Get ahead of the curve and learn from leading care providers and companies such as Cityblock Health, One Medical, Oak Street Health and more
Once upon a time, when you wanted to use a piece of software you had to insert a physical medium like a CD-Rom (Floppy disks or punch cards anyone? Magnetic tape?) into your computer to get it installed and ready for use. If you don’t believe this, ask an old person.
This thing that you had to buy in a physical store was the result of a painstaking waterfall process to create software and get it into the hands of customers. Organized in sequential phases from requirements gathering and analysis to planning to coding, quality assurance and ultimately shipping the aforementioned physical product to stores, this process could take years. By the time a version was getting installed and used, the initial requirements upon which that version was built were long outdated.
Thankfully, the world of business is ruthless. Teams started to find ways to ship software faster. They understood that in the long run the only sustainable competitive advantage is an organization’s ability to learn faster than the competition1.
If you ship smaller increments faster, you’ll get feedback from your customers faster, you’ll be able to update your software faster, improving it way more often than once every couple of years. This led to the birth of Agile2.
Fast forward a couple of years. Companies like Meta and Amazon are releasing new versions of their software multiple times per day. Famously, as far back as 2011 Amazon was deploying a new piece of code every 11.6 seconds3. It has been widely documented by Amazon and the industry that this unprecedented velocity to create and ship software was key to Amazon’s success. Why? Because a higher velocity means you’re learning faster, you can serve your customers better and stay ahead of competition.
Their secret sauce? DevOps practices such as continuous integration, continuous deployment and automated testing. These secrets have found widespread adoption across all businesses creating software today and DevOps is now an academic field with ongoing research into the practice of software development.
Where DevOps was a nice to have 10 years ago, it has become mission critical for software teams today.
Competition in healthcare used to revolve around a geographic presence and the reputation of their doctors. The business of care delivery revolved around performing activities such as visits, medical exams, procedures, administering treatments and prescribing medication.
In this Fee For Service world, scientific knowledge about best care is not applied systematically to clinical practice. A widely quoted stat says it takes an average of about 17 years for new knowledge generated by randomized controlled trials to be incorporated into clinical practice.
Similar to the history of software above, the way best practice in healthcare is created and implemented is stuck in a waterfall approach. Given activities, not outcomes are the revenue generators of care providers there is just not enough incentive to improve outcomes or to change from waterfall to agile.
But all of this is changing as we speak.
Some care providers still think Fee For Service is here to stay. But the reality is, the Value Based train has left the station and will not return. Simply because it promises the payer (whether single or multiple payer, government funded or private health insurance) more bang for their healthcare buck. Ultimately, we’re all payers through our tax money and/or monthly premiums. Would you rather incentivize care teams based on how many care delivery activities they perform or whether those activities contribute to making you healthy?
This means responsibility over outcomes (i.e. risk to achieve those outcomes for a given population) is slowly but surely pushed towards the care provider. In many cases, new provider organizations or separate entities inside larger organizations are being formed that are taking on risk on purpose because it represents significant upside if executed properly. All of this means that after more than a decade of trying out different mixes of sticks and carrots, the trend is turning into a tidal wave that will wash over healthcare in the decades to come.
This means provider organizations will find themselves increasingly in the business of competing for outcomes and cost rather than a combination of geography and having “the very best doctors” on staff.
For the very first time in healthcare history, provider organizations who learn faster which clinical practices contribute to better outcomes and which care delivery processes are inefficient and can be automated will create a sustainable competitive advantage, attracting higher value contracts from payers and more patients seeking best quality care.
1 Peter Senge