Increasing sales, growing the business

23. October 2008 William Davis (7)
I continue my portrayal of the fictional hospital, St. Matthews. Though fictional, it is based on real facts, figures, and situations.

Despite their success, administrators at St. Matthews’s Hospital continually fret over how to further expand their enterprise.

Market share can be increased, of course, by competing effectively with other hospitals, but that can be a tough arena. After all, St. Matthews’ competitors deliver pretty much the same services, and draw areas for patients overlap. The last thing the hospital wants is the appearance that heart care is a “cookie cutter” process, the same everywhere. In fact, this trend has hospital administrators wringing their hands. Two competing hospital systems in town recently launched multi-million dollar ad campaigns employing some of the same aggressive tactics St. Matthews’ marketers used successfully in past.

If St. Matthews is going to grow, new markets will need to be explored. What other strategies can a hospital system use to continue climbing the growth curve?

St. Matthews’ hospital administrators have drawn a number of lessons from other businesses. How about squeezing more procedures out of the population you already take care of? That’s an age-old rule of business: your easiest sales come from repeat customers. A former stent patient is going to “need” annual nuclear stress testing ($4000), more stents (about $25,000–39,000 per hospitalization), CT angiogram ($1800–2400), bypass surgery ($84,000), and so on. “Check-up” catheterizations, though clearly of little or not benefit to patients, are silently encouraged, yet another example of the bonanza of repeat procedures possible.

The lesson that “once a heart patient, always a heart patient” has been honed to an art form in business practices at St. Matthews and other hospitals like it. If you enter the system through your primary care physician or cardiologist, there’s an excellent chance you’ll end up with several procedures, diagnostic and therapeutic, over the ensuing years. Accordingly, St. Matthews provides a very attentive after-discharge follow-up program, complete with access to friendly people, phone centers, “support groups,” and even an occasional festive get-together, all in an effort to ensure future return to the system.

All in all, the St. Matthews Hospital System is a hugely successful operation. It provides jobs for thousands of area residents and provides high-tech, high-quality healthcare. Like any business—and no doubt about it, St. Matthews is a business with all the trappings of a profit-seeking enterprise—it grows to serve its own interests. The tobacco industry didn’t grow to its gargantuan proportions by doing good, but by selling a product to an unsuspecting public. So, too, hospitals.

Curiously, hospitals like St. Matthews continue to operate under the sheltered guise of not-for-profit institution with the associated tax benefits, ostensibly serving the public good. This means that all end-of-year excess revenues are re-invested and not distributed to investors. But non-profit does not mean that individuals within the system can’t benefit, and benefit handsomely. Under St. Matthews’ non-profit umbrella, many businesses thrive: 35 pharmacies, extended care facilities to provide care after hospital discharge, drug and medical device distributors, even a venture capital arm to fund new operations. The financial advantage conferred by “non-profit” status has permitted the hospital to compete with other, for-profit businesses, at a considerable advantage. For this reason, attempts have been made over the years to strip them of what some believe is an unfair advantage; all have failed.

While profits may not fall to the bottom line, money does indeed get paid out to many people along the way. Executives, for instance, pay themselves generous salaries and consulting fees, often from several of the entities in this complex business empire. Physicians are brought in as “consultants” or are awarded “directorships” for hundreds of thousands of dollars per year—Director of Research, Director of Cardiovascular Services, etc. Don’t forget the $3.7 million dollar annual salary paid to the CEO.

Hospitals and doctors have a vested interest in preserving this financial house of cards. They will fiercely battle anyone or anything that threatens the stream of cash. During a recent meeting of important doctors at St. Matthews Hospital, one cardiologist bravely voiced his concern that bypass surgery was performed too freely on too many patients in the hospital. The doctor was promptly and quietly asked to remove himself from the meeting. Several days later, he received a letter announcing his dismissal from the committee.

The silent conspiracy conducted by hospitals and cardiologists serves their own purposes better than the good of the public. Under the guise of good works, hospitals continue to promote strategies which are, for the most part, outdated, inefficient, inaccurate, and expensive. But that’s the rub. Expensive to you and your insurance company means more money for the recipient: your hospital and cardiologist, and the powers that support them. All this occurs while the real solutions that are of benefit to the public continue to be overlooked, hidden in the shadows.
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Comments (7) -

  • Anonymous

    10/23/2008 4:03:00 PM |

    Thanks for having the courage to say all of this!

  • Anonymous

    10/23/2008 4:52:00 PM |

    Yes, and let's elect a socialist for president who will work to make sure all American citizens have "free" access to this high standard of care they have a right to. Let's have a government that tells the people to eat in such a way they are all but guaranteed heart disease and then let's devise a universal health care system that will take their tax money to make them pay for their heart procedures. I'm going off a bit on a tangent here, but whenever I hear anyone start advocating a government-run univeral health insurance program, I think of the points you make about the greed of hospitals, and realize it puts a different perspective on just what it is these politicians are wanting the government to pay for.

