Niko Skievaski Redox This Week in Health IT
July 10, 2020

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July 10, 2020: Today we are talking “fancy backend stuff”. Our guest Niko Skievaski, President and Co-founder of Redox shares why their open source platform is currently one of the weight lifting champion’s in healthcare IT. How have they accelerated the development and distribution of digital health solutions? What does this mean for developers? And if the key ingredient in healthcare tech right now is frictionless adoption, how do we achieve it? Plus our host Bill gives invaluable advice to startups. 

Key Points From This Episode:

  • Find out what really accelerated Redox’s growth [00:05:50]
  • It’s not an innovation problem, it’s an adoption and integration problem [00:08:45]
  • The huge challenges for healthcare startups, why haven’t many platforms scaled up? [00:10:45] 
  • Niko talks health economics [00:14:00]
  • If you really want to make it as a health tech startup, Bill has invaluable advice [00:13:05] 
  • How Redox were able to grow a lot faster and win more market [00:17:20]
  • How healthcare is changing at lightning speed [00:21:05]

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Putting Data to Work for the 21st Century with Niko Skievaski

Episode 277: Transcript – July 10, 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.

[00:00:00] Bill Russell: Welcome to this week in health IT where we amplify great thinking to propel healthcare forward. 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.

And now that we’ve exited, the COVID-19 series has been sponsored by Sirius healthcare special, thanks to Sirius for supporting the show’s efforts during the crisis, [00:00:30] and now beyond the crisis. So Sirius will be a sponsor, moving through the end of this year. So we are excited about that. Don’t forget, we’ve gone to three shows a week.

Now, Tuesday, we cover the news Tuesday News Day, and we have interviews with industry influencers on Wednesday. Friday, we, we are just introducing a new thing called clip notes. C L I P clip notes for our interview shows. What is clip notes? I’m glad you asked, in conversations with leaders. I’ve been asked if I can find a way to share with them a list of the [00:01:00] best snippets from the show so they can consume it and share it with others specifically with their staff.

This is step one of that process for each show,  that you, if you sign up for this email list for each show, we will send you an email that has a summary paragraph of the show. Bullet points on the key items covered in the show with timestamps. So you can go right to those spots to hear about those topics and a couple of clips, actual video clips that we have hand selected by the staff, to [00:01:30] capture what we consider to be the best thinking on that specific show,  This is gonna make it easier for you to decide which shows are most relevant for which members of your team. And you can even share just the clips via email with your staff. So if you want to sign up for this, please send an email to clip notes.

C L I P N O T E S @thisweekinhealthit.com. And you will be signed up to start receiving these to your inbox. Okay today we interviewed Niko Skievaski with Redox. We [00:02:00] recorded this episode a few weeks back and as some of, you know, Redox reduced their workforce by as much as 25% since we recorded the show and what I consider to be a move, which shows the leadership that I admire in this c mpany  and the team that makes up the leadership. They did an amazing podcast episode on the Redox podcast, where they openly discuss the decision of the reduction and solicited on behalf of their team that was let go to help them find work. I think it’s a great [00:02:30] episode. If you get a chance to the redox podcast listened to that episode, they have, one of their investors on there, two of the leaders are on there.

And they talked through, you know, how they’re thinking about it, how the repositioning, or refocusing the company a great episode and worth listening to, I’m excited to share this discussion with you with Niko Skievaski  on today’s show. Hope you enjoy. 

This morning, we’re joined by Niko Skievaski the President and Co-founder of Redox, a healthcare platform that provides data liquidity to [00:03:00] accelerate the development and distribution of digital health solutions.

Good morning, Niko. Welcome to the show. 

Niko Skievaski: Good morning. Thanks for having me. Happy to be here. 

Bill Russell: You know I did that off memory. Is that still what Redox does for the most part? 

Niko Skievaski: Yup. Yup. You nailed it. 

Bill Russell: Yeah. At one point I had invested in a startup that really was in that same space and that’s when we first met.

And, I’m a huge fan of what you guys have done. I love the platform and what the team of [00:03:30] Redox has been able to accomplish, but, some of our listeners may not be aware of what you guys are doing. So give the listeners a short description of what Redox is and does, and then. We’ll jump into talking about digital health in the U S 

Niko Skievaski: yeah, for sure.

