Those of us "of a certain age," let's say over 45, have seen significant and sometimes rapid changes in well-established industries over the last decade. The entrepreneurial set uses the term "disruptive" to describe business strategies or technologies that redirect or have the potential to redirect an entire industry.
Who among us doesn't remember renting a movie from a video store? Driving through a one-hour photo kiosk? Calling a travel agent to book a trip? Today, these industries are all but gone, and seemingly overnight.
I bet if we looked closely at the decline of each of these industries we'd find a time when the people in charge had an inkling things were changing. It could have been the day a customer told a travel agent she could get a better price on something called Expedia or the time a photo kiosk employee brought her new digital camera to work. Maybe it was the Monday morning, when asked what he did that weekend, a young Blockbuster Video employee explained to his boss that he and his friends spent Saturday night downloading full-length movies on their computers.
Healthcare is experiencing a similarly pivotal moment right now. It's not coming. It's here. No more waiting. Across the country, hospital administrators and board members are in uncharted territory. Many are frozen in their tracks. Some are scrambling to find a road map. A small minority are walking ahead, taking calculated risks with every step toward an uncertain future.
While there are many things we don't know about the future of healthcare delivery, we can be certain of a few things. We know the demand for inpatient hospital services is declining, and payers will no longer pay higher fees for services that can be delivered less expensively, and possibly often more effectively, in outpatient settings. Though details are murky when it comes to value-based reimbursement, we know providers will be incented to keep people healthy, not just treat those who are sick. We also know young adults coming of age now will never know a $100 deductible or 100 percent employer-paid health coverage.
So while we don't know everything, we do know that business as usual is not the future of healthcare. Pay-for-performance rather than pay-for-readmissions is the new standard. Younger folks are looking for ways to reduce their healthcare spending and are probably more likely to join a yoga class than pay for physical therapy. Full beds and high patient censuses are not going to be the criteria by which we judge a successful health system CEO in the future. These are certainties you can act on today.
We've seen in recent times what happens when organizational leaders are slow to react to changing market forces. Simply put, not taking action is a not a viable strategy. To survive this disruptive time, we must take risks, and we must innovate.
This an opportunity begging for leadership — bold, direction-setting, career-making, L-E-A-D leadership. The alternative, of course, is to let your competition make the first move.
So what are you waiting for?
Joan Dentler is president and CEO of Avanza Healthcare Strategies, which provides healthcare organizations with strategic guidance, with a focus on outpatient services and community collaborations. For more than 25 years Ms. Dentler has been consulting on, developing or operating hospital outpatient services, ambulatory surgery centers and community health initiatives.
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