How to identify and quantify the value of integrating virtual care: 3 Qs with Mercy Virtual VP Daniel Norselli

In October 2015, Mercy health system — which operates 30 acute care hospitals across four states — opened the world's first virtual care center. Mercy Virtual is a four-story, 125,000-square-foot building located in Chesterfield, Mo., where the medical staff is wholly dedicated to developing and delivering virtual healthcare services.

Daniel Norselli, vice president overseeing strategic client success at Mercy Virtual, recently spoke with Becker's about launching and integrating virtual programs, quantifying program success and accelerating the value of virtual health services. 

Note: Responses have been edited for length and clarity.

Question: When exploring a telehealth strategy, what steps should be taken to ensure early success?

Daniel Norselli: ownership and buy in must be articulated from the top, right from the beginning, leadership cannot be outsourced. Virtual health programs when not integrated into the traditional model can be considered a threat to some, they shouldn't, but the feelings are real. To integrate successfully requires both clinical and business leadership, one missing link and the adoption has a high probability of failure. Leaders need to understand that investing in virtual solutions requires vision and that benefits can often be hard to see from a traditional profit/loss viewpoint.

Developing a 'start-up' culture with the mentality of challenging the status quo and having acceptance around testing and failing and moving on from failure fast is an absolute must. Culture will eat strategy all day long. If there is not an accepting and willing culture throughout the entire organization, with strong change management, there's the potential for a high failure rate. Leaders should empower their staff to try new ideas and remind them that it's ok to fail — this will encourage innovative thinking. Lastly, supporting a culture of developing solutions with a focus on solving a problem and supporting a 'flying the plane while you build it' mentality will encourage risk taking, speed up the development of solutions and create use cases to scale the solution. Healthcare is rapidly changing and being disrupted; therefore, traditional approaches need to change.

Q: Financially speaking, how does a health system quantify the financial impact virtual medicine has on the health systems bottom line?

DN: Identifying key stakeholders and what success looks like to for each of them prior to launching is critical. Alignment between clinical, operations and business is strongly encouraged. The journey to get the program where it needs to be is challenging — there are a lot of ideas of what success looks like and what desired outcomes should be for each unit. To start, data needs to drive the conversation. We live in a data-filled world, the challenge is what to do with that data. More important, is the 'why' behind the data. Additionally, the risk position of the system is relevant, are you trying to better manage risk and the total cost of delivered care or are you looking to address operational efficiencies and workforce challenges? The process of identifying the right data points associated with value for each of these is different and will look very different from a time horizon. This requires a lot of collaboration from your data, clinical, quality, finance, operations, bedside and business leaders — there has to be consensus around the data and the problem. Still, the mentality should be that measuring success is fluid and will evolve as the programs evolve.

Standard measures to look at are reduction in length of stay, reducing transfers, reducing leakage, reducing vent hours, augmenting staffing and workflow. More complicated measures that are harder to quantify but are absolutely real are reducing physician burnout, providing greater support to less experienced nurses, allowing everyone to operate at the top of their license, increasing capacity at larger facilities to take on higher acuity patients and keeping patients in rural areas in their community (community impact is huge, but again, hard to financially measure). Ultimately, measures must be agreed on from the beginning by all stakeholders with an understanding that over time the data and formulas can be tweaked and that in some cases value may not be purely revenue generation but cost avoidance or reduction in cost.

Q: Once a strategy is agreed upon and anticipated sources are identified, how can health systems accelerate the integrated value?

DN: The bigger question here is 'should we buy, make or partner?' Virtual medicine is relatively new space compared to the traditional care setting. There are a lot of headwinds impacting health systems — the need to land on a solution and drive value quickly is increasing. To derive the greatest value in an optimal timeframe, teams should take a disciplined approach to identify whether they should buy a solution (think acquisition) make (think in-house product development team that will create from scratch) or partner (think a joint venture or other formal partnerships). The decision-making process should answer these questions: 1) What is the sense of urgency of having a solution? 2)What is the cost of not having a solution by a specific date? 3) What are the skills and competencies needed to solve and create a solution? 4) What is the opportunity cost to pursue making vs. the other two options?

A critical thinking approach to what avenue to take should be a collaborative process. Many times, the right approach is not always the most immediate return on the investment. This is why an enterprise viewpoint should always be considered because if one path supports a strategic five-year plan, it needs to be understood that it won't drive financial results in the short-term but will deliver more long-term value. This decision is not easy. It's easy for folks to think they can just make the solution themselves but it can be a good idea to partner or buy. There is something to be said about organizations that value the chance to collaborate with other innovative minds that may think differently and provide a different perspective. It's a healthy approach and an approach that increases the likelihood of success!

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