Health Evolution: (Quality Equals Learning) Plus (Ethics Equals Justice)


HEALTH EVOLUTION:

(QUALITY = LEARNING) + (ETHICS = JUSTICE)

Peter J. Hammer*

INTRODUCTION ................................ ..... 415
I. THE HEALTH CARE (NON)SYSTEM Is BROKEN... ...... 416

A. General Indictment of Health Care: Cost, Quality and
Access .................................... 417

B. Symbolic Indictment: Medical Errors and Racial
Disparities. ................................. 419
1. Medical Errors ...................... ...... 419
2. Racial Disparities ..................... ..... 422

II. WHAT DRIVES THE BIOMEDICAL INDUSTRIAL COMPLEX?. 424
A. The Balkans of American Health Care........ .... 424
B. The Political Economy of Health Care..... ...... 429
C. The Conundrum of Asymmetric Information............432
D. The Limited Role Law Plays in Shaping Health

Care ...................................... 434
III. RE-IMAGINING HEALTH CARE QUALITY AND ETHICS ..... 436

A. Re-Imagining: Health Care Quality = Learning......436
B. Re-Imagining: Health Care Ethics = Justice ........... 441

IV. Conclusion. ........................... ....... 445

INTRODUCTION

True revolutions are rare. Rather, transformative change
is often the result of evolutionary processes. Unfortunately,
there is no guarantee that a system will evolve in positive
directions. Constructive social evolution requires a complex
set of selection mechanisms, feedback loops and built in
learning processes. In the absence of an appropriate
supportive framework, it is just as likely that a system will
stagnate, fracture, disintegrate or grow in maladaptive ways.
This essay takes up the challenge to imagine the health care

* Peter J. Hammer is a Professor of Law and Director of the Damon J.
Keith Center for Civil Rights at Wayne State University Law School in
Detroit, Michigan.



INDIANA HEALTH LAW REVIEW

"system" in the next quarter century as it relates to issues of
quality and ethics and to further explore its implications for
law and policy.

Part I outlines the starting premise that there is, in fact,
no functioning health care "system" in America. It is at best a
broken system, but may be so lacking in intra-system
rationality and coherence as to constitute a non-system or an
anti-system. Health care in America costs too much, excludes
too many and provides insufficient guarantees of safety and
quality. The endemic problem of medical errors and patient
safety illustrates the high degree of intra-system irrationality
and calls for a re-imagining of quality that incorporates
notions of learning. Persistent health inequalities and racial
disparities in health highlight extreme inter-system
irrationalities and the failure of biomedical understandings of
health to properly interface with notions of public health and
the social and economic determinants of health. This crisis
calls for a re-imagining of health care ethics that expressly
incorporates notions of justice.

Part II attempts to better understand the forces that drive
the American biomedical industrial complex in an effort to
diagnose its systemic failures from an evolutionary
perspective. Part III engages in the imaginative exercise of
visualizing what health care might look like in a world where
quality is associated with learning, ethics is associated with
justice and the health care system is consciously approached
from an evolutionary perspective.

I. THE HEALTH CARE (NON)SYSTEM IS BROKEN

The starting point of analysis in health law must be that if
you are looking for the health care system, there is simply no
"there" there. Merriam-Webster's online dictionary defines a
system as "a regularly interacting or interdependent group of
items forming a unified whole" or "a group of interacting
bodies under the influence of related forces <a gravitational
system>" or "an assemblage of substances that is in or tends
to equilibrium <a thermodynamic system.>"' Health care is

1 System Definition, MERRIAM-WEBSTER ONLINE DICTIONARY,
http://www.merriam-webster.com/dictionary/system (last visited Mar. 18,

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so lacking in intra-system rationality or coherence that it fails
to satisfy the basic characteristics of a unified system.2

Moreover, if one imagines how the health care "system"
interacts with other systems from a general equilibrium
perspective, such as the food system, the job system, the
education system, the environmental system and the housing
system, one finds a comparable story of inter-system
irrationality. Biomedical understandings of health stand in
isolation from the broader social and economic determinants
of health. The biomedical health care system does not even
interface effectively with the public health "system," such
that there is one. These failures are so well established that
they need only be briefly outlined here.

A. General lndictment of Health Care: Cost, Quality and
Access

The iron triangle of cost, quality and access provides a
standard means of evaluating health system performance.
Boldly stated, the American system fails with regard to each
measure. It costs too much. We get too little and we exclude
too many. The Commonwealth Fund has produced a number
of comparative studies of Organization for Economic
Cooperation and Development (OECD) countries in terms of
health care costs and outcomes:

Health care spending in the U.S. in 2008
towered over the comparison countries, both per
capita and as a percentage of gross domestic
product (GDP). . . . With regard to quality, U.S.
performance on a limited set of measures was

2013).
2 Peter J. Hammer, Arrow's Analysis of Social Institutions.

Entering the Marketplace with Giving Hands., in UNCERTAIN TIMES:
KENNETH ARROW AND THE CHANGING ECONOMICS OF HEALTH CARE 215,
226-27 (Peter J. Hammer et al. ed., 2003) ("What is more important (and
arguably what has been missing in U.S. health policy) is a commitment to
intra-system rationality . . . . Some of the most important challenges
facing U.S. health care policy makers involves the need to impose greater
rationality on patterns of clinical practice and processes of technological
innovation.").

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INDIANA HEALTH LAW REVIEW

variable. Five-year survival rates for patients
with three types of cancer were relatively high;
the U.S. ranked near the middle on in-hospital,
case-specific mortality for three conditions within
30 days of admission. The U.S. also had among
the highest rates of hospital admissions for five
chronic conditions and the greatest number of
lower-extremity amputations due to diabetes.
These findings suggest that the U.S. health
system is not delivering superior results despite
being more expensive, indicating opportunities
for cross-national learning to improve health
system performance. 3

These numbers do not even begin adequately to account
for the millions of people who cannot gain access to the health
care system. There are more than 50 million uninsured
people in the United States. This is the same as the
"combined population of Oklahoma, Connecticut, Iowa,
Mississippi, Kansas, Kentucky, Arkansas, Utah, Oregon,
Nevada, New Mexico, West Virginia, Nebraska, Idaho, Maine,
New Hampshire, Hawaii, Rhode Island, Montana, Delaware,
North Dakota, South Dakota, Alaska, Vermont and
Wyoming."4 It also points to a troubling reality with the
Affordable Care Act (ACA). With a broken system that costs
too much already for the too few it serves, a health reform
strategy that simply increases access without making
structural, systemic reforms will not be sustainable.

The international data are particularly important because
they permit aggregate comparisons of the entire health
system's performance. As a system, we deserve a failing
grade. No system spends a greater percentage of available
GNP on biomedical notions of health care. Our performance

3 David A. Squires, THE U.S. HEALTH SYSTEM IN PERSPECTIVE: A
COMPARISON OF TWELVE INDUSTRIALIZED NATIONS 2 (2011), available at
http://www.commonwealthfund.org/-/media/Files/Publications/Issue%20B
rief/2011/Jul/1532_SquiresUS_hit sysjcomparison12nations intlbrief
v2.pdf.

4 Matt Miller, GOP to the Uninsured: Drop Dead, WASH. POST (July
10, 2012), http://articles.washingtonpost.com/2012-07- 10/opinions/
35488825_1_uninsured-people-uninsured-man-republican-governors.

