SwipeSeries Interview: Dr. Neel Shah

How a Tube of Blood Represents Waste in U.S. Healthcare

Dr. Neel Shah on the role of providers in reducing waste and the
next frontier in quality of care


In late January of this year, SwipeSense CEO, Mert Iseri had the opportunity to sit down with Dr. Neel Shah, Assistant Professor of Obstetrics, Gynecology and Reproductive Biology at Harvard Medical School, and Director of the Delivery Decisions Initiative at Harvard’s Ariadne Labs. He is also an obstetrician-gynecologist at Beth Israel Deaconess Medical Center in Boston. They met at the Ariadne Labs in Boston, Massachusetts. If this discussion had been planned for just a few days or weeks later, their live meeting would not have been possible as COVID-19 quickly escalated across the U.S.   

Now only a few months later, the world as most of us know it has drastically changed.  The same of course goes for healthcare.  Many of the points Dr. Shah discusses in this conversation, hit on systematic issues that patients and the our healthcare system faced pre-COVID, which are now surfacing as even bigger challenges within the new healthcare landscape. 


We need more than shouting from mountaintops. We need to forge connection and alignment to improve healthcare.

Dr. Shah, it’s a pleasure to be here in Boston with you.

DR. NEEL SHAH (DR. SHAH) You as well… and ah, the bowtie!

MHI: Yes! I’m rocking the bow tie because in every photo I’ve seen, you are wearing a bow tie.  How did you get into this specific fashion trend? 

DR. SHAH: Yeah! That’s usually my M.O. I’ve been doing the double toddler thing at home, and it’s that extra little bit of effort.  It creeps through in a few ways, but that’s one of them.

I probably started wearing them in the post-residency period. At that point, you’ve been wearing institutional garb for a number of years, and when you reset and exit, you’re like,” Oh I need clothes now.”  it’s the right amount of whimsy, you know? If you're in a profession and you can get away with it, why not?

MHI: Plus, it’s good for infection control.

Dr. Shah: That’s also true.

MHI: I’m excited to learn more about your incredible insight on the healthcare system and the ways you have dedicated your time to helping improve it. 

To start, as a physician, your focus is rather unique.  Most of the people I know who choose to go into medicine, are of course focused on taking care of people.  It’s truly an inspiring profession and one of those things that as a kid, I always thought, “ I wish I could do that,” but technology took me in other directions.  However, very few of the physicians I know focus on the cost of care.  For you, I know this started very early in your career.  I’d love to hear about what led you down this path.

DR. SHAH:  I didn’t come into med school with a hot take or a soapbox. You know, I’m an Indian kid from New Jersey and had a totally straight-laced pre-med track.  It also probably came from the fact that I’m a son of immigrants and grew up being conscious of the fact that the people who come to see medical students or faculty are not the ones with the deep pockets.

Providence is also a pretty impoverished city—that’s where I was in med school.  We were making decisions on behalf of the people we were caring for, without any insight into what they had to pay, nor how it impacted GDP, but certainly not what they had to pay.  That seemed really dissonant for me, given that in medical school, everybody above you seems omniscient.  The fourth-year medical students seemed like they knew everything.

But really, nobody has this insight - it was a blind spot.  It was the lack of insight, combined with the fact that we were sort of carrying out causing harm—in some cases, ostensible, palpable harm—and it wasn’t something we were owning. That’s what started it for me.  It became the thought that I woke up with and the thought I went to bed with.  I’m sure you understand with whatever topic makes you crazy.

MHI: This frustration sounds very familiar.  At SwipeSense, we focus on helping to eliminate harm and waste in hospitals as well.  You talk about waste in this video, Why is Providing Better Care at a Lower Cost so Important Right Now. What would you say is the number one area in healthcare where waste still unnecessarily exists today?

DR. SHAH: You can rank waste according to lots of criteria. You can rank according to buckets of money. You can rank according to just ridiculous common sense. One that falls into the ridiculous common sense bucket, but is not a huge bucket of money necessarily, is that every patient in every hospital room in America gets their blood drawn every day, whether they need to or not.

