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Innovation Economy

Losing strategy in Mass. on education and health care

The future is not up and to the right.

Yet if you look at two of Massachusetts’ biggest industries — health care and education — that’s the trajectory. Better quality, high pay, strong reputations, expensive new facilities, and breakthrough innovations mean you can charge more, more, more.

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Where are the voices talking about expanding access to education and health care, and driving costs down? In Massachusetts, they’re scarce. And that’s a losing strategy.

A few recent data points:

 College tuitions are rising faster than inflation and family income. Student loans are now the second-largest category of consumer debt, after home mortgages, according to the Consumer Finance Protection Bureau. Student loan debt, totaling about $1.2 trillion, is increasing faster than credit card debt, the federal agency says.

 Some of Boston’s biggest biotech companies make specialty drugs for small patient populations. The UnitedHealth Group, a major insurer, expects spending on these drugs to hit $400 billion by 2020, more than four times the 2012 level.

In Arkansas, three patients are suing the state’s Medicaid system for refusing to pay for a $300,000 per year drug for cystic fibrosis, Kalydeco. The drug maker, Boston-based Vertex Pharmaceuticals, expects Kalydeco to generate more than $500 million in revenue this year.

 As Partners HealthCare attempts to gobble regional hospitals north and south of Boston, The New York Times last month used Partners and Massachusetts as a cautionary tale in an editorial. The Affordable Care Act creates incentives for hospital systems and doctors to collaborate to improve care, the Times editorial board said, but the resulting behemoths “must not be allowed to accrue such market power that they stifle competition and drive up prices, as seems to have happened in Massachusetts in past years.”

In health care, we’re content to be Saks Fifth Avenue, when the world needs Walmart. (Walmart, by the way, is opening primary care clinics in its stores. A check-up costs $40.)

In education, ever since 1636, the gold standard has been Harvard University. Yet when Starbucks wanted to gives its baristas access to free college courses, it did not put them on buses to Cambridge. Instead, in June, it announced a partnership with Arizona State University’s online program.

We have a split personality when it comes to “up and to the right.” When a family member is going to college, or getting treatment for a disease, we want them to be at the top institution, price be damned. And yet as a society, we realize that cheaper, “good enough” health care and education, delivered where we live as opposed to in centers of excellence (like Boston), is what the future holds.

“We are entering the era of practical, tactical innovation in health care,” says Jonathan Bush, chief executive of Athenahealth, a health care information firm in Watertown. “This era isn’t about new science — it’s about redeploying science that has been around for decades, with an eye toward getting the most value from it.”

As an example, he cites the Aravind Eye Care System in India, which takes an assembly-line approach to cataract surgery. By doing more than 1,000 surgeries a day, it can drive the cost below $50 per procedure.

Athenahealth sells services to physicians that help streamline the information flow of their businesses. The company also invests in startups developing software and services to make health care more convenient, efficient, and accessible.

There are other glimmers of hope locally: projects like Diagnostics for All (cheap, paper-based blood tests) and OPENPediatrics (a free, online learning platform for health care workers who take care of children). A Boston startup called American Well has been a leader in making doctors available for video consults over the Internet. It also offers iPhone and Android apps that will connect you with a doctor in two minutes or less for $49.

Unlike 21 other states, Massachusetts doesn’t have a law requiring private insurers to cover these sorts of consults as they would an office visit, says American Well chief executive Roy Schoenberg. “Massachusetts in general is oriented around the frontiers of medicine, rather than affordability,” says Schoenberg, a physician with a master’s degree in public health from Harvard.

At Berklee College of Music, a pioneer in bringing higher education online, David Mash, senior vice president for innovation, strategy, and technology, describes education as a wedding cake. The typical four-year, on-campus route to earning a degree is only the top layer. Other layers might be free online courses, or programs blending online and in-class experiences.

“It doesn’t take too much to look at the world of higher ed and wonder how it can possibly survive on the trajectory that it is currently on,” Mash says. This fall, Berklee is offering online bachelor’s degrees in music business and music production — at about half the tuition of earning those degrees on campus.

And in an office on the fringes of Kendall Square, edX, the nonprofit created in 2012 by Harvard and MIT, is developing new technology for online courses, including artificial intelligence software that can “read” an essay and give it a grade.

“When you have 150,000 students in your class, you definitely don’t want to be reading essays over the weekend,” says Anant Agarwal, edX’s chief executive.

For $25 or $50, edX will verify your identity, and certify that you’ve taken one of its courses. And that $50 “credit,” just like the $50 doctor “visit,” feels like the future — and exactly the kind of innovation we should foster and celebrate here in Massachusetts.

Scott Kirsner can be reached at kirsner@pobox.com. Follow him on Twitter @ScottKirsner and on betaboston.com.
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