X-Message-Number: 1909
Date: 07 Mar 93 06:48:31 EST
From: Mike Darwin <>
Subject: CRYONICS The Ever Rising Curve of Expectations

From: Mike Darwin
To: All
Re: The Ever Rising Curve of Expectations
Date: 6 March, 1993

     Many have commented here on the financial crisis at Alcor, the need 
to raise dues and so on.  In my opinion most of the comments have been 
right, even the seemingly contradictory ones.  Michael Riskin is right 
when he points out that Alcor has offered subsidized services, Ralph 
Whelan is right when he talks about how hard things are and how poorly 
people are paid, and so on.  And the members are right when they 
suspiciously complain about paying more for less.  So where's the answer 
and what's the bottom line.  And doesn't this all sound suspiciously 
familiar?

     History Lesson:  Dues were kept "subsidized" and artificially low for 
several reasons:

     1) As I often say, when you open a McDonalds you don't charge your 
first customer $500,000 for his order of fries, a Big Mac and a Coke 
"because that is what it costs to deliver the products..."  You recognize 
that the high start-up costs must be spread over a long period of time in 
order to recoup the investment.  Clearly, in the early days of Alcor there 
was NO POSSIBILITY of charging what it really took or we would have had no 
customers, *including ourselves.*  The question you must now ask 
yourselves is "is start-up over?"  and "are we ready to start behaving 
like a real commercial business?"  How you answer this question will be 
very important as I will discuss a little later.

     2) Every time the cost of the service goes up so does the cost in 
lives.  We know for a fact that the perceived high cost of cryonics deters 
MANY from making arrangements most of whom will die before they discover 
otherwise.  Having worked in the trenches for many years I can tell you 
about seeing people die because they cannot afford to be suspended.  This 
takes a severe psychological toll on the people who have to deal with this 
problem.  Historically, this problem has been so bad in the healthcare 
industry that ALL civilized countries have refused to deal with it and 
thus ultimately socialize medical care.  As Steve Harris points out, the 
net effect of all this is that instead of some people getting lobster and 
some people getting stale bread, everybody gets plain hamburgers.

     3)  Cryonics Institute's obvious success at acquiring patients by 
offering a cheaper kind of service speaks to the price elasticity curve  
more eloquently than wasting a long paragraph on it here would.

     Now back to # 1 above and the considerations involved.  If Alcor is 
to be no longer considered a start-up then it must offer a level of 
professional service commensurate with its desire to be treated as a 
"market commodity."  This means that it must have qualified people working 
for it, particularly in its core service area: the administration of 
cryonic suspension.  Having a suspension team leader out in the field who 
doesn't know how to take a blood pressure and tries to bluff through it, 
or doesn't know when a patient is suspension material and when they are 
potentially recoverable doesn't cut it.  You need competent people to do a 
competent job.  Members KNOW this in their wallets and in their guts.

     Unfortunately the situation that Alcor is in is a difficult one.  
Professionals come at a high price and are difficult to get in any event.  
But it is a do-able situation.  I'll give you a case in point.  Cryovita 
and Biopreservation are doing canine total body washout studies which are 
of enormous technical complexity -- far more complicated and demanding 
than what was done by Alcor and Cryovita in the mid-'80's and several 
times as complex as a cryonic suspension.  We have thus had to seek out 
highly qualified professionals to carry out this work.  We have two 
respiratory therapists, a perfusionist who is the head of perfusion at a 
local hospital, a scrub nurse (also employed full time in that capacity at 
a local hospital), a biochemist, and a physician with intensive care 
background.

     These people don't come cheap and most are not available on a full-
time basis even at a good market salary.  However, one of our people is 
outstanding.  He is a respiratory therapist, he is an excellent auto 
mechanic, sheet metal worker, and is employed full time as a respiratory 
equipment technician at a local hospital.  He is intelligent, attractive, 
well-spoken, and capable of fixing almost anything that breaks.  We employ 
him approximately half-time and he is worth every penny that he is paid 
(and he is paid remarkably little).  I am now starting to train him to do 
perfusion (which many respiratory therapists are now learning to do since 
they are increasingly being called on to do extracorporeal membrane 
oxygenator (ECMO) support on neonates).  He will make a very good 
perfusionist.  He is also willing to pump cryonics cases and is very 
interested in the opportunities for travel and the opportunities for money 
which cryonics represents.

     He is NOT a cryonicist.  He does not think it crazy, but he is not 
particularly interested personally.  However, what he is, is a highly 
competent individual who does every job he is given extremely well.  Even 
small jobs like fixing a surgery light; not only did he fix the broken 
switch he cleaned the light from top to bottom, lubricated the wheels and 
tended to half a dozen other small problems.

     What is more I do not care that he is NOT A CRYONICIST.  What I care 
about is that he has a hunger to learn, much of the necessary background 
information, and excellent clinical instincts and disaster coping skills.  
I want to train him because I would feel comfortable with him pumping me 
when my time comes.  If it works out that I CAN train him and he chooses 
to do cryonics work we will have a first class professional available.

