Intel Chairman: Transforming Health Care Is Employer Imperative

By Stephen Miller Mar 18, 2008
Craig R. Barrett, chairman of Intel Corp.

For its 55,000 U.S. employees, Intel Corp. pays health care benefits of about $700 million each year, soon to reach the astounding figure of $1 billion annually, noted Intel Chairman Craig R. Barrett as he delivered the keynote address before the National Business Group on Health's annual meeting in Washington, D.C., on March 14, 2008.

"We spend over $10,000 per employee. Yet essentially none of our employees has an electronic medical record. None of their doctors make house calls. Generally, they can't communicate with their doctors by the telephone or e-mail [since insurers won't reimburse doctors for this time]. Instead, they must physically go to the doctor's office or hospital for advice," he lamented.

Barrett is a long-time advocate for using information technologies to raise health care standards and practice. He helped establish Intel's Digital Health Groupto advance that goal.He is among the founders of Dossia, a nonprofit formed bya consortium of large employers to provide employees, their dependents and retirees with independent and portable electronic health records.

Critic of Government-Centered Solutions

Barrett doesn't hold out much hope for government solutions to the health care crisis, but he does implore employers to use their purchasing power to force the system to change.

"In Washington, D.C., the only health care topic that seems to interest reformers is covering the 45 million uninsured," Barrett said. "No one breaks that 45 million down to the 10 or 12 million illegal residents, the 10 or 12 million 20-somethings who are making the financial bet not to have insurance because it's a lot cheaper for them to pay out of pocket; the millions of children covered by government programs but not enrolled in an insurance plan, and then the truly poor who can't get insurance. The mind-set in Washington, D.C., is 'just insure those 45 million and everything will take care of itself.' "

He also is a critic of state efforts to ensure universal health coverage, saying the aim is "to create new government agencies that will spend the money smarter than we're already spending it while providing every citizen in the state with every medical procedure and medication that they want. There is a fairy tale here somewhere."

And "by the way, you pay for all these things by taxing employers more," he added.

Changing the Debate

"Until you start working the system to get affordable, higher-quality care, adding people and costs to the system is nothing but a deterrent to our overall competitiveness and economic viability," Barrett stated. "The private sector realizes that $2.2 trillion is probably enough to spend [on health care in the United States]. Enough is enough. Let's do something about it. Let's work to change the debate."

Employers' Purchasing Power

"Put competition into the health care industry, and you'll see transformation," Barrett advocated. "Today you can change your bank, your credit card, your telephone carrier, just about anything except your health care coverage. You have no purchasing power as an individual. But employers have purchasing power."

He observed, pointedly, "Using our purchasing power and starting to demand that things change is the only way something is going to happen. No other part of our businesses would just sit there and say, 'Ah, well, 8 to10 percent a year in inflation, that's OK. Not only am I not going to do anything about it, but the service I buy is substandard."

Pay for Performance

What needs to change are "the funding mechanisms, the reimbursement mechanism, and the outright resistance to change by the health care bureaucracy," Barrett said. "The only way you change things is by using your purchasing power to force change."

He advised, for example, getting away from paying to see people, regardless of the quality of care. In Silicon Valley, he related, "A number of companies are trying to move from a 'pay-for-service' to a 'pay-for-performance' model. We're doing it with a carrot; we'll pay you more initially if you start to adopt a pay-for-performance system." (For more on such efforts, see Employers Reward Family Physicians for Best Practices.)

E-Communication and E-Prescriptions

Barrett advised employers to put pressure on insurers to reimburse doctors for phone calls and e-mails to patients. And to promote electronic prescriptions—given that "some 100,000 people a year are materially impacted by wrongly dispensed medication or missed drug interaction warnings due to pharmacies and nurses misreading doctors' handwriting," he said.

"The National Transportation Safety Board will recall 2 million pickups if a half-dozen of them stop on the highway unexpectedly," Barrett observed. "But if 100,000 people a year are impacted, we do nothing. If you don't provide quality information and manage it effectively, you can't provide quality service. It's that simple."


If you don't provide quality information and

manage it effectively, you can't provide

quality service. It's that simple.


E-Health Records

Moreover, making electronic health records a practical reality is among Barrett's passions. To that end, he warned not to count on government initiatives such as the much ballyhooed National Health Information Network. "It's not going to tie everybody's records together," he said. "It's not working in the U.K. with the National Health Service."

But, he noted, "We're starting to see advancement with practical personal health records through private services such as Dossia that will enable employees to go online, use a password, access all their medical data, print it out and give it to their doctor. And it can be e-mailed or put on a thumb drive or CD-ROM."

The value for employees is clear: Their records are theirs and go with them even as they change employers or careers. And, "unlike the National Health Information Network, you don't need an input into every repository in the world; you have a private repository that's your own."

The value to employers: For a minimal fee, they will benefit by having a healthier workforce.

Data might be more secure on such a system than it is in the current environment, Barrett said. "But if employees don't want their medical record held on a server by a nonprofit, that's fine, too. Tell them 'If you don't want that, keep your shoebox.' "

Dossia is being rolled out this year, Barrett said. "I'd love to see 10 to 20 million participants during its first year. If we can get that kind of critical mass, we can drive the rest of the system to demand that capability, because we have the purchasing power to do that."

Remote Monitoring for Wellness

Among other positive developments, Barrett noted that there are "more businesses with clinics on site. We're starting to see retail clinics. And, increasingly, we're providing wellness programs that include continuous consultation. We're tailoring health care programs to different stages of employees' lives, including the use of health savings accounts. We're getting rid of co-pays on drugs for chronic illnesses."

In addition, "We're also starting to see the wider use of gadgets for remote monitoring. What could be more logical in today's society?"

About 80 percent of health care costs pay for chronically ill and aged people, Barrett said. "Remote monitoring can catch their illnesses before they get serious enough to require hospitalization, allowing for counseling and preventative action."

For example, remote patient monitoring through diagnostic equipment, he explained, interfaces with personal computers and the Internet to store and transfer information to medical practitioners. Applications range from monitoring blood pressure and blood-sugar levels, to automatic reminders regarding prescribed medications. "Technology can empower this capability," Barrett said. "We need to demand that it happen."

Collective Pressure

"You have to be aggressive about using your purchasing power for change or the system will defeat you,” Barrett reiterated. You need to use your purchasing power proactively to push for remote monitoring, electronic medical records, electronic communication, and pay for service.

"Collectively," he concluded, "we, as employers, pay 50 percent of the bills for health care spending. And collectively, we can make things change."

Stephen Milleris an online editor/manager for SHRM.


Job Finder

Find an HR Job Near You
Post a Job


Find the Right Vendor for Your HR Needs

SHRM’s HR Vendor Directory contains over 10,000 companies

Search & Connect