To excel in "healthcare 2.0" — the increasingly competitive healthcare market — hospital leaders need to not only meet consumers' demands, but prepare to address those they anticipate 10 years down the road.
At Strata Decision's 2015 Summit in Chicago, leading healthcare experts and executives discussed key considerations for hospital and health system leaders to apply to their long-term strategies.
Keynote speakers included Tom Main, partner and U.S. market leader at Oliver Wyman, Ron Paulus, MD, president and CEO of Asheville, N.C.-based Mission Health, Steve Allegretto, vice president of financial planning, analysis and decision support at Yale-New Haven (Conn.) Health System, and Keith Churchwell, MD, vice president of cardiovascular services at Yale-New Haven Health System.
Here are five key takeaways from the experts.
1. Prepare for enhanced competition. Medical services and technology are converging in ways that enable care of higher quality and spur competition among providers. For instance, data sharing and communication platforms allow for better coordination of care among providers, but hospitals aren't the only ones adopting this technology. As population health management comes to the forefront as a healthcare priority, pharmacy retailers — such as CVS, Walgreen's and Walmart — are leveraging their own capabilities to capture patients' business, according to Mr. Main.
These players are the new competition for health systems, and as consumer-focused companies, they may already be a step ahead. They are thinking about how to connect the dots between healthcare, transportation and shopping lists; wellness and social networks; or even how self-esteem influences patient engagement, for example.
"Technology is teeing up competition for hospitals," said Mr. Main. "The answer won't live in individual silos, but will exist within combination. Health systems competing with all of those above must think about consumers like they [retailers] do."
2. Give consumers what they want. Companies that cater to consumers, such as Google, Apple, Yelp and Amazon, are experts at evaluating consumers' wants and needs and expanding their offerings to best meet them, according to Mr. Main. Because of this, consumers are used to immediate feedback and satisfaction in the user experience — something lacking in healthcare.
Patients actually have very simple requests for their healthcare experience, according to Dr. Paulus of Mission Health, though most providers' goals don't align with those requests.
Patients want providers to be empathetic and nurturing, they want convenience, hope, continuity and trust, he said. What they don't care about is population health or aggregate-level data, according to Dr. Paulus. Nor do they care about efficiency, fairness or conflicts of interest, as long as they are comfortable with it.
Many of the things patients do care about go unaddressed. In fact, 73 percent of patients have spiritual needs, but only 6 percent get them addressed, according to Dr. Paulus. With provider and patient priorities so disjointed, issues crop up or worsen as soon as the patient leaves the hospital or physician's office. They may not take medications properly, or their diet and exercise regimen becomes detrimental to outcomes.
However, Dr. Paulus said, "There is no such thing as noncompliance. It truly does not exist. There are just people that comply with different plans than the ones we give them. That subtle distinction is a window of insight into the behavioral model."
Aligning patient and provider interests so both parties comply with the same plan is the key to patient engagement. And as Dr. Paulus notes, actively engaged patients cost 21 percent less.
3. Transform the "sick-care" model to a "healthcare" model. In healthcare 2.0, an actively engaged patient is engaged in health and wellness before they get sick or require urgent medical attention. The shift from a fee-for-service model of care to a fee-for-value model of care is largely predicated on this notion. "The ER is not the front door anymore," Mr. Main said. "The front door might be connected to the patient-centered medical home, Walgreens or telehealth."
Millennials in particular have different expectations from their healthcare providers than their parents or grandparents.
"It's imperative to listen to the consumer of the future," said Dr. Paulus. "There are more millennials now than baby boomers, and by 2017 they will have more spending power than any other group. But they don't like our system because it's about sick care. They want 'health' care."
To appeal to millennials, hospitals and health systems need to hone their strategies to focus on preventive care, embrace predictive modeling and analytics, and address the factors contributing to poor population health.
4. Get physicians and finance managers on the same page. To achieve the goals of healthcare 2.0 and address the needs of patients — and make it financially feasible — clinicians need clearer picture of cost. For Yale-New Haven Health System, which struggled with declining revenue over the last three years, two things allowed a breakthrough: clinical redesign and meaningful conversations between physicians and the finance team. "There is a significant and appropriate relationship between quality and cost," said Dr. Churchwell. "As a provider, we always thought great care is great cost — the more it costs the better it must be. This used to be what we told our patients. In our new paradigm, quality means lower costs."
Dr. Churchwell and Mr. Allegretto outlined the steps they took to engage physicians and finance managers in meaningful collaboration efforts. First, they worked together to define value, which equals "improved quality of care [divided by] reduced expense of care." Next, they sought to make physicians more aware of cost by displaying the prices for every lab test, procedure and treatment. Finally, they adopted an analytics approach to assess the rate of adverse events and determine their financial impact.
5. Use data to inform decisions. Adverse events in hospitals lead to longer lengths of stay, additional treatment and increased likelihood for readmission. Dr. Churchwell and Mr. Allegretto described Yale's strategy to eliminate adverse events, decrease unnecessary LOS, improve efficiency and optimize utilization and stewardship of resources. They used data analytics to capture the frequency and cost of complications in care delivery and used these insights to prospectively identify variation in risk for future patients.
With the data analysis on adverse events, Mr. Allegretto said they could "stratify patients by risk to assess whether patients will be at risk for events when they walk through the door. We can ask ourselves if there are things we can do to decrease the chance of an adverse event from occurring." Since adopting this analytics-based approach, Yale-New Haven has produced $150 million of sustained savings over the last three years, according to Mr. Allegretto.
By marrying data and risk, Yale-New Haven was able to bring individual patients higher quality, preventive care in a financially sustainable format.
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