So what Redux does is at the highest level, we are helping digital health companies. and that’s, you know, your earliest startups all the way to large, you know, large, EHR vendors and other groups like that, we help them share data with each other. [00:04:00] Really. So for instance, you know, a lot of what we’re doing right now during the pandemic is a lot of telehealth and virtual care type solutions are being purchased by health systems.

And then they need to be able to share data from their electronic health record with those organizations. And still we pull data out of it, jars. We standardized it in the cloud and then we make it available over at API to those software vendors. So they can use modern kind of web experience to, to utilize the data.

We do that across the network. So we’re in about 700 health systems now [00:04:30] across the country and all the data that we’re touching, we standardized in the middle. So if you plug into the Redox network, you can work with any of those organizations without having to do as big of a integration project to get your products up and up and running.

Bill Russell: Yeah. And Redox, you know, it’s interesting to me cause we talk about platforms a lot on the show and, people may not understand the distinction of a platform, but really it generates value on, on both sides of the equation. Right? You now call it the Redox network. So the value to a health system is [00:05:00] that if they plug in there’s so many other users of the system right now that they can benefit by plugging different applications in because you have application developers on the other side, who are developing to your set of APIs. And so, so it has a network effect, right? It grows as, as each side works. 

Niko Skievaski: Yeah, absolutely. And so when we first started the company, we worked in network, right. It’s like selling the first fax machine, right. You’re not, you’re not, you’re not plugged into a network.

So it was really more like outsourcing at the beginning where. [00:05:30] We were like, okay, you can either do innovation or you could let us do it. And we’re experts. And we have the software that we’re building to help that happen. As we started to grow in the more health systems we add, the more interesting it is for vendors, because they can say, Hey, well, if I, if I integrate on my own, I have to go one by one to tell a system.

Or if I work with redox, I can just plug into all the health systems that are already on the network. so that’s the, the network effects on the left hand side, the vendors on the right hand side with, with, the health systems. When they, when they look at it, they can, they can now [00:06:00] say, Oh, there’s all these vendors that are already plugged into Redox so if we work with redox, then we can get access to working with, you know, a number of different types of digital health vendors without having to do a big it project to get each one implemented. so that really accelerated our growth. After about two or three years of kind of growing at a linear rate, we started seeing those network effects kick in and, and really started seeing the growth kind of grow exponentially. So that’s what kind of 2018, 2019 was for us holding onto the rocket ship as we were onboarding more and more vendors and [00:06:30] all systems.

Bill Russell: By the way for my listeners, this is not a paid episode. If people are wondering, I’m just a huge fan. I love platforms and I love what you guys have done. B ut you know, you recently started a podcast and you cleverly named the podcast, the Redox podcast. How did you guys come up with that name? Did you hire a firm long hours? Lots of coffee. 

Niko Skievaski: Well, what was funny is that we were brainstorming for months. Cause, cause, we, we wanted to start a podcast for a long time.

And so it was always like, what do we call it? And [00:07:00] so, there was, there’s a whole podcast channel we have in Slack of just like people throwing out names and that’s trying to figure out something. and then we will, I went to Mathematics or Head of Marketing and was like, okay, I was like, Hey, which, which names do you like?

These are our top three choices. And he was like, why don’t we just call it the Redox podcast? That’s what everyone’s going to call it anyways, if it’s, you know, a podcast by Redox. And I started thinking about the casts I listened to, and I listened to a few podcasts from different companies that I follow.

And some of them have names, but I always call them, you know, the name of that company. I’m like, [00:07:30] Oh, it’s the, it’s the Octopod cast for instance. even though that podcast is called You, I think. so yeah, I was just like, yeah, I guess we could just call up the Redox podcast and, I think it’s worked out it’s, it’s quite descriptive. You know what you’re getting into. 

