Interview Transcript: Adrian Gropper, November 13th, 1998. Amicas Worldwide Headquarters
Video Tape 1 of 2
C: So what's up?
A: Well I guess the big news is that the Adac deal got signed.
C: Before it was, not signed, it was informal?
A: Well it went through 2 or three stages. It was actually a very interesting process, it was the first licensing deal of that kind that I have done. It had like four distinct business phases. Phase one was when the actual marketing-type people and product people decided that they like the product, they liked us, they liked the product, whatever and "Gee wouldn't it be great if Adac bought Amicas, or got an exclusive or something." So then they go and negotiate this whole deal that could be characterized as limited exclusivity by what they could afford with me and Barry , mostly with Barry. And they went to their corporate parents and said "Gee, here we've negotiated this nice deal, limited exclusivity, couple of hundred thousand dollars out of your pocket, and its July. The corporate people said, oh okay, Kid. And they came in all full of bluff and bluster, which was phase two of this process.
C: Phase two was Bluff and Bluster?
{3:00}
A: And basically sort of tried to establish what the value of Amicas was. [Phone ringing]. Excuse me one sec.
So Phase One was, lets try to establish the value , in our mind of the business. That didn't go very far. Phase two, and Phase one sort of had this idea accompanying it where they get everything and we get nothing. Now, by everything I mean something very specific, I don't mean it figuratively. They would basically cap the upside for the employees of the company.
C: Cap the what?
A: the upside. So imagine that a situation where, [coffee interruption]
{5:09}
A: So capping the... Wanting everything is basically this: Let's figure out a value for the business, 2million, 5 million, 10 million, it doesn;t matter. Sell me an option to buy 100% of the business for whatever that price is, if we choose to buy it. That's basically a deal that sets a value for the business today, in other words, doesn;t account for the potential growth of the company, has no liability on their side, cause its just an option, they don't have to buy the whole business. And caps the upside for the people in the business, cause instead of buying 50% of the business or 51%, so they just have control but share the uh thing, they want to have 100% they want both control and ...
C: So this is definitely cake and eat it too?
A: Is that too hot for you?
C: No that's okay, I just spilled it on me.
A: There is a bit on the rug if you can find it.
{6:33}
A: Okay, so that set an interesting tone for the next phases of the negotiation. To sort of come in with that level of bluff and bluster. The second phase was, "Okay, so you don't want to be bought out be Adac on this generous basis, now were gonna show you how tough we can be. In the last phase... So in the tough phase, basically they decided that they didn't want exclusivity after all, they weren't gonna give us anything, they just wanted to establish the pricing and the terms of the thing. And they were really, really aggravating. Aggravating in the sense that someone who's negotiating from their position of total weakness, because we no longer wanted, we never really wanted to sell them any kind of real exclusivity anyway and it taken long, you know, I breathed this huge sigh of relief when they said "oh right, well we'll do a non exclusive." So basically this was an argument over nothing from that point on. They weren't gonna take any significant risk and we weren't gonna get any significant benefit. In other words, there wasn't gonna be any cash up front, any minimums, anything like that. And I was happy with that. So there was this really aggravating phase for them. It's kind of like the aggravation of them being in an untenable position, they had no reason to walk away, their people were already selling Amicas, they had to make this deal, its not like they could go somewhere else. And at the corporate level they'd blown it, these people had negotiated a limited exclusivity agreement and they managed through their bluff and bluster to get it taken off the table, never to return again. And the third phase.... So they decided that maybe we were stupid and they were smart. So that went on for an incredibly aggravating time, a month and a half, at which point we hit phase four, as RSNA approaches and this deal is nowhere being signed, its kind of like this funny interlude because hey see us as a virtual company, they basically see us as being hicks, and maybe we are with respect to corporate America, I'm not saying we aren't. But our particular brand of hicks happened to have as a lawyer who had two interesting characteristics that they were not prepared for. One of them is that he is the CEO of a medical device business, incidental to his being a lawyer, second is that he is a personal friend of mine for 20 or 30 years and he wasn't charging me for this. Nor does he charge me for any of the other stuff. So for them to come in with all of their corporate might to come in and negotiate a licence with someone who knows about licenses and its costing him nothing, costing me nothing, kind of nullifies this idea that probably was the basis of their bluff and bluster to begin with. Cause this would have been about $20000 dollars worth of legal work if I had Bingham Dana do it. Anyways, so the third phase they capitulated because the clock is running out, and they were all kinds of really strange phone calls before they signed anything and so they sign on Tuesday. And immediately 15 minutes after they sign it, the meeting is still going on, I invite them to lunch, they proceed to tell me how unhappy they are. In the most friendly way, these guys are now my best of friends, because they have to work with us they want to work with us, but, "God are we unhappy, you're gonna need a partner." I said "I know we're gonna need a partner." [laughter]. So you go through this whole thing, so its november, right, this thing was a deal in july, and its just like this little taste of dealing with...