Once a physician has a tube of their blood, they can do anything to it. This is part of the challenge. There is the clinical workflow, the financial workflow, and then the person’s experience, which are three totally untethered things. The patient only experiences the blood leaving their vein, not the clinical workflow that follows.  That tube goes to the lab, gets centrifuged, gets reagents.  From there, the finance office generates line items on a bill, but are not considering how much it costs for magnesium as opposed to sodium for the patient’s bill. 

MHI: Or whether insurance covers it too.

DR. SHAH: Exactly. And meanwhile, the clinician doesn’t necessarily value the degree to which we’re spending money and the impact on patient care.  That was something that more than a decade ago, drove me crazy.  I would try not to check somebody’s blood count if I didn’t need to, and the system made it nearly impossible.

That was the idea behind Costs of Care (costsofcare.org).  It’s not revolutionary.  Clinicians are responsible for a lot of things, and we need to be conscious of burdening them with more to shoulder.  It may seem crazy to ask them to also take responsibility for the affordability or the finances of the system. On the one hand, it’s somewhat of a false choice because we take responsibility for genomics—that’s a new thing. 

Regardless, it simply requires deploying a lot of tasks and knowledge we already have. We’ve got a pretty good sense that an MRI machine or proton beam machine is more expensive than an X-ray, but we don’t necessarily incorporate that into our decision making.

And today, the affordability of healthcare is touching everyday Americans in a very different way than it did a decade ago. Healthcare was always an abstraction. Percentages of GDP are really hard to wrap your mind around.  

In 2020, healthcare is in fact the least affordable it has been for the average American in a half century and a lot of people are marginalized, and don’t have a voice.  The average American today has a several-thousand-dollar deductible that they’re guaranteed to blow because they’re pregnant or just because they stubbed their toe and walk into an emergency room. It’s a lot of money that our industry is not taking into consideration. 

MHI: For the average American, that’s the difference between not being able to pay rent. 

DR. SHAH: Exactly.  And those dollars are not being taken into consideration. 

MHI: Why do you think there’s such a disconnect between finance and quality in hospital administrations?  There seems to be always a debate. “Should we invest in something that improves quality, if the ROI isn’t high?” We are putting patient wellness on one side of the scale and dollars on the other side. 

What is your take on this debate and how can we address this challenge?  

DR. SHAH: There are very clear structural reasons for why it’s this way. Through a series of historical accidents, we ended up where we are, but a big part of the reason is that we just didn’t have to. Nobody forced our hands to connect the dots.

For example, almost every hospital is staffed to the gills with revenue cycle managers, but what about the idea of cost cycle management?  Not only is cost cycle management not staffed, but it’s a foreign concept. The capability to calculate activity-based costing in our hospitals doesn’t exist. We don’t know what anything costs, right? So for every episode of care, we know how to turn out and optimize our billing.

But what we care about is not just the revenue; it’s our margin. On the cost side, we know that roughly, our staff costs this much, and our supply closet and our electricity bill is this much, but I can’t tell you what it costs to deliver one baby.  I can tell you how much I make. The implications of that are that we can’t do any of the process engineering or operation stuff that your company is shedding light on through monitoring technology.

It should be a very simple exercise.  A woman comes in for her first prenatal visit and my job is to get a battery of tests.  Her experience during the 15-minute visit includes talking to me, maybe an ultrasound, maybe scheduling some follow-up appointments, maybe drawing her blood.  Then on the billing side, all of those things become individual line items on a bill.  It’s then snail-mailed back to the patient, which she’ll receive weeks later.

MHI: With some garbled language.

DR. SHAH: Yes, and then we’re already in the second trimester by that point. But if someone were to map the patient experience flow and the clinical workflow from the clinician’s perspective, and then with the backend finance process, you’d be able to create multiple points of meaningful connection.

In an environment that’s surrounded by alarm bells, so much so that the most disconcerting noise in a hospital, is silence.  There’s no red flag, there’s no alarm that goes off when I’m about to hose somebody with a high medical bill.  Nobody warns me. The only way to find out is when the patient gets a bill, months later. This is a solvable problem.

"In an environment surrounded by alarm bells, so much so that the most disconcerting noise in a hospital, is silence.  There’s no alarm that goes off when I’m about to hose somebody with a high medical bill.  The only way to find out is when the patient gets a bill, months later. This is a solvable problem." — Dr. Neel Shah

Absolutely. Medicine has changed, but the finance world hasn’t evolved with it.  Value-Based Care happened, but left the future unevenly distributed.  In your book, Understanding Value-Based Healthcare, I love the argument that cost is quality. 