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is at best mediocre. At the same time, an unacceptable
percentage of Americans stand on the outside of the system
looking in. Just as unfortunate, the system unintentionally
harms many of those that it seeks to serve.

B. Symbolic Indictment: Medical Errors and
Racial Disparities

We can go beyond the general indictment and examine
two issues that provide deeper insights into systemic failures.
These are important substantive issues on their own, but
they also have symbolic significance. The first is the endemic
problem of medical errors, which highlights issues of intra-
system irrationality. The second concerns racial disparities
in health. These categorical health inequities provide a vivid
illustration of inter-system irrationalities in health care.

1. Medical Errors

For more than a decade, the problem of medical errors and
patient safety has been at the forefront of health policy. The
1999 IOM Report To Err is Human reported countless
injuries and perhaps nearly 100,000 deaths taking place each
year as a result of preventable errors.5 The ensuing decade
has witnessed countless public and private initiatives to
improve patient safety. Nevertheless, few would claim that
we have made sufficient progress. 6

5 INST. OF MEDICINE, To ERR Is HUMAN: BUILDING A SAFER HEALTH
SYSTEM 26 (Nov. 1999) ("Preventable adverse events are a leading cause of
death in the United States. When extrapolated to the over 33.6 million
admissions to U.S. hospitals in 1997, the results of these two studies imply
that at least 44,000 and perhaps as many as 98,000 Americans die in
hospitals each year as a result of medical errors."). See also INST. OF
MEDICINE, CROSSING THE QUALITY CHASM: A NEW HEALTH SYSTEM FOR
THE 21ST CENTURY (Mar. 2001) (using shortcomings in health care quality
to provide a comprehensive critique of medical care in America from a
"systems theory" perspective).

6 Delos Cosgrove et al., A CEO CHECKLIST FOR HIGH VALUE HEALTH
CARE 4 (2012), available at http://www.iom.edu/~/media/Files/
Perspectives-Files/2012/Discussion-Papers/CEOHighValueCheckhst.pdf
("Patients are still harmed by medical errors. Recent assessments indicate
that 10 years after the IOM report To Err Is Human estimated that

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INDIANA HEALTH LAW REVIEW

Why have we failed to make better progress on this front?
It is easy to frame patient safety and medical errors as issues
of quality. These issues, however, provide a window into the
way the health care system works or fails to work as a
cohesive whole.7 Medicals errors highlight the dimensions of
intra-system irrationality: the fractured nature of the
hospital as a health care firm; the hyper-specialization of
physician expertise; and the failure to devise effective means
of coordination and communication. In addition, medical
errors illustrate the lack of the capacity for the existing
system to learn and adapt.

Medical care is becoming increasingly complex. As
complexity increases, so does the need to manage resources
and information. Coordination and cooperation become
essential. What is needed in this environment is obvious.
The "regularly interacting or interdependent group of items"
constituting how health care is organized and financed need
to form "a unified whole."8 Yet, this is precisely what is so
often lacking. Its absence, unfortunately, is the cause of
countless hospital infections, prescription mishaps and
delayed or mis-diagnoses. The lack of system-ness is
similarly a major cause of our failure to effectively manage
many chronic conditions.9 Effective systems, however, do not

medical errors cause up to 98,000 deaths in hospitals each year, roughly
15 percent of hospital patients are still being harmed during their stays.
Poor care coordination places further strain on patients and the system,
with roughly 20 percent of discharged elderly patients returning to the
hospital within 30 days.") (footnotes omitted).

7 INST. OF MEDICINE, To ERR Is HUMAN, supra note 5 at 3 ("The
decentralized and fragmented nature of the health care delivery system
(some would say 'nonsystem') also contributes to unsafe conditions for
patients, and serves as an impediment to efforts to improve safety.").
Indeed the Crossing the Quality Chasm report is organized almost entirely
around approaching quality and health reform from the perspective of
complex adaptive systems. INST. OF MEDICINE, CROSSING THE QUALITY
CHASM, supra note 5 at 63-67, 309-22.

8 See MERRIAM-WEBSTER, supra note 1, for the definition of system.
9 The promotion of "medical homes" is an effort to impose greater

systemic cooperation in the treatment of chronic conditions in a system
lacking in such cohesiveness. The Henry J. Kaiser Family Foundation,
Focus on Health Reform: Medicaid's New "Health Home" Option (Jan
2011), available at http://www.kff.org/medicaid/upload/ 8136.pdf ("Many
Medicaid beneficiaries suffer from multiple or severe chronic conditions

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HEALTH EvoLUTION

arise accidentally. They require effective organizational
structures, regulatory and financial infrastructures,
information, incentives and professional socialization. When
viewed from this framework, one can start to develop useful
intuitions on how particular categories of medical errors
suggest deficiencies in particular aspects of system's
integrity.

Coherence, integration and coordination are all important
aspects of well-functioning systems. An evolutionary
perspective of systems adds one other important
consideration - the capacity for learning and adaptation. The
existence of numerous medical errors highlights the lack of
effective system performance. The persistence of medical
errors highlights the lack of effective mechanisms for
learning, feedback and adaptation. The same errors happen
time and time again. Different organizational structures
have different capacities for learning and adaptation. These
are not simple matters. Many of the factors impeding
effective system performance also forestall the capacity to
learn and adapt. The incentive to learn and adapt, for
example, is weakened if the reimbursement system provides
greater compensation for making a mistake and treating its
consequences than fixing it. It is clear, however, that in
considering the future of health law in the next quarter
century, the capacity for learning and the conditions that
facilitate adaptation must become central parts of how we
consider health care quality. Such re-imagining will
necessarily take us further down the road of greater intra-
system rationality. Similar lessons could be drawn from the
persistence of small area variations in health practices as
documented in the Dartmouth Atlas Project. 10

and could potentially benefit from better coordination and management of
the health and long-term services they receive, often in a disjointed or
fragmented way.").

10 Dartmouth Atlas of Health Care, DARTMOUTH ATLAS PROJECT,
available at http://www.dartmouthatlas.org/ (last visited Mar. 18, 2013)
("For more than 20 years, the Dartmouth Atlas Project has documented
glaring variations in how medical resources are distributed and used in
the United States.").

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2 Racial Disparities

Medical care is not the only factor contributing to an
individual's and a population's level of health. The literature
on the social and economic determinants of health
demonstrates how income, housing, education, nutrition and
the environment influences health outcomes, often in
manners more dramatic than one's access to a physician."
As a society, we must not only care about how well the health
care system functions internally (intra-system rationality or a
static equilibrium framework from an economic perspective),
we must also care about how the health care system interacts
with other sectors that affect health outcomes (inter-system
rationality or a general equilibrium framework from an
economic perspective). The literature on health inequalities
and racial disparities in health provide insight into these
issues. Health outcomes vary substantially by socioeconomic
category and by racial groups, even independent of
socioeconomic status.12 As Ralph B. Everett, President of the
Joint Center for Political and Economic Studies, reminds us:
"[not everyone in the United States enjoys the same health
opportunities. Studies show that minority Americans
experience poorer than average health outcomes from cradle
to the grave. They are much more likely to die as infants,
have higher rates of diseases and disabilities, and have

11 WORLD HEALTH ORG. COMM'N OF Soc. DETERMINANTS OF HEALTH,
CLOSING THE GAP IN A GENERATION: HEALTH EQUITY THROUGH AcTION OF
THE SOCIAL DETERMINANTS OF HEALTH 1 (2008), available at
http://whqlibdoc.who.int/publications/2008/9789241563703_eng.pdf ("The
poor health of the poor, the social gradient in health within countries, and
the marked health inequities between countries are caused by the unequal
distribution of power, income, goods, and services, globally and nationally,
the consequent unfairness in the immediate, visible circumstances of
people's lives their access to health care, schools, and education, their
conditions of work and leisure, their homes, communities, towns, or cities
and their chances of leading a flourishing life.").