{11:26}
The real root of it is not bad, these people are, I mean they have two things about them that are really endearing: one of them is that their sales force and product management people a) love us for good reason and did the job and continue to do their job. The second thing is that as a corporate entity they are incredibly aggressive, which is not something that I would fault. Its like some of the other people we are negotiating with are basically asleep at the switch. So..
C: Is that part of the reason they are unhappy, because that aggressiveness translates into their relationship with you, that they can't...
A: yeah, no that's a good point, its like spouse beating... [laughter]
C: But now you're under agreement where they sell for you and you set prices and
A: its basically a Value Added Reseller Agreement that's already had a huge benefit which I kind of, its not surprising, its kind of like the middle fish eats the small fish and now maybe the big fish can come in and eat the middle fish. Its made Philips stand up and take notice. We basically made a bid for HBOC which is still in play but that's an interesting from your point of view, I can go into it, but suffice it to say that we went through this RFP process, or this proposal process with this company that does the imaging component for HBOC that they just bought, Imnet, you've probably heard of them. And I walked out of this process with total amazement, cause, here was a group that was supposedly trying to license our technology and who we would want to work with, definitely the largest group doing this in the world, being bought by the largest HIS vendor in the world. And I walked out of there not being able to tell why anyone would wanna buy their product, or who of the customers in the thirty or forty people that i'm trying to sell Amicas to, would I send to them to buy Amicas from them as opposed to from us or from Adac or somebody else.
C: Was that a technical issue, or a personal or sales issue?
{14:31}
A: Its a technical issue! You know, for somebody like me to have relatively extended dealings with the leader of this market segment that they're in, which is not PACS, and for me to walk away saying I don't understand what these people are doing, at a technical level, but also includes marketing channels and collaborating with other companies and the industry. I mean I have a vague idea, but I mean its really amazing. It appears to me like all of these CIO magazines that are throwaways that I get that just seem to me to have ads that are full of buzzwords, with obviously the content behind the buzzwords is a service business that's being offered, not a technology business. But that's as far as I can get. In other words, I can't get from an understanding that there's this world of people selling very expensive services based on what I consider to be very lame or trivial technology, and I'm not able to understand that. But then there's also the modality vendors like philips and so uh, this signing, will have a good impact on both those kinds of deals. [three stooges. intermission.]
{17:20}
C: The question I was going to ask is about larger scale strategy, because you were in discussions with Eclipsys a while back, and Eclipsys seems to be in the same business as HBOC in terms of integrating technologies together, now philips would be a departure from that kind of strategy?
A: Yes, no its just a different channel. They would not necessarily be competitors at all. In other words there are three natural players in this world, of the hospital information systems. There's the people who are collecting the bits, typically modality vendors, there are the people who put terminals on desktops, which you could think of as application software vendors, and there's everybody else who's basically infrastructure. Now film vendors might like to consider themselves infrastructure, but they have no reason to exist. Infrastructure would be either Microsoft selling Windows NT or Dell selling computers or you know, AT&T selling internet services. Infrastructure, in other words, infrastructure as I'm defining it has this characteristic of not being image or radiology specific, or healthcare specific for that matter. And therefore lending itself to the impact of standards beyond healthcare. Um, the other two groups obviously have to be healthcare specific.
{19:30}
So, I consider all three of these... so from a strategic point of view, I consider all three of these as being target resellers, target partners. That may be very academic, they may end up seeing each other as deadly competitors.
C: or it may be different from healthcare institution to healthcare institution...
A: Exactly, so I don't really know enough, I don't analyze at that level, but I don't know which of those three channels I'll be successful in.
C: So there's no reason to restrict your self to one?
A: Well, yeah, its just ignorance. If I had more experience or more understanding of whats going on, then I could say, "Well the his vendors are never gonna do this" because dot dot. Or with the Eclipsys deal, Adrian, you know it didn't work with Eclipsys, and you don't understand what Imnet/HBOC is doing, there's a message there for you: Worry about either the Microsofts of the world, or the modality vendors...
C: But you seem fairly confident that you not understanding what they're doing is because they don't know what they're doing, not because you are missing the point?
