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In trying to think about the future of health care, thoughtful, intelligent people often ask, “Why can’t we just let the free market operate in health care? That would drive down costs and drive up quality.” They point to the successes of competition in other industries. But their faith is misplaced, for economic reasons that are peculiar to health care.More “free market” competition could definitely improve the future of health care in certain areas. But the problems of the sector as a whole will not yield to “free market” ideas – never will, never can – for reasons that are ineluctable, that derive from the core nature of the market. We might parse them out into three:1. True medical demand is wildly variable, random, and absolute. Some people get cancer, others don’t. Some keel over from a heart attack, get shot, or fall off a cliff, others are in and out of hospitals for years before they die.Aggregate risk varies by socioeconomic class and age – the older you are, the more likely you are to need medical attention; poor and uneducated people are more likely to get diabetes. Individual risk varies somewhat by lifestyle – people who eat better and exercise have lower risk of some diseases; people who sky dive, ski, or hang out in certain bars have higher risk of trauma.But crucially, risk has no relation to ability to pay. A poor person does not suddenly discover an absolute need to buy a new Jaguar, but may well suddenly discover an absolute need for the services of a neurosurgeon, an oncologist, a cancer center, and everything that goes with it. And the need is truly absolute. The demand is literally, “You obtain this or you die.”2. All demand apes this absolute demand. Medicine is a matter of high skill and enormous knowledge. So doctors, by necessity, act as sellers, and agents of other sellers (hospitals, labs, pharmaceutical companies). Buyers must depend on the judgment of sellers as to what is necessary, or even prudent. The phrase “Doctor’s orders” has a peremptory and absolute flavor.For the most part, people do not access health care for fun. Recreational colonoscopies are not big drivers of health care costs. In some cases, such as cosmetic surgery or laser eye corrections, the decision is clearly one the buyer can make. It’s a classic economic decision: “Do I like this enough to pay for it?” But for the most part, people only access health care because they feel they have to. And in most situations, it is difficult for the buyer to differentiate the truly absolute demand (“Do this or you die”) from the optional.Often it is difficult even for the doctor to tell the difference. The doctor may be able truthfully to say, “Get this mitral valve replaced or you will die. Soon.” More often, it’s a judgment call, a matter of probabilities, and a matter of quality of life: “You will likely live longer, and suffer less, if you get a new mitral valve, get a new hip, take this statin.At the same time the doctor, operating both as seller and effectively as agent for the buyer, is often rewarded for selling more (directly through fees and indirectly through ownership of labs and other services), and is not only not rewarded, but actually punished, for doing less (through the loss of business, the threat of malpractice suits, and punishment for insufficiently justifying coding).So the seller is agent for the buyer, the seller is rewarded for doing more and punished for doing less, and neither the buyer nor the seller can easily tell the difference between what is really necessary and what is optional.This is especially true because the consequences of the decision are so often separated from the decision. “Eat your broccoli” may actually be a life-or-death demand; maybe you need to eat more vegetables to avoid a heart attack. But you’re not going to die tonight because you pushed the broccoli around the plate and then hid it under the bread.So, because it is complex and difficult, and because its consequences are often not immediate and obvious, the buy decision is effectively transferred to the seller. We depend on the seller (the doctor) to tell us what we need. Whether we buy or not usually depends almost solely on whether we trust the doctor and believe what the doctor says.3. The benefit of medical capacity accrues even to those who do not use it. Imagine a society with no police. Having police benefits you even if you never are the victim of a crime. You benefit from that new bridge even if you never drive over it, because it eases the traffic jams on the roads you do travel, because your customers and employees and co-workers use it, and because development in the whole region benefits from the new bridge.This is the infrastructure argument. Every part of health care, from ambulances and emergency room capacity to public health education to mass vaccinations to cutting-edge medical research, benefits the society as a whole, even those who do not use that particular piece. This is true even of those who do not realize that they benefit from it, even of those who deny that they benefit from it. They benefit from having a healthier work force, from keeping epidemics in check, from the increased development that accrues to a region that has good medical capacity – even from the reduction in medical costs brought about by some medical spending, as when a good diabetes program keeps people from having to use the Emergency Room.All three of these core factors show why health care is not responsive to classic