  • Anna

    10/23/2008 4:55:00 PM |

    Dr Davis,

    Excellent pair of posts.  I wish more people would understand that while there are many people in medicine who are dedicated to caring for patients in the best way they know how, the "system" and some people in it have rigged the game to perpetually favor "the house", like gambling establishments.  Like post-vacation gamblers, post-procedure patients come away awed by the smoke & mirror shows.

  • Anonymous

    10/24/2008 12:12:00 AM |

    I am afraid we need to get medicine back to its altruistic roots.  Physicians should be limited to pay not to exceed $200k/yr. If you want to make more than this you should go to business school not medical school. Make it a law.

    On another note as the economy continues its colapse you will see medicine return to a decetralized model complete with a return to altruism and much less regulation. This is not an optimistic hope-it is where it is going.

  • Anonymous

    10/24/2008 5:10:00 PM |

    And we should make it a law that Angelina Jolie must dump Brad Pitt and date me. And that she must never make any dish for me that includes broccoli.  

    I hate broccoli.

  • Andrew

    10/24/2008 8:49:00 PM |

    ^^
    I hope you're right, but I don't see it happening that way.

    People with money and power will always struggle to increase both, regardless of the consequences.

  • Anonymous

    11/15/2008 6:29:00 PM |

    "Democracy is the worst form of government except for all those others that have been tried."

    ~ Winston Churchill
    Similarly with the hospitals, the pts seem to like them. It employs lots of people. Does it really matter that it is a lot of smoke? Is there a better way?

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Postprandial pile-up with fructose

Postprandial pile-up with fructose

12. November 2009 William Davis (20)
Heart disease is likely caused in the after-eating, postprandial period. That's why the practice of grazing, eating many small meals throughout the day, can potentially increase heart disease risk. Eating often can lead to the phenomenon I call triglyceride and chylomicron "stacking," or the piling up of postprandial breakdown products in the blood stream.

Different fatty acid fractions generate different postprandial patterns. But so do different sugars. Fructose, in particular, is an especially potent agent that magnifies the postprandial patterns. (See Goodbye, fructose.)

Take a look at the graphs from the exhaustive University of California study by Stanhope et al, 2009:



From Stanhope KL et al, J Clin Invest 2009. Click on image to make larger.

The left graphs show the triglyceride effects of adding glucose-sweetened drinks (not sucrose) to the study participants' diets. The right graphs show the triglyceride effects of adding fructose-sweetened drinks.

Note that fructose causes enormous "stacking" of triglycerides, meaning that postprandial chylomicrons and VLDL particles are accumulating. (This study also showed a 4-fold greater increase in abdominal fat and 45% increase in small LDL particles with fructose.)

It means that low-fat salad dressings, sodas, ketchup, spaghetti sauce, and all the other foods made with high-fructose corn syrup not only make you fat, but also magnifies the severity of postprandial lipoprotein stacking, a phenomenon that leads to more atherosclerotic plaque.
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Comments (20) -

  • KENNY10021

    11/12/2009 2:01:55 PM |

    What if spaghetti sauce is NOT made with HFCS? I love my spaghetti sauce over my chicken.......in moderation.

  • LynneC

    11/12/2009 2:58:34 PM |

    Nice find.... this really demonstrates the insidious nature of HFCS, on multiple fronts.

  • homertobias

    11/12/2009 3:04:43 PM |

    Dr. Ron Krauss again.  Any research with his name on it is superb in my book.  I wonder if he knows Dr. Lustig (UCTV Fructose lecture).  They are neighbors.  So is BG.  Thanks for the whole reference.

  • LPaForLife

    11/12/2009 3:50:40 PM |

    Dr. Davis,

    Given this information. If someone has a good BMI and good overall diet without grains, how much fruit should they limit themselves to in a day. Should they only eat this fruit with a meal and not eat it alone between meals?

  • Anonymous

    11/12/2009 5:47:48 PM |

    Is Grazing on protein and vegetables also bad?

    Thanks,
    Penny

  • Will

    11/12/2009 9:42:57 PM |

    Wow. I guess fructose of any source would be bad, not just HFCS but eating an apple as well? It's hard to rationalize why something that is found in nature, is a whole food, and appeals to our sense of taste, would be bad for us. Maybe the fact that the fructose in the the study was in liquid form, versus being held up in some fiber, had something to do with the results but this isn't the first time that I have read that fruit is bad for you.

  • Dr. William Davis

    11/12/2009 10:32:50 PM |

    Keep in mind that the design of studies like this are often meant to yield exagerrated effects for the purposes of clean observations. It does not necessarily mean that every time you eat, you get similar postprandial phenomena.

    Nonetheless, I believe there are important lessons from such studies.

  • Anonymous

    11/12/2009 11:39:36 PM |

    This study suggests that a rice cracker or a potato (converted directly to gluclose) might be more healthful than a piece of fruit

  • pmpctek

    11/13/2009 3:33:20 AM |

    I've been able to adapt relatively easily to everything in your TYP program Dr. Davis, but this one seems to be the toughest for me.