Bill Russell: You do. I’m actually gonna use your intro as a, as a framework for questions. I love the podcasts. I recently listened to the, the two part series on platforms. I think it’s a must listen to, I have Jonathan Bush cued up. To listen to he’s a quote machine. So I love listening to him whenever he [00:08:00] gives, whenever he talks. He’s phenomenal. So your intro let’s, let’s, let’s just run through it and, and, you know, you say Redox is on a mission to make healthcare data useful and in turn enable the frictionless adoption of technology in healthcare. And I’m just going to stop there and say, How are we doing? It’s June of 2020.

How are we doing on that vision? 

Niko Skievaski: Yeah. So that, that kind of goes back to some of the reasons why we started redox. I worked at Epic before, before let’s cut kind of how I cut my teeth in [00:08:30] healthcare and looking around in the industry. It’s it’s very, every time you go to the doctor’s office, you could see 10 different ways that technology should and could be used to make that process more efficient and more effective for the patient experience.

And so, so it seems like there’s a lot of tech that technology could do in the industry. but as you start looking at all the startups out there, Basically, there’s a startup trying to solve every single one of these problems. There’s probably 10 startups trying to solve that problem with the amount of funding that we’ve had in digital health.

[00:09:00] So what I started thinking about realizing that in healthcare, we don’t necessarily have an innovation problem. There’s a lot of people throwing time and money and companies are trying to solve a lot of these challenges, but we have a technology adoption problem in that, you know, they still use pagers and clipboards in hospitals.

Not because they don’t have a software solution to get rid of those, but because they haven’t figured out how to adopt them in a, in a seamless way and a big barrier, the technology adoption is, is the [00:09:30] it barrier, which is actually, you know, setting up the systems, integrating them with the legacy EHR.

A lot of the stuff that Redox does to help enable these, these technologies to come to market. So that’s what we mean by trying to, to enable frictionless adoption of technology and healthcare. That’s actually one of our that’s our big, hairy audacious goal at redox is to. Enable the frictionless adoption of technology.  So, just throwing a homage to that. 

Bill Russell: Yeah. So I’m going to, I’m going to transition and just start talking about some of the challenges we’re facing. You go on in the intro to talk about [00:10:00] exploring the intersection of healthcare and technology, how technology is making a difference and the barriers and how they can be overcome  and you know, there’s some that I want to talk to you about because having. Having a lead early stage investments in startups. There’s a lot of barriers to overcome from the startups side. And then there’s barriers overcome from the adoption and the healthcare side. But talk a little bit about being a startup and the, you know, what it takes to go from [00:10:30] selling that first fax machine to actually being a platform that’s experiencing network effects.

I mean, that’s. That ended up itself as almost a unicorn in healthcare isn’t it?  

Niko Skievaski: There are not many platforms that have scaled and in healthcare. I think Surescripts is probably the best example. The one that’s actually reached kind of a critical mass, moment, but you know, if you look at platforms like Uber and, E-bay and Amazon kind of in the non-healthcare space, in the consumer space, you [00:11:00] can reach network effects faster because consumers have word of mouth. They shop based on convenience, best product wins, best price wins. you can differentiate on those factors in healthcare because of the enterprise B2B sale that you typically have to get into. It becomes a lot harder to reach sort of ubiquity, and create the platform network effective experiences that a lot of non-healthcare companies create.

And that’s largely because. In healthcare, the people that are benefiting from your product are [00:11:30] usually never the ones who are paying for your product. So you have to convince multiple people across the organization to say yes, and there’s probably a hundred people at a big health organization that have to say yes.

And if any, one of those people says no, then it can kill your deal. And so that is a huge challenge for startups. As they’re trying to build something in the healthcare space is how do you, how do you actually make a sale into a health system without sinking two years of, of time and effort, and then the sales cycle, and to get alive . And do you have enough [00:12:00] funding to actually get through that process, to get your product, validated and start generating revenue before you run out of money yourself and have to have to go under. I think that’s one of the hardest challenges for, for health tech companies. with redox, what we do is we just try to, you know, there’s a lot of barriers in place. We try to remove one of them when you get to IT and IT asks, how are you going to integrate? Can you handle HL seven? Can you, you handle fire, can  you handle  whatever standard they throw at you? You can confidently say yes, and, and give them a plan on [00:12:30] exactly how that happens. That’s what we work with our customers on. And so we try to reduce that barrier. we help them with security concerns, things like that. but we’re not going to help vendors with their value proposition. They still have to make that sale to a health system. They sell to convince their clinical users and administrative, stakeholders that their product is worth buying.

