May 26, 2020

 – Episode #

Guest Information

Share this clip:

Share on linkedin
Share on twitter
Share on facebook
Share on email

May 26, 2020: We’re back with another Tuesday News Day! In this episode, we dive into a variety of news stories, with three features focusing on the future role of tech and tech spending in healthcare. Our first article, ‘Don’t Sleep. Healthcare CIOs Must Step Into 2021 Now,’ was published by Forbes and features David Chou’s top 10 tech priorities for healthcare CIOs. Bill provides his own take on the topic before exploring a second article — ‘The Amazon-Berkshire-JPMorgan Health Ventures’ Fails to Disrupt,’ a Bloomberg piece that explores how Haven failed to meet expectations of disrupting healthcare. Next, Bill looks at research by Ray Wang which predicts an increase in tech spending in the healthcare sector — and why this spending won’t affect traditional projects — before discussing Angela Yochem’s  Protocol piece on why working remotely should become the norm, and not the exception. Finally, Bill briefly talks about his great love, baseball, as he discusses an article in The Wall Street Journal about the many ‘unfun’ regulations that the MLB is proposing to keep their players safe. Listen to this episode to pick up Bill’s key insights and advice on the future of healthcare. 

Key Points From This Episode:

  • David Chou lists 10 key tech priorities for healthcare CIOs to initiate for 2021.
  • Bill provides his own list of top tech priorities for healthcare in the future. 
  • Why Bill thinks that CIOs need to be working on integrating virtual and home-based care.
  • The importance of asset-light strategies for moving into new markets.
  • How Edward Jones opened new offices when their competitors were closing theirs. 
  • Expect business opportunities to arise from the financial stresses of COVID-19.
  • Why IT needs more efficiency and how this impacts your M&A playbook. 
  • The norm of cost-cutting and why agility is the metric with the highest value.
  • Everything has changed; reevaluate every project, especially in light of a post-COVID world.
  • The status of Haven, the Amazon-Berkshire-JPMorgan health venture. 
  • Tech spending is predicted to increase in the health sector but not for traditional projects. 
  • Why remote-work is here to stay — within reason. 
  • Successful businesses are embracing a customer-centric, data-driven, and agile culture.
  • MLB’s safety framework; the need to provide protection for people going back to work. 

News Day – My List, Haven, and Work From Home

Want to tune in on your favorite listening platform? Don't forget to subscribe!

Thank You to Our Show Sponsors

Related Content

Amplify great thinking to propel healthcare forward and raise up the next generation of health leaders.

© Copyright 2021 Health Lyrics All rights reserved

News Day – My List, Haven, and Work From Home

Episode 254 – Transcript – May 26, 2020

This transcription is provided by artificial intelligence. We believe in technology but understand that even the smartest robots can sometimes get speech recognition wrong.

[0:00:04.5] Welcome to This Week in Health IT. It’s Tuesday Newsday where we look at the news which will impact health IT. Today, we’re going to go deep into a bunch of stories, we’re going to take a look at a list of the CIO must-dos from David Chou and I’m going to give you my own list. We’re going to take a look at the Amazon Berkshire, JPMorgan, Haven venture and what is going on there. We’re also going to take a look at where tech spending is going to go post-COVID, a little work from home, a bunch of other stuff like that.

Looking forward to it. My name is Bill Russell, healthcare CIO coach and creator of This Week in Health IT, a set of podcast, videos, and collaboration events dedicated to developing the next generation of health leaders. This episode and every episode since we started the COVID-19 series have been sponsored by Sirius Healthcare.

It is their commitment to making this content available that has made the daily episodes possible. Special thanks to Sirius for supporting the show’s efforts during the crisis. 

We have a live episode this week, this Friday, from 11 to 12 Eastern Time, we’re going to talk about funding Telehealth’s future with a great panel and your questions. Mari Savickis, CHIME public policy, Praveen Chopra, CIO for George Washington University, Dr. Stephanie Lahr, CIO, CMIO for Monument Health, and Albert Oriol with Rady Children’s in San Diego will be joining me. Mari is going to share some insights to get the discussion going and then we’re going to talk about the future of telehealth funding with the panel and you, actually. Mark it on your calendar, invite a friend, would love to have you join the conversation.