12 See generally INST. OF MEDICINE, UNEQUAL TREATMENT:
CONFRONTING RACIAL AND ETHNIC DISPARITIES IN HEALTH CARE (2002),
available at http://www.iom.edul-/media/Files/ Report%20Files/2003/
Unequal-Treatment-Confronting-Racial-and-Ethnic-Disparities-in-Health-
Care/DisparitiesAdmin8pg.pdf.

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HEALTH EVOLUTION

shorter life spans."13 One dramatic illustration of this is the
health status of elderly residents in Detroit. "Detroit area
residents age 60-74 are dying at a rate 48% higher than their
peers in the rest of the state."14

This is one of the most important civil rights issues of our
day, one that will hopefully start receiving the attention it
deserves in the next quarter century. Unfortunately, the
health care system has an incredibly narrow biomedical
understanding of the meaning of "health." Similarly, the
health care system has an incredibly narrow biomedical
understanding of "ethics." There needs to be a re-imagining
of health care ethics in a manner where the problems of racial
disparities in health are viewed first and foremost as ethical
concerns. This will require a new medical ethics that
expressly incorporates notions of justice.

Racial disparities in health serve a deeper symbolic
function and provide a window into the extreme inter-system
irrationality of American health care. 15 If one adopted a
general equilibrium perspective and was only concerned
about maximizing health outcomes, in equilibrium, the
marginal increase in health for every dollar spent in every
sector would be the same. Assuming we had the metrics to
operationalize this "dollar test," how would the health payoff
of an extra dollar devoted to the biomedical sector compare
with the health payoff of that same dollar devoted to public
health, or education, or housing, or food support? If one were
to focus on investments in preventative care, at least one
study suggests a greater than five-to-one return on
investment over a five year period.16 As health care is

13 Ralph B. Everett, Foreword to THOMAS A. LAVEIST ET AL, THE
ECONOMIC BURDEN OF HEALTH INEQUALITIES IN THE UNITED STATES
(December 2009), available at http://www.jointcenter.org/hpilsites/all/
files/BurdenOfHealthFINAL_0.pdf.

14 DETROIT AREA AGENCY ON AGING, DYING BEFORE THEIR TIME 4
(2003), available at http://www.daaala.org/DAAAlmedia/DBTT%20
Synopsis.pdf.

15 While this article focuses on the socio-economic determinants of
health and the need for greater inter-system rationality, serious issues of
race and racial inequalities also exist inside the health care system.

16 Trust for America's Health. Prevention for a Healthier America.
Investments in Disease Prevention Yield Significant Savings, Stronger

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INDIANA HEALTH LAW REVIEW

trending to consume nearly twenty percent of GNP, if we
were only concerned about health, we could achieve better
health outcomes by reallocating health dollars outside of the
health sector.

Not only is there deep intra-system irrationality in health
care, there is deep inter-system irrationality in health care.
The negative effects of this inter-system irrationality fall
disproportionately on under-represented minority groups and
the poor. As we re-imagine health care in the next quarter
century, we need to imagine means to improve the
distribution of resources between traditional biomedical and
other health-related sectors. We also need to imagine how to
better address underlying racial disparities in health. Both of
these efforts will require a new health ethics better attuned
with notions of social justice.

II. WHAT DRIVES THE BIOMEDICAL INDUSTRIAL COMPLEX?

To imagine the next quarter century, it is necessary to
have an idea of where we are now, how we got here and the
dynamic processes driving the system. We are starting from
the intuition of health care as a dysfunctional system lacking
in intra- and inter-system rationality, but we need to better
understand the interdependent public, private and
professional infrastructures that seek to regulate and control
the health care system, as well as the internal forces that
drive it. To state that a system is dysfunctional is not to say
that it lacks power, intensity or drive. It need only be
recalled that the essence of cancer is the unregulated growth
of cells to appreciate the potential power of dysfunctionality.

A. The Balkans ofAmerican Health Care

The dysfunction of health care has its own geography.
Balkanization is the antithesis of integration, coherence and
synthesis. To Balkanize is "to break up (as a region or group)
into smaller and often hostile units."17 Health law and policy

Communities, 3 (2008), available at http://healthyamericans.org/reports/
preventionO8/PreventionO8.pdf.

17 Balkanize Defmition, MERRIAM-WEBSTER ONLINE DICTIONARY,

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sadly operate in the Balkans of American health care.' 8 On
the front end, health care finance is divided between public
payment and private payment. Public payment is further
divided between Medicare and Medicaid. Medicare is further
divided into Parts A, B, C and D. Private payment is divided
between large-group insurance policies, small-group polices
and the absence of payment (the uninsured). On the back
end, the Balkanization of health finance can be seen in terms
of the diverse patients (and therefore payment systems) who
may show up in any given physician's waiting room. The
dozens of patients seen each day could each pay for a
comparable set of services in a completely different manner.

The regulation of health care is Balkanized through a
complex array of state and federal, judicial common law,
administrative, statutory and quasi-public professional self-
regulatory processes. Through traditional state police
powers, states control the licensing of health professionals
and institutions (to the extent that they do not loosely sub-
delegate that responsibility to the professions themselves or
to professional organizations). States also largely control the
regulation of health insurance, unless those regulations affect
self-insured employer plans and are therefore subject to
federal ERISA preemption and almost no regulation at all.
By default, the complex rules governing ERISA have been
ceded to the shifting opinions of the federal courts.

The source of federal constitutional authority to act in
health care has become a more controversial and momentous
question than anyone might have ever anticipated. Medicare
and Medicaid are an outgrowth of the spending power, but
also prove that substantial strings come attached to the
receipt of federal funds. For example, Medicare and Medicaid
have their own standards for participating organizations and
efforts to ensure quality, that run in parallel to state
regulations and state common law malpractice suits.
Furthermore, outdated and ill-suited forms of Medicare

http://www.merriam-webster.com/dictionary/balkanize (last visited Mar.
18, 2013).

18 Peter J. Hammer, Competition and Quality as Dynamic Processes
in the Balkans of American Health Care, 31 J. HEALTH POL. POL'Y & L.
473 (2006).

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reimbursement necessitate Byzantine rules governing self-
referrals, kickbacks and false claims, along with tremendous
efforts to combat fraud and abuse. A real but often hidden
cost of these rules is the extent to which laws fighting fraud
and abuse in public payment systems have constrained the
evolution of organizational forms and limited economic
innovation on the private side of the health care system. The
fractured Balkans of American health care also includes
robust private markets for physician services, hospitals,
pharmaceuticals and medical devices. But, sadly, private
competition in dysfunctional systems will often (efficiently)
produce dysfunctional results.

