Pellere

by Stephen Parente, director

What a great year! The Institute continues to grow in ways unimagined at its inception three years ago. What started as an informal set of meetings between Carlson School faculty and medical industry leaders, about future human capital challenges and path-breaking research, has yielded an active curriculum with over 150 MBA and undergraduate students, university-wide faculty research projects, funded by Pfizer, and over 40 community guest speakers providing live cases. Along the way, our student association, MILISA, was formalized as a University-wide student group with officers and a great set of professional networking activities. What's coming for 2008-9 is even more groundbreaking.

Starting this fall, we add another course, the Medical Industry Enterprise (MILI 6995). The enterprise will produce early stage medical technology assessments for emerging devices, drugs, software, and procedures. The Enterprise will create rapid turn around, comprehensive assessments of the potential market, profitability, and intellectual property of a new technology. Besides MBA students, graduate students from up to eight collegiate units including pharmacy, engineering, medicine, law, public health, and liberal arts will take part in this enterprise, and will be directed by experienced industry professionals.

Students will experience the complex but rewarding task of articulating the value proposition of life enhancing innovations that need to simultaneously change lives for the better and be financially sustainable. In future issues of Pulse, I look forward to talking about an array of new technologies accelerated to the market by MILI and their potential impact to improve lives. Pellere!

Seminar on the Impact of Consumer Driven Health Plans

In December 2007, the Institute hosted Anthony Lo Sasso, PhD, associate professor of Health Policy and Administration from the University of Illinois at Chicago. Professor Lo Sasso is an economist and applied econometrician whose research spans several dimensions of health and labor economics and health services research. He is currently studying workplace health benefits and how they affect employee health. He discussed this research at the seminar and presented evidence from individual and small employer markets.

Professor LoSasso also explained how community rating provisions in state non-group health insurance markets affect non-group health insurance coverage and uninsurance.

If you would like more information on Professor Lo Sasso and his research please go to: http://www.cade.uic.edu/sphapps/faculty_profile/facultyprofile.asp?i=losasso

Seminar Speaker Charles Phelps, University of Rochester, NY

Professor and Provost Emeritus Charles Phelps, PhD, University of Rochester New York , presented two Institute seminars in April. During his 13 year tenure as Provost at the University Rochester , Professor Phelps was responsible for overseeing the academic activity in each of the University’s six schools.

The first seminar focused on his research topic The Origins, Purposes, Governance and Management of Not For Profit Organizations. Phelps work applies modern “rational actor” political theory to the governing boards of not-for profit (NFP) organizations and proposes that the key to understanding the behavior of NFP is their governance structure.

At the second seminar, Phelps discussed Risk Bearing and Moral Hazard. This research focuses on how health insurance reduces financial risk associated with treating illnesses, but creates “moral hazard” losses by reducing the price of medical care at the time of consumption. Increasing health insurance coverage improves on the risk dimension but exacerbates the moral hazard problem. His research quantifies both the financial risk loss and the moral hazard loss, and shows how the optimal insurance coverage achieves a balance. Preventive medical care also is introduced into the model, which demonstrates how insurance should subsidize such interventions in concert with purchasing traditional health insurance.

For a copy of these presentations go to: http://www.csom.umn.edu/Page4770.aspx?showcontent=85798&display=102&templateID=5024

If you are interested in Professor Phelps other research go to: http://www.econ.rochester.edu/Faculty/Phelps.html

Design of Medical Devices (DMD) Conference

In April, the University Minnesota's Biomedical Engineering Institute, the Institute Technology, the Academic Health Center , the Office of the President, and the Department of Mechanical Engineering hosted the seventh annual Design of Medical Devices (DMD) Conference. The goal of the conference is to promote the medical device industry and provide a forum to bring medical device designers, manufacturers, researchers, and representatives from the public sector together to share perspectives on medical devices. This year the conference had 130 speakers and over 900 attendees.

The conference opened with keynote speaker, Robert Langer, one of 13 Institute Professors (the highest honor awarded to a faculty member) at the Massachusetts Institute of Technology (MIT). Professor Langer’s talk, Creating and Implementing Breakthrough Medical Technology, highlighted case studies, which detailed the process from discovery to patents to commercialization, in the areas of drug delivery, medical devices, and biotherapeutics.

Another conference highlight was a live video feed of a cardiac surgery procedure at the University of Minnesota Medical School – Fairview. Dr. Kenneth Liao, Division of Cardiothoracic Surgery, University Minnesota performed the surgery while a second surgeon, Dr. Herb Ward, answered questions and demonstrated the use of specialized surgical tools. The session discussed the limitations and design opportunities for the tools and devices used in modern surgery.