A: Well, no, it is true that they don't know what they are doing if you use the technical definition of knowing what they are doing, but remember I said that there's just this area of non overlap. I see them as basically being service businesses. Let me give you an example: Adac takes 9 months to install a hospital. Adac, our partner, after they've signed a contract. Adac is incapable of putting an Adac server into downstairs so we could test our stuff. Its beyond their thing, they would;d rather put in a thousand dollar a month T-1 line, then to ship me an installation of their software. And mind you, Adac is people that I consider technically at the head of the RIS pack, and my friends and the people I deal with and I like them and they like me. So clearly they understand what we're doing, I think I understand what they are doing as a product, so what does that tell you? That basically tells you that these people are a service business, and we're product people, and I have no idea what those people are doing. Do I think they are technically unsophisticated? Yes, in the following sense: if you have good technology you should be able to shrink wrap it. If you know how to make a car, you shouldn't;t have to train a chauffeur to drive it around type of thing. So clearly I like to imagine that the technology we are developing is going to be user-installable, user-supportable and could be purchased as a standard component of your internet, intranet type infrastructure, if its good enough.
{23:00}
But, uh. So that is the answer to your question, but I don't remember the question.
C: So in the past we've talked about the possibilities for different kinds of service oriented uses of the internet. Ways to take advantage of the internet to provide services in a sort of distributed manner. Which is what Amicas takes advantage of. And on the one hand that is a technical issue, you guys do that in a technically specific way that its important to understand. On the other hand it is a service issue, its a way of thinking about providing service that is necessary for it to be able to be sold. You have to be able to think about, for instance, the way you distribute and manage images in order for it to make sense as a product that you would buy. SO I'm trying to blur this boundary between the technical and the service industry here, because you've done that for me, and it seems like you would be most interested in those companies that would blur that boundary , and obviously its probably clear that they don't exist if the biggest companies and the best don't see the world that way.
A: I didn't hear a question. I heard a statement saying that we are all interested in both technology or product and service, and that the boundary between the two businesses, the product business and the service business, is the scope of the question, but I didn't hear the actual question...
C: Well maybe there isn't a question, cause its, you seem to some extent to be giving something up with respect to HBOC and Eclipsys, by saying that they are a service industry, that what they are selling is a service based on your reading of the buzzwords, which is I think entirely valid. But to me, that selling of a service has the potential to fail just as much as the potential to fail based on their technical work, because if they don't understand the technical work, then they are not going to be able to provide a service that takes advantage of it.
A: Yes, well its worse than that. Its, these people are struggling to understand standards as a generic thing and the internet specifically, as it will impact their business. And its kind of like the most extreme example.... [interruption]
{26:34}
The most extreme example is.... [lavalier mike time Chris fucks up again. Silence until]
{28:02}
C: Okay, where were we.
A: Okay. Are the dinosaurs in frame? Oh we were talking about service vs. product and I was about to make this uh, analogy to try to deal with this argument that we're having about whether this is prod...about whether you are asking me a question or not
C: Or just trying to fill empty space.
A: Yeah. Here's the point, the extreme case is Travel Agents. Travel Agents and people trying to sell things to travel agents, its not necessarily a good metaphor, but the internet technology and everything else changes everything for travel agents. They may or may not exist next year, but if they do exist it will be in a dramatically different form. Another example is Stock Brokers. Stock Brokers per se may have to turn into money managers or financial advisors or may have to go sell vegetables because Stock Brokers per se are not gonna be able to exist unless they change. Well, so you have this world out there of companies that are supporting the service business of healthcare. And they are protected from the change that the internet brings about, but not that much more than the people who are supporting the service business of travel agents or stock brokers are protected. So the part that I don't understand, that you are talking about relative to HBOC and this distinction between product and service is if you are a big supplier of technology or services
{30:30}
services to yet another service industry, you are having to parse too deep, you are doing two things at once. And they are almost conflicting at a level that makes this almost inconceivable that you could do this right, because on the one hand your clientele is being significantly impacted by the internet (the travel agent) the doctor. On the other hand you yourself are providing what I consider to be a service oriented business. I mean if it takes Adac 9 months, if it takes HBOC probably 2 years to install a hospital in the technology world that they are living in... So there is this incredible conflict that I see: you don't want to be telling your customers that your service is trash, before you can give them an alternative. So then you have to make this choice as to whether to protect them [your doctor-customers] from the ravages of the internet and the nobody knows your a dog type of thing, by giving them the comfort of this proprietary-we'll-integrate-the-whole-thing-for-you- it'll-only-take-two-years-it's-all-right kind of environment. That's where the mystery, the interest is with respect to HBOC. With respect to the other two channels, the modality vendors or the infrastructure vendors, there is no such conflict. The modality vendors obviously...
C: Because they are both products...
