The Impact Advisor 3Q19
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August 6, 2019
TOP BARRIERS TO DIGITAL HEALTH TRANSFORMATION: AN IMPACT ADVISORS SURVEY
A new Impact Advisors survey of hospital and health system CIOs looks at approaches to Digital Health in a rapidly changing health delivery market. For the purposes of the survey, Digital Health was defined as “the innovative use of new technologies, data intelligence, and organizational leadership aligned to achieve a patient– and consumer-centered vision of health.” Key findings include:
- Among respondents, the biggest factor – by far – driving the need to transform the patient experience is “rising consumer demands and expectations.”
- When CIOs were asked about “significant” barriers to their Digital Health efforts, the top four responses pertained to issues with sponsorship and/or leadership.
- 23% of respondents have established a multidisciplinary team structure to define and execute their Digital Health program; an additional 31% have plans to do so.
- Some respondents view their enterprise EHR vendor as an early platform upon which to build their digital capabilities, while others are recognizing the limits of this approach and are partnering outside of the traditional healthcare IT market to accelerate their Digital Health efforts.
- More than 70% of CIOs are looking to implement new patient-facing tools and apps in the next 12 months, but far fewer have plans during that time to focus on the critical activities needed to scale and grow Digital Health programs.
- Overall, close to two-thirds of CIOs said “implementing patient-facing Digital Health tools and apps” is a higher priority right now than trying to better understand the patient journey or efforts to put more structure behind Digital Health, suggesting many respondents – like most hospitals and health systems nationwide – are still in the early stages of the Digital Health transformation.
Why It Matters:
Although the sample size of this survey is not large enough to be representative of every delivery organization nationwide, the results underscore some important realities in the market right now when it comes to Digital Health – particularly the critical role that structure, sponsorship, and strategic partnerships need to play. Selecting and implementing the right patient-facing apps and tools is an important starting point, but the ability to scale and grow Digital Health initiatives requires deep, multifunctional commitment to change across the healthcare organization. Click here for complete survey results.
TOP NON-TRADITIONAL COMPETITOR THREATS
A new survey of hospital and health system executives from Kaufman Hall finds high levels of concern about the threat posed by non-traditional competitors. Specifically, according to the report, 88% of respondents “agree” or “strongly agree” that hospitals and health systems are “vulnerable to consumer-friendly offerings from non-hospital competitors.” Health delivery executives are most concerned about the threat from UnitedHealth Group/Optum and CVS Health over the next five years, but a number of respondents cited concerns about Amazon, Google, and Apple, as well (see chart below).
Perceptions of Potential Competitors
Why It Matters:
Providers should be worried, as pressure from non-traditional competitors is only going to increase in the coming years. UnitedHealth/Optum and CVS Health in particular have made no secret about their intentions to compete directly with traditional provider organizations (especially on the outpatient side). The number of respondents who cited concerns about the threat from Amazon, Google, and Apple is more curious. A lot can obviously happen in five years, but for now, we think tech giants’ efforts to gain more traction in health delivery actually represents far more of an opportunity for hospitals and health systems. There will likely only be so many “seats at the table” for provider organizations looking to partner with big tech firms, though. In fact, we think the threat for providers is not competition from Amazon, Google, and Apple – but rather the prospect of one of those companies forming a strategic partnership with a competing hospital or health system in the region.
TOP CLINICAL & FINANCIAL OBJECTIVES OF M&A
The annual survey on M&A from HealthLeaders Media highlights some of the driving forces behind health delivery organizations’ merger, acquisition, and partnership (M&A) planning and activity. When respondents were asked about the financial objectives of their M&A planning or activity, the top response was “improve financial stability” (cited by 60% of respondents), followed by “increase market share within our geography” (55%). The most commonly cited clinical objective was “improve position for care delivery efficiencies” (60%), followed by “improve position for population health management” (58%). See charts below. [Note: call out boxes added by Impact Advisors.]
What are the financial objectives of your merger, acquisition, and/or partnership (M&A) planning or activity?
(n = 133 health delivery executives)
What are the care delivery objectives your merger, acquisition, and/or partnership (M&A) planning or activity?
(n = 124 health delivery executives)
Why It Matters:
We think the results of this annual survey continue to underscore 1) the growing pressure on many provider organizations to achieve scale and increase market share, and 2) the increasing need to improve clinical integration and care coordination. With M&A activity unlikely to slow down anytime soon, we think it will be important to monitor the degree to which the organizations involved in a given M&A event try to ensure that the intended objectives are actually achieved. How well defined are the goals of the merger, acquisition, or partnership to begin with? Are there specific clinical performance metrics and/or cost-saving targets associated with the M&A event that have been formally established – both at the enterprise level and at the service line/department level? What is the level of accountability for those performance metrics and cost targets across the newly combined organization?
TOP REASONS FOR PHYSICIAN BURNOUT
A recent study published in the Annals of Internal Medicine estimates that physician burnout costs the U.S. healthcare system $4.6 billion every year – or $7,600 per employed physician at the organizational level. In fact, per Healthcare Dive, “Some providers, such as Cleveland Clinic, the Icahn School of Medicine at Mount Sinai and Stanford Medicine, have appointed chief wellness officers in recent months in an attempt to ameliorate the burnout problem.” For context, a separate study from Medscape earlier this year found that 44% of physicians reported feeling “burned out,” while an additional 11% said they were colloquially depressed and 4% said they were clinically depressed. Respondents to that January 2019 survey from Medscape cited a variety of factors contributing to their burnout, including “increasing computerization of practice (EHRs).” See chart below. [Note: arrow added by Impact Advisors.]
Why It Matters:
There is no question that physician burnout is a major problem for hospitals and health systems right now, and if nothing else, the Annals of Internal Medicine study is a good reminder that there are tangible financial consequences. The EHR tends to take its fair share of the blame as one of the factors contributing to physician burnout due to justified frustrations with the lack of interoperability and usability of current enterprise clinical systems. We think it is important to keep in mind that problems with EHR satisfaction are not solely due to vendor shortcomings or the technology itself, though. In fact, per a recent study based on data from the KLAS Arch Collaborative: “The single greatest predictor of user experience is not which EHR a provider uses nor what percent of an organization’s operating budget is spent on information technology, but how users rate the quality of the EHR-specific training they received.”
Q: With all the jargon in healthcare IT projects, is there any difference between operational readiness, culture, and change management?
A: The people side of healthcare IT (HIT) projects ultimately has one goal: to have the users of the technology successfully integrate it as a tool into the work processes needed for either patient care or the business of healthcare. Operational readiness, change management, and culture shaping are three different but interrelated dimensions of the human side of HIT projects.
Operational Readiness refers to the readiness of the end users involved in the care and business of healthcare. There are two parts to operational readiness – training and communication.
Change Management refers to the individual change journey for each end user and the facilitation of how that individual processes and deals with a change.
Culture Shaping is the management of what is considered normal and acceptable behavior. Culture is largely shaped by how leaders act, react in a crisis, and by the stories they share – good and bad.
Through managing all three human aspects of a new project or technology, one can almost ensure success in the adoption and eventual ownership of both the workflows and technology involved.
For more information, check out our blog.
(Response provided by Adam Tallinger, Vice President at Impact Advisors)