But hopefully when they get to IT, they’re working with Redox. That process can go smoothly from that point on. 

Bill Russell: Wow. You’ve given me a lot to jump off of there. And, you know, I heard someone on the platform say, you know, [00:13:00] somebody came alongside them, somebody with some wisdom and said, you know, if you really want to make it as a health tech startup, make sure you’re not selling to the providers, the healthcare providers and having been on the other side of that equation and said no to about.

90%, if not 95% of the startups that walked through my front door, that sales cycle is long. And if you don’t have the, it, it, it can, it can really, I dunno, it can, it can end [00:13:30] your company right there before it even gets started. That’s the first aspect of it. And the second is, you know, you talk about know people you’re trying to benefit.

Aren’t, really the ones that if you’re trying to do anything for the consumer, they’re, they’re indirect payers through the, you know, through the insurance carriers and other  means, so they’re you, it’s hard to build a platform that benefits consumers in healthcare because they’re unwilling to pay for anything cause they’re already paying for something.

[00:14:00] Niko Skievaski: Yeah. Yeah. And it’s a, so it’s what we call in health economics, derived demand in that. Consumers don’t have a direct demand for healthcare. Just like, you know, when you go to the store and you buy groceries, you have a direct demand for groceries and you know, the benefit that you’re going to get from buying groceries and bring them home, eating them.

You don’t know the benefit you’ll get from buying health care. As a consumer, we have demand for health. We want to be healthy, but we have to buy healthcare. And so there’s a production function there between what we buy and what we actually want. And that derived demand [00:14:30] actually creates a ton of challenges with really market failures in the healthcare space  just because, well, it’s, it’s not a pure market in that consumers don’t have a direct demand for the products that they’re purchasing. It has to come through an expert like a doctor to tell you, Oh, you need a knee replacement, versus physical therapy, for instance, 

Bill Russell: You know, if I, if I rewind to like 2012 or whatnot, we were talking about the app store, is that essentially what you become a layer of API’s over this data that exists out there that [00:15:00] people can plug into and write their apps.

Niko Skievaski: Yeah. Well, it’s, it’s funny. you know, you mentioned you, you worked with another company that was kind of in this integration space. I think the thing that has made Redox successful is avoiding selling to health systems and avoiding trying to become an app store. and th the reason is, is I don’t think that healthcare organizations, these, these big enterprises, they all, they all think that they’re very unique.

And in a lot of ways they are right. They have their own demographics of the dealing with they have their own structures and culture. I don’t [00:15:30] know if they’re going to standardize on a way to purchase software that an app store experience creates. So like the iTunes app store, our kind of first app store example in the market, it makes it so that you as a consumer or buys an app for the exact same way that everyone else does.

It standardized the process, both for selling and buying and finding these applications. If you think about how software is purchased from a health system perspective, there’s this huge procurement team there’s legal, there’s security, there’s it. [00:16:00] and it’s this gauntlet that startups have to run through to make a sale.

And if for an app store to be successful, you’d have to reform all of those processes and make it so potentially someone as close to the end user as possible, potentially like a. Actual end user, like a doctor or nurse could actually purchase software on this app store and implemented it in their, in their systems.

And I think that we’re, we’re pretty far away, away from that. So yeah, with Redox, there is that two sided network. It kind of feels like an app store, but we don’t. We don’t [00:16:30] match supply and demand. So most app stores you actually go in and you search and you try to sit and you try to find the, Hey, what’s the best calendar app for my computer.