A: Well the infrastructure people are not necessarily products. They're not imagining themselves as services too much, and in the case of infrastructure vendors, they are not healthcare specific, so both their strength and their weakness is, they don't have to worry about whether their stuff is being used by travel agents or stock brokers, for all they care the stock brokers will become travel agents or vice versa and they'll still have to use the phone company. So they win either way, the modality vendors are clearly in the catbird seat. [Lunch interruption...] Its very authentic if you go there, it looks like you're in Greece. Can I get baked lamb with French fries please.... co
{34:20}
I forgot what I was saying, Oh, the modality vendors know that very well, and they I think are in the cat-bird seat, because they understand radiology, the internet isn't going to impact their core capability, but they are going to split the value of the system integration component or information management component or whatever you want to call it, that we're in, they're gonna split that with the other two categories. And to the extent that a jet fighter or a car is now more than half electronics, its little solace to the people that are making the steel and the engines that Motorola isn't going to go and start stamping out metal. So...they've got that problem
C: With respect to the mystery of why HBOC still exists, with respect to healthcare, healthcare who needs the service and you guys who perhaps need them to help integrate your software into healthcare. To me it seems like a lot of that mystery is just this fairly rational desire on the part of healthcare to have someone whose responsible, someone who takes responsibility for this, as opposed to having the sort of free-for-all, where there is a certain control issue over who maintained control over the integration of these things...
{36:40}
A: I would be really frightened if I was you, you HBOC. Your question is extremely well posed, but now lemme ask you this: Look around at the rest of corporate America, in other words. lets not think of healthcare as non-for profit, charity that doesn't work by corporate standard, lets think of it as managed care, continuing to head in the direction it has headed, lets imagine that its gonna happen even if the Democrats control both houses of congress, that we're not gonna go back to the Canadian model, no matter how you and I might feel about the politics of that. Now ask yourself the question: what other large scale software businesses or information systems businesses are industry specific relative to corporate America? Who's doing well out there? Peoplesoft, well do you think there's a Peoplesoft out there that's different for car manufacturers than the one for lawyers? No. As a matter of fact, Peoplesoft is in at Partners doing their purchasing thank you very much.... Do you think that digital dictation systems from IBM are gonna remain health care specific, or will it just be that within a year that MedSpeak for radiology is simply a new dictionary that costs 69.95. Are you, HBOC, willing to stake the next generation of software on the fact that people wont use Word to type up their reports when its already integrated with IBM and Dragon Dictate, just because you understand how the service business works.I challenge you to think of one example of a large scale software supplier whether they be oracle, Peoplesoft, SAS, that to corporate America that you can say oh yeah these guys are in the insurance business, and they are making billions of dollars and price/earnings rations of 80:1, so you see what I'm saying, just because you are offering service doesn't mean you can be anything more than a consultant.
C: I think you are absolutely right about that, but do you think that there is something exceptional about the healthcare industry that...
A: Yeah, its never been for profit.
C: Exactly, and I don't think that people really recognize that it is going towards managed care, that it is becoming an industry in its own right that, don't you think there will be a lot of resistance? Because someone has to be responsible for it?
{40:00}
A: No. I think the profit motive will dominate and people will buy oracle systems and make them work and people will buy Peoplesoft systems and make them work. The reason is that the way in which HBOC sells, it's almost too simple (so simple I could be dead wrong) to imagine, the reason has nothing to do with strategy, it has to do with consolidation. In the not-for-profit era, every department and every hospital could stand as an island and they were all profit centers, and none of them would compete on any obvious basis that I could understand. Maybe they competed on the basis of their political strength in getting certificates of need, lets say, which is significant. Being able to get financing and certificates of need is probably a purely political exercise, local politics, and that was the field of competition. Now what happens with technology and services that are geared towards that kind of industry, is that when you try to put two hospitals together, one of them has to give up their system and adopt your system. I think it's as simple as that. It can't last in the managed care world, because, there is no, it's just unlikely that business will go and replace left-opening doors with right opening doors just cause they got bought by Partners today.
C: if that's the way things go then at the national level, if you have an American system, where anybody can plug into it, you get a conflict with national health care systems. Because if for instance, all of your patients in Turkey come to the german hospital, then there might be a conflict with whether the Turkish national government is ultimately responsible for that or whether the American one is, or some international governing body in between
{43:40}
A: There's a legal question of liability, there's the classical in the case of telemedicine and in the case of internet medicine in general, it really has to do with who's licensed and who pays, what's the licensing body that applies to an internet transaction, it's the same as buying shoes in terms of paying taxes.
C: What's at issue is a certain guarantee that has been guaranteed by the state. Even if it hasn't existed, there has been a guarantee of a minimum level of healthcare guaranteed by the state, pretty much regardless of counrty... Any
A: I don't see, so what. I don't see this
C: What I'm implying is that that guarantee is gone now.
