Movie, music, and publishing revenues are a shadow of what they were 10 years ago thanks to new technology and delivery systems. The same can be said of healthcare.
Nick Bilton wrote a fascinating article in Vanity Fair, “WHY HOLLYWOOD AS WE KNOW IT IS ALREADY OVER,” about the dramatic change disruptive new technology has brought to the music, movie, publishing and television industry. From computer generated graphics to eBooks to on demand streaming for television and movies, the what, how, when and where of how people consume entertainment has changed so much that data analytics determine what we want to see. Digital editing and other software modifies content to appeal to different global audiences.
The big studios, except for Disney with its Star Wars franchise, are seeing revenues and margins drop alarmingly fast with money moving to the entertainment technology sector and away from traditional productions.
The parallels, through my healthcare eyes, are striking.
Population health, predictive risk and related stratification, utilization and analytic software tools can transform mountains of clinical and claims data into actionable information. In the right hands, it will improve quality and outcomes at a lower cost. Telemedicine has gotten so big that it needs the Orlando, Fla. Convention Center and its massive infrastructure to fit over 180 exhibitors and house thousands of attendees. Advances in genetics are bringing precision pharmaceuticals and nutrition into the mainstream.
Just as a technological and business model transformation upended the entertainment industry, a similar change is underway in healthcare. In this case, the change is called value-based reimbursement and it has already arrived.
The selection process of who survives will be Darwinian. Not by the popular misnomer “survival of the fittest,” but, by Charles Darwin’s authentic theorem, “It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change.”
The stakes are high as healthcare tops a $3 trillion annual spending threshold and has already passed economic sustainability. Those best positioned to survive are not only responsive to change, but are the agents of it. Visionary, agile, entrepreneurial.
As a physician, who you align with is decisively important to your future. Looks can be deceiving. Promises empty. Size a liability.
Finding that right partner in the midst of dynamic change is like picking a Google, Facebook or Amazon from the pack twenty years ago. There are three reliable aspects, however, that will increase the odds of long-term survival, and possibly breakout market domination:
1. Analytics. Not just some software tools, but the actual ability to capture clinical and claims data on an enterprise basis and to transform it into actionable information. It is far harder and more complex to capture everything needed for success than most will let on. Few have achieved it:
a. Population Health – risk and disease stratification are just the start. Predictive risk, chronic disease and cost capabilities focus physicians’ expertise to the patients who need it most, and allow advanced practice nurses to handle the routine;
b. Quality Metric Measurement – meeting quality measure goals is where the money will be made. Value-based programs are a team sport because an Integrated Physician Association or Accountable Care Organization (ACOs) is graded in the aggregate, making enterprise-wide analytics essential. Miss quality goals, and the subsequent reductions in the percentage of shared savings can cost millions;
c. Utilization Measurement – waste in the U.S. healthcare system as measured by medically unnecessary diagnostics, procedures and hospitalizations is estimated to be about a trillion dollars each year. Identifying specialists and allied health providers who regularly use less resources than others to deliver equivalent results is essential to success.
2. Standards. Because ACOs’ succeed or fail on their aggregate performance, established and high, standards for participating providers are essential to achieving quality and savings to share and critical to assume risk. Like any team sport, the teams with the most talent are the best equipped for success.
3. Training and Support. Like any team sport, the teams that are best equipped, trained and managed, win.
It all comes down to which team you make. The only thing that guarantees failure, however, is sitting this one out.