed what most might have guessed: in the wake of the pandemic, women are more likely than men to have reduced their work hours to take on additional child care responsibilities due to school/daycare closing -- four or five times as much.  

The study found that:

Scaling back work is part of a downward spiral that often leads to labor force exits—especially in cases where employers are inflexible with schedules or penalize employees unable to meet work expectations in the face of growing care demands.  

We are also concerned that many employers will be looking for ways to save money and it may be at the expense of mothers who have already weakened their labor market attachment.

Even more worrying, lead author Caitlyn Collins, a professor at Washington University, says: "Our findings indicate mothers are bearing the brunt of the pandemic and may face long-term employment penalties as a consequence."  

Five-Thirty-Eight's Neil Paine and Amelia Thomson-DeVeaux analyzed how the pandemic could "force an entire generation out of the workforce."  It starts with availability of child care, as shown in this chart:

Combine that with uncertainty about schools reopening and it makes child care decisions extremely tough.  Women with young children were already less likely to be in the workforce than other women, they point out, with caregiving cited as a major reason, and the pandemic is exacerbating the effect.  "Leaving the workforce," they note, "even if it’s just for a year or two, has ripple effects that can follow a woman for the rest of her life, even depressing her earnings in retirement."  

"We’re in danger of erasing the limited gains we’ve made for women over the past few decades, and especially women of color,” Melissa Boteach of the National Women's Law Center told them.  

Trying to get the economy open again without figuring out how we're going to support working moms is a "recipe for a generational wipeout of mothers’ careers," Joan Williams, University of California Hastings College of Law and founder of the Center for WorkLife Law, told The Wall Street Journal.  

The WSJ article cites a Boston Consulting Group survey from this spring that found that both men and women were spending more time on domestic chores than pre-pandemic, but that the gap between women and men had increased from 10 hours per week to 15 hours.  "That’s almost two days more of a secondary job,” Matt Krentz, a managing director at BCG told WSJ. “When the trade off comes and it’s not sustainable, the solution often falls to the woman taking the step back.”

The article notes: "People who drop out of the labor force for an extended period not only miss out on pay, they also often fall behind on raises that come from longer tenure and employer contributions to retirement accounts."  When you see "people," read "women."

Betsy Stevenson, a University of Michigan professor of economics and public policy, told The New York Times, "We could have an entire generation of women who are hurt.  They may spend a significant amount of time out of the work force, or their careers could just peter out in terms of promotions."  

Professor Stevenson summed up what may be the core issue: "This pandemic has exposed some weaknesses in American society that were always there, and one of them is the incomplete transition of women into truly equal roles in the labor market.”

Deb Perelman, writing in The New York Times, puts the dilemma succinctly:  "In the Covid-19 economy, you’re allowed only a kid or a job."  She goes on to add:

The long-term losses for professional adults will be incalculable, too, and will disproportionately affect mothers. Working mothers all over the country feel that they’re being pushed out of the labor force or into part-time jobs as their responsibilities at home have increased tenfold.

It's outrageous, Ms. Perelman believes, and she wonders: 

"Why isn’t anyone talking about this? Why are we not hearing a primal scream so deafening that no plodding policy can be implemented without addressing the people buried by it?"

Why, indeed.  

In an op-ed in The New York Times, Professor Williams asserted: 

We’re in this mess because, even before coronavirus, the legal protections for working mothers consisted of a convoluted matrix of federal, state and local laws...The lack of straightforward legal protections is just one of many ways that public policy fails mothers; the haphazard nature of Families First is merely one symptom of a broader problem.

As The New York Times noted: "In countries that offer more comprehensive support for families — like Germany, France, Canada and Sweden — a significantly larger proportion of women are in the labor force."   

This is, of course, an issue of particular importance to healthcare. According to the Census Bureau, women make up 76% of the healthcare labor force. Child care considerations may drive much of the gender imbalances by specialty for women physicians and other healthcare workers. When COVID-19 hit, essential healthcare workers struggled to find child care that allowed them to keep working. These factors shape our healthcare workforce and our healthcare system.

It's hard to picture now, but the pandemic will eventually pass.  Perhaps we'll get a vaccine, perhaps it will have to run its course through the population.  Most, but not all, jobs will come back; the economy will improve.  We'll settle into a new normal.  All that will cost trillions of dollars, hardships for millions, and way, way too many lives.  

Most of the damage, though, will be measured in months or years -- not generations.  Unless we proactively take action, though, these impacts on women's careers can be generational.  The pandemic may galvanize action on, for example, unemployment programs/systems and our healthcare system.  We need that same will to action on supporting working moms, such as through better family leave and child care policies.

Do it for your mom. 

The Not-So-Odd Couple: Microsoft Pursues TikTok

TikTok keeps generating interesting news.  In the past week, it is about Microsoft's pursuit of it -- fueled by the U.S. government's not-too-subtle nudging.  Each time I write about TikTok I thought it'd be the last, but how could I resist that?

I first wrote about the potential implications of it being China's first AI-based Internet success outside of China.  My second piece discussed the security concerns that raised with many observers.  My latest article discussed how TikTok users were using it to power social protest.

