Wise Thoughts March 2024

The human brain is one of the most incredible resources in the universe. The brain holds about 86 billion neurons, or 1 quadrillion connections, which transmit signals at 268 mph. The brain is the source of all human art, music, creativity, and science. Through our brain we experience the idea of a self, our emotions, and the ability to ponder our own existence. Our brain cleans itself out, adapts to changes, and reorganizes itself throughout our lifetime.  

And yet part of what makes the brain so awesome also limits us as leaders. Because there is so much information for the brain to draw in, it has evolved to take some shortcuts. The brain processes new data by connecting it with experiences. This mechanism enabled the brain to evolve when the daily factors of life were relatively stable for long periods of time. However, these adaptions also naturally lead us to expect the future to look like the past.  

This phenomenon is known as normalcy bias. We encounter normalcy bias when our brain’s natural processing tilts us to expect what is familiar. As society evolves more and more quickly, normalcy bias leads us to underestimate the impact of foreseeable change, especially if the future diverges radically from our historical experiences.  

The healthcare industry is awash in normalcy bias on many fronts. We have become so accustomed to relative stability that we find it difficult to imagine the level of disruption likely coming our way. The intersection of new tech, consolidation, healthcare aims from other sectors, and uncertain changes in the social, political, and environmental realms all are driving change in parallel.  

If left unchecked, our normalcy bias leads us to be under-prepared to respond to change. It's not just about denying the possible changes; it's about the difficulty in even imagining that significant changes could occur. 

Climate Risk: A Case in Point 

When we talk about climate change, many people imagine a dramatic future that our children or perhaps grandchildren will inherit. Normalcy bias can interfere with us seeing what is happening in the here and now. Over the past decade, ninety percent of counties in the U.S. have experienced a climate disaster, leading to more than $740B in damages. The frequency and severity of these climate events have been accelerating. The number of billion-dollar climate events has increased steadily each decade between the 1980s and 2010s, and the 2020s are already on pace for a greater rate.   

In healthcare, we are very good at estimating health risk, but few healthcare organizations are extending this risk management to the topic of climate risk. Most healthcare organizations see climate change as a distant threat, rather than a risk that has been emerging around us for some time. The increasing frequency and intensity of natural disasters from hurricanes to wildfires and from extreme cold to extreme heat, underscore the pressing need to transition from a reactive disaster recovery model to a proactive risk management and mitigation model. 

A proactive approach can, not only, lessen human suffering but also is likely to reduce costs hitting the health system during climate events. With a proactive plan, we can identify individuals who may have limited mobility and ensure that they have a supported path to safety. We can identify residences that may need air conditioning during heightened periods of heat and drought. Before crises we can create safe community gathering spaces that are well staffed and supplied with food, water, and medications. These are small examples of climate risk plan elements that builds community-level resiliency.  

Organizational Resiliency
These areas of intervention also offer community-based and regional health plans and providers an opportunity to lead. Many organizations that we work with still consider climate risk to be too far out to become a priority in three- to five-year strategic planning. Yet the reality is that most of them will be addressing some form of major weather event during this time period. When crisis hits, those who are have already been working with community-based resources to reach people, provide comfort, and address needs are better positioned to reduce health risk. In the area of climate risk, there is a benign intersection between the opportunity to do good, to reduce system-level costs, and to drive organizational stability.  
In this sense, the ability to overcome normalcy bias becomes a long-term strategic advantage. At Spring Street Exchange, we use data and scenario planning to continually stretch our own minds around what is coming around the corner. Our work to confront and sidestep our natural biases helps boards and leadership teams become better prepared and take strategic leadership in moments of change and uncertainty.  

Climate risk is just one example of the many forces demanding our attention. With a structured approach to future agility, we can continue to work our near-term strategic plan while also taking into account planning for broader changes on the horizon.  

Join us in a half-day workshop! Reframe the concept of climate change with your healthcare team. Gain practical climate risk strategy recommendations for your 2024+ plans. For more information, contact Janice Sparks, PhD, at janice@springstreet.exchange.  

Wise Thoughts January 2024

We’ve been crying wolf about change in healthcare for a long time now, and the dramatic changes have still not quite arrived. When I started Spring Street Exchange in 2016, I used to give a presentation on innovation in healthcare that included an image I used in 2006 to talk about this very topic. During a period that included the signing of the Affordable Care Act (ACA),  the mass adoption of smartphones and the mobile internet, the explosion of social media, the ubiquity of e-commerce, the emergence of the sharing economy with Uber, Lyft, AirBnB and more, there was shockingly little change in the health sector.  

Evolution in healthcare has sped up in the past several years, boosted by the pandemic, increasing competition, and healthcare penetration by non-traditional competitors. Nevertheless, the general rules of the road have remained relatively steady -- so far. We still (mostly) have payers and providers in their own swim lanes, with coverage organized by lines of business corresponding to who pays - government, employers, and individuals. It’s all so entrenched that it’s hard to imagine something else.  

And yet we must.  

We have become so accustomed to the siloed sector of healthcare being impenetrable that it can be tempting to continue categorizing innovation and change within existing swim lanes. But this isn’t how transformation works. Kodak didn’t miss the boat just because it underestimated the transition to digital cameras. People found digital to be a more convenient way to store and share images as well. And this latter purpose became so foundational that it changed the nature of the device used to take pictures. It turns out that we often found greater meaning in the ability to instantly share a visual memory with others, and now, only 7.5% of photos are taken with cameras.  

The experience, outcomes, and economics in healthcare demand something more transformational than doing a better job at yesterday’s healthcare. The changing ‘rules of the road’ will include new definitions of who is a provider, what is considered healthcare, how it is paid for, who manages the data, and more. While we may not know specifically how these trends will play out by region and market, we do know the long intransigent industry is in motion. Nothing in human history has ever been protected completely from change, and while healthcare has benefitted from regional and regulatory protection, there is no reason to believe that healthcare has some magical shield that can keep the new potential of AI and emerging business models at bay.  

Despite the amazing feats of our current system, by heroic providers and administrators trying to make it right, we still are failing consumers, who face:  

People will be seeking health support that is integrated in their lives, easy to access, and available on a moment’s notice. They will seek custom and nuanced advice that is caring, convenient, and culturally relevant. While these goals have been difficult for the current system to meet, new tech and escalating focus from companies in virtually every sector of the economy are already working to deliver on these aspirations. We can begin to see tech not as a means of depersonalization, as it has historically been, but rather a means to deliver care that is more compassionate and more personal. New capabilities will redefine the core functions of providers and health plans. That wolf crying change in healthcare is now howling for a reason. 

At Spring Street Exchange, we deeply believe that we don’t need to be able to predict the future in order to plan for it. And we also know that values-driven change needs value-driven leaders at the helm. Many of you are having discussions on these emerging trends with your boards, peers, employees, partners, and consumers. I’m always up for swapping stories and we can also share our approach for developing organizational muscle memory around change all while keeping today’s lights on.  

We’re in this together.  
Peace,  
NW