Okay, let’s get to the news.

[0:01:51.1] BR: I’m going to challenge myself to cover as much as possible in 25 minutes. Here it goes — David Chou put out an article in the Forbes contributor network. Says, ‘Don’t Sleep, Healthcare CIO’s Must Step Into 2021 Now’. I love the title, I love the concept, and I want to pull it up so I can give you some of these real quick. Top initiatives for 2021 and beyond, I don’t know if this is updated for — yeah, it’s updated for COVID. Okay, here we go:

Top technology initiatives include virtual care, mobile initiatives, remote patient monitoring, that’s number one. Number two, foundation technology emerges as a priority with every organization’s expansion strategy. Number three, healthcare leaders rethink their physical expansion strategy. Organizations face enduring effects of post-COVID. Number five, operational excellence masks itself as another way to say cost cutting.

Number six, focus on value based programs misses the mark on population health. Number seven, providers must make strategic cloud ERP decisions. Number eight, administration emphasizes clinician satisfaction. Number nine, health systems go global, and number 10 — information security risk exposure tops all priorities.

All right, well, you know again, I love a good top 10 list. But what I’m going to do is, rather than comment on his list, what I’m going to do is to give you my own list. Which is what you tune in here for. I’m going to drop my list, some of it overlaps with David. The business of healthcare will not bounce back in 2020. Financial pressures will be the underlying theme for the next 18 months in healthcare. For that reason, here is what I’m thinking about — Telehealth. Know the funding sources and keep your program aligned to it.

It may sound heroic and cool to be the digital leader of your organization but without funding, telehealth is a bad strategy for healthcare providers in most cases. It cannibalizes the business. Don’t get me wrong, it is absolutely the future of healthcare and it will be hard to explain to people why they may no longer be able to see their doctor online and after sitting in a waiting room, which is barbaric as we now know. But if you serve the organization that you’re employed by, you have to make decisions that strengthen them and not weaken them. If you want to go full on telehealth and virtual strategies, then you have to have covered lives. That is you have to be paid to keep people healthy. To keep them out of the hospital. 

[0:04:25.7] BR: You know, the work isn’t pushing the government and the commercial payers to continue to fund telehealth. If they do, go crazy. Really, go crazy. In fact, I would say, any CIO that isn’t working on a plan for integrating virtual care and home-based care strategies is missing the boat. If I were a CEO of a health system, I would ask for a plan that would be probably jointly developed by the CMO, CMIO, operations, COO, and CIO. I would say to people, get to work on this today, yesterday actually. 

But anyway, I’m going to get into more of this in the next item. My next item is a theme which we covered in January; asset light strategies. This was one of the key themes for the JPMorgan Healthcare Conference, a lot of health systems are doing this. Figure out how to make a solid move into a market without planting a billion dollar seed in the ground and hoping that the acute care hospital will grow into a profitable business. Asset-light strategies include retail strategies, partnerships, and products. Primarily digital products that appeal to the consumer directly. Leverage your brand to make a move into a new market. You know, I covered this in detail in the beginning of the year. The JPMorgan show, we talked about Baylor Scott & White’s move into Austin, Texas. Have a listen and figure out a much better way to spend a billion dollars.

What’s IT’s role in this? Well, you’re actually right at the core of this strategy. Asset-light strategies are digital, efficient and adaptable. Telehealth becomes an offensive weapon when trying to go into a new market. You aren’t cannibalizing anything when you go into someone else’s market. You are planting your flag, you’re creating a business around a new model. Video visits become the foundation for a new model of care. The key is to match the cost model and the revenue model. I did some work for Edward Jones a while back, gosh, it feels like centuries ago and it was probably almost two decades ago. 