A: Oh its gone all right, and its getting gone at a faster and faster rate. but I don't think that guarantee, it hasn't existed in general in places other than this country
C: What about Canada, England...?
A: No let me tell you what I mean. I think that in places like England or Romania, not that they are at all synonymous with respect to healthcare, in fact you might consider them opposite poles in healthcare- people make two assumptions neither of which apply to the united states: one assumption is that they will have some level of government guaranteed healthcare, the second assumption is that they will have to worry about their care as a result. And if they want to, the reason that people go to the German Hospital in Istanbul and have their cases sent here, and I don't know that specifically but if its like the middle east it's because they think they're gonna do better for themselves, or because they are engaged. What people in this country do, is you know, they'll go and have coronary bypass at their local hospital in a town of four thousand people and believe in wishful thinking that he outcome is gonna be the same as if they went to the Brigham. That kind of merging of what the responsibility of the state or legal environment with the responsibility of the individual who's sick, uh, that you have in this country, I don't think that exists either in England or in Canada, or in Romania.
C: I have a very different sense of that, I mean especially with Canada, the people I talk to really seem to think that regardless of what hospital they go to, they are gonna get the same level of healthcare. That is until they actually go through the system, maybe they might realize that its different. But I think they assume that having a nationally socialized system means that you get the same level and quality of care anywhere.
A: That's true, to some extent but in a system like that people still take responsibility for how to manipulate that system and how to advocate for themselves for what they need. To varying extents. I don't know much about Canada, but you sort of see this idea in England, of people realizing that they if they want to have elective surgery, they might as well go to Switzerland or come to the us to get it, which also plays in Canada to some extent so the point is, that in a system like England's people do not assume that just because the NHS tells you that its okay to wait to fix the broken bone for three months, that it really is okay.
{48:02}
C: you think they do in America?
A: yeah, yeah, in America people sort of merge these two things together because of the way and the idea is you picked your doctor and if they tell you to go kill yourself because they have some financial incentive in for you to die quickly, well then its okay, that's sort of, I picked that health plan, that's my doctor, that's my man. OK, so in this country you have this very active issue of liability, you have this very vibrant idea of doctors as private practitioners, as private business, which exists in other countries as well, but not to this extent. So anyway what I'm saying is I think that in those places where healthcare is managed much more than it is here, people learn to defend themselves because people mistrust bureaucracies all around the world not just here. And i think those people are likely to be internet customers also: you know where can I get my coronary surgery?
C: So do you think American health care consumers will become more like international ones than vice versa/
A: oh sure, and I think vice versa and i think the whole thing will globalize where Americans will come to realize that there are pieces of surgery that you can get done in Switzerland that you can't get done here, that this isn't god's gift to medicine, from many points of view. There are drugs that are not available here, there are surgical procedures that are not available here. I think that's inconceivable that people would leave the golden shore here to get healthcare elsewhere. But I'm convinced that there's better healthcare elsewhere if you pay attention to, or really know what you need.
C: so then, more empowered consumers. There's a possibility that healthcare will bifurcate into an two different sectors. One in which it provides this service that people come to and take advantage of, and pay for themselves, and the other may be public health.
A: Yeah. The same thing is true all over the world, its true in England its true in Romania, people have a nationally supported healthcare plan that provides certain set of rights, and then the people who care to, want to, know to, go and bring the local doctor an extra chicken or travel to the us for their surgery, or order their drugs from Israel, so what's so different about that? that's the way the whole world runs. Why will this place will be special? its special now.
C: No, it's not that this place is special
A: It is special now.
C: Right, I agree with that, I think things are becoming more same. Everybody same healthcare, kind of like socialism?
A: Yeah, [grimace], I'm sure there are more flavors of socialism out there than there are of capitalism....
C: but what I'm pointing to, is that there is still is a population that can't advocate for themselves, or that need some form or social healthcare, infrastructure, public healthcare etc. Do you think that will just sort of fall out of healthcare?
A: I don't understand. Are you talking about this country
C: No I'm talking about internationally
A: do I think that Public health will go away?
C: No no no. The way you describe this it sounds to me like the only way it will evolve is to turn into two different systems. One in which you pay for your healthcare, and you can do that by having a job, or just paying outright for it, and another where there is some larger than an individual body responsible for the health of a people in an area...
A: Yeah I'm saying you always have both.
C: but traditionally there have always been both the same thing and they have been called healthcare
A: yeah there's a balance, but I think even traditionally
C: well I don't have the answer. It's something I've been trying to think about in political economic terms...
