Authored by Lisa Suennen, Senior Managing Director, GE Ventures
With so many new alliances in the healthcare system, it’s great to know that companies with experience effectively serving customers are talking about change at the most fundamental levels. I welcome Walmart’s efforts to build an integrated healthcare system, and it is exciting to imagine what the trifecta of Amazon’s Jeff Bezos, JPMorgan’s Jamie Dimon and Berkshire Hathaway’s Warren Buffett could do to tackle our country’s dysfunctional healthcare system on behalf of their employees and others. Simply put, patients and consumers need a healthcare system with a new point of view.
And I, for one, am cheering them on. Because it’s personal. And I’ll tell you why.
When I was rushed to the hospital a couple years ago, I got outstanding health care, but the customer service experience was plain awful. Despite nearly 30 years in the healthcare field, there were times I was frightened and baffled by what was happening during my hospitalization. I can only imagine how much worse it would be for someone who didn’t think and talk about healthcare for a living. And my experience only echoes what I have seen with friends and family. If any of us experienced service this poor at the average restaurant, we’d leave without paying. In healthcare, you would get double billed.
So many things—from the hospital staff’s lack of skill with the facility’s own electronic medical records system to near-miss medical errors to my stunningly unempathetic interactions with the clinical staff—were disappointing. And, because someone ignored the new insurance information I provided when I was admitted, sorting out the billing at the end of my stay was a huge mess. Oh, and I couldn’t get my medical records transferred to another provider without a near act of Congress.
Unfortunately, my experience is all too common these days. Let’s face it, when it comes to customer service, many healthcare enterprises come up woefully short. I’m not saying healthcare quality hasn’t improved. It has on many fronts, for sure. Cancer patients have much better survival rates than they used to, for instance. But too many advances have been made in isolation. If the system is going to work for both provider and customer, improvements in clinical outcomes and overall experience have to be made in unison.
Fortunately, there’s reason for hope. And this is why, as someone who invests in healthcare companies for a living, I’m optimistic.
Federal and state policy changes, the shift of healthcare costs onto consumers, and the high cost of concomitant quality deficits are finally pushing the industry to recognize the value of improved patient experience. A willingness to recognize how social determinants of health are impacting care and cost, and advances in thinking about how to realize personalized health give me hope that a more responsible, empathetic healthcare system is possible.
And spurring all this along is the digital transformation that is finally taking hold. As the healthcare world turns, albeit slowly, from one that is provider/payer-centered to one that is more patient-centered, the impact of changing business models and new capabilities brings opportunity and the tools to create an improved patient experience.
For instance, new medications and high-quality health systems are key to successful patient outcome, but they can be even more effective when accompanied by home-based digital technology that advances the patient’s perspective. Companies like Omada Health, HealthLoop and Teladoc are making this possible. Especially when they are sick, people want convenience, comfort, knowledge and a fair price. Companies and products are emerging that makes these ideals a step closer to reality.
Money and whose wallet it comes from is, not surprisingly, one of the biggest factors driving the demand for an improved provider-patient experience. Today nearly 40 percent of Americans have high-deductible insurance plans and are responsible for footing much or all of the bill themselves. These consumers are becoming much more aware of what healthcare services cost and are demanding comparative shopping experiences similar to what they get at Amazon (hmmm, didn’t I hear that Amazon is also thinking about this?). Companies like Gravie can help employers and insurers make sense of the insurance purchasing process while companies like Amino are making prices more transparent and predictable. This is important because patients who believe their medical charges are fair are five times more likely to recommend their hospital to others, and hospitals with higher patient-satisfaction scores result in better margins for the hospital too. Treat a patient well and it pays off for all involved.
Additionally, digital technology is contributing, at least in part, to a democratization of medicine, similar to what has occurred in other industries. One example: genetic testing is becoming part of routine care for cancer patients and is no longer limited to use in highly specialized situations or by those on a quest for ancestral knowledge. This would have been unthinkable a few years ago when test results provided volumes of information but only a fraction of that data was useful, or when the cost of such testing was much higher than anyone could afford. With the Centers for Medicare & Medicaid Services’ (CMS) recently announced coverage of tumor sequencing for advanced cancer patients and Geisinger’s plan to provide free genetic sequencing to all their patients, the demand for these services will rise meteorically. This has the potential to be great news for patients and to drive meaningful precision health initiatives.
But unfortunately, our health system isn’t really ready for it, and thus there is a risk that this great advance won’t initially meet consumer expectations. I say this because physicians are often unequipped to integrate genetic information into their practice because most have little training in the field. And there are far too few of the genetic counselors needed to help a large population of patients make sense of this information.
Genome Medical is a company that is leveraging scientific advances with digital technology that has stepped in to address this challenge and translate it into a far better patient experience. The company makes sense of the myriad of genetic tests and labs to generate the actionable information that doctors can reliably use to make better treatment recommendations. Genome Medical also provides mobile telemedicine-based genetic counseling to patients, significantly reducing the long wait times consumers experience for this service due to lack of locally available genetic counselors. The result is better care provided to more people, in more places, in a way that significantly improves both patient and provider experience. When it works, it’s beautiful.
From a business perspective, this is both a great and a difficult time to be an investor in healthcare technology. In 2017, about $9.1 billion poured into new healthcare ventures, more than double what was invested just four years ago. In Q1 2018, more than $6.8 billion poured into healthcare investments, dwarfing every other industry including tech for the first time. There are an awful lot of companies, and it is sometimes very hard to tell the good ones—those that have evidence of value—from the mountain of the rest joining the fray. Companies focused on technology to improve cancer treatments and tools dominate the field. This is fantastic, but has also come at the expense of reduced attention to cardiovascular disease, which is still the number one cause of death in the U.S.
I am gratified to see that many startups are devising new ways to use data in healthcare, including some, like Health Reveal and Pera Health, that are helping physicians and patients anticipate major adverse medical events, like strokes or sepsis, before they happen and then marrying information with services to ensure that each patient gets attended to rapidly and responsively. Others, like Iora, Devoted Health and WiserCare, are helping patients and their families navigate the healthcare system effectively or helping them effectively consider treatment choices and how to best define outcomes for themselves. Yet others, like Evidation and Syapse, are helping ensure that pharmaceutical interventions are more consumer-responsive and personalized.
This shift is gradual. For decades we have seen that when patients are surveyed about their healthcare experiences, factors like staff friendliness and facility conditions, count for far more than whether they went home healthy (we know this because the federal government has been measuring patient satisfaction since 2006.) But for patients with serious conditions and for those who are feeling the financial impact of illness, the cry for improvements on all fronts is getting louder. And that’s a good thing.
If you work for Nordstrom or any other large quality retailer, your job depends on your ability to deliver outstanding customer service and a great product. Amazon certainly gets this, and it’s why so many are closely watching their healthcare activities. Only recently were physicians actively taught to introduce themselves to patients before launching into an examination or engaging with other professionals on the healthcare team. Customer empathy and a product which delivers a satisfactory clinical outcome are the winning healthcare business model of the future. The many traditional consumer retailers who are entering the business in partnership with traditional healthcare companies are helping make that realization more and more clear, and I’m glad to see it.
Customer satisfaction is good for business. In healthcare, the patient is the end customer. But other customers, like the physician and the employer, are also essential parts of the equation. We must keep working to align the incentives in healthcare that force all participants to do better because it is right and because it is also more profitable. We often think of healthcare as a place where we can do well (financially) by doing good (clinically/administratively). It is now time to make the thinking real, and we are finally seeing the tools to do it. It will be essential for the financial incentives to catch up to ensure these advances stick.