Healthcare Transformation

How matters

How matters more than most leaders thought.

Corporate America is changing. Business leaders are realizing that they need to think beyond the bottom line.

Some investors are pushing back but what they might not realize yet is companies can do even better when they consider the social and environmental impact in their policies and business practices.

Haven

Haven Healthcare is the new healthcare company formed by Chase, Amazon and Berkshire Hathaway that is led by Atul Gwande MD. Dr. Gwande has been sharing his experiences, thoughts and insights about the cost and quality of healthcare in his books and articles for more than a decade. 

Since formation, the company has been working to understand the needs of their patient population so that they can “create new solutions and work to change systems, technologies, contracts, policy, and whatever else is in the way of better health care.”

The “whatever else” in this case likely refers to the way American Corporations have focused solely on the bottom line. It should come as no surprise to any of us that Jamie Dimon, CEO of Chase is one of the leaders championing this change. 

He is likely getting some good data and management insights to support his position. Hopefully we’ll learn more about that when the Forbes article is published next month. Until then, you might want to check out this book.

Dying for a Paycheck

We’re likely going to hear about some of the work published by Stanford Professor, Jeffrey Pfeffer. In Dying for a Paycheck, he talks about the management practices that “literally sicken and sometimes kill employees” which as you might imagine also negatively impacts productivity and the bottom line. 

Professor Pfeffer hypothesizes that prescription drug data is a better indicator of health and wellbeing than solicited input from employees because it is unbiased. Researchers in Denmark are reportedly using prescription drug data to draw correlations between prescription drug use and the effects of entrepreneurship, organizational change, compensation and more.

My guess is that Haven is using their medical data to investigate the policies and business practices of the operating companies and drawing similar types of insights. It could be game changing for Americans and the healthcare industry.

Times change, we need to change as well. 
~ Nelson Mendela

Changing how

A lot of this might seem like common sense, but without data it is harder to convince people change is necessary.

I was a very early pioneer in the online learning space. Our solution helped clients enhance their operations while providing a path for a brighter future for their employees. How you ask?

Our training solution provided the much needed training to those responsible for the revenue cycle and financial management. Most had never received formal training on the systems or best practices which from a financial perspective is a recipe for disaster.

Staffing decisions are emotional but became so much easier with data about the time spent on course work, modules completed and assessment results. 

We enrolled everyone in their required training modules and gave them time on the job to complete the course work. Some just didn’t complete all of their modules and not surprisingly, they underperformed in those areas of their job. It was a clear indication that they had no interest in the work.

Rather than terminating their employment, it was our opportunity to start a conversation about the right career path for them. There are really only three career options: 

1/ Develop functional depth

2/ Transition to a cross functional role

3/ Retrain for something entirely new

Even though the organization had less than 100 people, we were able to offer all of these options within the organization and financially, we had some of the best years. 

Investments in fundamentals and people pay off in companies of all sizes.

Training investments help people perform better on the job and prepare for a brighter future. Many of the people who successful completed our courses have already transitioned into new jobs. They didn’t have to experience the stress of having their job eliminated.

Industry leaders need to making these types of investments to be profitable and accountable to all constituents going forward. If you’re coming from a strong viking and victim culture such as in law, finance and tech it might be harder for you to make the mental shift but it’s necessary now. 

Good Data

Only 30% of the analytic results in healthcare organizations are accurate. 

It was one of the facts that we learned on the Health Catalyst webinar this morning and based on my own experience seems about right.

Part of the issue is the old adage “Garbage In/Garbage Out” and the other part is lack of consistency in defining and pulling the data elements.

The new Health Catalyst population stratification module standardizing the datasets makes it easy enough for business people and maybe even some clinical people to pull their own data. It’s a huge plus especially for healthcare organizations conducting research.

Garbage in/Garbage out needs to be addressed with better user interface design, refined data capture requirements and compliance with medical record documentation. There is just no way around it.

Everyone needs quality data to make sounds decisions whether clinical or business. When the data is bad, we end up wasting resources solving problems that don’t exist and overlooking the real issues.