Institute director, Stephen Parente, was session chair for Assessing Early Stage Medical Device Technology. The session discussed the new University Medical Industry Enterprise course as well as how e arly stage medical technology assessment can be critical to advance a promising innovation from conception to financial sustainability. (The enterprise is highlighted in the featured course section of this newsletter). The session included presentations by Michael Finch, Finch & King; Randal Nelson, Evergreen Medical Technologies, LLS; and Kevin Roche, Investment Banker who have been involved in the development and implementation of the course. Mr. Roche commented that “the new program will be very helpful in promoting the growth of new health care and other enterprises in the State of Minnesota, which is extremely important, given that these businesses are a major source of good quality new jobs.”

Other highlights included luncheon keynote speaker Thomas Gunderson, managing director and senior research analyst, Piper Jaffray and member of the Institute’s National Industry Council. Institute director Stephen Parente also participated on a panel discussion How the University Can Aid in Lifelong Learning.

Save the date! Next year’s DMD Conference will be held on April 14-16, 2009. For more information go to: www.dmdconf.org

7th Annual Health Information Technology Institute

On May 21^st, the Institute and the Minnesota Chapter of the Healthcare Information and Management Systems Society, (HIMSS) hosted the 7^th Annual Health Information Technology Institute, “Payers, Providers and Politics, Oh My!” The event brought together IT professionals, hospital and health plan executives, nurses, physicians, and academia for a wide range of topics relevant to today’s healthcare industry.

The conference featured two keynote speakers, Marty LaVenture, director of Public Health Informatics at the Minnesota Department of Health and Jeff David, director of industry advancement for HIMSS . Breakout session presenters included representatives from University of Minnesota School of Nursing, MEDNET USA, Utah Public Policy Association, Healthia Consulting, UnitedHealth Group, Health Partners, Fairview University Hospital, and the Mayo Clinic among others.

Conference attendees were able to choose from four simultaneous subject matter tracks: technical, clinical, payer/finance, and vendor. These four tracks provided insights into how government policy, regulation, and priorities impact the healthcare system, helped attendees understand how technology will affect healthcare for the consumer, payer, and provider and also demonstrated how the vendor community is responding to the evolving health IT landscape.

For more information on the Minnesota Chapter of HIMSS go to: http://www.himss-mn.org/

2008 grant winners

In May, the Institute awarded the 2008 Interdisciplinary Grants to four proposals. Awarded through a competitive review process, the grants are designed to provide opportunities to foster a collaborative community of faculty researchers from across the University. Grants are available to inter-collegiate research teams that include at least one Carlson School faculty member and one faculty member from another University of Minnesota unit. Proposed research also requires the endorsement of a local or national firm with revenue from the medical industry. Investigators, or faculty members preparing the proposals, are asked to address the market impact of successful exploration, specifically by answering the question, “why care?” if posed by the collaborating firm.

The four winning proposals were:

Does Ownership Matter in the Selection of Nursing Homes? Evidence from Consumer Surveys

• Principal Investigators: Avner Ben-Ner, professor Center for Human Resources and Labor Studies, Carlson School of Management and Pinar Karaca-Mandic, assistant professor, Health Policy and Management, School of Public Health


• Research Team: Darla Paulson Flint and Ting Ren, research assistants, Center for Human Resources and Labor Studies


• Industry Support: Minnesota Council of Nonprofits

Bioresorbable Materials for Use in Cardiac Implants

• Principal Investigator: Arthur Erdman, professor, Mechanical Engineering, Institute of Technology


• Research Team: Carl Adams, professor, Information and Decision Sciences, Carlson School of Management and Jessica Holst, graduate research assistant, Mechanical Engineering, Institute of Technology


• Industry Support: St. Jude Medical

Effects of Task Variability and Handoffs on Patient Outcomes in a Heart Attack Treatment Program

• Principal Investigator: Susan Meyer Goldstein, associate professor, Operations and Management Science, Carlson School of Management


• Investigators: Rachna Shah, assistant professor, Operations and Management Science, Carlson School of Management, Dr. Timothy D. Henry, director of research, Minneapolis Heart Institute Foundation, and Christopher Solie, data coordinator, Minneapolis Heart Institute.


• Industry Support: Allina Hospitals and Clinics

A Twins Study of Genetic Influence on Economic Preference

• Principal Investigators: Aldo Rustichini, professor of Economics, Department of Economics and John Dickhaut, professor of Accounting, Carlson School of Management


• Industry Support: Merck and Co., Inc.