What are the implications of a Balkanized anti-system on
private organizational forms and economic forces? I have
written elsewhere about the puzzle that the traditional non-
profit hospital structure presents from the perspective of
Coase's theory of the firm. 19 Rather than coming under
common ownership and control, the human (physician),
physical (hospital) and financial (insurance) capital
associated with the financing and delivery of health care
services has traditionally been broken up and divided into
separate economic parts. In essence, the basic units of
payment and production became, themselves, mini-Balkans.
The incentives (good and bad) of this fractured structure can
be contrasted with the incentives of a more integrated unit of
production where human, physical and financial capital are
under unified ownership and control, such as the Kaiser
health system or the Henry Ford health system. One can
theoretically take an even greater step towards systemic
coherence by imagining the integrated unit as a form of
mutual insurance, where ownership and control was vested in
the insured themselves. 20 The same economic function can be
operationalized in many different organizational forms, but
specific organizational forms matter because organizational

19 Peter J. Hammer, Medical Antitrust Reform: Arrow, Coase and
the Changing Structure of the Firm, in THE PRIVATIZATION OF HEALTH
CARE REFORM 113, 117-18 (Gregg Bloche ed.) (2003).

20 One further step could envision the same structure unified under
public ownership and control in a single payer system where individual
preferences were exercised by votes rather than dollars.

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structure governs individual incentives. Differently
organized units will have radically different sets of interests
and objectives. A corollary lesson is the more divided and
Balkanized the system, the more difficult it can be to ensure
that all costs and benefits are effectively internalized in any
faction's decision making.

What are the implications of a Balkanized anti-system on
the evolution of organizational forms? Well-functioning
private markets can create strong incentives for dynamic
efficiency and the evolution of organizational forms and
contracting practices that improve welfare. That said,
predictions are dangerous. Early in my career, based on the
Coasian logic suggested above, I predicted the evolution of
managed care into increasingly tighter forms.21 This did not
happen. Instead, we have observed patterns of herding and
cycling on the private side of the market moving towards and
then away from tighter forms of integration. 22 The paradox is
partially resolved when one appreciates the many ways that
the Balkans of American health care can impede normal
evolutionary processes. The absolute din of conflicting
payment plans reflected in the physician's waiting rooms
drowns out the ability of any one set of financial incentives,
even Medicare's, to drive organizational forms. The Medicare
rules governing self-referrals and fraud and abuse are
designed to remedy defects in Medicare's own payment
system, but have the unintended side effect of constraining
evolutionary paths on the private side of the market. As a
result, private evolutionary potential is not realized. One can
view current efforts to establish Accountable Care
Organizations, (ACOs) as a romantic hope and a prayer to
obtain the end results of rational adaptation and evolutionary
processes, without the underlying infrastructure necessary to
enable its creation. If one cannot transcend the negative
forces of Balkanization, the aspirations of ACOs will not be
realized. Ironically, if one could transcend the constraints of
the Balkans, ACOs would not be necessary.

In the absence of rational adaptation, one should expect
various forms of maladaptation. If one wants to understand

21 MedicalAntitrust Reform, supra note 19 at 118.
22 Balkanization ofAmerican Health Care, supra note 18 at 485-88.

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what is really driving the biomedical industrial complex, one
needs to come to terms with two underappreciated
phenomena.23 The first concerns how health insurance is
radically different from most other forms of insurance.
Indeed, health insurance is not insurance at all, it has been
transformed into a vehicle of health finance. John Nyman
develops this argument in his article, The Value ofInsurance:
The Access Motive.24  Traditional insurance serves the
function of (1) pooling like risks and (2) shifting risk.
Individuals use insurance, in essence, to transfer money from
healthy states of the world to unhealthy states. They will
continue to buy insurance to transfer such money until the
marginal rates of substitution are equalized in all possible
states of the world. Insurance in this traditional framework
is subject to the initial budget constraint of the individual
insured. Traditional insurance cannot create a greater
expected value in an insured state than exists in the original
state. Contrast this with how health insurance works for
those lucky enough to be able to access the system. Nyman
argues that people use health insurance to buy "access" to
care they could not otherwise afford.25  He provides an
example of an individual earning $50,000 who needs a
$300,000 liver transplant that exceeds their income, assets
and ability to finance care through traditional commercial
means.26 Health insurance becomes a vehicle to collectively
finance health care, not a vehicle of pooling or shifting risk.27

This has radical implications for the potential economic
metastasizing of the biomedical industry.

The largest driver of health care cost is technology. At the
complex interplay between insurance and technology, Sherry
Glied, has coined the term "dynamic moral hazard."28 There

23 Peter J. Hammer, Diagnosing America ' Health Care Ills: Analysis
Beyond Epithet, 15 MICH. ST. J. MED. & L. 337, 338-40 (2011).

24 John Nyman, The Value o/Insurance: The Access Motive, 18 J.
HEALTH ECON. 141 (1999).

25 Id. at 150.
26 Id. at 144.
27 Id at 150.
28 Sherry Glied, Health Insurance and Market Failure Since Arrow,

in UNCERTAIN TIMES: KENNETH ARROW AND THE CHANGING ECONOMICS OF
HEALTH CARE, 103 (Peter Hammer, et al., eds. 2003).

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HEALTH IEVOLUTION

are strong access incentives from health insurance, without
comparable mechanisms for internalizing the costs of
decisions in individual decision makers. Consequently, at the
front end, insurance creates incentives for additional research
and development. At the back end, insurance contains few
active means of technology assessment and, in fact,
significantly speeds the diffusion and use of new technology,
creating additional profit and incentives for future R&D -
dynamic moral hazard. All the while, insurance contains few
individual incentives for cost control. Indeed, in a perverse
form of bootstrapping self-blackmail, given the rising costs of
health care technology, individuals continue to buy insurance
to gain accessing to the future technology that they otherwise
would be unable to afford.

B. The Political Economy of Health Care

In some respects, the Balkans of American health care
presents a misleading image. In the actual Balkans, the
sharp rugged mountains, valleys and coastlines are concrete
geographic realities. In the Balkans of American health care,
these barriers, divisions and obstacles are our own path-
dependent creations. What are the forces that enable the co-
creation of such structures and how might they change? One
can picture the health care system being jointly shaped by (1)
political, (2) market and (3) professional processes.

Figure One

A k

Political

Fritic. 1
Health
Care

System

Profe
-Vket(Ci

SO&

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The simultaneous interplay of market, political and
professional processes co-create the health care system.29

Markets and politics present complementary processes for
aggregating social preferences and allocating resources.30

From this perspective, they serve more similar functions than
most people realize. Health care becomes particularly
complicated given the important role of specialized knowledge
(physician expertise), the inherently decentralized manner in
which health care must be dispensed and the corresponding
role of professionalism. 31

An important lesson from institutional economics is that
the same social function can be performed though many
different public, private and hybrid organizational forms.
Given this fact, how does one choose between competing
forms? Here, economic sociology is more helpful in
addressing these questions than more popular forms of public
choice theory. One needs to engage in a power analysis.
Actors will rationally manipulate market, political and
professional processes to obtain their desired objectives.
Antitrust law has sensitized us to the ways in which private
market power can be exercised to detrimental ends in the
private domain. As such, markets have the potential to yield
socially desired objectives or to be coopted for private ends.
Similar observations can be made of political processes.
There is an inherent capacity for political processes to be used
to pursue desired social objectives, but there is also the
capacity to be coopted for private ends. This would suggest
the need for potentially greater scrutiny of the substantive
results of political processes. It should be remembered that
monopolies, at one point, were dispensed by the crown.

