The rise of retailers and a transition to outpatient services are just two realities that will shape the health system of the future.
That's a consensus Rishi Sikka, MD, the president of system enterprises at Sutter Health in Sacramento, Calif., and Larry Kaiser, MD, the former president and CEO of Temple University Health System in Philadelphia, shared during a panel session at Becker's CEO + CFO Virtual Event Nov. 12. The panel was titled, "What does the successful system of the future look like? Strategies to continue, or changes that need to be made for system success."
Here is an excerpt from the conversation, lightly edited for clarity. To view the full session on demand, click here.
Question: How would you define the health system of the future?
Dr. Larry Kaiser: No longer is the centrality of medical care the inpatient setting. For those of us who've run systems, that's where we generate the most margin, but it clearly is not where we're going to be concentrating in the future. You have to look at more disseminated models, including the outpatient and home settings. We need to look at the rise of retail, at players like CVS basically entering the market, combined with changes in the payer landscape. It's not unreasonable to think that most of us on the delivery side will be working with the payer side as we move forward.
Dr. Rishi Sikka: We're seeing the collapse of our business model, which has been based on cross subsidization. Cross subsidization has covered losses from government payers with what's generated in commercial reimbursement. Recent studies have highlighted just how large this cross subsidization is. Honestly, I think a portion of the electorate doesn't really buy into this cross subsidization model anymore. To deal with that cross subsidization issue, health systems of the future will need to focus on health and avoid utilization and acute episodic illness.