Focus on Why

Do you know why your company exists?

If you answer is something like to provide high quality medical services or to provide a specific type of solution to the healthcare industry, you’re telling me about your company’s what – not the why. 

The why is the reason the company was founded and continues to exists. The why embodies the company’s beliefs about those that it serves and reflects the values that guide how the company operates. 

One Medical

I reviewed an investor report on One Medical recently that had this really wordy description of why the company exists. It made me wonder whether the company is loosing touch with their why [a common problem as companies grow] or if the why was just lost in translation.

However, most people are familiar with the company so it seemed like a good example to explain the differences between why – what – how and the value of focusing on why.

Early success:

1/ Why: The founder, Tom Lee MD believed waiting 29 days [the average wait time in the US] to see a primary care physician was unacceptable. So the company’s core belief is timely service is most important to their customers and members.

2/ What: One Medical found customers willing to pay a premium for on demand access to care. Employers and those without an established relationship with a primary care physician were willing to pay the premium. 

3/ How: The company solved the wait problem by incorporating nurse practitioners and technology into their service so that most if not all of their members are seen within 24-48 hours of scheduling an appointment. They also increased the length of the appointment to minimize the risk of wait times on the date of service.

Growth + Profitability:

The why has defined the company and is the reason existing customers and members value the company. As the company enters new markets and partnerships, the management needs to consider:

1/ Do other populations value timely access to care as much and are they willing to pay a premium for it? 

2/ Are they able to modify the how without sacrificing the why to achieve long term growth and profitability?

It will be interesting to see how the next chapter turns out.

Frontline of Addiction

Everyone is feeling the pain of the homeless issue and the drain of addiction related issues.

A colleague emailed me today with his latest story of arriving to work early and stepping in human feces on his way into the office. Emergency workers were also on the scene dealing with some other health hazards and attending to what he referred to as the walking dead. Needless to say, the drama affected his mental state all day.

The healthcare systems are also being taxed. I was on a call a few weeks ago listening to the gains realized by a Canadian hospital system after redesigning key processes. When I asked if they were able to reallocate those resources to reduce their waitlists, they replied no because they are experiencing an increase in ER visits.

Addiction is a specific mental illness. We need to get the experts on the frontlines of this issue and remove the access barriers or we’re not going to stem the tide.

Hospitals aren’t set up for rehab. So what if we restructured rehab facilities for emergency overdose services and observation? They have the expertise and resources to really help people suffering with addiction.

It might not be the right solution but it’s a starting point. We need to challenge our approach to the problem because what we’re doing now is clearly not working.

IDNs are the Now

A colleague has been asking me about the biggest challenge for integrated delivery systems now.

He was specifically asking about Kaiser and in the interest of full disclosure, they are not one of my clients.

Kaiser is a staff model HMO which gives the company a unique competitive advantage. Other integrated delivery networks are trying to replicate the model but without the structural efficiencies most won’t achieve the same economics.

The economics are a big part of the challenge for all integrated delivery networks including Kaiser. Healthcare in the US is simply too expensive.

I found my notebook from a design thinking course that I took at Stanford. One of the cases discussed was the high infant mortality rate in India. Most hospitals in India have incubators but they’re rarely used. Why? Most babies at least then where born in the community not hospitals. The incubators didn’t meet the need.

To some degree, integrated delivery networks seem like the incubators in India. They are state of the art but they’re not meeting the needs of the community. The US needs something more accessible and affordable.

That’s why I think IDNs are the now but not necessarily the future of healthcare.

Words Matter

How you make people feel is more important than what you do. Why?

It’s a lesson from the book Undo It by Dean Ornish, MD on enhancing one of the four key elements of life – Love. However, it is equally important to remember in the workplace.

I met with a colleague this week and he commented on “the waste” in the US healthcare system. His only point of reference was one statistic: healthcare as a % of GDP.

One statistic does not tell the whole story and for me, it struck a nerve. The healthcare system operated as it was designed and unfortunately, limited technology and misaligned incentives didn’t enable it to operate optimally. That’s changing – although slowly.