    I don't think I can eat one meal a day.  I have always been blessed with a fast metabolism and need at least 3,000 (LC) calories even on a moderately active day, or I start to lose weight, which at 5' 9" 165# @ 8% BMI, I don't want to do, and probably shouldn't.

    3,000 calories is simply too much for me to eat in one meal.  Plus, it seems so counter-intuitive to good health, like maintaining a good energy/thermogenic/glucose/insulin/nitrogen balance throughout the day.  It just seems a perfect recipe for storing fat at the expense of lean mass, which is the complete opposite of paleolithic man's highly muscular, lean composition. I don't know, maybe just I wouldn't survive well back then...

  • Anonymous

    11/13/2009 9:43:58 AM |

    This is an excellent point- the reverse of intermittent fasting and variation in calorific consumption. Excess macronutirent calories, in the wrong form, at frequent intervals. No surprise there are adverse implications. OB

  • moblogs

    11/13/2009 10:40:00 AM |

    It rings a bell. My maternal grandfather died not long after a meal.

  • LynneC

    11/13/2009 2:29:51 PM |

    Re fructose from fruit vs HFCS, I don't think that there's much comparison.

    There are benefits to eating fruit (antioxidants, fiber, vitamins).  There is no benefit to consuming HFCS.

    Choose your fruits carefully and eat in moderation...

  • Helen

    11/14/2009 12:27:30 AM |

    I doubt that eating fruit is the same as eating refined fructose.  Not all fruit is high in fructose, for instance.  Also, the fiber in the fruit slows absorption, and this may give time for the fructose to be fermented by bacteria in the gut, producing, for instance, acetic acid, which may be beneficial to fat deposition patterns. (This is just a personal theory of mine.)  

    Furthermore, fruit contains vitamins, minerals, antioxidants, and flavoniods, which can benefit glucose metabolism, prevent lipid oxidization, and dampen the tide of free radicals and advanced glycation end-products (AGEs) produced by glucose and fructose metabolism.

    Those concerned with the effects of fructose from fruit should focus on eating whole fruits only (no juice), and eat mostly berries (low in fructose, high in flavonoids).

    I think it would be wise to separate the valid concerns about refined fructose from fruit.  We could be as off-base about vilifying fruit as people were about eggs.

    Just because a food contains a substance that can is harmful when it's been refined from its source doesn't mean that it has the same effect when found in a whole food.  The digestion and metabolism of whole foods is far more complex than can be understood by studying a single factor.

    If it's something humans have eaten for millennia, and it's safe to say that fruit is, I think it's probably innocent until proven guilty.  Just don't eat refined stuff (including juice), and you'll be fine.

  • Jim Purdy

    11/14/2009 11:13:36 AM |

    I am now trying to eat a diet that is very low in carbohydrates, moderate in protein, and high in fats like butter, omega-3 eggs, and cream cheese.

    This kind of diet seems to prevent the blood glucose spikes and the very unpleasant tachycardia that I get from high-carb meals.

    And it is frequent small meals that best control my blood glucose and the tachycardia.

  • Dr. William Davis

    11/14/2009 1:47:09 PM |

    Pmp--

    Eating once a day was not the intended message.

    This discussion is simply part of a larger discussion on the effects of various foods on postprandial patterns. We must all eat and preferably do so 3 times a day.

  • camilynn

    11/19/2009 7:08:46 AM |

    Good one on "Postprandial pile-up with fructose".I'm using the methods from http://debtfreeliving.lose20.com to reduce weight and it really works.

    Thanks,
    Edwin-   Lose 20 - Losing weight may save your life

  • Walter

    11/27/2009 6:00:10 AM |

    Hey, not all  spaghetti sauce has added fructose. Those made with sugar and or fructose cost more, because they are cheating on the ingredients.

    And yes, sugar is (half) fructose.

    Dr. William Davis, do we have any studies that show 3 times a day is optimal? One could hardly do a double blind study on this.

  • Anonymous

    10/19/2010 10:29:18 PM |

    I ate 50 grams of grapefruit (with extra fiber), with my last meal of the day and it spiked my blood sugar from 120 to 170 in 1 hr and I think I felt the beta cell damage for several hours - fruit is worse than oatmeal WITH sugar! I am pre-diabetic. I am trying to give up all bad things, but I am starving and I have to eat. I have chewing problems, so this complicates things. I tried soymilk, but it seemed to destabilize me, which is not good - I'll try it with fiber next time. I am underweight now. I am in a real bad place. I can't eat fruit anymore and even veggies give me problems. I hope I can avoid scurvy. Does anyone know if vitamin C pills truly prevent scurvy?

  • Documentaries

    11/1/2010 9:06:16 PM |

    I don't think I can eat one meal a day. I have always been blessed with a fast metabolism and need at least 3,000 calories

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