Those security concerns never went away, and they (or perhaps anger at TikTok possibly helping undercut President Trump's Tulsa rally) spurred the President to threaten a ban (as India had just done).  It is not at all clear that the U.S. could actually implement such a ban, but users went nuts anyway.  "Everyone is running around like a chicken with their head cut off," one user told The Wall Street Journal.  

Then things got really interesting.  ByteDance, TikTok's owner, said it would consider selling TikTok's U.S. operations.  Fox News, which first reported the talks a month ago, when President Trump had first brought up the potential ban.  Numerous outlets confirmed late last week that talks were now at an "advanced stage."  The deal is expected to also include Australia, Canada, and New Zealand.

Credit: GeekWire

The President almost scuttled the deal before it got any further, but relented after a weekend call from Microsoft CEO Satya Nadella.   Microsoft has committed that it would bring TikTok's code to the U.S. -- believed to be some 15 million lines of A.I. code -- within a year, and protect the consumer data.  It set September 15 as the deadline for a deal.  

Experts suggest the deal could be for as much as $30b.

Many wondered at Microsoft being the lead suitor.  Mr. Nadella is doing his best to change Microsoft's sometimes stodgy image, but it still has been viewed as more corporate-oriented.  Former Microsoft executive S. Somasegar told The Wall Street Journal: "If you look at the major acquisitions over the last five years or so, the common theme is to acquire a vibrant community of customers that is both critical and net new add to the Microsoft community."  TikTok users certainly count as "vibrant."

Microsoft is already extremely strong in both cloud computing and artificial intelligence, both of are key to the deal.  Oren Etzioni, chief executive of the Allen Institute for Artificial Intelligence, told The Washington Post: "If AI is the new electricity, the fuel that powers these plants is data."   All that content are data.

Keep in mind that content going viral on TikTok isn't a function of who you know or how many followers you have, but if/how TikTok's A.I. promotes it.  ByteDance is an A.I. company and that drives TikTok's success.  For anyone interested in A.I. -- and what tech company isn't? -- that makes TikTok extremely attractive, not to mention for its legions of rabid users.

Microsoft has had success among younger people with its Xbox platform, and hopes for more from its Minecraft acquisition and Hololens platform, but TikTok could be a breakthrough.  As one user explained to The Washington Post: "People might think it’s just an app where people do 15-second dances, but it’s so much more.  The app speaks to my generation — yes, we share music and dances, but we also share ideas and views on the world."  

Dan Ives, an analyst at Wedbush Securities, told The New York Times: "Microsoft is viewed as your grandpa’s company, and it is trying to change that.  Microsoft goes from an uncool company to many under 25 to potentially as hip as TikTok if they get this done."

Take that, Factbook.  

Instagram Reels

Facebook, of course, is not sitting idly.  Today it launched Instagram Reels, "a new way to create and discover short, entertaining videos on Instagram."  It is now available in 50 countries, including the U.S., and obviously has been under development for some time.  TechCrunch's analysis is that "Instagram’s goal is not just to capture the now potentially up-for-grabs TikTok audience in the U.S. — it’s to steal them away even if TikTok remains."  

Although Instagram may be TikTok's most formidable competition, others are also trying to take advantage of the current uncertainty to steal some of its audience, such as byte, Clash, or Triller.  

There are many potential bumps in the road.  For example, what does it even mean to split the four impacted countries apart from the rest of the world?  As The Verge commented:

No one has ever acquired a regional section of a social network before, and peeling away the Microsoft-owned portion of TikTok will be harder than it looks. As TikTok officials keep reminding us, the app is based in California, but the majority of its users are still in Asia or Europe.  

Negotiating the code and the content in such a split scenario complicates things greatly.  Systems engineer Karl Higby told The New York Times: "In order to personalize the app for existing users, they’re going to need historical data for U.S. folks unless they want to wipe the slate clean, which would be a terrible user experience."  Historical data from non-U.S.users helps drive current algorithms, so the user experience may be altered in any event.

 

Plus, of course, the regulatory scrutiny will continue, and Microsoft would face the same kinds of concern over its content and privacy practices that Facebook and other social media platforms have.   Gigi Sohn, Georgetown Law Institute fellow and former FCC advisor, warned in The New York Times: "Microsoft is buying itself real aggravation."  

Still, though, the opportunity to obtain an asset like TikTok may be a once-in-a-generation opportunity for Microsoft.  Mr. Ives thinks the deal could add $200b to Microsoft's market cap within three years, adding:  

An aggressive acquisition (or strategic investment) of TikTok would be Microsoft throwing its hat in the ring and trying to compete with other tech giants such as Facebook in a new avenue of growth for the next decade for its consumer business.

Or, as Hank Green, CEO of Complexly, told The New York Times, "If I had the opportunity to buy TikTok, I’d buy TikTok.  There’s so much value on that platform right now that is completely untapped.”

Frankly, I don't know if the deal will happen or what TikTok might end up being worth to Microsoft, but I sure am interested to see what happens next.  

Health Insurance Needs to Grow Up

I've been covered by private insurance my entire life.  Even more telling, I worked in the health insurance industry for -- gasp! -- some thirty years.  It's not just paid for my healthcare, it's financed my life.

