The Digital Imperative for U.S. Healthcare Providers

Jason Lineen will be presenting at HFMA’s 2018 Annual Conference, taking place June 24-27 in Las Vegas. This blog post touches on the theme of his presentation, Digital Health Solutions: Health System Disruptor or Enabler? For more information or to register, go to annual.hfma.org.

All industries are undergoing a digital transformation. At the epicenter of the digital movement, service industries such as media, retail, banking, and hospitality/travel have been dramatically reshaped and disrupted over the past decade. Although the pace of digital transformation may be slower due to the inherent complexity of the $3.5 trillion U.S. healthcare industry, tremors of change are afoot.

The digital health sector is attracting billions in venture capital fueling an arms race in two broad camps: those seeking to partner with health systems to digitally enable the industry, and those seeking to disrupt industry-incumbent provider (and payer) organizations. Healthcare organizations that fail to understand this world of innovators are putting themselves at a significant strategic disadvantage. Tinkering is insufficient. When viewed as a differentiating business asset, digital technology permeates all strategic pillars, from radically enhancing access to care (bricks to clicks), to delighting consumers with frictionless experiences (including a consumer-friendly patient financial experience), to making care easier by automating low-value tasks and untethering clinicians from the electronic health record (EHR).

Although many futurists are quick to write off incumbent health systems as being too complex and too monolithic to adapt and embrace digital, the tech industry and venture-backed startups do not have a monopoly on innovation. The delivery of health care is clearly not as easily disrupted as the VHS/DVD movie rental business. Further, health systems have a big role to play in both shaping emerging digitally enabled care models and accelerating adoption of digital solutions that move the needle.

Everyone in the organization has a role to play in the digital transformation of health care—from C-suite executives to caregivers at the bedside. Rather than “one more thing to do” on top of following current trends and regulations, the digital transformation must be viewed and communicated as a key enabler of all strategic initiatives. The first step for hospitals and health systems on the journey is resetting the organizational mindset that fully embracing digital technology is fundamentally different from the multiyear IT projects of the past, such as EHR planning and implementation. Software is only one component of this new technology, and in health care, it often is the least challenging one to implement. Today’s digital health solutions are rapidly maturing. The key barrier often lies in changing caregiver/patient behaviors, workflows and sustaining engagement that the digital solution is meant to enable. 

A recent survey conducted by the American Hospital Association (AHA) and AVIA found that 75 percent of senior hospital executives endorsed the importance of digital innovation. In practice, however, it is difficult to mobilize a health system workforce of tens of thousands to embrace change and adopt digital solutions. Following are three ways healthcare leaders can begin to bring their organizations into an era of digital transformation.

Assess: Measure the Organization’s Baseline, and Frame the Opportunity

The first step on the journey is aligning and resetting the organization’s mindset about what adopting digital technology actually means. Organizations that employ successful digital strategies will be left with a differentiating business asset that cuts across all facets of the enterprise—delighting consumers, empowering caregivers (and back office teams), and enabling success in alternative payment models. Conducting an inventory of the organization’s current digital capabilities and initiatives underway (from foundational capabilities such as online scheduling to more advanced capabilities such as digital cognitive behavioral therapy). When framing the opportunity, digital initiatives should be tightly aligned and embedded across all pillars of the organization’s strategic plan. Implementation of digital technology is a force-multiplier of an organization’s current business objectives, not a separate competing strategy.

Align: Map the Digital Journey

Leaders can help translate the organization’s vision into actionable digital roadmaps. Long-range (five- to 10-year) strategic plans are a thing of the past given the rapid pace of change. Digital roadmaps should be expressed in terms of business outcomes, not the number of “bright shiny objects” implemented. One example of a useful plan is a consumerism/consumer access roadmap that makes accessing care easier, as indicated by metrics such as the number of digital interactions and the number of new patients entering the system via digital channels. Finally, digital roadmaps must be nimble enough to adapt to new opportunities (and challenges) in real time.

Act: Mobilize the Organization to Execute

Everyone in the organization has a role to play. It is not the sole domain or responsibility of any single department or function (e.g., IT or marketing). Nimble approaches to governance, funding, and approval are required to accelerate digital progress. Leaders must inspire and empower managers with a bias toward action and controlled risk taking. Roadmap scorecards with clearly defined key performance indicators are essential to manage and measure progress along the journey. Transformation is not achieved by running proof-of-concept projects that celebrate anniversaries. Piloting digital solutions in ad hoc siloed projects is not the path to success, but unfortunately, it’s often the norm. A bias toward highly coordinated action, at scale, is required.

Digital transformation is a multiyear journey presenting immense opportunity for health care organizations and the communities they serve.  However, until digital is viewed as a differentiating business asset, “tinkering” organizations will tend to fall short of having the comprehensive vision, funding, and consistent leadership required to drive a meaningful impact.  A new approach is needed.  Similar to embracing the auto industry’s Lean methodologies to drive continuous process improvement, health care leaders can look to the software industry to embrace its well-developed approach to driving digital innovation projects called “Agile.” 

A proven systematic framework for driving digital innovation, Agile empowers small cross-functional teams, breaks tasks into smaller modules to be tackled in short cycles called “sprints”, and iterates rapidly with active customer/stakeholder input to achieve and build on successes along the way. Like Lean management programs, adopting the Agile approach requires training employees new skills/processes and empowering teams to work across silos to achieve shared goals.  Championing digital innovation efforts at scale from within a large complex health care organization is not for the faint of heart; however, as retired U.S. General Eric Shinseki often said, “If you don’t like change, you’re going to like irrelevance even less.”

Jason Lineen leads strategy and advisory services at AVIA, Chicago.