economic supply-and-demand theory, and why the “free market” is not a satisfactory economic model for health care, even if you are otherwise a believer in it.Answers for the future of health care?The answer to the first problem, the variability and absolute nature of risk, is clearly to spread the risk over all who share it, even if it is invisible to them. If you drive a car, you must have car insurance, and your gas taxes contribute to maintaining the infrastructure of roads and bridges; if you own a home, you must have fire insurance, and your property taxes pay for the fire department. Because of your ownership and use of these things, you not only must insure yourself against loss, you also must pay part of the infrastructure costs that your use of them occasions. Similarly, all owners and operators of human bodies need to insure against problems that may accrue to their own body, and pay some of the infrastructure costs that their use of that body occasions. However the insurance is structured and paid for, somehow everyone who has a body needs to be insured for it – the cost of the risk must be spread across the population.Skipping to the third problem, the infrastructure argument, its answer is somewhat similar: To the extent to which health care capacity is infrastructure, like police, fire, ports, highways, and public education, the costs are properly assigned to the society as a whole; they are the type of costs that we normally assign to government, and pay for through taxes, rather than per transaction. In every developed country, including the United States, health care gets large subsidies from government, because it is seen as an infrastructure capacity.That leaves the second problem, the way in which all demand apes the absolute nature of true demand in health care (“Get this or die”). The answer to this problem is more nuanced, because it is not possible to stop depending on the judgment of physicians. Medical judgment is, in the end, why we have doctors at all. But we can demand that doctors apply not just their own judgment in the moment, but the research and judgment of their profession. This is the argument for evidence-based medicine and comparative effectiveness research. If a knee surgeon wishes to argue that you should have your arthritic knee replaced when, according to the judgment of the profession as a whole, the better answer in your situation is a cortisone shot and gentle daily yoga, the surgeon should have to justify somehow, even if just for the record, why your case is different and special. The physician’s capacity to make a buy decision on your behalf must be restrained at least by the profession’s medical judgment. If the best minds in the profession, publishing in the peer-reviewed literature, have come to the conclusion that a particular procedure is ineffective, unwarranted, or even dangerous, it is reasonable for insurers, public or private, to follow that best medical judgment and stop paying for it.These three core factors – the absolute and variable nature of health care demand, the complexity of medicine, and the infrastructure-like nature of health care capacity – are all endemic to health care and cannot be separated from it. And all three dictate that health care cannot work as a classic economic response to market demands. Failure to acknowledge these three core factors and structure health care payments around them account for much of the current market’s inability to deliver value. Paying “fee for service,” when the doctor is both the seller and acting as agent for the buyer, and when the doctor is punished for doing less, is a prescription for always doing more, whether “more” delivers more value or not. Paying “fee for service,” unrestrained by any way to make classic value judgments, means that hospitals and medical centers respond to competition by adding capacity and offering more services, whether or not those services are really needed or add value.For all these reasons, it is vastly more complex to structure a health care market rationally, in a way that delivers real value, than it is to structure any other sector, and simply fostering “free market” competition will not solve the problem.

IntroductionIf you want to learn about managing the safety and security of your corporate travelers then you will need to read this report.Specifically we’ll discuss preparation, analysis, management, monitoring and response as it relates to an active and successful travel risk management program.After reading this article, you should know how to prevent or predict approximately 90% to travel risks and act immediately to improve your own program.Implementing a successful travel risk management strategy can be one of the easiest corporate actions but the most difficult to get moving.Too much time is wasted focusing on the wrong areas for assessment and implementation, that results in minor coverage for the major areas of concern.Here we will simplify the process for immediate action or comparison.PreparationPreparation is the primary and key step for all programs, whether mature or developing. Any-and-all information that is collected, especially data, should be consolidated to ensure consistency and accuracy.Overcoming a “silo” mentally within the organization is also paramount to consolidating.Intent, progress and resolutions must be communicated to all stakeholders in the most effective medium possible.Managers should not limit themselves to the more traditional mediums but also include popular social media offerings.Key