Today, though, for the first time in my life, I'm covered by public insurance -- and I couldn't be more relieved.

Credit: WorkLife Partnership

Now, I'm not going to go all Wendell Potter.  I know many people have their health insurance horror stories, but, sadly, people have them about pretty much every part of the healthcare industry.  I believe most people working in health insurance, like most people working in healthcare generally,  sympathize with the people they serve and are just trying to do a good job.

The problem is that the health insurance model has outgrown the times.  I'll try to explain some ways how.

Premiums
Once upon a time, most people had employer coverage, and those employers paid all or most of its cost.  Those days are gone.  Employer coverage is still the predominant form of private health insurance, and employers still pay the majority of its cost, but percentage of people with employer coverage continues to drop and the amount they pay for it continues to increase.

Kaiser Family Health's 2019 Employer Health Benefits survey found that annual premiums for family coverage topped $20,000, with employees paying $6,000.  The average income for workers is $48,000.  Those premiums are awfully daunting -- yet people in the individual market would long for those numbers.

The fact is, premiums have become unaffordable for most Americans.  If you have a marketplace plan you might quality for a premium subsidy, and if you have employer coverage your employer might vary contributions by salary, but there's few of us who don't take a gulp at every premium payment, especially given the prospect that they're only going to keep going up.

Our scattershot, segmented, and inequitable mechanism for financing health insurance is no longer sustainable.  We need a more universal financing mechanism -- such as taxes -- that is based on wealth/income/ability to pay.  

Cost-Sharing
Once upon a time, point-of-care cost-sharing was minimal.  Those days are also gone.   Deductibles, copayments, and coinsurance have soared, even though ACA sought to at least place limits on the resulting out-of-pocket expenses.  Cost-sharing was originally intended to help deter unnecessary care, but have become more of a way to shift costs to consumers.

Credit: eHealth

As a result, nearly one-in-four report skipping medical care due to cost, with some estimates even higher (Gallop, 33%; HealthPocket 51%).  Again, ACA tried to mitigate this by mandating no cost-sharing for preventive care, but when, for example, 25% of diabetes can't afford their insulin, it's evident that cost-sharing has become punitive.

Some types and levels of cost-sharing may be appropriate, but it needs to be highly targeted and affordable.  Our current shotgun approach to it is harming more than it helps.  

Networks

There are too many stories of people getting astronomical out-of-network bills, often for healthcare professionals they didn't choose and may not have even known about.  Plus, your favorite in-network doctor or hospital may suddenly drop out -- or be dropped.  The same can happen with your prescription drugs.

It is true that networks do offer substantial "savings" from non-discounted charges, but that reflects more how outlandish the latter usually are.  Networks purport to be chosen at least in part on "quality," but measurement and demonstration of that remains elusive.  They represent a failure of the market, not a sign of its value.

We should all want patients to use the best possible healthcare professionals for their needs.  We should expect that the cost of those professionals should be directly related to the outcomes they deliver to their patients, and known in advance.  But, instead, we have networks that drive volume to those professionals and organizations who happen to contracted with our health insurer.  That's not a recipe for our best health.

Can we focus on getting patients to the right professional at the right time and place, for the right price?

Scope of services
When I said I now had public insurance, I overstated the case.  I have Medicare Parts A and B, but my Part D coverage is delivered by a private insurer, although largely funded by public dollars.  Like most on Medicare, I also have a Medicare Supplement, delivered by a private insurer.  And I still have private dental and vision insurance, not to mention auto, homeowners, and long-term care insurances that each also cover some health expenses.

Thought experiment: you're driving while talking to your boss on the phone, get distracted and smash into a tree on someone's lot.  Fortunately, your most serious injury are a broken jaw and some broken teeth.  The question is: who pays?  Your health insurance?  Your dental insurance?  Workers compensation?  Your auto policy?  The homeowners policy?  Why is my mouth -- and, for that matter, my eyes and eyes -- almost always treated differently when it comes to insurance?

The answer to the thought experiment -- and I honestly do not know what it is -- will dictate which healthcare professional you see, how much they can charge you, and how much of that you have to pay.  That is, in a word, crazy.

And it is not just insurance, it also goes to how we educate and license healthcare professionals.  It's what I called the Animal Farm of healthcare: all services are equal, but some are more equal than others.

We need to step back and develop a comprehensive view of what is necessary for our health, how we assure we get it, and how we finance it.  

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I'm glad I no longer have employer coverage, where the employer chooses my network, level of care, cost, and even covered services -- and which I lose if I lose or change my job.  I'm glad I no longer have marketplace coverage, where the insurer can just drop out of the market.  Still, though, I regard Medicare as pretty clunky -- a 1960's (BCBS) design spiffed up with more modern touches like prescription drugs and preventive care, financed and delivered in a variety of ways.  It is not what one would design if starting from scratch.

So let's do that: for private insurance and for public insurance: let's rethink from basic principles and agreed-upon goals.  Let's design a health financing and delivery system for the 21st century.

We can certainly do better, if only because we could hardly do worse.