You know, the thing about Edward Jones is they were opening offices when everyone else was closing them down. And their financial planners, I asked one of their IT leaders at a strategy session we were having, how they could be opening all these offices? He said they could open an office in only a few weeks which included getting the contracts done. They had a complete office in the warehouse ready to ship at a moment’s notice. They had automated just about every aspect of opening an office and thus, they drove the cost out of the equation. Their offices everywhere in the USA became a differentiator and the rest of the industry started following. I mean, now you drive down the street and you see all these banks in places popping up. Chase has opened up more and more locations and they’re going into more and more remote locations.

That is the nature of asset-light. Take those strategies into new markets and expand your brand at the expense of someone else. Yes, healthcare is a business. My third one is going to be to dust off your M&A playbook. The government money isn’t going to be enough, the revenues will appear to be coming back to normal quickly but they won’t return to pre-COVID levels this year. They will be slow to return to those levels and it will put immense pressure on healthcare balance sheets. Expect to have opportunities. Expect to have hospitals offer your system the privilege of taking on their problems for no money at all. They will literally hand you the keys. Expect medical groups to be looking for cover, expect large systems to continue to jettison under-performing assets in markets that haven’t been able to, really, they haven’t been able to establish essentiality since they started there. What’s IT’s role in M&A? We have to be more efficient and start being more clear.

Let’s start with efficiency. We can’t take three years to integrate a new system, it has to be done in like 12 months. We just showed we can do amazing things in short periods of time. We have to get better at the M&A stuff. It is not rocket science. The clarity comes in letting people know that there is a cause for running duplicate systems and eventually, we will be moving to a single system.

[0:08:56.3] BR: Please, don’t’ tell how to acquire an entity that they won’t be changing any of their systems for 12 to 24 months. This is the silliest thing you can possibly do. It’s poor leadership. Consolidate IT systems, get to a single HER, ERP, PAX, as fast as you can. You’ve got to drive the cost out of this equation. You have to get the operational efficiencies. You have to get the ability to drive quality higher — and a lot of that requires being on the same system. Now, I can put together strategies for multiple systems but it is generally better if you’re on the same system. 

Number four, cost cutting is the norm for the foreseeable future. I know, tell me something I don’t know. Well, how does IT play in this situation? Figure out what your system’s posture is going to be post-COVID. Even if you’re furloughing staff that they may want to be aggressive coming out of the crisis. And you have to understand that. How can you be faster if you have less staff? Simplify. Consolidate. Eliminate. Change the culture — you have to value efficiency, reliability, security, absolutely.  But what about agility? You know, what systems will give you the quickest time to bring new medical groups for health systems onboard. Agility is the metric that is of the highest value in and coming out of a crisis. Also, here is where I really want to talk about — work from home. Not in detail but we have to figure it out. We have to make it work. This is a cost savings move and it is a game changer in hiring the best talent. 

[0:10:35.7] BR: Next thing. Reevaluate every project, I’ve talked about this on the show a couple of times. You have to ask yourself, do the factors which led to the project being funded still hold true? You may not have the same amount of staff, for starters. Capital may be frozen, you have a majority of your staff working from homes in the near future. IT’s role is to look closely at the resources and to make sure that you have them aligned to the most critical needs. Ensure that the assumptions for resourcing the project still hold true — “Does the project hold up in a post-COVID world as the project that you should be funding right now?” As a side note, I hate the annual budgeting in healthcare. I understand, I really understand why it has to happen but I do hate it. The process is so time consuming that it can’t possibly happen more than once a year. However, that means that we are deciding on what projects to fund 18 months in advance. That is by definition, slow. It’s not nimble, it’s turning a ship very slowly. But what if we had a way to have six months budgets? Would a health system that figured out how to allocate their funds to the most important projects, every six months, have an advantage over the competition? I think so. 

The final one I’m going to give is, because I just want to move on from this, is platforms. I have talked about it before so I will light on this today, configuration over coding, pay for what you use, ubiquitous access, security by design. You get the picture, platforms are more efficient.

