The Scales of Life and Death, Profit and
Q & A on the Business of Health
Besides designating him an SAS alumnus, the alphabet soup following the
name of Mitchell Blutt, C78, M82, WG87, identifies him
as a Penn Med doctor and a Wharton MBA. Who better to tell us a thing
or two about the business side of medicine? Blutt is an executive partner
at the NYC private equity firm JP Morgan Partners. A venture capitalist,
he no longer sees patients, although he is an adjunct faculty member at
Cornell medical school. He sits on the board of the Michael J. Fox Foundation
for Parkinsons Research and is an SAS overseer and Penn trustee.
Q. How did you come to study both medicine and
A. After medical school, I entered a residency program at Cornells
New York Hospital, where there was a professor of infectious disease conducting
clinical trials for a new antibiotic. He told us that any resident who
identified a patient that fit the enrollment criteria would receive a
bottle of wine. That was an exciting prospect at that point in my career.
At the time I believed medical science was advanced by the physician-scientist
tinkering in a lab, which was the career path I aspired to. I was reading
about the pharmaceutical industry and talking to people, and I began to
realize that in most cases a study for a new drug comes from the pharmaceutical
industry. These giant businesses spend billions of dollars trying to find
the next compound that will have clinical efficacy and be a successful
product. I began to understand that a huge force shaping medicine was
what Arnold Relman, the former editor of the New England Journal of
Medicine, called the industrial-medical complex. I decided that if
I were to have an impact on this profession and this industry, I would
have to understand the business side of health care.
Q. Do you think for-profit health care is the
best way to serve patients?
A. I wouldnt say its the best way, but theres
no reason why it cant be as good, if not better, than any other
way. Even not-for-profit health care systems have to survive or thrive
Q. Can medicine be both humanitarian and profit-making?
A. I think clinical care needs to come first always, but one
can practice good medicine with cost effectiveness in mind. Theres
some interesting literature on the difference between the individual patient
and the statistical patient. You might ask, Why wouldnt we do an
MRI scan every year on every American? Wouldnt we pick up an occasional
tumor and be able to cure it?
The answer is: We would, but it would be unaffordable. The yieldthe
number of tests that show a positive finding and result in successful
treatmentwould be incredibly low for the billions of dollars in
additional spending. Just doing all tests and giving all treatments to
all patients all the time is not in the patients interest. Putting
someone on an antibiotic because they ask for it every time they have
a runny nose is not just a waste of moneyits dangerous.
Q. Would you say that the physician serves the
individual patient and the HMO serves the statistical patient?
A. I would say the government reimbursement sources are trying
to serve the statistical patient. The HMO, if its for-profit, is
trying to serve its shareholders. And thats fine as long as the
HMO doesnt neglect quality of care. There are lots of anecdotal
reports in the press, but I dont know that its been demonstrated
that HMOs have caused neglect of patients.
Q. What do you believe are the critical issues
facing the health care industry?
A. There was a letter in the New England Journal of Medicine
about 20 years ago. It had a title something like Schizophrenia
of the American Public Regarding Health Care. They were using schizophrenia
in its lay meaning, the idea being that Americans want unlimited health
care, but theyre not willing to have tax increases to pay for it.
That continues to be the biggest challenge: How do you provide the best
and most health care of any country in the world and at the same time
make it affordable? Affordable not just to individuals but to corporations
and the government. Eventually, I think, Americans will have to make more
choices about where they spend their dollarsfor health care or otherwise.