Disruption Is Bringing Much-Needed Innovation To Healthcare
Disruption is not new to healthcare, but the entrance of established brands from other industries signals a level of disruption that hasn’t been seen before. Healthcare organizations (HCOs) take note: Innovate now, or become irrelevant tomorrow.
We are in an environment where consumers have more choice. Customer experience drives loyalty, and loyalty drives revenue. Healthcare organizations across all sectors must provide a more personalized experience for the patient as a consumer. Consumers demand a digitally enabled experience that is convenient, personalized, connected, and insights-driven.
Cost information for consumers has been notoriously difficult to come by in healthcare. Patients and members are demanding cost information before they seek services. According to HealthFirst Financial, 77% of healthcare consumers indicated that it was important or very important to know their costs before treatment, and 63% want a pricing list of common procedures.[i] Cost has been well recognized as a source of pain in healthcare — due to both a lack of transparency and a lack of control over rising costs. We have neglected to find a solution for too long.
Joint Healthcare Venture Moves Forward With Announcement Of CEO: Expect A Focus On Healthcare Costs
The joint healthcare venture by Amazon, Berkshire Hathaway, and JPMorgan, as well as other potential partnerships such as Humana and Walmart, indicates we are within reach of delivering an improved patient experience at a lower cost. All signs point to tackling the cost conundrum for the new joint healthcare venture. Dr. Atul Gawande has a long track record of innovation and thought leadership that targets rising costs and inefficiencies in healthcare.
Today, out-of-pocket costs are due to a chargemaster that is not tied to activity-based costing but is a result of waste in the supply chain, wide variation across providers, cost shifting, and a provider incentive system focused on volume. Consumers bear greater financial responsibility for their care but are still blindsided by bills and confusing EOBs weeks or months after service.
This healthcare venture will bring metamorphosis to the traditional delivery model, revolutionizing the way healthcare is financed. While the venture appears to have backed away from tackling supply chain issues, there is potential to drive down costs and enable better pricing transparency up front for consumers. From inception, the joint venture can establish a focus on data and analytics, virtual care delivery, education and tools for employees to proactively seek the lowest cost setting, and incentives for providers that have increased availability and prioritize preventive medicine. Employees stand to benefit through incentives for sharing remote monitoring data and managing their chronic conditions through the use of voice-enabled applications.
Stop Hiding Behind Skepticism And Regulatory Challenges And Start Innovating
Innovation is happening across the country — from the use of Apple’s Health Records at 500-plus hospitals and clinics putting medical record data in the hands of patients to the use of voice to help members understand their benefits or help understand how to treat a burn at home. We are at a critical turning point. HCOs must find a way to empower consumers and give them ownership over their care and health costs.
HCOs: Continue to build out a platform ecosystem, prioritize analytics and applications that enable insight into consumer behavior and cost, invest in technology that supports modernizing your supply chain to reduce waste, and make an investment in value-based care to shift incentives for providers.
[i] Source: “HealthFirst Financial Patient Survey: It’s Never Too Soon to Communicate Pricing and Payment Options,” HealthFirst Financial (https://www.healthfirstfinancial.com/white-papers/healthfirst-financial-patient-survey/)