Innovation in healthcare is hard in part because the culture doesn’t support it. In Dare to Lead, Brené Brown explains the connection between vulnerability and innovation. You can’t have one without the other because failure is inevitable.

How we think about failure and what we say to those who are brave enough to try and fail matters.

Experience vs. Service

The Hudson Bay Company [HBC] is a really good case study for modernizing healthcare. Why?

The retail customer is becoming the healthcare consumer. In an era where the retail customer is becoming more knowledgable and empowered with choice, HBC is struggling and stores will likely close.

After attempting one transaction with HBC, I told a healthcare colleague that the company is in for a rude awakening as Amazon expands operations throughout Canada. 

1/ Lack of Customer Focus: They’ve tried to be things that they are not [ie. competing in the luxury market] and failed. They clearly don’t have a strong grasp of their customer and what their customer expects of them.

2/ Product over Experience: HBC is still focused on what to sell rather than curating the experience for their customer. Companies thriving in the modern era of retail are doing so by focusing on the entire customer experience rather than simply curating product. 

3/ Ease of doing business: Retail consumers expect the payment system to work for all their transactions whether online or in person. The more friction there is with the purchase process the more likely the customer will go elsewhere.

Healthcare service companies are also in for a rude awakening if they don’t get these three things right.

Financing Healthcare

My pick of healthcare systems would be none. Why?

All the choices are dated. Rather than looking at a model in it’s entirety, we need to look deeper to what aspects are working and why.

What we know is that healthcare financing affects timely access and all systems no matter how they are currently financed have access issues whether it’s waitlists, the cost of care or patient’s who prioritize savings over timely care.

We also know that untimely care typically results in more expensive care. So the question should be not which system is best but rather do we shift the financing to emphasize more timely care that keeps people healthy.

The questions that everyone should be asking now are:

1/ Which companies should be at risk for keeping people healthy?

2/ Which companies should be at risk for delivering high quality care?

3/ What role should the government play to make healthcare affordable?

As an industry, we can’t answer those questions. We need to know:

1/ Who do people trust as a partner for their journey through life?

2/ How much involvement are they willing to tolerate before the solution becomes too invasive and creepy?

3/ How can we build trust?

Design for disruption

Streamline processes or anticipate the disruption that is going to happen and design for it?

I was at a digital health event last night and one of the companies presented the new process that would be enabled by their technology. It was better but only modestly better. 

What it didn’t consider is an engaged healthcare consumer, patient or member. People everywhere in the world are trying to self diagnosis themselves with online information and studies. That trend is going to continue with the number of free apps, wearables and tests that are engaging people in their own health.

As an industry, we can’t put the genie back in the bottle. We need to anticipate what people are likely going to do and design for it.

Disruptive tech companies study how people use their technology and hook them by making their solution even easier to use. We need to take that mindset into process design and design for how people actually want to use the healthcare system.

Dated gatekeeper models are not going to work in the era of an engaged consumer, patient and member. People will circumvent processes that are long and difficult. It’s the work around that we all do in corporate America. So why would we expect anything different in a healthcare service?

A good plan

Five tips for physicians trying to push their initiatives through the healthcare systems.

I read a summary proposal prepared by a MD today that fell flat with the Hospital Administrator. It was missing the essential information needed to evaluate viability.

I provided some feedback and thought other MDs might benefit from some general feedback too.

1/ State the problem. What’s wrong with the status quo? Tell the story about how patient’s are being negatively impacted by the current treatment and/or service.

2/ Describe the future state. What would the new treatment and/or service look like, how would it be enabled and who would deliver it?

3/ Provide existing metrics and goals. Back up your plan with data for the relevant metrics.

4/ Resources. What needs to change to enable the new treatment or service? Can you train and redeploy resources or do you need more and/or different types of resources? How hard will it be to train, attract and/or hire the resources needed? How much will it cost? What other resources do you need?

5/ Commitments beyond approval. Who needs to buy into the plan and/or who could enable it because they have existing business relationships etc.? Are there partnerships that would be beneficial?