{53:58}
A: Its a question that I think every doctor thinks about a lot more than people give them credit for from the time that you are in medical school and you have to make your first practice decision until you stop thinking about it. I certainly haven't stopped thinking about it even though I decided not to practice shortly after starting to think about it. Of course it's the question, if you look at from the point of view at any level people balance access to care, free health care that they provide as individuals, the business relationships they form, and spend immense amounts of time worrying about this thing you are talking about. You're sort of making it sound like your trying to figure out whether something else beyond this age old thing is about to change because of either global communications or the internet or technology. Uh you seem to be asking, is there something in technology that's going to tip this in one direction or another. Uh. that's a very interesting question., that's a fascinating question.
C: I think that at bottom its not a question about healthcare, its a political question about the social organization.
A: About the individual, yeah, do you still have a combination of how you allocate tax dollars and how you pay lawyers determine how healthcare is managed, basically so at a societal level you can do three things, you can train doctors in a particular way that makes them lean in one direction or another, no I suppose you could do four things...
{END TAPE 1}
Tape 2of2
C:
A: four things okay: What do people do? People can train the population by advertising or educational means, they train doctors to have either more or less regard for the public welfare. They set up systems that dole out resources, you could think of it as kind of insurance company regulations, they put programs in place to control the flow of public health dollars as a political thing and they can institute, basically train lawyers , a major component of what use to drive healthcare in this country as a way of controlling the system, right?
C: Or an entirely different system that is state based, then you have socialism?
A: No that's the third one, basically you can control the flow by some mechanism that is political at the level of the providers. You can call that insurance, you can call that public health funding mandates, you can call it either insurance mandates or public health funding but either way its the same thing. Um. And you can deal with lawyers, or consultants of various sorts. So what you're asking about is a very interesting question and its a very complicated one because your sort of asking, "Okay, if as a society we can handle these four things, to achieve some goal that i'm not sure anyone understands at any level, if as a society we can control these four things, now lets think about what does technology has to do with any of the four of them, and has anything really changed in the last ten years because of all this information technology or medical technology. And uh, that gets you into this huge, huge expanse of things to think about. There is one subset of it which i'm happy to tackle with you, but its not the one you seem to be asking me about. The subset that i don't think anybody has worked on is the issue of the access to expensive technology as a political process. And here's basically what, you know and it's only a piece of what we're talking about here, but its so unimaginably huge a field that to. Well i think its fascinating I think we all think about it, I think especially doctors think about it, but I don't think I particularly have anything to add to this.
{3:53}
C: Except experience, I think that's important to understanding
A: But its philosophy, its not technology or medicine, your talking about philosophy. Look there is this thing which I think is a little bit clearer which is: does technology save money, and if so, how do you politically control access to technology in order to do that. Let me now tell you what I mean, that didn't make any sense. I firmly believe that in the long run the only way you can save money and improve healthcare is to add technology. I believe that more strongly than I believe for instance that if people invent better pesticides they'll be able to grow more rice and it's for the universal good of the world to be able to support more people. I have some doubt as to whether I support people doing genetic engineering of crops and pesticides as a way as being 'to the good.' But i do however believe that healthcare is different in that in the long run, you can impact both the cost and quality of healthcare by adding technology. And you can call that a religious belief if you want, it's not rational. But I guess what I'm willing to say is that traditional healthcare that's not technology based has pretty much run out of steam. Your not gonna support people being happier, healthier, more productive by simply doing a better job in medical school or a better job in the statehouse, right? okay So technology is the only answer, I would say. The argument between whether we have a national healthcare system or an insurance system that's run by lawyers or anything between that leaves me completely cold, as you can probably tell from my previous answers about how I compare Romania and England in the same breath. Okay, however, because I think there is nothing there fundamental there, and I don't think the internet is going to change that balance either in a political or the real management sense, but I think that there is a world of good to be done by adding technology to the mix, because technology is not the same zero-sum game. So you could, for instance figure out how to vaccinate everyone by putting fluoride in the water supply and except for the political fringe that doesn't believe that fluoride doesn't damage your precious body fluids, you can get an improvement in public health by a piece of technology.
{7:15}
Okay so I think this can extend all the way to minimally invasive surgical procedures, to non-invasive procedures, to customized drugs, to large scale, to as many people as you want to impact. Now however you get this other problem which is that the way that healthcare is rationed is through the fear of pain, financial pain to some extent, but physical pain, so if you have a technology that for instance that makes it relatively painless to fix.... I guess bluntly put, its cheaper to let people die , uh in most cases, and that's just undeniable, so what I find interesting in all of this, is that most people who are dealing with the politics of healthcare resource management, don't want to have this discussion, nobody wants to talk about this, the doctors don't want to talk about it much because its too depressing, to talk about the value of.... and they don't really have a mandate to talk about technology, so you see what I'm saying, it like opens up a Pandora's box so you have people like me, who are an incredibly small minority of doctors, who of necessity because I've forsworn taking care of people have to deal with the impact of technology. But, I don't play in the political arena; nor does anyone who's a real doctor care about what I have to say, so I have no standing to speak of, and so this is something that people won't talk about, or if they do talk about it they talk about it in just the most gross and negative terms.
