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West Health co-founder speaks up about health care costs

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Gary West, co-founder of West Health, doesn’t want to leave the fate of health care up to green visor-wearing bureaucrats puffing cigars in a dark room in Washington, D.C.

“The American health care system is at a tipping point. Either we, as a country, will figure out how to do things better, faster and cheaper, or the government is going to ration our health care,” he said.

The former is the favorable option, he says, and supports the mission behind West Health: to invest in and create innovative solutions and technologies to lower health care costs.

The major philanthropic leader made an unlikely speech — let alone appearance — on Wednesday at the West Health Institute in La Jolla to introduce the new chief executive of the collective West Health organization.

West Health was introduced as an independent initiative in 2012, consisting of four entities: the West Health Institute (formerly West Wireless Health Institute), West Health Policy Center, West Health Investment Fund and West Health Incubator.

“Today, there’s no greater problem facing the country than the ever rising cost of health care,” West said. “Let me put things in context for you that are sobering to me but are a mathematical fact of life."

If the current spending continues, by 2030, 100 percent of the average family budget — the entire income of a family making between $60,000 to $75,000 a year — will be spent on health care.

“Think about it. That is an almost unbelievable thought. That’s 18 years from now," he said. "That simply can’t happen. But that’s the direction we are headed if something isn’t done about it.”

The Gary and Mary West Foundation started doing something about it in 2009, starting a nonprofit medical research organization called West Wireless Health Institute with a $45 million grant.

The Rancho Santa Fe couple made it big in the communications industry and have their hands in various businesses, including the Carlsbad restaurant Bistro West.

The $100 million investment fund, set up in October 2011, targets small companies working to disrupt health care and come up with patient-centered solutions that lower costs.

One is Change Healthcare, which provides cost transparency to employers so employees can make cheaper decisions regarding their own health care.

West Health's policy center was set up in Washington, D.C. this year with a goal of saving more than $100 billion in cumulative health care costs within 10 years by identifying common sense changes in reimbursement and regulation.

The recently announced small business incubator sits across the street from the La Jolla institute.

Dr. Joseph Smith, chief medical officer and chief science officer, explained the reasoning for starting the incubator.

“The ideas one may have, no matter how important, need a place to start so individuals driving those potential patient-centered solutions can actually succeed and be aware of all the limitations in the process,” said Smith.

He admits he has the "best job in the world" because he gets to do good for not only the country, but also for each patient and family.

“Putting health care within their reach but also not outside of their financial grasp,” he said.

West introduced the newest member of the institute’s board on Wednesday: Dr. Michael Johns, chancellor of Emory University from 2007 to 2012 and an innovative thinker in health care policy.

“Mike thought he was retiring. We had a new plan for him,” he joked.

The institute's new CEO, Nicholas Valeriani, has more than 34 years of experience in various leadership positions at Johnson & Johnson (NYSE: JNJ), including engineering, manufacturing, human resources, and sales and marketing.

“Most people would not do in three lifetimes what Nick has somehow managed to do in one,” said West. “He’s obsessed with figuring out how to lower the cost of health care without the degradation of the quality of patient care that’s provided.”

Valeriani took the stage, thanking the Wests for the opportunity and making an announcement of his own.

“This assignment will be the last assignment in my professional career," said Valeriani. "There’s nothing else I’d want to do other than be part of this team and to make an everlasting difference in the health care in the country.”

One of West Health's cost-lowering innovations is Sense 4 Baby, a wireless fetal monitoring system — the first medical device developed at the institute — that can save nearly $1.4 billion a year in maternal health costs. Another is its Reflexion physical therapy software with Microsoft Kinect, which can cut rehab expenses.

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West Wireless Health Institute

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10350 N. Torrey Pines Rd.
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West Wireless Health Institute Executive(s):

Don Casey

  • Chief Executive Officer