2019 March

Political Risk

Lower cost is one element of the triple aim. How does your company’s values address the cost of healthcare?

Cost is a big issue for the 2020 election. Some of the government findings about healthcare pricing and billing practices are clearly an issue that could blow back on companies that aren’t proactively addressing cost.

What are patients being promised about the cost of their care? Is your company promising the lowest cost, a market rate or a high cost for a premium service? There is no one right answer but patients need to know what your company is promising. Why?

Stakeholders have the ability to influence government action now more than ever thanks to social media. Social pressure from stakeholders including patients, employees and employers will force the government to regulate the reported problem. We’re seeing it now with proposed regulation for pricing and billing practices.

Leaders of companies should be thinking about:

1. Risk profile as it relates to cost.

2. Prioritizing cost as a risk and integrating it into their values + strategies.

3. Mitigating existing risk.

Companies that don’t will expose themselves to unnecessary political and reputation risk by not making a clear statement about cost.

AI in healthcare

One of our clients would always say “think about sitting in your big easy chair.” I definitely thought about it but never experienced it. Why?

For reasons similar to the premise behind AI. I streamlined and automated a lot of workflows for the organization so that the staff focused on the more complex issues and higher value work.

Today automation replaces about 25% of the routine transactions. AI may replace another 20%. There will always be work to be done which is why you shouldn’t put too much thought into that big easy chair yet.

The difference is that automation and AI increases productivity so that companies have the resources needed to do more. So the long story short, is that AI won’t replace jobs but it likely will change what people do and how they do it. The win is that higher value work pays more.

Non-clinical tasks will likely change first because the health and safety risk for AI is lowest. Leaders should start considering the potential impact on non-clinical workflows now and plan accordingly.

The aim of medicine is to prevent disease and prolong life; the ideal of medicine is to eliminate the need for a physician.

Dr. William W. Mayo

Now – Near – Far

Now – Near – Far is a strategic framework that some executives of legacy healthcare systems are using now.

The framework was developed by James Hackett, CEO of Ford to assemble and align the resources needed to deal with disruptive market forces.

1. Now – Assembling and aligning resources for the Far.

2. Near – Executing on the strategic plan in a way that continuously meets the expectations and needs of patients.

3. Far – Imagining who your patients are, what they will need, what they will expect and how you can serve them.

The problem for some executives is that they are not thinking about the Far and may in fact be brushing it off as something they have seen before. However, the consolidation and emerging technology will eventually result in disruption to the status quo.

The threat for the legacy healthcare systems is the vertical consolidation of outpatient providers and insurers. The resources of the combined entity and the lucrative services provided will make them hard to beat.

Uber didn’t start with Pool. Uber started with a resource some people already used and made it easier to use. Then they offered cheaper options to capture more marketshare.

If something sounds too crazy to work. Don’t brush it off. Think about the possibility.