Have you visited a doctor recently? Your visit may have gone something like this: you fixed an appointment with the doctor on your mobile phone, scheduled the visit in your digital calendar, used Google maps to reach your doctor, and perhaps made a payment for the meds using a mobile wallet. But remember those piles of paper files you filled out when you were at the clinic? Chances are you filled in a paper form with your personal details. Isn’t the old school clipboard with the form quite a contrast to your otherwise taken-for-granted digital life? On the other hand, there are segments of healthcare where we have cutting-edge, ingestible nanotech that interfaces with wearables to send telemetry data to cloud systems. We have Watson using software to predict cancer. And we have digital imaging to accurately detect detached retinas. The list of eye-popping digital innovations in the healthcare segment is staggering. It is a peculiar characteristic of Healthcare today: Some processes across the value chain are highly digital while others remain Neanderthal by comparison.
All this makes healthcare an exciting space at the moment. Clunky tech is being replaced by innovative tools, systems, probes, and devices. Physicians have access to more data than ever before leading to improved diagnosis; they can monitor patients in real time to assess the efficacy of their treatment regimens. And payers have more accurate data to drive down care costs. Digitalization is disrupting traditional business models by blurring the lines between the patients, medical device manufacturers, doctors, care givers, drug manufacturers, and payers. It is redefining value chains.
Notably, the value chain has one common denominator: the patient. And yet, ironically, patients are unable to take control of their healthcare. They are unable to move from disease management to pro-active health management, pre-empting disease, suffering, misery, and expenses. If patients could, they would launch a revolution in Healthcare all on their own!
Fortunately, the industry knows there is value in becoming patient centric through digital interventions. A McKinsey report noted that digital health solutions can unlock $350-400 billion of value by 2018. Further, if incorporated at scale, the report suggested it could generate $600-800 billion of global opportunity. Imagine this: The new revenue source doesn’t need one additional person to fall ill. As some cynics would say, revenues won’t have to depend on the prolonged suffering of others.
The problem with drawing distinct digital lines between patients and health care providers, payers, pharmas, device manufacturers, and regulators goes back to an era ruled by theories emanating from a world dependent on industrialization. Many healthcare organizations continue to live with Michael Porter’s industrial-economics oriented Five Forces. The Five Forces (threats and opportunities) that determine an organization’s profitability have so far been measured along traditional vectors. The Five Forces do not consider how digitization changes the dynamics of the healthcare industry.
Digitization is bringing about dramatic change in the healthcare sector that has traditionally functioned in silos – namely, pharma, provider, payer, and medical devices and equipment manufacturers. Today, digital technologies can become the glue between disparate industry segments, making them work in concert, increasing efficiency, reducing costs, and improving health care.
A way of examining the value chain and injecting it with “steroids” is to look at the points of intersection between users and healthcare systems. These nodes become the target of digital technologies, shifting the focus from rolling out large CRM type systems. These, admittedly, are necessary; but with the amount of attention they draw, they blindside us to more urgent needs.
Here are some interesting examples of nodes where digital is re-engineering the healthcare value chain:
- Pharma: An online data sharing platform, PatientsLikeMe, connects patients to one another so they can share first-hand information, advice, and resources. It helps members monitor their health between doctor or hospital visits, document their symptoms, identify triggers, note how they are responding to new treatments, and track side effects. A traditional value chain approach would be to capture data at care delivery nodes or traditional supply chain end points.
- Provider: With digitally connected and well-informed patients, healthcare providers need to deliver quality and value-added services. This is exemplified by DoctoronTap, which offers telephone and email medical support services – 24 hours a day, seven days a week. This is an Uber like asset-light aggregation model which leverages digital.
- Patient: The healthcare value chain has shifted its focus to the user, testified by the business model of 23andme. Although the company faces several law suits, its concept of direct-to-customer genetic testing is novel and led the company to cross the 1 million user mark.
Perhaps the real problem facing the industry is the different clock speeds at which dominant technologies work: legacy ERP – essentially a system of records – is slow, difficult to change and replace; the new technology on top of legacy investments – or systems of engagement as they are coming to be called – are moving much faster. A clean, seamless marriage of the two is necessary – one that will orchestrate business rules, processes, and policies with experience and engagement to deliver an organization of the future.
Next time you visit your doctor, it may be possible to simply provide a bio-metric impression that pulls out your digital records and auto fills the mandatory forms, which in turn connects you seamlessly to a number of relevant digital services from payers, providers, pro-active healthcare management systems, and support communities – effectively putting you in better control of your health.