     I spend all this time citing this man as an example because he is the 
kind of person Alcor needs to get.  If not someone like him, then other 
professionals with real credibility.  This will be necessary because if 
you are asking people to pay for what they get, they will want a lot.  You 
will have begun to *formally* embark on the Ever Rising Curve of 
Expectations.  Alcor will simply fail if they continue to rely on people 
who have openly and repeatedly stated that they are not really interested 
in doing perfusion, or suspensions... but are doing its because there is 
no one else.  Such intentions, however good, are a disaster, pure and 
simple.  And if you pay for them you are likely to be a victim of that 
disaster.

     When Alcor was a volunteer, small, non-customer organization people 
were very understanding about shortcomings.  If mistakes were made 
everybody (more or less) grinned and bore it because everybody was in this 
thing together.  Jerry and I have, on more than one occasion, had a 
husband or son, or lover assist us with surgery or help with transport for 
their mother, father, wife, lover...  These people knew us intimately, 
knew above all that we cared, and knew that we were doing the best we 
could for that patient.  Charles asks why we called them members?  Well, 
the best answer I can give is that someone who holds the wound open with 
the retractor while you work on his wife and *can't find her femoral vein* 
while the minutes are ticking away and she is not oxygenating well on the 
HLR is NOT a customer.*   What *word* you call such a person I don't know, 
but it sure as hell isn't "customer" or "client."

     Those days are largely over.

     Like it or not Alcor is now large enough that it has become in many 
ways a "normal" business -- at least with respect to its customers' 
expectations.  This is an incredibly dangerous thing and in my opinion it 
is not being handled well.  I think that catastrophe lurks on the event 
horizon.

     Where does all these leave us with respect to practical matters like 
raising dues and suspension minimums?  I have the following thoughts:

     *  Dues should be raised in an equitable manner: meaning that those 
who need the services they get should pay for them.  This means that 
people who need remote standby should pay for remote standby and should 
pay for it according to the likely cost based on geography and many other 
factors.  As long as it does not depend upon RISK it is not insurance and 
a program along these lines should be implemented IMMEDIATELY.

     *  Since we have mentioned the words insurance and risk we need to 
deal with those issues.  The *fact remains that the vast majority of money 
being paid for cryonics services is going to insurance companies, not to 
Alcor.*  This is STUPID, STUPID, STUPID, STUPID!  In the last few years 
Alcor has let slip through its hands (in nonessential expenditures), plus 
what it had in the endowment, enough money to set up its own self-
insurance program.  Alcor even has as its members professional actuaries, 
mathematicians, and others who have worked in the insurance industry who 
could have assisted with implementation of such a program.  

     If Alcor had done something about this by making hard decisions 
several years ago, NOT DOUBLING THE STAFF IN ONE FELL SWOOP, NOT SPENDING 
ITS CAPITAL COUNTING ON GROWTH TO BAIL IT OUT... they would have enough 
money to hire professional technical staff and your total cost for 
services (i.e., life insurance plus "dues) would be LOWER today, not 
edging higher.

     *  The fundamental problem with dues is that they are unfair.  
TOTALLY UNFAIR.  Young people are subsidizing the old and dying who sign 
up when they are old and dying.  The local California and Florida members 
(who constitute a big hunk of Alcor's membership) are subsidizing the 
scattered members who need remote standby services when they run into 
trouble.  Many of these members cannot, or more often, will not relocate 
to near Alcor facilities even when they know they are dying.  Now I do not 
question their reasons for this choice.  But I do question PAYING for it.

     So, listen to what Michael Riskin is saying about socialism, but 
realize that he hasn't touched the tip of the iceberg.  A good hunk of you 
folks are being taken to the cleaners and you don't even realize it!

     The solution to this problem is for Alcor or the cryonics 
organizations as a whole to self-insure.  Do you realize how much money 
the insurance companies are going to make from us poor bastards?  And in 
the end the policies we buy will be worthless to pay for the costs of our 
suspension having been eaten up by inflation!  And the only ones who will 
have profited will have been the insurance companies!   If Alcor had all 
that revenue and managed it just as conservatively and JUST AS PROFITABLY 
as the insurance companies do THERE WOULD BE NO MONEY PROBLEMS RIGHT NOW 
and what is more THERE WOULD BE PLENTY OF MONEY FOR RESEARCH AND IMPROVED 
PATIENT CARE.

     Of course, the problem now is that there is a serious lack of trust 
of management's financial abilities and of their ability to keep their 
word and much of the necessary capital has been frittered away.  And to 
Michael Riskin I would say that you are wrong, DEAD WRONG when you keep 
shouting that there has been no financial impropriety when indeed there 
has been.  And if you don't think cobbing money from the patient care fund 
or "borrowing" from the endowment when you have made contractual and/or 
other promises to the contrary isn't wrong, then with all due respect, you 
don't know what the definition of impropriety is.

     So, if you Suspension Members plan to fork over more money for an 
even lower level of service on a "commercial" or "real costs" basis then 
you have every right to be unhappy.  And if you plan to do so on the basis 
of paying your fair share under the current system, then unless you are 
already dying or are 80 years old you are are being raped.

     The take home message to Alcor: Please, no more tax and spend and tax 
and spend with services getting shabbier every step of the way.  Fix the 
socialism guys.  Fix it.  Really fix it.  Make people actually pay for the 
services they get and deliver services worth paying for.

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