And you can find that. So you match up supply and demand. Redox. Doesn’t do that. We get involved after. Supply and demand in this match. So after a health system says, I want to work with, you know, Evizio for eConsults, then Redox gets pulled into the mix to help facilitate the exchange of value between supply and demand, but not actually the matching of those, of those sides  [00:17:00] and a lot of the, a lot of our competitors over the years have really tried to figure out how to. How to sell something directly to a health system, how to go through that sales cycles, how to reform that buying process. And, that’s why they didn’t grow as fast. so by us avoiding and focusing, avoiding that problem and focusing on the problem of making the developer experience really good, we were able to grow a lot faster and win more market share, 

Bill Russell: you know, the, the, the other thing and as I’m thinking about this, the other thing we’re always concerned about as [00:17:30] startups is, is one of the big players going to turn and all of a sudden point their, their desire or their interests at the market that we’re playing. And, you know, you’re playing that, that intermediary between this really rich data that exists behind the iron curtain and, and the app community.

But yeah, you know, the EHR providers are also starting to say, Hey, it’s through fire through, I don’t like mentioning specific things, but through a series of APIs and the store [00:18:00] around it, and those kinds of things, and through developing, building a development community, we’re going to open this thing up.  Do you have to keep an eye on that at all times just to make sure that they don’t just swerve over and intercept you? 

Niko Skievaski: Yeah. Yeah, for sure. I think, I think it’s great what EHR companies are doing, you know, building up more that’s that’s that’s side of history, that’s what they should be doing because the EHR, you know, it’s, it’s grown too big and it does too much for them to keep up with the ever changing demands of all of the [00:18:30] stakeholders in healthcare.

So we need to be able to plug in. Applications to be able to work with you. HR is to, to enable that technology to actually make improvements in the healthcare space. One of the things that well, so the health care EHR market is, is quite fragmented. And of course we talk about the really big ones out there, like Epic and Cerner and stuff, but still  their market share isn’t as big as if you think about like the, like the operating system market or, or even, mobile operating systems like Android and iOS, right.

They have pretty much a 50 50 split. And so as [00:19:00] a developer, you can build to those two platforms and cover a hundred percent of the market. Whereas in healthcare, because of the fragmented nature of the technology systems you’re using, it’s hard to pick one vendor and use that as your channel. And so therefore you have to end up integrating with many, many, many law, a long tail of EHR.

so  my. Hypothesis in the market is that it’s much better to have an independent party that can integrate with everybody. So developers can choose to interview with that platform and that work with all of these [00:19:30] app stores that EHR is, are coming out with. So Redox has partnerships with, with a few apps out there that if you work with Redox, you’re basically enabled on the, on the affinity ATARs marketplace.

So you don’t have to go through their certification. you can just do Redox. so that’s our approach to that and, and try to help, help that ecosystem thrive and really help those EHR marketplaces become more successful than they have been to date. because like I said, those marketplaces are trying to reform how health systems are purchasing software  and so [00:20:00] they haven’t been all that successful as being a channel for startups and vendors to work through, to actually get more business with the health systems. 

Bill Russell: Yeah. And it’s, yeah, you can rest assured that Metatech, isn’t working on a set of API is to get to Epic data. Epic’s not working on a set of KPIs, that concern Cerner data.

And so there’s always going to be the need for that third party. you know, alright, so I’m gonna to transition, we do a very quick podcast here. No, no more than 30 minutes. So I wanna close it on the last two questions. You throw out a very big [00:20:30] statement towards the end of your intro of podcasts. Where you say that healthcare will change dramatically in the next decade.

Why do you believe that? And where do you think your, that we’re going to see a change the most? 

Niko Skievaski: Well, I, so it was whenever recorded that this was probably December of when I actually wrote that and recorded it. So six months ago, I. 

Bill Russell: You were, you were omniscient you knew what was going to happen in health care, I guess.

Niko Skievaski: Well, so because of the inefficiencies that have been in this market, [00:21:00] I, it was more of a hopeful statement that I really hope healthcare changes dramatically over the coming decade. and I gave it a decade because, you know, normally in a market with, with the inefficiencies that we have in healthcare, if this was, if this was a more kind of customer focused market, it would change a lot faster.

