Cathedral and the Bazaar in Healthcare

15 Apr Cathedral and the Bazaar in Healthcare

Bazaar (bə-zär’) n.

  1. A market consisting of a street lined with shops and stalls, especially one in the Middle East.
  2. A shop or a part of a store in which miscellaneous articles are sold.

Eric Raymond is a famous open source advocate who published a seminal book on the fundamental philosophic basis for the movement. He used the analogy of the Cathedral as contrasted to the Bazaar as the metaphor to compare very top down, overly ornate approaches to software development versus the much more chaotic, decentralized, but ever more vibrant approach of open source.

The Cathedral and The Bazaar

The Cathedral and The Bazaar

Having lived that world for several years, I understand the powerful metaphor, and appreciate its appeal to my natural revolutionary streak.

I see the same thing evolving in healthcare – we are beginning to see the big, monolithic systems like Kaiser, Intermountain, Geisinger, Group Health, and even the VA begin to demonstrate impressive outcomes in terms of cost, quality, IT, and patient experience. This might lead one to think that this is the best way to go and we should all begin to worship within the whited walls of a an integrated, fixed fee provider group (“The Cathedral”).

But while the Cathedral has its place and has its appeal, there is much to be found within the ever more vibrant, chaotic, and pleuripotent Bazaar. In fact, I believe that the bottoms up Bazaar holds far more promise to bring me products and services to meet my personalized needs than could be provided by the Cathedral model. Unfortunately, the very nature of the Bazaar makes it difficult to harness, coordinate, and distribute those services in a scalable way.

[slideshare id=1292004&doc=whcc-dc2009-21stcenturysystemss-20090414-090415021539-phpapp01]

My contention, however, is that the tools and technology are arriving that will allow the Bazaar to compete head on with the Cathedral. In my “Bazedral” model, there is a layer of software and services that serves as the virtualization layer to abstract out the current challenges of coordination, mixability, and modularity. This integration layer would enable providers to come together in ways to deliver  analogous if not superior results (given the enhanced competitive nature of trying to be one of the “care modules” that gets plugged into the overall solution). Thus all the component parts of a right hip repair (pre-op workup, surgeon, anesthesia, recovery, rehab, etc) could be put out to bid but brought together in delivery by the virtual integrator to provide a seamless, integrated service experience This could be huge.

Bottom line for me . . . Cathedral Care is superior (for now). However, I believe there are “virtual integration” companies coming that will allow the Bazaar Care model to self organize in ways that will not only challenge but beat the outcomes results we have seen to date from the Cathedral. This would actually be good for the overall health care system, would challenge Cathedral players to continue to improve and adapt, and ensure competitive market alternatives.

Let us pray for the hastening of this day – Amen!

6 Comments
  • Jeremy
    Posted at 23:17h, 15 April Reply

    Scott,

    Would you not expect a great deal of resistance from providers (especially the average and sub-standard ones) in moving from a model where they “sell” themselves once, or at least on a fixed schedule to a large corporate entity for an extended period of time to one where they must be continually competitive and market constantly to a larger number of integrators? How would you encourage providers to participate in this new system? Or do you feel that if you could get the ball rolling, consumer demand alone would push it along?

    I would be concerned how much additional overhead would be incurred on the part of the providers, as this would doubtless be passed directly to the consumer. If the Bazedral model saves each consumer 5% per hip replacement, but each provider has raised his rate 8% to cover the overhead, well, that obviously isn’t good.

    I would think the “bidding” process as well would be quite interesting. Obviously with health care, you couldn’t (or certainly shouldn’t) do a straight low-bidder-gets-the-job model. I would think that an Ebay-type “seller” ranking would have to be incorporated, with a consumer able to specify the lowest ranking they are willing to accept, or a cost-ranking sliding scale. Some people also insist on special conditions in their health care professionals (i.e. certain gender, shared nationality, etc) that would need to be factored in. The number of potential variables could be rather large, but a system like this that uniformly and objectively ranked health care providers and allowed such a bidding process would be VERY powerful.

    A final thought regards the virtual integration layer. This layer would need to be heavily audited in a very open way. Without transparency in this process, providers would doubtless cut deals with the integrators that insured that that provider was always the best bid.

    I think this is a great idea. As someone who has spent a great deal out-of-pocket on medical expenses in the last few years, I think the potential for individual control here is fantastic.

    I do enjoy that this idea does for the health care system as a whole what MyMedLab seeks to do for laboratory services. It’s a nice symmetry.

    Keep up the good work (and interesting reading),

    Jeremy

  • Brian Jackson
    Posted at 16:47h, 24 April Reply

    Scott,

    I love your metaphor choice on this. The mainstream health reform “experts” (I’ll include Clayton Christensen and coauthors in here) have long been promoting integrated systems as saviors. And yes, integrated systems have the most aligned incentives and power to move things. But Kaiser and IHC have been around for an awfully long time, and are moving absolutely glacially toward the kind of reform we need. It seems that all they care about is having incrementally better quality than everyone else, but they’re definitely not dramatically better. I think the problem is that those organizations are way too connected into the medical industrial complex “value network” that almost all other hospitals and clinics are stuck in, plus their leaders are way too culturally tied into those same systems.

    So we need disruptive innovation, and I agree with you that small organizations are much more nimble at pulling this off than large ones. The only way I can see a Kaiser or Intermountain or Geissinger pull this off would be by spinning off clinics that operate completely independently and do not accept 3rd party reimbursement, and that are led by radicals such as the Hello Health folks.

  • John Batelle’s “The Search” - Ch. 10-12, Eric Raymond’s “The Cathedral and the Bazaar,” and Tim O’Reilly’s “What is Web 2.0″ « Whatgnau’s Blog
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    […] and the bazaar have been drawn by members of and commentators on various industries, from tech to healthcare to pharmaceuticals to the newspaper […]

  • PB
    Posted at 05:38h, 27 May Reply

    […] and the bazaar have been drawn by members of and commentators on various industries, from tech to healthcare to pharmaceuticals to the newspaper […]

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