For executive summaries of these projects go to: http://www.csom.umn.edu/Page8665.aspx

Course Spotlight on University Medical Industry Enterprise

This fall the Institute is launching a new and innovative course, University Medical Industry Enterprise ( MILI 6995). The co-operative course seeks to produce medical innovation valuations for University of Minnesota and State of Minnesota clients for high value economic development and professional training purposes using an interdisciplinary team of faculty, students, and industry leaders.

The Enterprise anticipates serving a wide-range of clients including:

• University of Minnesota scientists, physicians, and engineers with new ideas for an innovation
• Innovators from other academic institutions
• Individuals with marketable medical industry ideas (i.e., surgeon with a new idea for a surgical tool, computer programmer with a new algorithm that will prospectively identify high-risk hypertensive patients).

In this course, student teams will be engaged in completing a rapid production market analysis of promising medical technologies and services to determine potential for success in the market. Students will learn skills to evaluate emerging medical industry innovations by considering market size and potential, intellectual property, and return on investment while gaining exposure to University innovations, venture firms, and inventors. Another unique aspect of the Enterprise course is that it provides an experiential learning opportunity that brings together teams of graduate students from up to eight colleges across the University including: the Carlson School of Management, the College of Liberal Arts, the Institute of Technology, the Law School and the Academic Health Center.

Student spotlight on Stephan Dunning

Stephan Dunning is a MBA candidate completing his second year of the Carlson part-time program, a charter member of the Medical Industry Leadership Institute Student Association (MILISA) and the group’s first elected president. As part of the leadership team for the MILI Student Association, Dunning works to foster an interdisciplinary network of students, with a passion for the medical industry, from schools across the University.

In his time at school, Dunning has researched Therapies for Treating Anemia due to Chronic Kidney Disease in the United States to analyze the emerging competitive market. In the Medical Industry Leadership Institute course Medical Technology Evaluation and Market Research, Dunning was a member of a team that analyzed the important topic of post market surveillance for patient safety. The team researched FDA policy trends and performed case studies to assess when postmarked surveillance should be pursued to minimize patient risks and maintain product longevity. The team then presented their findings to faculty, students, and executives from UnitedHealth Group, the Mayo Clinic, and Medtronic.

While in school, Dunning is also working full-time at the Minneapolis Medical Research Foundation as director of project management in the Chronic Disease Research Group. His group is responsible for managing the United States Renal Data System and receives funding from a number of medical industry firms to perform a wide range of claims-based research. Dunning will concentrate his remaining time in the MBA program on developing expertise in finance, marketing, and new product development

Institute Student Group by Stephan Dunning

The Medical Industry Leadership Institute Student Association (MILISA) recently completed its first academic year. The group is pursuing its mission of fostering a strong interdisciplinary network of students, faculty, alumni, and industry representatives who share a common passion for the healthcare industry. MILISA hosts executive speaking engagements, sponsors networking events, and facilitates interaction between candidates at the Carlson School and individuals from many of the other healthcare-focused schools and organizations at the University and across the country.

Recently, MILISA held its first officer election during which four new officers were elected for the 2008-09 academic year.

• Inaugural President: Stephan Dunning. Stephan is a 2009 MBA candidate currently working at the Minneapolis Medical Research Foundation as director of project management in the Chronic Disease Research Group.
• Vice President: Anil Asrani. Anil is a 2009 MBA candidate currently working for the University of Minnesota as a molecular biologist.
• Treasurer: Bernie Zimmermann. Bernie is a 2009 MBA candidate currently working as a senior consultant intern at Thomson Reuters.
• Secretary: Kate Bautch. Kate is a 2010 MBA candidate currently working as an associate consultant at Ingenix, a subsidiary of UnitedHealth Group.

The MILISA officers look forward to further engagement with the University and the business community through a variety of medical industry related events that will help to prepare its members for leadership roles in the medical industry.

The group has accomplished many goals in its first year and is now focusing on making more progress in the coming year. The 2008-09 academic year will be filled with new opportunities to engage the medical industry community such as Grand Rounds for non-medical students at the University’s Medical School, attending the annual LifeScience Alley Conference, and a new symposium, which is under development, scheduled to be paired with a medical industry focused recruiter fair.

Through these events and activities, MILISA is committed to establishing its student membership as among the most prepared to enter into new leadership roles in the medical industry. For more information about the group please email milisa@umn.edu.

Thank you to graduating founding MILISA members

The Institute would like to acknowledge and thank the dedication and hard work of a group of Carlson students and graduates: Stephan Dunning, Katie Dziak McBride, Stacy Eichenlaub, Jonathan Hovda, Crystal Hughes, Jeremy Jenkins, and Matthew Tarjick.