Then that, but I gave it a decade cause I’m like healthcare moves slowly. We’re probably not going to see the change that we all want. very fast, but the pandemic had like dramatically accelerated that change. I think it’s exposed. The parts of healthcare that people have been saying [00:21:30] are broken for a long time. Access to care, rural care. I’m not adopting technologies that everyone knows are, is obvious  like virtual care tools to telehealth type solutions. so those things are things that were exacerbated by the pandemic and the need to adopt the became so high that we saw health systems turning on telehealth products that, you know, in a normal time them would take them a year or two years to implement and roll out pilots and test out in different areas. They turned it on overnight and then they saw, you know, a [00:22:00] hundred X increase in telehealth visits. so that’s the change I’m talking about. We’re going to see a fundamental change in how care is delivered and that, that change is going to be driven off of, technology enabling it.

So it will be technology enabled change in our healthcare delivery models. And, you know, like everyone has been saying tele-health is not, we’re not putting that genie back in the bottle. it’s been implemented. Patients are starting to get used to it. 80% of patients who had their first telehealth visit over the past few months in the pandemic are saying that they would like to do it again. [00:22:30] according to a recent survey that was put out, Doctors are. getting over the chain, like getting out of the status quo and learning how to use it and, understanding that they can see patients effectively for certain types of things over telehealth. so we’re going to see that, that settled down over the next six months or so.

And, the telehealth programs will become more established, but then they’re going to start adopting tools that really are complimentary to tele-health other virtual care solutions, remote diagnostics, remote patient monitoring, anything that happens outside of the four walls of [00:23:00] the health system.

And, you know, it’s, it’s pretty clear right now that the healthcare organizations that took risks on patients, the ones that, were deep into the transition to value based care, the, you know, the ones who were paid on a capitated rate or had a payer as part of their organizations are, are surviving.

More effectively, during this, during this economic downturn, that’s caused by other pandemic. So hopefully we’ll start. Yeah. Seeing more adoption of value based programs. And, and with the adoption by these programs, that means more incentives to figure out what’s going on with [00:23:30] patients outside of the four walls of your organization, because you’re at risk on that patient’s life.

And what that means is technology. Is so suited to do that. And your traditional EHR is aren’t really in a place to help you out with that. So, I’m expecting a lot more adoption of, of tools that will help healthcare organizations focus on how do we take care of our populations and make sure that we can track them and, intervene.

So people don’t become, or don’t end up a high cost. you know, Poor health situation that [00:24:00] causes a lot of the costs in the system. So that’s the reform that I hope we’ll see. And I thought it would take 10 years, but I think it’s going to be over the next two years now, as we pull out of this recession and, healthcare organizations figure out how to generate revenue again.

Bill Russell: Yeah. I’ll tell you, what do you guys really it’s fascinating to me. One of the things I’ve been saying to people as we’ve been talking about digital transformation for a decade, And we just did it in three months. I mean, the patient’s experience, digital transformation on how they interact with us. The physicians experienced digital transformation [00:24:30] workers went out into their homes. The culture just in general has dramatically shifted over overnight. I’m not sure anyone could have predicted that. You know, if you would have predicted where we’re at today, Majority of healthcare workers are the administrative workers working from there, including finance and others. The patients overwhelmingly across the country, at least at this moment in history being seen via virtual means and, [00:25:00] and liking it, the physicians delivering it and, and essentially at a greater than 60% clip.

Saying that they prefer it and you know, those kinds of things. if you would predict that in five years, I think you would have been aggressive and now we’ve just seen it in a matter of three months. It’s amazing. Yeah. 

Niko Skievaski: It’s, it’s phenomenal. And you know, for a long time, people have been saying that we need to have this digital transformation because a lot of people estimate that about a third of spending in healthcare, it was waste.

What this means [00:25:30] is that. Coming out of the recession. I think this might what we might be seeing as a right sizing of the industry in that it would have been very difficult for a larger organization to go digital, because what that would mean is, is retooling their staff to, for different skills and potentially laying people off and, and letting a large portions of their staff go that’s that’s happening anyways.

Right now, we’re seeing furloughs and job loss in the healthcare space, Really dramatically. And the jobs that come back online after, as people start to see volumes increase [00:26:00] again, will be the necessary jobs. And so the industry might come back and actually be smaller than in the past. And that’s good because we were hearing 20% of the GDP being spent on healthcare, which is phenomenally too high.