Comparable issues are raised today in the field of
economic development. Despite the biases of neoclassical
economics, well-functioning markets cannot exist without

29 Peter J. Hammer, The Architecture of Health Care Markets
Economic Sociology and Antitrust Law, 7 HOUS. J. HEALTH L. & POL'Y 227,
237-51 (2007) (applying the lessons of economic sociology to health care
and stressing the role of politics, markets and professionalism).

30 Id. at 229.
31 See id. at 238-39 (discussing the complexities of the health care

market).

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appropriately robust public infrastructures. Development is a
simultaneous process of state-building and market-building.32

In this process, the market must be protected against the
inclinations of a predatory state and institutional constraints
must exist to limit the capacity of political processes to
expropriate private resources. At the same time, public
processes must be protected against cooption by private
economic interests. 33  Stated differently, comparable
institutional constraints must exist to ensure that public
action is in fact in the public interest. Ironically, pursuant to
the "state action" doctrine, American antitrust law largely
assumes that state action is in the public interest.34 This is
not a concession that antitrust law in developing countries
can necessarily make, where the predatory inclinations of the
state are sometimes more transparent. The assumption that
state action is necessarily in the public interest is also of
questionable historical validity as applied to American
medical markets, where state laws, driven at the behest of
the medical profession, substantially inhibited the growth of
pre-paid health plans and the evolution of better functioning
health care markets.35 Indeed, the robustness of present
market forces is in large part the result of the unintended
consequences of federal ERISA preemption. 36 Back to our
triangle in Figure One, federal ERISA preemption limited the
ability of medical professionalism to coopt state political
processes to restrict the growth of medical markets and
managed care in the 1980s and 1990s.

The shape of the health care system has been and
continues to be the contested product of complicated
interplays between market, political and professional
processes, the dynamics of which needs to be the subject of
more careful study and examination.

32 See generally DARON AcEMOGLU & JAMES ROBINSON, WHY
NATIONS FAIL: THE ORIGINS OF POWER, PROSPERITY, AND POVERTY (2012)
(contrasting politically and economically inclusive institutions that are
conducive to economic growth with politically and economically exclusive
institutions that restrict economic growth).

33 The Architecture of Health Care Markets, supra note 29 at 261-62.
34 Id. at 259.
35 Id. at 249.
36 Id.

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C The Conundrum ofAsymmetric Information

While the forces shaping the health care system are
difficult to model and largely under-determined, there are
aspects of health care that do make it different from other
sectors. As acknowledged by Kenneth Arrow as far back as
1963, one key aspect is the role of asymmetric information.37

Asymmetry of information (uncertainty) in health care is real
and helps shape the contours of the industry.38 Physicians
have specialized knowledge that patients lack. Patients face
fundamental uncertainties about what treatments to choose
and the efficacy of the treatments they select. There is no
guarantee that the treatment provided will be effective and
there is no market to insure against the risk of failed
treatment (non-marketability)39. Some types of uncertainties
are endemic and irresolvable. Moreover, when one adopts an
evolutionary perspective, yet a new type of uncertainty must
be recognized. Given the rapid changes in the health care
environment, there are additional asymmetries in the
capacity to understand and interpret the nature of change
itself.

It is possible to make some generalizations about the
differential effects of asymmetric information for the market,
political and professional processes shaping the health care
system. Significant asymmetries of information tend to
disempower market processes, as well as political processes.
This is significant. Simply transferring a problem laden with
uncertainty and asymmetric information from the market
realm to the political realm does not necessarily make it
easier to address, as acknowledged by Mark Pauly's non-
transformation theorem.40  To paraphrase crassly, an
ignorant consumer is also an ignorant voter. The

37 Kenneth J. Arrow, Uncertainty and the Welfare Economic of
Medical Care, 53 AM. ECON. REV. 941 (1963).

38 Id. at 946.
39 Id. at 945, 951-52.
40 Mark V. Pauly, Is Health Care Different., in COMPETITION IN THE

HEALTH CARE SECTOR: PAST, PRESENT, AND FUTURE (Warren Greenberg,
ed., 1978) 11, 24 ("The mere transfer of the locus of choice from the market
to the political process does not transform consumers into better judges of
quality, nor does it necessarily improve the decisions made.").

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asymmetries do not get resolved simply by changing the
forum. Analysis must go deeper to assess the relative
abilities of the competing fora to manage and address the
underlying uncertainty. This fact leads to the next
generalization. Asymmetries of information tend to empower
parties that can claim legitimacy in interpretation and
understanding. Historically, this has been the role of the
learned professions and a central thesis of Paul Starr's
analysis of the rise of physicians in controlling both markets
and politics for most of the twentieth century.41

What might these lessons mean for the future of health
care? The endemic nature of asymmetries of information
must be examined in combination with the inherently
decentralized nature of health care production and
consumption. Information is intrinsically difficult to
translate into a commodity that can be traded on the open
market (non-marketability).42 Interestingly, the education
and licensing of doctors and the historic branding of the
profession served as an effective means of bundling and
selling information in the form of the individual licensed
physician, making the information a marketable commodity.
The individual physician as the central unit of production,
however, has had its own limits and inefficiencies. As
illustrated by the colorful maps of the Dartmouth Atlas's
small area variations, physician-based units of production are
not very effective units for scientific learning or the
dissemination of best practices. As information systems
progress and comparative effectiveness research proceeds,
there need to be new and better ways to bundle information
that will make the individual physician's role less central. As
the unit of health care production moves from an individual-
based unit to a health-system-based unit, information will be
bundled, branded and sold at the systems level. This is
consistent with broader trends that have persistently de-
privileged the individual doctor in the production process.43

41 PAUL STARR, THE SOCIAL TRANSFORMATION OF AMERICAN
MEDICINE: THE RISE OF A SOVEREIGN PROFESSION AND THE MAKING OF A
VAST INDUSTRY 9-10 (1982).

42 Arrow, supra note 38 at 946.
43 See Peter J. Hammer, How Doctors Became Distributors: A

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These informational transformations could lay the basis for a
complete restructuring of the way health care is organized
and delivered (a different solution to Arrow's conundrum of
the non-marketability of information).

The same transformations have political implications as
well. As individual physicians lose their role as the
authoritative interpreters of medical information, they also
lose the political power and legitimacy that being the arbiters
of asymmetric information entailed. This, in turn, will lead to
further shifts in the market, political and professional
processes collectively defining the shape of the health care
system.

D. The Limited Role La w Plays in Shaping Health Care

What role does health law play in shaping the health care
system? The role of health law and health lawyers is fairly
limited. To begin with, law is constrained by the domain of
the issuing regulating authority. There is a simple mantra
that to be effective, the scope of the regulatory unit must map
onto the scope of the regulatory problem. Given the breadth
of the health care system and the Balkanized nature of
federal, state and local authorities, the nature of the health
care problem often eludes the scope of any given public
entity's ability address the issue. The contested debate over
the constitutionality of the Affordable Care Act tragically
underscores that reality.44  Matching the nature of the
regulatory units and the regulatory problems could certainly
be done better than it is today, but it will always remain a
unique challenge in the United States.