In March 2007, the Institute organized a student council in order to ensure that student needs and ideas on how the Institute can better serve them are heard and acted upon. As the group evolved, the core members decided to form an official University student group, the Medical Industry Leadership Institute Student Association or MILISA (discussed in story above).

The Institute is grateful to these founding members for raising student awareness of both the medical industry and the Institute. They have planned exceptional events and networking socials as well as compiled a list of over 100 students, from across the University, interested in MILISA and its mission. We wish them continued success in all of their future endeavors

Faculty Spotlight on Rachna Shah

Assistant Professor Rachna Shah has found a way to apply her background in lean manufacturing and supply chain management developed in the automotive industry to the medical industry. Her early research focused on defining and understanding what constitutes lean manufacturing and how lean firms are different from non-lean firms in their strategic and information processing behaviors. In 2007, Shah was recognized for her research achievements and received the Production and Operations Management Society’s Wickham Skinner Early Career Award, which recognizes academics who have achieved outstanding research accomplishments early in their careers. She was chosen for the award in part for the impact her research has to broaden and expand the way that operations management is practiced. Shah’s current research focuses on lean production in manufacturing and service operations and the strategic role of information technology in supply chains. Currently, two of her large research projects are focused in the medical industry.

One of her ongoing projects analyzes the relationship between focus and performance in healthcare. To curtail healthcare costs, policy makers have advocated that healthcare facilities focus on specific specialties including stand alone specialty centers. Taking this cue, Shah, and fellow researchers define focus as, “a disproportionate emphasis on a specialty in a healthcare organization.” The research team selected cardiology as the specialty and using secondary data from all hospitals that provide cardiac care in New York State, they examined the relationship between focus and hospital performance along cost and mortality dimensions. Preliminary results suggest that increased focus affects cost and mortality outcomes in different, even counterintuitive ways: too much focus is associated with higher costs but leads to lower mortality rate in their sample of hospitals.

In addition, Shah also is working on a project with Associate Professor Susan Meyer Goldstein, of the Carlson School, and researchers from the Minneapolis Heart Institute (MHI), Abbott Northwestern Hospital. This research stream examines work design and process improvement in a health care supply chain, where four organizations coordinate their work activities to treat one of the most serious types of heart attacks associated with high mortality and time-dependent treatment options. The treatment starts with a patient arriving at a rural hospital and culminates in angioplasty (commonly called “balloon treatment”) performed at MHI. The work activities are interdependent but organizations performing it are financially and contractually independent of one another. Despite this independence, members of the studied supply chain have achieved significant improvements in process cycle time and patient mortality – process cycle time has reduced from three to fours before process improvement to an average of 95 minutes for patients transported less than 60 miles and 120 minutes for patients transported 60-210 miles. At the same time, MHI has one of the lowest mortality rates among the US hospitals. Shah and colleagues explain how and why independent organizations coordinate and collaborate their work and its improvement in independent supply chains. Shah and Goldstein are conducting an additional study to examine which specific work activities impact time and mortality rate of the patients most significantly.

For more information on Professor Rachna Shah and her research, please see her profile at http://www.csom.umn.edu/Page2075.aspx?type=faculty&eid=218445997

Faculty news

Associate Professor Stephen Parente was interviewed for the June 2, 2008 Wall Street Journal article, “Campaign '08: McCain's Free-Market Health Plan Would Boost Role of High-Risk Pools.”

Assistant Professor Carlos Torelli in the Carlson School’s Marketing and Logistics Management Department was awarded a grant with T. Beebe, N. Chavez, Y.I. Cho, A.L. Holbrook, S. Shavitt and S. Weiner, titled “Cultural Variability in Patient Responding to Survey Measures,” by the Robert Wood Johnson Foundation Grant for Advancing Measurement of Equity and Patient-Centered Care to Improve Health Care Quality.

Stephen Parente was quoted in the April 8, 2008 Duluth News Tribune article, "With AIDS drug patent expiring, U of M looks for other income." He was also quoted in two April 5, 2008 Star Tribune articles:"Health-savings plans may not live up to name," and "U's transfer problem."

In April, Associate Professor Pri Shah, in the Carlson School’s Strategic Management & Organization Department presented a Brown Bag Lunch, “Money, Friends, or Fit: Factors Influencing Career Selection Decisions in Medicine,” with John Bechara. They have written a paper on the subject with five coauthors from the Mayo Clinic.

Stephan Parente was quoted in the March 3, 2008 article, "Patients shop for health care on Web site," in the Lansing State Journal. On January 28, 2008 he was quoted in the Minneapolis Star Tribune article, "Clicking for care: Website aims to transform economics of medicine."