You know, a country of our size should, should be sitting around 12% of GDP. So what I’m hoping is that when, whenever returns , we’ll be in the, you know, 16, 17, 17% range, then it sure will be a little smaller, but a whole lot faster, a whole lot more nimble and a whole lot more efficient with how they use technology.

Bill Russell: Yeah. If we align the incentives, it’s, [00:26:30] it’s interesting to just. Think about it. You could literally go into a care pathway right now and look at the entire thing and say, does this need to be a physical visit or a virtual visit? And now everyone in the room has a concept for what can actually be done virtually that wasn’t done before all the way through to rehab and home visits and those kinds of things.

And that has, that has the opportunity to fundamentally change the cost model from end to end. And one of the things I talked about on, on Tuesday’s podcast was just [00:27:00] the concept that the payers are going to come back in and redesign. What they’re going to pay for. And they’re going to say, we’re only going to pay for this type of visit if it’s a virtual visit and that’s going to drive change across the industry, just because we’ve just experienced it and it’s opened up, it’s just a whole new conversation.

Niko Skievaski: Yeah. Well, and I’m particularly interested in payers and how. So if, if they’re only going to pay for certain types of visits, being virtual, why don’t those payers provide those visits themselves, by [00:27:30] employing their own providers. And so we’ve seen it over the past few years, this sort of vertical integration of payers into the provider space.

I think that they should do that virtually and let let the hospitals and health systems keep the brick and mortar. But they can take a bigger step into that virtual care space, especially right now when they’re, When they have so much cash on hand, because of not paying out claims, they can invest in solutions like that, and actually provide more care at a virtual level, but then they’re competing with their providers that they pay for it.

So it’s an interesting space to watch. And [00:28:00] I don’t know what the payer strategy is going to be coming out of the pandemic, but I could see a lot of them. doing more vertical integration in a virtual standpoint, providing their own tele-health solutions, employing their own docs in that network.

Bill Russell: I’m going a little long, but I’d be really remiss if I didn’t talk to you about data and interoperability. you know, we have 21st century cures act. We have final rule. coming at us pretty quickly. A lot of people talking about, you know, just the overall impact on healthcare. I I’m looking at this space.

[00:28:30] And even before COVID, I was looking at this year and saying, this is the year it really starts to transition. This is the year where the data starts to become more liquid, across the environment. And when I talk about data, liquidity, liquidity, I just mean. The, the, you know, giving access to groups of people that can have the greatest impact with that data.

I mean, what, what, how are you, how are you viewing this, this timeframe within interoperability and what do you anticipate are going [00:29:00] to be the, the, most far reaching impact of, 21st century cures and the final  rule? 

Niko Skievaski: Yeah. Yeah. Like you, I was excited and preparing to go to him, just to talk to everybody about interoperability, you know, and everyone’s plans for meeting the new requirements  and then of course it was just canceled and the pandemic took over our lives and our industry. And, it seems like the inoperability rule kind of went to the back burner, but it’s still there. It’s still really important. Some of the deadlines got. Delayed six months or so, but, there’s still, they’re still [00:29:30] coming up.

I think the, so there were a lot of things in it and a lot of them were kind of incremental improvements to the interoperability legislation that we’ve seen over the past, gosh, 10 years now. but what I think was the most important piece of it. Was the push towards patient access to their, to their own data.

And what, what the law says is that patients should be able to use any app they want. And if that app meets the requirements of the API and those requirements are, have now been specified to use fire, [00:30:00] then. Then they should be able to get data into that app. And what that means for patients out there is that you’ll be able to download an app on your phone and get your clinical data onto it.

And who knows what those apps will do. It’s kind of what the government’s saying is it’s almost like if we build it, they will come model where they’re saying, if we mandate that the infrastructure exists for apps to get data, then. Entrepreneurs out there will make applications that can actually engage. patients, can help them change their behaviors and get healthier. so we’re, we’ll, we’re [00:30:30] likely to see this right now. Consumer health is really focused on like wearables and fitness, but we’re likely to see consumer health as a sector grow and start getting a lot more clinical because that data will be made available, over a standard format.