Those that teach health law understand a related
frustration. Health law tends to lag the industry, not lead it.
The law we teach our students often feels like it is twenty
years out of date. I realize that some practitioners will find

Fabled Story of Vertical Relations, 14 LoY. CONSUMER L. REV. 411, 412-13
(2002).

4 See generally Nat'l Fed'n of Indep. Bus. v. Sebelius, 132 S.Ct. 2566
(2012) (rejecting the claim that the Affordable Care Act could be based on
federal commerce clause authority, but finding the act to be a legitimate
exercise of the federal government's taxing authority).

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these statements controversial, but the existing tort system
does very little to substantially improve patient safety or
reduce errors. The tools employed for quality regulation,
licensing, accreditation and malpractice, are ad hoc,
incomplete and of limited effectiveness. Similarly, the
theoretical notions underlying traditional approaches to
quality are first generational and fairly primitive in light of
contemporary advances in health services research.
Fortunately, the Affordable Care Act makes a number of
advancements in this regard.45

The health care industry is changing much more rapidly
than the legal environment, which raises interesting
questions about the comparative adaptive ability of legal,
economic and political processes. Why does law tend to lag
and not lead? Has health law itself been sufficiently nimble
and adaptive in a changing economic environment? Lawyers
and law professors must accept some level of humility. Law
is often not intended to be innovative. Moreover, law is often
structured to protect existing power systems. From this
perspective, health law tends to descriptively track the
superstructure of the biomedical complex itself. It is not on
the vanguard of change. Moreover, law and lawyers are
often called into service to help shore up the weakest and
most dysfunctional parts of the system. If one could subject
the health care system to a legal equivalent of a magnetic
resonance image (MRI), areas of high density or
concentration of law would often signal likely pathologies.
Again the rules governing self-referrals and fraud and abuse
come to mind. This dense concentration of laws, rules and
regulations is intended to remedy dysfunctionalities
embedded in the payment system itself. If the system of
reimbursement were redesigned in a more rational manner,
while one would still need a set of legal rules to police
opportunistic and strategic behavior, the density of that set of
rules on our imaginary MRI would be much lighter. In
practice, this means that one will typically observe changes in
the evolving structures first and see changes in the legal
regime second.

45 See discussion infra notes 53-56.

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III. RE-IMAGINING HEALTH CARE QUALITY AND ETHICS

The task of imagining the next quarter century of health
care law is different from trying to predict what the next
quarter century of health care law will look like. The task of
re-imaging is different still. It calls for deeper creative skills
and the visualization of paths open but not yet taken. The
difficulty is that we reside in a dysfunctional system. The
best and most accurate prediction, given existing power
structures and trajectories, suggests that the future will be
some maladapted version of the dysfunctional present.
Standard acts of imagination will likely fall victim to the
same problem, if the act of imagining is rooted within the
confines of existing systems. An act of re-imagining focuses
on the same problem but seeks to creatively address concerns
from a perspective that transcends existing structures.46 To
be practical, however, it must also be grounded in
evolutionary considerations that credibly link the re-imagined
world with the one we find today.

A. Re -Imagining: Health Care Quality = Learning

How can we re-imagine health care quality? The problem
of medical errors was used earlier to symbolically highlight
problems from inside the health care system. The
visualization exercise is to ask: What would patient safety
look like in a system designed to foster greater intra-system
rationality? A consideration for greater intra-system
rationality calls for a greater awareness of and sensitivity to
the many ways that elements of the health care system are
interconnected. We are trained to see separate parts as
separate parts. The structure of the system is often designed
to highlight differences and not connections. Artificial

46 This is not just fanciful musing. Serious people are beginning to
give serious attention to the cognitive and social processes necessary to
engender systemic transformations. See, e.g., PETER SENGE, ET AL.,
PRESENCE: AN EXPLORATION OF PROFOUND CHANGE IN PEOPLE,
ORGANIZATIONS, AND SOCIETY (2005) (providing a meditation on the
cognitive, personal and social processes that are conducive to
transformational change). For an application to health care see Id. at 154-
57.

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barriers in terms of corporate structures, legal status and
reimbursement policies are imposed to further increase the
divides. When the need for greater system thinking does
arise, the answer is to form a new committee or, better yet, to
establish a separate department to address the systemic
deficiency.

The patient safety movement is significant, in part,
because the very logic of the movement forces participants in
the process to view health care as a system and to engage in
deeper systems thinking. This has significant transformative
possibilities. At the heart of the environmental movement lay
a new awareness of the ecosystem as not just a system, but a
complex adaptive system. This awareness highlighted issues
of interconnectivity, new understandings of multiple and joint
causation, as well as the significance of inflection points and
feedback mechanisms. This awareness helped transform
environmental law and environmental policy. The patient
safety movement has similar radical potential.

Unfortunately, after highlighting the issue of medical
errors and calling for systemic analyses and approaches, the
patient safety movement has failed to meet its real potential.
Part of the problem is structural. While actors can try to
change policies within those parts of the Balkans they
actually influence and control (the Coasian-fractured hospital
systems in which they operate), they face greater challenges
obtaining necessary and complementary changes in other
domains, such as reforms in reimbursement policy, medical
school training and state malpractice laws that are also part
of the systemic problem.

In a complex, interrelated system, changes in one
subsystem are often insufficient to trigger the meta-level
changes that are sought and can sometimes produce
unintended negative consequences. In the Balkans of
American health care, it is often difficult, costly and impolitic
to implement the system-wide reforms necessary to advance
positive evolutionary change, even when the bases for such
change are well developed and well understood in one
fractured part of the system. This suggests a related
problem. The systems thinking characteristic of the patient
safety movement is largely cabined to its own domain.

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Unlike the fundamental understanding of ecosystems in
environmental policy, systems-thinking does not yet pervade
the health care sector.

To date, there are also shortcomings within the patient
safety movement itself. While it understands the importance
of learning and building learning into systems to remedy
medical errors, it has yet to effectively operationalize learning
processes at individual and organizational levels. It
interesting to note how the focus on medical errors in the
IOM's report To Err is Human led to a greater appreciation of
quality more broadly and the significance of complex adaptive
systems in health care writ large in Crossing the Quality
Chasm.4 7 Awareness of greater systems thinking led to a
greater appreciation for the role of learning. Citing the work
of Peter Senge, the IOM argued that "moving toward the
health system of the 21st century will require that health care
organizations successfully address the challenge of becoming
learning organizations." 48 Learning, in turn, requires data
and information. "A critical feature of learning organizations
is the ability to be aware of their own 'behavior.' In
organizational terms, this means having data that allow the
organization to track what has happened and what needs to
happen-in other words, to assess its performance and use
that information to improve."49 Learning and awareness can
form the catalyst for growth, adaptation and change.
However, the challenges to creating effective learning
organizations are great. Few organizations inside or outside
health care are effective in institutionalizing processes of
progressive adaptation.

As such, this part of the patient safety agenda remains
unfulfilled. What is needed is creative re-imagining. What
would patient safety look like in a system designed to foster
intra-system rationality? What are implications for health
law? What changes would be necessary to facilitate this
process? What pictures would you draw to highlight new

47 INST. OF MEDICINE, CROSSING THE QUALITY CHASM, supra note 5
at 63-67.

48 Id. at 135 (referencing PETER M SENGE, THE FIFTH DISCIPLINE:
THE ART AND PRACTICE OF THE LEARNING ORGANIZATION (1990)).

