Health Care Should Go (Micro) Nuclear

By | July 21, 2021

By KIM BELLARD

I think of hospitals as the healthcare system’s nuclear power plants.  They’re both big, complex, expensive to build, beset with heavy regulatory burdens, consistently major components of their respective systems (healthcare and electric generation) yet declining in number.  Each is seen to offer benefits to many but also to pose unexpected risk to some.

Interestingly, there’s a “micro” trend for each, but aimed towards different ends.

Micro hospitals have been with us for several years.  They usually have only around ten beds, along with an emergency room, lab and imaging.  Dr. Tom Vo, CEO of Nutex Health, says: “We position ourselves between urgent care and a big hospital.”  A micro-hospital Chief Medical Officer admits: “We still partner with our larger hospital partners for patients who might require surgery or intensive care.” 

They’re not trying to reinvent hospitals so much as to support them and offer more convenience to patients.  Not so with micro reactors; they’re looking to revitalize their industry, which is in trouble.

According to the U.S. Energy Administration (E.I.A.), there are 94 U.S. nuclear reactors, at 56 nuclear power plants, in 28 states.  Only one new reactor has gone active in the U.S. since 1996, while almost two dozen are in various stages of decommissioning and only two new ones are under construction.  Overall, the U.S. gets about 20% of its power from nuclear reactors, while 13 countries get at least a quarter of their electricity from nuclear, with France leading the pack at 75%.     

We talk a lot about transitioning away from using fossil fuels to generate electric power, but none of the renewable options currently offers a realistic path towards replacing them.  Nuclear power is the proven alternative, but, as Dan Van Boom wrote in CNET, nuclear power has a PR problem.  No one wants a nuclear power plant in their backyard, no matter how big that backyard is.

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When most people think about nuclear power, they think of disasters, especially Fukushima (Japan, 2011), Chernobyl (Russia, 1986), or Three Mile Island (U.S., 1979).  Nuclear power, many people feel, is dangerous, expensive to build, and something we should be moving away from, not embracing. 

Proponents of nuclear power point out that, as scary as they were, deaths from the three disasters listed above were actually very small.  Moreover, they argue, almost every other form of power generation is much more dangerous than nuclear

Enter micro reactors.  CNBC reported on Oklo, a start-up that is selling mini-reactors that are small enough to fit in an A-frame structure and – get this! — powered by the waste from conventional nuclear reactors.  They only produce around 1.5 megawatts of electric power (MWe), compared to conventional ones that can produce as much as 8,000 MWe.  Perhaps most importantly, though, instead of taking a dozen or more years, and as much as $ 20b, to build, these will take less than a year, and are substantially cheaper.

This is not pie-in-the-sky stuff.  “These reactors have been built and operated before. So they’re ready to go,” Oklo co-founder Jacob DeWitte told CNBC.  Mr. DeWitte expects “a number of plants operating by the mid-2020’s,” with potential customers including utility companies, industrial sites, large companies, and college and university campuses. 

Oklo has already signed a deal with bitcoin mining company Compass Mining for 150 MW of power, at a cost Compass believes is considerably lower than it is paying now.   Mr. DeWitte sees this as a “beacon” for how to supply power for cryptocurrency.

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There are still some regulatory barriers for Oklo to overcome, not the least of which is to have the plans operate without any onsite human oversight.   

Not to be outdone, China has started construction of its own “small modular reactor” (SMR), Linglong One, build by China National Nuclear Corporation (CNNC).  It will produce 125 megawatts, enough to power 526,000 households.  It can also be used for heat supply for cities, industrial steam, seawater desalination, and oil exploitation.  CNNC believes SMRs offer miniaturization, high safety, short construction period and flexible deployment. 

Similarly, the U.S. Office of Nuclear Energy asserts: “Advanced Small Modular Reactors (SMRs) are a key part of the Department’s goal to develop safe, clean, and affordable nuclear power options.” It cites multiple advantages, including “relatively small physical footprints, reduced capital investment, ability to be sited in locations not possible for larger nuclear plants, and provisions for incremental power additions. SMRs also offer distinct safeguards, security and nonproliferation advantages.”

As if this isn’t eye-opening enough, the Defense Department is working on transportable nuclear reactors, and some engineers are proposing small reactors that they refer to as “nuclear batteries.”  Of the latter, MIT Professor Jacopo Buongiorno told MIT News: “It’s so small that the whole power plant is actually built in a factory and fits within a standard container.”

CNNC and ONE overlap on many of the characteristics they like about mini-reactors: small size, cheaper and faster to build, flexible deployment, and high safety.  All of those would be desirable in healthcare, particularly for hospitals.   But no one (that I know of) is building a hospital that can be built in a factory and easily transported.  No one is actually proposing to replace full service hospitals with a network of micro-hospitals.

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Last year, in response to the pandemic, CMS launched both the Hospital Without Walls program and the Acute Hospital at Home program. Both are laudable, but both were aimed more at reduce the strain on hospitals, not reinventing them (and neither is permanent). 

Hospital-at-Home programs are already gaining traction, as evidenced by Kaiser Permanente and The Mayo Clinic jointly investing in the Medically Home Group, along with a host of other hospital-care-at-home deals.  John Halamka, M.D., president of Mayo Clinic Platform, believes:

We can advance the well-being of patients by catalyzing innovative, collaborative, knowledge-driven platform business models to redefine the standard of high-acuity care for patients with serious or complex illnesses who currently receive care in hospitals.

Amen. 

If we can replace massive nuclear power plants with micro-reactors that can fit in a suitcase or shipping container, we can do better than micro-hospitals that just look like scaled down hospitals.  If we can aim to run those reactors without onsite personnel, we find more ways to reduce staff in micro-hospitals.  If micro-reactors can both significantly reduce carbon emissions and be cheaper than traditional power sources, micro-hospitals should help reduce health care costs and improve outcomes. 

When the nuclear power industry is out-innovating healthcare, it’s a good sign that healthcare is way off-track.

Kim is a former emarketing exec at a major Blues plan, editor of the late & lamented Tincture.io, and now regular THCB contributor.

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