C: Or they talk about in terms of immortality and prolonging life, evading the question...
{9:40}
A: They talk about it in political terms that are just doing an incredible disservice because, in the long run, the only thing that's not a zero-sum game is technology. So, You can sort of step back and say: logically, there ain't nothing left to do. I mean you are not gonna improve the way you train people, you are not gonna change the way the political system runs, how you allocate money, you are not gonna solve the problem of whether the world should have a billion people or half a billion people, you are not gonna do any of those things. In any reasonable... so I don't know.
C: So maybe you can put a finer point on what you mean by technology. Is it work, labor, the activity that people invest in. What do you mean by technology, is it new technical solutions, or is it the internet?
A: Its both, I meant I think, the globalization and the internet is gonna have this, just, this incredible... its gonna cause a revolution. I mean imagine being able to read, imagine that the people in Africa who are dying of AIDS are able to read that there are drugs that are keeping people alive for 10 or 15 years now, that are can completely outside the scope of what they can do. Boy, you know, I'd be ready to kill. I mean you have to deal with you know, if healthcare, access to technology is being restricted on the basis of an iron curtain like situation where you try to make sure that the people don't hear the news and don't know that the people in America have refrigerators and they're still using iceboxes, um, you're its gonna kill you, the same thing's gonna happen in England and Canada. I mean think of for instance these little pieces of technologies like these Imatron CT scanners that have reasonable predictive power, lets stipulate, I'm not saying that there isn't... There are other technologies, I'm talking to people tomorrow who are about to publish an article that shows that a much much cheaper test than Imatron, namely echosonography of your carotid arteries can be quantitatively interpreted to tell you exactly what your cardiac incident risk, stroke, heart attack, whatever, is over the next five years, whether you're in the high risk category, the low risk category or normal. Which is kind of what these Imatron people are trying to do. What does it mean to give people access to that information. or to genetic information or any of these things. I mean nobody wants to deal with this stuff. Nobody. I'm just appalled at the fact that doctors don't want to deal with this stuff. And the politicians certainly wont, so whose gonna deal with it and the lawyers don't want to deal with it. So its like anything else, the people are gonna deal with it. And the internet is going to have this incredible effect, very very quickly of making the people deal with this thing that the doctors and the politicians are unwilling to deal with.
C: That makes the people who design the technology and the people who decide to use it de facto politicians. There's a possibility of an enormous shift from the people who are currently in control of governments to those who are in control of technology.
A: It makes us allies, but it also threatens the entire fabric of what's going on. Don't think that I, I mean look at Amicas. It's not licensed for individuals to use and that's okay, you know our FDA license, because individuals don't need to use it, but if the net result is that individuals begin to have the power of moving images between one licensed practitioner and another licensed practitioner, then that's all it takes, I mean the individual doesn't have to look at their images. It becomes an incredibly powerful tool... and the alliance you are talking about is as easy as that.
{15:46}
C: Its really not even a question of revolution, just a question of the delegitimation of one control... the revolution happens by virtue of the creation of this new order.
A: Yes and the fact that it is not a zero sum game, and that is obvious to everyone involved. In other words, there will increasingly be situations where people just look at the technology on one page on the internet, and the doctor or the healthcare person is no longer the person that they need to ask as to the, what's the word, the reputation of the technology, the internet becomes a reputation system for technology in the use of reputation in the technical sense: how many people say you're a good person, how many people say I'm a good person, you say I'm a good person therefore I'm a good person because people believe you're a good person. Using reputation relative to technology, the internet, it sort of means that it no longer matters what sort of public health measures you take other than the ones that impact the reputation of technology, so it doesn't matter how you train doctors, because no one cares about their reputation anymore, only their technical skills become important, so they just become a piece of technology too.
C: Might have to censor that part. They might not like that.
A: Who's they?
{17:30}
C: The doctors. I mean that's where the resistance is today. With the doctors, who professionally speaking are concerned. Not that its not a big blind spot for them, but that's the only place I can locate political struggle, that doctors are being reduced to a professional position that is akin to technician's positions...