All right that is probably enough for that. Let me keep going, let’s see, ‘The Amazon-Berkshire-JPMorgan Health Venture Fails to Disrupt.’ This is a Bloomberg article talking about Haven. So when Amazon, Berkshire, Hathaway, and JPMorgan Chase announced their formation of Haven in January 2018 to extend the rise of employer healthcare spending, the world was expecting bigger results. Rather than disrupting healthcare, Haven finds itself in disarray with its top two executives departing in the past year and the venture giving few clues as to how it is going to slow the upward march of health costs in America. So we have talked about this at least twice on the show. We talked about it when it came out. They hired Atul Gawande, a surgeon Harvard professor, a high-profile expert in the field. And he resigned abruptly. He still has a role there as the venture’s chairman. He is devoting his time to the COVID-19 pandemic. But what people, what analysts are saying who are looking at this is it looks like they were incrementally iterating on something that looks much more like the status quo than most people were anticipating and that is from Jeff Becker, senior analyst for Forsa Research. “It didn’t feel like Haven early on was focused on the key blocking and tackling,” says Allen Miller, CEO of Consultant Cope Health Solutions. Another one, “Haven said all the right things at the start, promising to be relentless in articulating a mission to deliver simplified high-quality and transparent healthcare at a reasonable cost.” 

[0:13:55.5] It is a worthy goal. The average cost of healthcare is $13,000 per employee in 2019 with workers shouldering about $3,000 of that in annual paycheck donations according to Willis Towers Watson. Haven wasn’t the first one to do this. There was a coalition Health Transformation Alliance, AMEX, IBM and Macy’s, which was about 4.5 million people that they are trying to cover and they did work around that. Health consultants agree that in order to ring out costs in the systems, employer plans need to ensure that the doctors are being financially rewarded for lowering spending. So it is going to require a little different mindset. The one I always keep coming back to is Walmart. They actually talk about it in this article.

—“Another way is by pointing patients to the best performing doctors at any given specialty to ensure better results. This isn’t easy for large national employers to do across the nation given the amount of work it takes to identify high performing medical groups and local markets but at least one large employer is starting to try. Walmart Inc. is rolling out a program this year to direct employees to higher performing doctors in Arkansas, Florida, and Texas.”

I’ll tell you what, if I were a provider in Arkansas, Florida or Texas I don’t want to know where I rank on the Walmart scale. I think I believe they are still the largest employer in most states, if not still in the country. I would want to know where I rank and they have done some other interesting things in terms of second opinions and whatnot. Really trying to drive down the cost of care. So we are going to keep an eye on this one. You know, America spends about $3.5 trillion annually on healthcare. Employer coalitions have been searching for ways to lower these costs for a long time. 

[0:15:51.9] It is believed that there is a great opportunity here. I think Walmart has a distinct lead. The other players, Amazon, Berkshire, and JPMorgan are innovators, each in their industry, and I think we can still expect some big things from this. We will have to wait and see where our leadership goes with this. 

I wanted to highlight a tweet from Ray Wang on tech spending post-pandemic. So he has how it is going to shift by industry. Interestingly enough, travel and hospitality, tech spending is going to go down by 27%. Is there a source? It’s Constellation Research, it is Ray Wang’s. It is actually their research. They probably do a survey of some kind. So, 27% decrease in travel and hospitality, as you would expect. Energy and oil is 22% down. Automotive is 21% down. You go up retail is about 13% down, legal — 11 or 12% down, education, engineering three to 5% down. Telecommunications is about 3% down. Then you have real estate 3% up, healthcare at 10% up, food and beverage is 11% up, government is 13% up. Those are just some of the numbers. To be honest with you, I hope that is true. I don’t believe it is going to be true for most of health care but for the aggressive players, I believe that they are going to double down on tech spending in healthcare and we are going to see a growth in that number. But I think we have to be — it is not going to be on traditional projects. I don’t think it is going to be on traditional projects and I think the time of having massive IT staff that are not nearly as efficient as they are in other industries — if you look at other industries I have talked to CIOs from other industries and when I tell them the amount of people that we have per dollar coming in, they just cannot believe how many people we have. And how many people it takes to run a healthcare organization. At least from the IT side, so I think there is going to have to be some changes. We are going to have to adopt some digital technologies, some automation. We are going to have to look at technologies that require less people long term. 