So that’s what I’m hoping. It’s a bet because we haven’t seen those apps exist yet. But I think over time, we’ll, you know, there, there will be a, for lack of a better term, a killer app and healthcare that actually a command to the attention of, of lots of consumers. And that starts the wave of people pulling their data out of their health, [00:31:00] hospitals, and health systems on to applications that they control and mediate who gets access to.

Bill Russell: So I’m going to push back on you a little only because the economics of that, and you’re an economists and some of your concepts, are you talking about the economics really don’t make sense? I mean, what makes sense to me is, okay, so I can get to it as a, as a patient, which is kind of cool, but it has to be somebody who’s making money. somehow, either from me, no, I asked me somebody was making money from me. So [00:31:30] Apple can do that because. Every time I buy an iPhone and it’s closed a closed garden, if you will, they they’re making money. So they’re more than happy to aggregate my data and make it available, create new opportunities for me on that.

but others are going to, they’re going to struggle. They’re going to have to create incremental value on that data and it could be something that’s as simple as, you know, taking all this disparate data. cause I know that certain CEO has said, you know, the patients don’t know what to do with this.

And I agree with her. I don’t know what [00:32:00] to do with it. But I could envision a company coming along and saying, Hey, you grab all your data and we’ll put somebody on the line on a Zoom call with you and we’ll explain your data to you. 

Niko Skievaski: Exactly. Yeah, that’s it. That’s a great idea. A great business idea. It’s and heck bill, bill forward as a telehealth visit a wellness checkup.  Right? So there are business models that we can’t perceive yet that people will try. And if you think about all the apps on the app store, like if you go to your, your, your phone app store, there are [00:32:30] so many apps out there that are all, they’re all free, right? I, I barely ever paid for an app on the app store and they figured out a way to exist and a business model that can drive value for their company while giving value to their users.

And so we’re going to see things like that and really an application. And if you think about it, like software development, the application layer, Is what turns data into information and information is what’s, what’s actionable from a user perspective. So yeah, patients don’t have, they don’t have a demand for their data.

They don’t have a demand for an API. [00:33:00] They don’t know what the API is, but when they used an application that utilizes that annoying infrastructure, that applications job is to turn is to surround that data with context so they can understand what it means for their health, and what it means for their livelihood. and you can think of ways to actually incentivize patients to do that too, because if you’re a company that’s aggregating all of that data, that data becomes a valuable asset to you, and you might be able to pay patients back for the use of that data. either in the through great features and technology like Google does or through actual [00:33:30] monetary payments, like, DataBank model.

So, so there’s things that need to be tried out and fleshed out in the market. and that’s what, that’s what 21st century cures is about, is creating the landscape to allow innovators, to try those things. and so we’re going to see a whole bunch of innovation happening and a whole bunch of people fail, but the one or two who make it can actually start a revolution that, hopefully will get people more engaged in their health data, to the point where, where.

We might see a consumerism trend in healthcare, where instead of being driven off of, you know, what your employers, [00:34:00] coverages from a payer perspective and what doctor to see through that, really based off of like, what’s convenient for you as a patient, what matters most to you? And what’s the price point?

you know, more like a, or like a model where, we have direct demand. so going back to that initial concept of drive demand, we can actually fix a lot of those market failures to be a technology and transparency in the market  

Bill Russell: Niko, I, you know, I’m reminded cause I met with a lot of. startups that were looking for funding and whatnot and, talking to you, I’m [00:34:30] reminded of what it takes to be successful.

You are so optimistic.  have so much energy, so much passion towards this, but I think it’s the optimism. It’s, you know, you believe in the industry and you believe in the. The solution that you’ve come up with and you believe in, and the people that you work with, I, I appreciate everything that you guys are doing.

I appreciate you taking time to come on the show. 

Niko Skievaski: Yeah. Thanks a lot. This is really fun. 

Bill Russell: That’s all for this week. Special. Thanks to our sponsors, VMware Starbridge Advisors, Galen Healthcare, Health Lyrics, Sirius healthcare and Pro [00:35:00] Talent Advisers for choosing to invest in developing the next generation of health leaders.

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