Stephen Parente was interviewed by Lorna Benson of MPR for "Employees not seeing many HSA bargains, " on November 25, 2007 and discussed "Health savings accounts: Are they helping consumers?" on MPR, December 21, 2007.

On September 20, 2007, the American Enterprise Institute held a discussion on a study on recent health insurance options, with Stephen Parente and Roger Feldman of the University of Minnesota.

Stephen Parente discussed Clinton's new health plan in the Sioux City Journal article, "Clinton unveils national health plan, on September 24, 2007.

On October 28, 2007, Stephen Parente discussed medical banking on The Patient's Doctor.

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Faculty Publications

Recent publications by institute faculty affiliates.

J. M. Holm-Denoma, T. E. Joiner, K. D. Vohs, and T. F. Heatherton, "The "Freshman Fifteen" (the "Freshman Five" Actually): Predictors and Possible Explanations," Health Psychol. 27, no. 1 Suppl (2008): S3-S9.

J. I. Krueger, K. D. Vohs, and R. F. Baumeister, "Is the Allure of Self-Esteem a Mirage After All?," Am.Psychol. 63, no. 1 (2008): 64-65.

K. D. Vohs and J. W. Schooler, "The Value of Believing in Free Will: Encouraging a Belief in Determinism Increases Cheating," Psychol.Sci. 19, no. 1 (2008): 49-54.

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Alumni Spotlight on Anita Messal

Anita Messal, ’03 MBA, is chief operating officer of OptumHealth Care Solutions, a division of UnitedHealth Group. In this role, she oversees products, networks, and operations.

She credits the Carlson School’s well-rounded curriculum with preparing her for her career. Establishment of the Medical Industry Leadership Institute creates an additional focus, which takes advantage of the rich Twin Cities medical marketplace. Because of the high concentration of medical industry talent and high-performing organizations in this market, the Carlson School has a unique opportunity to combine its faculty, research, students, and access to industry leaders to create an experience that sets the school and its students apart.

“I gained a greater understanding of sustainable competitive advantage through Carlson School classes and was able to focus on applying those concepts to health care, applying learning from an evening class the very next day. Carlson students are in a unique position to collaborate with and learn from leading global companies with local headquarters. Students graduate with experiences as rich as any other leading business school.”

“Maintaining relationships with the Carlson School through MILI, speaking engagements, student advisory boards, the Capstone project and First Tuesday, have increased my enthusiasm for the medical industry, and especially within Minnesota.”

Prior to attending the Carlson School, Anita graduated with a BA in Journalism from the University of Minnesota. Her background includes work in account management, sales, and marketing positions.

Become an Institute Affiliate

The Institute recently launched its Institute affiliate program for Carlson students and MBA graduates with medical industry expertise or experience. Institute affiliate status rewards students and alumni with ongoing access to Carlson School faculty research, lifelong learning programs, contact with others in the industry, as well as opportunities to network with industry leaders.

As an Institute affiliate, Mark Eckstein, director, Office of Ethics and Integrity at UnitedHealth Group, feels that "MILI has the vision, network of expertise, and reach, to engage thought leaders across the delivery of care spectrum to creatively and collaboratively address barriers that impede accessible, quality health care in Minnesota and the country. The opportunity to be a part of a group focusing on the critical needs of the medical industry as an affiliate member is a "no brainer." As an affiliate, I have access to leading edge medical industry research and thought leadership that I can directly apply in my career at UnitedHealth Group."

To become an affiliate current students write a leadership statement describing their best work in an experiential learning project or real world firm-based project. Alumni agree to fulfill a service commitment such as guest lecturing in an Institute course, sponsoring an Institute event, mentoring a student, etc.

By engaging Carlson School students and alumni as Institute affiliates, we are creating a community of leaders in the medical industry, providing opportunities for service to the school and to our students. It is a unique opportunity to engage Carlson students and alumni to discover new avenues for collaboration, education, and research. For more information on becoming an Institute affiliate, please go to: carlsonschool.umn.edu/miliaffiliate

National Industry Council

The National Industry Council is comprised of senior-level executives from national medical firms, as well as from banking and consulting firms with strong connections to this industry. The council supports the Institute, its mission, and the Carlson School by providing leadership in joint venture research projects, national outreach, general advocacy, and ambassadorship for the Institute. The council engages in experiential learning, advises on the Institute’s education agenda, facilitates contact with industry firms to enhance graduate placement opportunities, and offers guidance to the Institute on the development of relevant Executive Education programs.

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Faculty Council and Faculty Affiliates

The Faculty Council and affiliate groups represent the Carlson School, as well as University of Minnesota units with research and educational interests that intersect with the medical industry sector.

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