49 Id. at 136.

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pathways and interconnections? What are the logical
implications for the rest of the health care system? How
could these changes be implemented in a manner that
progressed the agenda as part of a natural, ongoing
evolutionary process?

It is clear that greater "systems thinking" must be part of
the answer. There is good news in this regard. The health
systems thinking reflected in Crossing the Quality Chasm
does not stand in isolation. Under the rubric of health
systems development, there is a growing literature that
examines "health systems" as a cohesive unit.50  This
particular literature originated from the challenges facing
developing countries, particularly as it relates to balancing
the objectives of vertically oriented global health initiatives,
such as the Global Fund to Fights Aids, Tuberculosis and
Malaria, and the local objective of health systems
development.51 Nevertheless, the international call to create
a new science of health system development has direct
implications for the systems orientation necessary to
transforming the Balkans of American health care and to
implement a sustainable quality improvement agenda.

There are other promising developments on the domestic
front in the progressive quality components of the Affordable
Care Act (ACA). A number of these provisions expressly focus
on quality as a learning problem.52 Parts of the ACA are

50 See World Health Organization, An Assessment of Interactions
between Global Health Initiatives and Country Health Systems, 373
LANCET 2137, 2140 (2009); Healthy Development: The World Bank
Strategy for Health, Nutrition, and Population Results, THE WORLD BANK
170-71 (Apr. 24, 2007) available at http://siteresources.worldbank.
org/HEALTHNUTRITIONANDPOPULATION/Resources/281627-
1154048816360/HNPStrategyFINALApril3O2007.pdf, see also World
Health Org., Systems Thinking For Health Systems Strengthening World
Health Organization, ALLIANCE FOR HEALTH POLICY AND SYSTEMS
RESEARCH & WORLD HEALTH ORGANIZATION (2009) available at
http://whqlibdoc.who.int/publications/2009/9789241563895- eng.pdf.

51 Peter J. Hammer & Charla M. Burill, Global Health Initiatives
and Health System Development: The Historic Quest for Positive
Synergies, 9 IND. H. L. REV. 567 (2012).

52 See, ACA Provisions with Implications for a Learning Health
System, INSTITUTE OF MEDICINE OF THE NATIONAL ACADEMIES, http://
iom.edu/-/media/Files/Activity%20Files/Quality/VSRT/summary%20of/20

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devoted to the production of new knowledge through
comparative effectiveness research. In addition, the ACA
plugs into a growing infrastructure to work the quality
agenda, such as the Center for Quality Improvement &
Patient Safety.53  This work seeks to be appropriately
sensitive to cultural and organizational considerations. The
creation of knowledge alone is not enough. Knowledge must
be used in practice and underlying patterns of behavior must
be changed.54 As the patient safety movement has learned,
sensitivity to the issue in isolation is not enough. The entire
health care system must be oriented to the new objectives,
particularly the incentives embedded in reimbursement.

Positive change is not limited to the ACA. The 2009
Stimulus Package contained numerous provisions to improve
information systems and electronic records.55  While the
program is far from perfect, it is a significant step in the right
direction. Asymmetries in information were identified earlier
as the most significant challenge to rationally organizing the
health care system through either market or political
processes. Successful efforts to better manage available
information flows in health care could prove a more lasting
and more effective reform than the collective provisions of the
ACA. That said, we have still not developed proper
understandings on how that information can best be
packaged and used by either patients or health care
providers. It all comes back to the need to re-imagine health
care quality around the theme of learning and adaptation,
but building learning organizations is easier in theory than in

ACA%20impact%20on%20the%201earning%20healthcare%20system.pdf
(last visited Mar. 19, 2013) (working background document developed by
Leigh Stuckhardt of the IOM Roundtable on Value & Science-Driven
Health Care that has not been subject to the review processes of The
National Academies).

53 Mission Statement: Center for Quality Improvement and Patient
Safety, AGENCY FOR HEALTHCARE RESEARCH AND QUALITY (Feb. 2004),
http://www.ahrq.gov/legacy/about/cquips/cquipsmiss.htm.

54 Mission Statement: Office of Communications and Knowledge
Transfer, AGENCY FOR HEALTHCARE RESEARCH AND QUALITY (Mar. 2008)
http://www.ahrq.gov/legacy/about/ockt/ocktmiss.htm.

55 See Jessica Holzer & Gerard Anderson, Increasing HIT through
the Economic Stimulus Bill, HEALTH POL'Y MONITOR (2009), available at
http://www.hpm.org/us/bl3/3.pdf.

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practice.

B. Re -Imagining: Health Care Ethics = Justice

How can we re-imagine health care ethics? The problem
of racial disparities in health was used earlier to symbolically
highlight concerns between the health care system and other
health-related sectors of the economy. These disparities
highlight the significance of the socioeconomic determinants
of health and the need for greater inter-system rationality.
An appreciation of inter-system rationality calls for a greater
sensitivity to the many ways that elements of the health care
system are interconnected with other sectors, such as
housing, education, food security, transportation and
employment. Again, we are trained to see separate parts as
separate parts. In truth, health is generated from the
interaction of numerous forces, of which the biomedical
components are just a small part.

Unfortunately, there is no movement inside the
biomedical industrial complex pushing the issue of racial
disparities that is comparable to the patient safety
movement. Even if one looked at the entire resources devoted
to public health, let alone the fraction seriously devoted to
racial disparities, it constitutes a drop in the bucket compared
to the resources that flow through private health care system.
The re-imaginative work here is more daunting than that of
quality/safety, where most actors are already ostensibly
dedicated to the same cause. Re-imagining health care ethics
will take more energy and educational awareness. The key
insight is the need to establish a new understanding within
the existing bioethics framework that openly focuses on
notions of justice.

One can start with the visualization exercise: What would
racial inequalities look like in a system designed to foster
inter-system rationality? What pictures can you draw to
facilitate better understanding of the socioeconomic
determinates of health? What are the deeper lessons of the
racial disparities in health? What do they teach about issues
of injustice in health care and in the rest of society? What
enabling environment is necessary to address these concerns

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and what would be needed to enable the enabling
environment? What are implications for health law? What
new understandings would be necessary? What changes
would be needed to existing doctrines?

Again, the path forward requires a greater understanding
of how complex systems work and how they interact. There
are interesting advancements in understanding the
mechanics of structural racism that parallel research on
health system development. The Kirwan Institute has
published work examining structural racism from the
perspective of complex adaptive systems.56 The intersection
of these research agendas can be the starting point of
developing the tools and methodologies necessary to create
greater inter-system rationality in health care and take
effective actions to address health inequalities and racial
disparities in health.

Traditional understandings of medical ethics are too
narrow and need to be expanded. Bioethics typically address
the individual, in their personal and not their social context
(assuming that the individual is lucky enough to gain access
to the biomedical industrial complex at all). Moreover, while
issues of access and justice are discussed in the health law
literature; they are seldom framed expressly as ethical
concerns. We need new understandings of ethics that
embrace notions of social justice and advocate expressly for
an ethics of inclusion. It is striking how sterile and detached
existing ethical and professional discourses can become.