messages or content must be trackable or at least acknowledged to ensure potentially life saving information isn’t lost in the vast corporate email inbox or mislabeled as spam.Each major milestone and change needs to be documented, rated and followed channeled into the communication plan.Time spent on effective preparation is rarely wasted and will pay dividends, throughout the course of the program’s lifecycle.Example-PreparationA relatively small consulting firm, who understood that they had a significant investment in their consulting staff, was able to develop and implement an effective, world class travel risk management strategy in a matter of weeks.Through a well-structured phase of preparation and mapping they were able to resolve an issue that had consistently been pushed back because they had always assumed the task was insurmountable.AnalysisAnalysis of all key components associated with corporate travel must be conducted.TravelersThe first and most pivotal is the travelers themselves.A profile and rating of each traveler needs to be developed.Questions around health, experience, knowledge, function and even preparation are basic requirements for each travelers threat profile.With this information managers will be better positioned to make accurate assessments on the overall risk of any journey.LocationThe location visited is the second element.The threats vary greatly from location to location and generalized ratings are useless if based on such known vulnerabilities.Trips to a key, developed city warrant different planning considerations than that of a remote location in a developing economic country.Different cities within the same country may have vastly differing threat concerns too.ActivityNext is the activity to be undertaken by the traveler.A conference, factory tour, expedition or client meeting all have differing threats and planning considerations and are not adequately address by a “one-size-fits-all” approach.SupportAdditionally, the level of support afforded the traveler is considered.This is not only those organic support options such as internal support and providers but that of emergency services, infrastructure and so on.The time it takes for an ambulance to respond can turn a “routine” incident into a potentially fatal encounter.The assessment and access to support should be inclusive of routine and emergency situations.ThreatsLastly, all the known or prevailing threats need to be assessed.You can never know everything but an overall list and impact/potential outcomes assessment needs to be conducted to complete the process if consistent and measurable results are to be expected.Many threat factors may be seasonal or vary over the course of the month or traveler’s journey.Example-AnalysisDue to changing economic challenges, a mid-sized company was pressured to seek new business in developing countries and emerging markets.Until this point they had always been reluctant to venture into such markets due largely to their perception of risk.Following structured and less superficial analysis they were able to fully appreciate the actual threats and separate the more emotive elements.Following consultation with managers and travelers, they successfully expanded their market and sought new business with less competition as their competitors continue to lack the understanding and preparation to successfully pursue potentially lucrative opportunities.ManagementThe greatest threat to preparation and analysis is an unsupervised or unmanaged program once the traveler commences travel.Ownership must be displayed and active management of travelers from a door of departure until a door of return is required.This must be conducted with frequency of effort and communications to ensure the traveler feels supported and management is across the potential for change and intervention.This phase is a marathon and not a sprint.The management of successful programs requires consistency in conjunction with frequency.Relatively standardized approaches need to be applied to like situations/circumstances for the purpose of efficiency, productivity, safety and cost control.Demonstrable support is required both within the management group but to all identified stakeholders such as travel management, security, the traveler, families, etc.Example-ManagementA company with tens of thousands of traveling personnel successfully manages the risks and demands of travel with only a handful of people.Their system and support mechanism is adaptive enough to support individual requirements but automated enough to ensure efficiency by keeping headcount at optimal and minimal levels while leveraging technology.Their overall strategy is not managed by one department but all departments and stakeholders work in collective unison at each and every stage from departure up to return of the traveler to the office or their place of residence.MonitoringMonitoring represents the Achilles’ heel for the majority of travel risk management programs.Ongoing monitoring of events and activities is required, whether this is carried out by the traveler or higher support function such as HR or security.Tactical events (those that occur within proximity of the traveler/travelers route) should be scrutinized on a regular basis.These events are the ones most likely to cause disruption or harm and should constitute the priority of effort.Wider events or more strategic developments also need to be monitored for change that will impact the traveler or group of travelers.Tactical events include