[0:18:19.3] Okay, Angela Yochem was quoted in an article – where is that article? I forgot what the magazine is, I apologize but they asked a bunch of CIO and not necessarily from healthcare. She is the EVP Chief Digital and Technology Officer for Novant Health and she was talking about work from home and she said, “Forward thinking companies will recognize the power in adopting remote work as the norm rather than the exception. Companies that encourage remote work can cherry-pick differentiating talent from anywhere, and investment can be shifted from facility cost and travel expenses to innovation. Using fluid teams and being nimble were essential capabilities even in the pre-pandemic economy but even more so now as our future becomes less predictable.” She closes this out by saying, “What we learn about our cultures, our reliance on past norms and our ability to adapt quickly will be tremendously valuable as we adjust our long term strategies and will determine, which companies and industries thrive in the new world.” 

A lot of people are talking about remote work. I think it is here to stay but I don’t think you are going to see the entire IT team work from home. I think we are going to have to really think this through. I think it is time to do surveys with your staff and figure out what is working, what is not working. There are clearly some people that cannot wait to get back to the office when it is safe to do that. Let me check the time real quick. We are about 20 minutes. I am going to hit one last thing. 

[0:19:55.3] I will do it quickly. ‘The CEO and Board Playbook for Leadership Through Technology Transformation’, Russell Reynolds, sent this out. I got it in the email, it is actually a pretty good article written in April, April 17th, 2020. They talked about how to set up your organization for addressing the technology transformation that is required and they talk about 2019 MIT studies shows that having multiple tech-savvy directors on the board contributes to above market performance. In both revenues and profitability — and they go on. They have a pyramid here, a line go to market functions, digitize core businesses and functions and operating models build, scalable technology, platforms, to support the business. Scalable technology platforms. You are going to hear that over and over on this show. The bottom is move to customer-centric data driven and agile culture. There you go and they talk about best in class. They have some excerpts about Disney, Goldman Sachs, Nike, Ikea, Siemens, Merck, MGM Resorts, Heineken, wow these go on. There you go. So worth a look. I am not going to cover it in detail. 

And then the last thing I will cover, ‘Please Step Away From the Base Runner: Why baseball in 2020 Won’t Be Much Fun.’ So they released a massive book for how we can safely play baseball and let’s see, baseball might not be fun this summer. And “A 67-page outline of MLB’s new health and safety protocols highlights how different the game will look if players were able to take the field this summer.” I think this is a moot point because they cannot get to an understanding on the financials, how much they are going to pay the players, are they going to pay them for a half-season. And because they can’t get to that agreement, you know coming back safely doesn’t really — playing the game safely doesn’t really matter until they can figure that out. 

[0:22:10.7] Which really makes me sad since baseball is the sport I love to watch more than any other. We will see if they are able to figure that out. What is the practical application for that? I want to talk about that story because I love baseball and wanted to close with that but the practical application is that we’ve got to take care of some things before we ask people to go back to work. We have to take care of the liability. We have to take care of contact tracing. I mean we have to provide for the safety of people who are going to have to go back to work and serve others in their capacities. We just have to do it. We have to think it through. I applaud MLB for coming up with this framework. I hope they can figure out the money to move forward. 

So that is all for the news. Special thanks to our sponsors, VMware, StarBridge Advisors, Galen Healthcare, Health Lyrics, Pro Talent Advisors, and Sirius Healthcare for choosing to invest in developing the next generation of health leaders. This show is a production of This Week in Health IT. For more great content, you can check out our website, thisweekhealth.com or the YouTube channel. If you want to support the show, the best way to do that is to share with a peer, the second best way is to subscribe to our YouTube channel. 

And don’t forget, this Friday from 11 to 12 Eastern Time, we are going to be doing a live episode. Thanks for listening. That is all for now.

Play Video