One illustration concerns scope of practice laws. What is
"ethical" quickly gets wrapped up in professional rules and
state licensing laws. Historically, many of these practices
had the dual effects of restricting access to certain types of
providers and increasing costs.5 7 Sometimes this was done
for legitimate technical considerations, sometimes it was done
to enhance the profitability of the favored group.

What is the appropriate re-imagined ethical frame? In a

56 Stephen Menedian & Caitlin Watt, Systems Primer Draft,
KIRWAN INSTITUTE (Dec. 2008) http://kirwaninstitute.osu.edu/docs/
systems-thinking-and race-primerjuly2009.pdf.

57 Peter J. Hammer, Medical Code Blue or Blue Light Special.' Where
is the Market for Indgent Care?6 J. L. IN SOCIETY 82, 95 (2005).

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world where we are unwilling to commit to principles of
universal access, limiting the scope of practice necessarily
increases the price of health care and decreases access to
service.5 8 This has a disproportionate impact on the poor,
which include disproportionate numbers of minority groups.
Those that advocate for expanding scope of practice laws or
consciously making available sets of lower cost options for
traditionally excluded groups run the risk of being labeled
"unethical." At the same time, the existence of 50 million
uninsured persons largely excluded from any meaningful
health services may broadly be thought of in ethical terms,
but not specifically conceived of as an issue of bioethics.

There are reasons to be hopeful with the passage of the
ACA. The ACA expands the scope of coverage for many
presently uninsured and provides them access to the
traditional health care system.59 The ACA also aggressively
pushes traditional scope of practice laws to permit new
combinations of health care workers to provide services. 60

This should benefit under-served communities. In addition,
the ACA makes a dedicated effort to start collecting and
analyzing data on racial disparities in health care and
establishes a new administrative infrastructure for future
policy action.61

To begin to address the underlying causes of racial
disparities in health, however, we have to move substantially
beyond the notion of simply increasing access to the
biomedical industrial complex. We need to imagine new
conceptualizations of health. Traditional public health

58 Id. at 95-96.
59 States that choose to do so may categorically extend Medicaid

benefits to those under 1.33% of the federal poverty level. Various forms of
subsidies to purchase individual and small group policies will be given to
those with incomes less than four-times the federal poverty level that
purchase their insurance through newly created health exchanges.

60 The Future of Nursing: Focus on Scope of Practice, INSTITUTE OF
MEDICINE (Oct. 2010), http://www.iom.edul-/media/Files/
Report%20Files/2010/The-Future-of-Nursing/Nursing%2Scope%20of%
20Practice%202010%2OBrief.pdf.

61 Dennis P. Andrulis et al., Patient Protection and Affordable Care
Act of 2010: Advancing Health Equality for Racially and Ethnically
Diverse Populations, 3-5 (July 2010) (Joint Center for Political and
Economic Studies).

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INDIANA HEALTH LAW REVIEW

models are a good starting point and serve as a bridge
between the biomedical model and the socioeconomic
determinants of health. Sadly, the ties between health care
and public health are historically weak and frayed; another
illustration of the Balkanization of health care. Before public
health can become a bridge, public health institutions must
themselves be strengthened. Again there is reason to be
hopeful. While still mired too deeply in the biomedical model,
the ACA signals a stronger commitment to public health and
preventative care than past reform efforts. 62 These, however,
are just small steps forward. Much more needs to build from
this foundation.

On the other side of the bridge, there must be deeper
notions of community-based health and recognition of the
need to strengthening communities themselves. Many under-
served communities are in increasingly abandoned urban
areas with frayed public infrastructures and weakened civil
society institutions. Meeting the varied health needs of these
communities will require strengthening the communities
themselves and empowering them to be meaningful partners
in forging their own futures. Again, we can find inspiration
from abroad. Many global health initiatives in developing
countries also work in challenging circumstances where
public, market and civil society institutions are weak or non-
existent. In this setting, new doctrines of "Community
System Strengthening" have been developed that can be an
inspiration to future American efforts to connect the health
care systems to the social determinants of health through
public health institutions and Community System
Strengthening. 6 3

There is another frame that can help visualize the process.
In Figure One, the dynamics of health care was portrayed as
a triangle with political, market and professional processes

62 See Lance Gable, The Patient Protection and Affordable Care Act,
Public Health, and the Elusive Target of Human Rights, 39 J. L. MED. &
ETHICS 340 (2011).

63 Hammer & Burill, supra note 52 at 627-31 (detailing the Global
Fund's approach to Community System Strengthening); see also, GLOBAL
FUND, COMMUNITY SYSTEMS STRENGTHENING FRAMEWORK (May 2010)
(same), available at www.who.int/entity/tb/dots/comm-hss.pdf.

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shaping the health care system. In some respects,
Community System Strengthening seeks to wrest control of
health away from the elusive domain of the professionals and
return it to a more traditional model of State-Market-Civil
Society, where professional associations are simply one of
many civil society actors. Health must become everybody's
business.

I am a pragmatist, not an idealist. For these re-imagining
exercises to be meaningful there must be a defensible
pathway plausibly connecting the imagined possible state
with the dysfunctional state of affairs observed today. The
template necessary to effectively engage the socioeconomic
determents of health to address racial health disparities
through Community System Strengthening is similar to the
template needed to better address chronic illnesses like
diabetes and asthma. The locus of treatment for many
chronic illnesses must be moved out of the biomedical
industrial complex and re-situated in the community.
Effective universal cost control for health care will require
these types of community-based health interventions and a
better understanding of health determinants that would
prevent the precipitation of medical episodes. The heightened
recognition of this connection, in addition to the justice-based
ethics discussed above, can create a credible pathway for
future actions on health inequalities and racial disparities in
health in our re-imagined world of quality and ethics for the
next quarter century.

IV. CONCLUSION

Twenty-five years ago, few could have completely
envisioned the range of health law and policy issues we face
today. The same will be true twenty-five years from now.
That said, creatively re-imagining our approaches to patient
safety and to racial disparities will not only address two of the
most pressing policy issues we face today, it could also hold
the key to systemic transformation. Patient safety cannot be
improved without an appreciation for organizational learning
and intra-system rationality. Racial disparities necessitate a
focus on an ethics of justice and inter-system rationality.

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Both agendas will have to transcend the geography of the
Balkans and will run head long into the political, market and
professional forces that define and defend the biomedical
industrial complex. At the same time, even the defenders of
the system must acknowledge the dysfunctional and
unsustainable state of affairs. What makes the re-imagining
exercises in this essay more than fanciful is the desperate
need for improving the system itself. From this perspective,
progress on patient safety and racial disparities can be
instruments triggering cascading evolutionary changes
improving the functioning of the entire system. Changes in
complex adaptive systems are not restricted to discrete,
isolated domains, especially when the changes themselves are
conceptualized and implemented in a manner that seeks
greater intra-system and inter-system rationality.

While intra- and inter-system rationality have been
discussed as distinct principles, it should be clear that these
objectives are themselves interrelated. The ultimate
imaginative task will be to increasingly merge the agendas of
intra- and inter-system rationality in an unfolding
evolutionary scenario. The path forward for the next quarter
century of health law is clear. For the meaningful evolution
of the health care system to take place, "quality must equal
learning" and "ethics must equal justice."

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