A: I think doctors are not that stupid. They are not that menial. I think every doctor... would rather be, keep straight in their mind [Interruption for lunch]
{Lunch, 19:00 - 42:36}
C: So what do we have left to talk about, have we exhausted everything?
A: Well I was making a single point that we can drop, though I remember the point I was trying to make and that is that I don't think doctors, I think every single doctor makes the conscious decision with regard to being a technician [interruption]. Every doctor makes their peace with to what extent there being paid out rages sums of money to be a technician, surgeons being the typical case, and to what extent they see themselves being compassionate, advisors to individuals with no particular technical expertise beyond that. And so I don't think anybody would be terribly upset with this because I think everybody deals with it.
C: as long as it doesn't translate into some other kind of undesirable work situation, for instance, I don't know how radiologists feel about this but, Regina Herzlinger's argument about focussed factories that you just put all the radiologists in one place and have them read scans, and not neccesarily have them be in hospitals the way they are now, which may not be I really don't know how radiologists feel about this, but I would think that wouldn't be a very desirable step up.
A: certainly not. But I think that's a very naive way of looking at technology, actually I don't think Regina's looking at technology at all, I think she's looking at business organization issues. I would say, look at Amicas, probably the most important impact of Amicas is the fact that you can put the radiologists out in the community hospital, where before they would not been busy enough, and would not have been sub-specialized, and by sending work to them at the place where they are, you now have that radiologist closer to the patient to do procedures, closer to the doctors who are their peers in patient management decisions, hopefully, as opposed to them being technical readers at a distance. It'll also have a huge economic impact because the productivity of a single radiologist will go up, so you will need a lot fewer radiologists, unless and the competition between them will also go up because the work will be more fungible so unless the radiologist figures out how to do some of the non-technical things that they're doing, they as a practice will make less money and they are will be fewer of them. So I think there's a huge amount of decentralization that is allowed by technology. So the message of focussed factories in the case of what we're doing, is really the opposite, we might be taking a situation where the radiologists are already providing a technical service and allowing them, by putting this information online, to play a role that is a patient management role. Like for instance ask yourself the question why wouldn't a primary care doctor consultant a radiologist before even ordering tests if they could? So there things like that, and I don't think Regina with argue with that.
C: but that's the distinction between the sort of negative vision of doctors as technicians and the ability to use technology to their own ends, to make their own tools, but remain in the role technician. I think there's a distinction there. For the people who don't understand technology and don't know how to work mouse, for instance, it's only the negative side that you hear, the sense of dehuminazation or of turning doctors into machines, which is not a very well-informed view, but is something that shows up in JAMA editorials frequently.
A: Oh yes, yes.
{47:49}
C: so I guess it's the perception of that rather than the reality.
A: yes it's the perception of that but there is also the reality of allocation of technology. What I'm saying is what's frustrating to me is that political forces are generating this unholy alliance with the people writing those JAMA articles and the people who are in the political arena interested in restricting the quality of care, because it would cost too much to let people know that they're gonna die in the next five years unless they have five thousand dollar a year worth of therapy. What you're seeing is an unholy alliance, and that's... unfortunate.
C: what's going to happen at RSNA this year?
A: what's going to happen at RSNA this year is two things, we hope. Well they will both happen a question is how much. Thing No. 1 will be, we will start to understand, and the world will start understand, where we fit with respect to our channel, our distribution channel, we are now much better able to articulate how people will make money, who we will sell to and who we won't, how will set prices... [Interruption]
C: RSNA...
A: one of the things it's going to happen is that were going to learn more, or going to be more sophisticated and focussed on or channels, that will be good. The other thing that's going happen is we're going to get more support in the notion that we are a competitive PACS environment, in other words some people will start to look at us as an alternative to PACS and we are starting to understand how to convince people that we are a potential alternative to PACS. And that's never been true before. So I think those two things are what look forward to more or less.
{52:30}
[Reading mail] Oh ye of little faith... you see I ordered vacuum cleaner bags over the internet and Judy got mad at me because they weren't here in time for the cleaners today, so I had to go and buy them, so I lost faith, I explicitly told him they had to be here by Thursday and they weren't, so. This was shipped priority mail on the 10th.
C: today's the 13th
A: today's the 13th,
C: so it took three days, it's the Post Office you have to lose faith in. what little you have left.
A: Its the Post Office that I have to lose faith in the takes. The internet and its job. But this is only 3.50 that's a real bargain.
C: I guess you better make sure they are the right ones, though. A.: Okay, what else about RSNA?
C: is everybody going? So it's kind of a big sales event.
{End}
Interview clip with Adrian Gropper: Infrastructure and the Internet
Last Modified 11-Sep-99 9:36 PM ckelty@mit.edu
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