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Physicians Must Ride the Third Great Wave...
Here we are ready to say goodbye to 2010 and usher in 2011. This year has been a massive year for the tech world. The Consumer Internet reigns. Start-ups are providing incredible services for both consumers and businesses to gain feedback on their application and use of their sites. Lean start-ups which start first with customers and then create products out of nothing are the norm. Cost of business creation is at an all time low. Free and freemium models abound. Our social graphs have deepened and have new-found importance. As of November 2010 Apple is activating 275,000 ios devices a DAY. Consumers have chosen the mobile as their device of choice. E commerce reins as the consumer’s choice and has decimated almost every brick and mortar industry.
Now let’s reflect on the year of 2010 in health care. There is a lot going on. Hospitals and physician practices are hard at work. The focus is on reform and meaningful use implementation, as well as the acquisition of government funding to keep floating our ailing hospitals and broken fee for service business models. Primary Care continues to lose ground, as hoards of physicians flock to retirement, better opportunities in health care consulting and health IT sales, as predicted in this Physician’s Foundation Study from 2008. Physicians in private practice are leaving contracts with medicare in a variety of states, notably, Texas. Innovative products and services do help our hospitals and physician practices improve, with improved billing platforms, portals, and the like. These are all forms of incremental innovation. Yet, the focus for both hospitals and physician practices remains the third party payer, with most of our products in Health IT laser focused on revenue cycle management. They focus on the improvements in the work-flow of the physician office that must implement the excruciating and time consuming details of third party payer practice. There are certainly opportunities for improved contracting, process, revenue cycle and acquisition of HHS funding for Medical Home projects. These are the domain of consultants in the industry. Christensen notes that industries in decline always have the most robust consulting opportunities.
I want to take a minute to warn all of us entrenched in the above considerations, that we have missed the boat, my friends. Meaningful use and specifically the Patient Health Record has a far more significant importance. Clay Christensen writes in Innovator’s Prescription that the only chance of saving healthcare is through disruption. Disruptive Innovation that is. Disruption is all around us in 2010. Both hospital and physician practice models are being massively disrupted already, by companies harnessing the third great wave of innovation that John Doerr of Seqoiua Capital predicts. We have been disrupted by a long list of emerging business models that have taken marketshare, accentuating the financial woes of the typical physician practice. Clay C. and Jason Hwang discusses a long list of these in his book. Coming from the experience of building a health service organization and cloud platform that helps doc’s go mobile, I have spoken at conferences and Health IT panels with the founders of these emerging businesses that focus on consumers, self tracking, social contagion, and croudsourcing. There are even new professional organizations that have grown out of this refreshing consumer interest in creation of health WITH their physician. that are growing as a result. They focus on consumer’s interest to improve the physician patient relationship utilizing high tech tools in some instances, specifically the PHR. Yes, the group of us doctors who use social media to improve health all agree that 2010 is the “ Year of the Patient”, with epatient dave leading the charge.
The growing success in these emerging business can be attributed to new business model creation which validates pricing directly with customers. They utilize a host of high tech tools to rapidly gather feedback and iterate their product offerings. They are creating something out of nothing, what Eric Ries from Lean Startup calls, a “ Miminum Viable Product” and then selling it. They then build the business around customers with an ongoing process of customer development. They build out process and corporate culture that revolves around customers. This is disruptive innovation. As the existing business models in healthcare continue to struggle with distractions like meaningful use, government, reform and revenue cycle management, the new value network in health care is DISRUPTING you. The disruption will continue, Clay says, until within 5 years we will have a new value network, the center of which is the Patient Health Record. (Not hospitals and physician offices as in 2010) In order to stay in the game, primary care physicians MUST implement the principles of disruptive innovation alongside the continued incremental changes that you are implementing in practice.
See, disruption starts and ends with consumers. If you listen to your patients carefully, they will tell you exactly what they want. Consumers and businesses are willing to pay for services. I want physicians in primary care to remember they need us now more than ever. We are focused at Personal Medicine on service line strategy of disruption and new business model creation for physicians. Our legacy and vision is a global mobile primary care workforce who rides the third great wave of innovation, the mobile, social, e-commerce revolution.
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Natalie Hodge MD FAAP
Chief Health Officer Personal Medicine
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