demonstrations, storms, violence and the like while strategic events include visa changes, political unrest, health crisis and so on.The actual journey taken by the traveler should be regularly reviewed or automated to report and respond disruption events and threats.Finally, the individual needs to be monitored outside of the usual performance and reporting requirement to ensure their health and well-being is preserved or unchanged.Example-MonitoringNumerous companies have averted crisis and maintained productivity by monitoring developing events.Changes in weather, strikes, airline delays and even public holidays can occur at short notice and outside of standard policy doctrine.By keeping “a finger on the pulse” with active monitoring these companies maximize their travel spending and ensure their travelers are highly productive and efficient.Less vigilant companies who leave the process to static policy and dated knowledge are forced to spend more or suffer unnecessary delays.ResponseBad things happen to good people all the time.No plan is complete without a response capacity in support of the affected traveler.The plan and steps must be painstakingly simple and clear so as to be remembered under the worst of situations.The plan must be adaptive and simple in implementation so that it can build in complexity and content after the initial activation or call for assistance.The plan may be infrequently called upon but it should have consistency in application and capability.All locations, activity, individuals and threats need to be considered and inclusive of the response plan.Above all, the plan needs to be timely in its application.A distressed, affected traveler or manager must get the support and collaboration required in the shortest possible time frame.While the planning and preparation may be measured in days, weeks or months the response should be valued in minutes and hours dependent on the need.Most companies acknowledge this is not their core competency and therefore part or all of this function is outsourced for maximum return and results.Example-ResponseA “seasoned traveler” from an acclaimed academic institution became unwell while traveling for work purposes.Despite years of experience and seniority at the institution they had in fact very little knowledge or experience when it came to emergencies or supporting medical services in the location they were when they became ill.As a result of poor choices, lack of knowledge, no support, limited integration coupled by a litany of local challenges the individual nearly died.It was only through the swift and successful actions of a concerned spouse, engaging a far more organized process with predictable results, did the individual receive the care and support required to save their life and begin the long recovery process.Conversely, one company experienced several similar incidents in a single month, however not once were their travelers placed at such grave risk, suffered uncontrolled costs or outright loss of productivity for long periods.This was all due to a successful and scalable response capacity if and when required.The Main Travel Safety and Security Threats-Locations and EventsThe majority of incidents negatively affecting travelers occur at airports, on the road, accommodation, office/business location, social/leisure locations or result of dynamic change.AirportsAirports must be included in any action plans or support strategies as it is first/last leg of all journeys and likely to present delays and disruptions ranging from flight delays to targeting by petty criminals.AccommodationAccommodation of all kind must be evaluation and included in timely response and advice communications.Road MovesRoad moves remain the most prevalent and greatest for deadly consequences. Motor vehicle accident rates vary wildly from country to country.LocationLocations of business activity within the journey plan represent the smallest of impact locations but demand inclusion.Social and Leisure ActivitiesOften forgotten with tragic results are social or leisure locations.This element is likely to be largely unscripted but has a high rate of incidents and events that negatively impact upon the traveler.ChangeThe one constant with travel is change.Elections, violent crimes, attacks an other major news events create change and potential for concern, whether affected directly or not.Planners and managers need to include this dynamic in the constant monitoring, response and communication plans.CloseMost agree that travel is inherently risky or laced with threats but far less actually do something about travel risk management as they don’t know where to start or see the task too daunting.As you can see, it is relatively straightforward to capture 90% of the problem and manage the risk in a few simple steps.With a methodical and consistent process inclusive of preparation, analysis, management, monitoring and response you too can have a world-class travel risk management program.Most events and concerns occur in and around airports, accommodation, road moves, office/business locations, change and social leisure locations.Now you know the key focus areas you have the information and plan to start now.Even if you already have a plan and strategy, you can benchmark your own approach with this information gathered from years of empirical data, thousands of incidents and insight from thousands of companies ranging from small startup to some of the largest multinationals around the globe.Travel alert and you truly travel safe.