Category Archives: Randomness

Transparency and the invisible hand in hospital and healthcare costs

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All opinions are my own and do not necessarily reflect those of Novo Nordisk

One of the things that sometimes seems to get lost when people talk about the power of the market to create efficiency is that a free market requires that information be shared and freely available and understandable by everyone.  When information is withheld by one side or the other of a transaction, or when different customers for a service or product are unable to compare prices, the metaphor of the invisible hand breaks down.

You can see, this, interestingly enough, in sports as it relates to both the trading of players under contract and the signing of free agents.  Since I’m a baseball fan, let me link here to a discussion of research that’s been done looking at Major League Baseball.  The studies looked at players traded or signed by a different team as a free agent and how those players performed in subsequent years versus players whose original team re-signed them.  It turns out that players who switched teams did, indeed, perform more poorly relative to projections than players who stayed.  This suggests that the original teams have proprietary information that allows them to make better decisions about which players to retain.  Thus the market for baseball players isn’t quite free and efficient because of information asymmetry.

And unfortunately, information asymmetry is also rampant in other industries such as healthcare. Continue reading →

Jeff Bezos is the anti-unbundler or, can the founder of Amazon make us eat our greens?

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All opinions are may own and do not necessarily reflect those of Novo Nordisk.

h/t to @Frank_S_David for tweeting the link.

People have wondered and speculated and analyzed why exactly Jeff Bezos decided to buy the Washington Post.  Late last week Timothy B. Lee of the Washington Post offered some clues.  He reported how Bezos, in remarks to the Post staff, described wanting to get back to “that glorious bundle that the paper did so well.”  What Bezos wants is to find a way to make the Post such a destination that people will choose to visit regularly and not just read individual articles but stay and scan through many, presumably in one sitting, as people used to do as their morning ritual.

Timothy Lee is skeptical and I’ll just briefly summarize his points and urge you to go read his great article for the details.  Lee points out that news distribution has become unbundled due to the influence of the internet.  (For some nice posts on the concept of unbundling see this one by Leigh Drogan and this one by Frank David).  People consume news in individual article-sized chunks, often following links provided by friends and colleagues and search engines, without much loyalty to specific outlets or writers.  Lee also points out that while the Post has excellent writers, they’re still a miniscule fraction of the writers on the internet and most of the best writers are not on the Post’s staff.  Lee uses this as a launching point to talk about the increasingly important skillset of attracting clicks, largely through evocative headlines.  You know, like the one I tried to write for this post.  Did it work?

Jeff Bezos’ ambition is quite interesting on a couple of different levels.  The first is the basic question of why Bezos thinks he can do this?

The answer, I believe, is that he already succeeded once.

Continue reading →

Hanging with the herd, for the immunity of it all

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All opinions are my own and do not necessarily reflect those of Novo Nordisk.

When I hear about events such as the recent outbreak of measles among a small group in Texas, I am reminded of how complex, complicated and difficult public health efforts can be. In the US, for example, there are conflicting imperatives:  the rights of people to practice their beliefs versus the right of the community to be protected against preventable health threats.  This particular situation involved members of a church congregation, many of whom had not gotten vaccinated for measles due to worries about a link between autism and the Measles-Mumps-Rubella (MMR) vaccine.  While no scientific evidence has been found to support any such link, many had chosen not to be vaccinated “just in case.”

One day I hope to write about the link between the phenomenon of science denial and personal identity (one perspective can be seen here), but for now I just want to point out how this event and a recent publication by the Centers for Disease Control (CDC) on rotavirus vaccines demonstrate nicely the concept of herd immunity (article behind paywall, but writeup here).  There are different usage patterns for the term, so I’ll say up front I am using “herd immunity” to describe not just the proportion of individuals within a population who are immunized to a given pathogen but also the indirect effects for non-immunized individuals.  The term was first used in a publication in 1923, by Topley and Wilson, in the context of how to describe the host side of their studies in bacterial infection among mice.  The concept later gained mathematical underpinnings, including formulas describing how the different ratios of vaccinated to nonvaccinated individuals defines the degree of herd immunity depending upon how infectious a disease agent is. Continue reading →

What $85 million could get the NFL: thinking about the NFL concussion settlement

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All opinions are my own and do not necessarily reflect those of Novo Nordisk.

Yesterday the NFL and the NFL Players Association reached a settlement concerning compensation for concussions and other football-related injuries.  The impending lawsuit was brought by former NFL players who claimed, among other things, that the NFL downplayed the risk of concussions despite having knowledge of their effects and also did not do all it could to help former players.

The total amount earmarked for the settlement is reported to be $765 million dollars, with the vast majority ($675 million) in a fund to support former players and families in dealing with the aftermath of concussions.  Commentators have noted that this appears to be a great victory for the NFL.  First, the amount of money is less than many expected even with a settlement.  Second, the NFL did not have to go through discovery, which would have laid open exactly what the NFL did know about concussions and possible side effects, as well as potentially other damaging information that, once released in court, could never be private again.

It seems likely that those who were bringing forward the suit settled because they were motivated to help the most needy members of their group.  Many former NFL players are suffering dementia and lingering aftereffects from their playing days.  Some families of deceased players will also benefit.  The former player pool can’t really afford to wait for the long protracted time a trial and subsequent appeals would take since in the interim many would fall into poverty and even poorer health; some could also die. Continue reading →

Internet access is a public (and private) health issue

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All opinions are my own and do not necessarily reflect those of Novo Nordisk.

If the Founding Fathers had lived today, they would surely have included internet access as one of our inalienable rights.  No, scratch that, because if they had lived today they would have used Google Docs to crowdsource the Declaration and the result would probably have been much more generic and middle of the road than it actually is.  Also, the Declaration would also have been limited it to about 500 words so readers wouldn’t get bored and surf somewhere else, and it would have had embedded GIFs. Preferably animated.

Still, the ability to access the internet and everything that comes with that is, if not a right, an incredible advantage.  So I was stunned when I read in the Seattle Times the other day that a significant fraction of people in the US–about twenty percent–have little to no internet connection, although those numbers have recently begun to creep up, presumably due to smartphone uptake.   But of course, being a good Seattlelite with a liberal bent, my next reaction was to say, well, let’s not rush to judgement or conclusions.  Maybe those people just don’t want the internet.  Not that there’s anything wrong with that…

Except the article goes on to say that while seniors generally did not feel they were missing anything, the majority of other respondents did feel they were missing something important and were being left behind because of their limited access.  So it’s not a life decision; it’s a question of cost, access and education. Continue reading →