These things shouldn’t be separated.  In the last decade, what areas in healthcare do you believe have seen improvement?

DR. SHAH: I think that there have been real shifts, and it’s important to step back and recognize that. We have moved from a professional paradigm that was all about thoroughness - where thoroughness was the leading value.

In other words, If you had chest pain, I would ask you for everything. That was the pedagogy.  Everything about the way we were trained in medicine was, “What are the causes of chest pain?” Then your job as a medical student is to rattle off every cause, which was fine in the 1950s, because there were five, but now there are 5,000 possible causes.  And not only can you not name them all, but you can’t test for them all.

There’s a new professional norm that did not exist ten years ago, where we know the goal is not thoroughness. It’s appropriateness. And I think we’re at the inflection point now of moving to a new paradigm, where it’s not just about appropriateness. It’s about appropriateness plus affordability, recognizing that this is the least affordable healthcare has been for the average American in a half century, and sometimes things are both appropriate and expensive.

There are a number of things that a clinician on the frontline can do, short of changing policy, to get a patient something that they need and is expensive. That’s been a tectonic shift, actually, in professional norms—the subtle one. Professionalism is hard to see. But you can feel it. You can see it in the new crop of medical students.  I think the move to accountable care organizations, obviously, has been huge.

MHI: As this shift occurs, how do you think we can attract more young energy and talent into medicine - talent that brings entrepreneurial thinkers, academics, non-profit leaders, and others from the outside in to make a tremendous impact? 

DR. SHAH: Do you want a tactical answer or a philosophical one?

MHI: Both!

DR. SHAH: There’s always going to be an adoption curve among any group of people.  At the front end of the curve, there are those ready to innovate and disrupt.  The answer is to encourage and validate that group.  They view the opportunity for progress differently.  They have much stronger takes on where we have to go.  My defaults and norm just don’t go far enough.  I recognize fully that when I was in their shoes, I felt the same way and my mentors validated me and encouraged me.  That made all the difference.

MHI: Who was that person for you?

DR. SHAH: There were a few, but the dean at my medical school is still a close mentor of mine. I told them that I wanted to leave medical school to see something else through, and there was not really a clear model. There was not a lot of precedent for that, but he gave me what I needed, which was an injection of tiger blood and faith that I would figure it out.

MHI: I love that. I had a similar conversation with my dean of engineering school. 

DR. SHAH: Yeah, totally! I think listening, validating, reflecting back, and realizing that progress comes from zero-gravity thinking.  I had a mentor who told me something that seemed cynical at the time, but actually was very, very true, which is, if you are doing something that you think has never been done before, either you're wrong and somebody has, or there’s a really good reason they haven’t done it. So, figure out which category you're in, and then do it! 

I think the philosophical answer, though, is that improving healthcare is a collective action problem, just like climate change. The big, big problem and challenge in 2020 is that we don’t feel connected to each other anymore for a whole variety of reasons. We need more than shouting from mountaintops. We need ways of forging connection and alignment, and we need the right people in leadership to move together. It’s not the fault of the pharmaceutical companies or payers or providers or purchasers or patients who are too demanding.  It’s all of us. 

About Dr. Neel Shah

Costs+of+care_Neel_ShahDr. Neel Shah, MD, MPP, FACOG, is the Assistant Professor of Obstetrics, Gynecology and Reproductive Biology at Harvard Medical School, and Director of the Delivery Decisions Initiative at Harvard’s Ariadne Labs. He is also an obstetrician-gynecologist at Beth Israel Deaconess Medical Center in Boston and is widely profiled and published as one of the smartest, most influential people in healthcare.  He has written more than 50 peer-reviewed academic papers and contributed to four books, including as senior author of Understanding Value-Based Healthcare (McGraw-Hill), which Don Berwick has called "an instant classic" and Atul Gawande called "a masterful primer for all clinicians."

When Dr. Shah is not teaching or treating patients, he is involved with several organizations that support women’s health and the wellbeing of mothers.  Prior to joining the Harvard faculty, he also founded Costs of Care, an NGO that curates insights for clinicians and patients to help delivery systems provide better care, and is co-founder of March for Moms Association.

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