Creating the ‘New Healthcare’ — Should we blow it up and start from scratch

by James DiGiorgio

Part 2 of 3

The more I think about it the more I wish we should start from scratch — blank sheet of paper — zero based budgeting — blue field! Okay, we cannot change an industry that accounts for about 18% of the U.S. economy overnight. But I think we need some very aggressive programs to try new approaches on a larger scale. Perhaps offer incentives for experimentation by larger populations of patients to try new care models, even beyond current ACOs, incorporating more focus on keeping people healthy from an early age instead of treating them after they become chronically ill. Could some insurers take up the challenge? Perhaps — since their current business model does not seem to be doing so well regarding affordability. Could some leading health organizations who are already integrated and delivering coordinated care step up to the plate — hope so. Could even a state or two be courageous enough to take the plunge — Wow that would be something to watch! I am a fan of experimentation and change to find new ideas and new ways to be better — and now is the time for healthcare to be bold! And yes, take some risks.

First, let’s try to take a bigger leap forward in thinking about change and consider how we can achieve more than just iterative changes/improvements. I mentioned in the first post of this series that most healthcare organizations use one size fits all messaging that may only be effective in engaging just under 15% of healthcare consumers. We are missing connecting with 87% of them! How can we do better — much better? Can we find messaging models elsewhere, outside of healthcare, that could help? Yes. Well if healthcare is becoming more ‘consumerized’, let’s look at how successful consumer products companies engage with their customers. Instead of one size fits all messages, they segment consumers into multiple groups using psychographic insights about what motivates these groups of consumers to act/make decisions. They customize messages for each group that are most effective in engaging them to act — buy their products/services. More about this approach from an article in Harvard Business Review and from the Commonwealth Fund.

I have seen this approach at work for multiple health systems and deliver breakthrough results. What is ‘breakthrough’? Reducing surgical re-admissions by 75+% is breakthrough. Reducing CHF re-admissions by almost 90% is breakthrough. Delivering ROIs of 20–30X or 2,000–3,000% ROIs. Treating patients as consumers works to significantly improve care, reduce costs, improve patient experience!

Can we also address the problem of providing more useful and transparent pricing data to patients? By providing this data we will empower them to be more engaged consumers of healthcare. Yes, pricing information is becoming more available even to the point of some systems being able to provide patients with solid estimates of out of pocket costs for procedures/visits. Advanced systems can now do their estimate calculations including real time data from a patient’s health coverage plan/deductible, cost data from the hospital, as well as pricing data from various providers involved such as surgeons, anesthesiologists, etc. and deliver a ‘comprehensive’ out of pocket cost estimate via the internet.

These appear to be significant innovations that can inject transformational change in to the existing system. To make the next leap for even more radical transformative change, we need to break through the existing boundries of our thinking which limit us to only ‘improving the current system’. This will require ‘thinking differently’. This is how visionaries such as Jeff Bezos, Peter Theil and Elon Musk approach thinking. It is thinking based on ‘first principles’ where we do not base our thinking on the findings of others. Elon Musk describes this approach as follows, “I think it is important to reason from first principles rather than by analogy. The normal way we conduct our lives is we reason by analogy. We are doing this because it’s like something else that was done or it is like what other people are doing… it’s like slight iterations on a theme.” (from ‘What Musk, Bezos, Theil and Feynman teach us about First Principles’)

It may be difficult to shed decades of our own approach to thinking but by doing just that, we may uncover new ideas for healthcare. Perhaps healthcare (or even ‘healthy-care’) guidance from conception (pre-natal care) to end of life care. Would it work if it includes ongoing education about healthy lifestyle, nutrition, exercise, along with an understanding of our genetic make-up and potential future health risks. (More ideas in part 3)