Wise Thoughts April 2024

The US healthcare system has been plagued by complexity and inadequate technology for decades, creating an infrastructure that has been all too often inefficiently bandaged together as it works to address urgent demands and layers of regulation. For many, offering coverage and caring for patients within this infrastructure can feel like being charged with trying to fix a plane while it’s in air, full of passengers, and slowly leaking fuel. The limitations cause friction and frustration for people in all roles – clinical, operational, administrative, technical -- leading to an overwhelmed workforce and environment that can be tilted toward crisis.

In this context, many healthcare leaders have the instinct that they do not currently have time, resources, or capacity to tackle innovation or plan for the many changes emerging in the healthcare system and the world around them. For some, the goal is to master the fundamentals of healthcare administration as a foundational step before they can move forward to tackle new capabilities. These executives espousing caution are often the best kind of leaders on some dimensions – they are those who are protective of their teams, committed to listening, and working hard to solve current problems before inviting in new ones. Because the healthcare industry has been relatively stable over the past several decades it is familiar to imagine having a few years to stabilize before needing to embrace change.

And yet, here’s the challenge. At the dawn of the AI age, new capabilities are coming on deck faster than ever before, all at a time when big retail, big tech, and others are gaining traction after years of experimentation in healthcare. For-profit national carriers and other mega players in the healthcare ecosystem have been investing in AI and advanced analytics to increase efficiency and embrace new capabilities. Those organizations waiting to get their ‘ducks in a row’ before exploring innovation will continually be ‘catching up’ to industry standards. With new tech on deck, this ‘catching up’ could lead to getting better and better at yesterday’s healthcare.

The tools available to address all aspects of care and delivery becoming available to us are evolving so quickly that it is virtually impossible to keep up. In The Coming Wave: Technology, Power, and the Twenty-First Century's Greatest Dilemma, Mustafa Suleyman writes:

“Within the next couple of years, whatever your job, you will be able to consult an on-demand expert, ask it about your latest ad campaign or product design, quiz it on the specifics of a legal dilemma, isolate the most effective elements of a pitch, solve a thorny logistical question, get a second opinion on a diagnosis, keep probing and testing, getting ever more detailed answers grounded in the very cutting edge of knowledge, delivered with exceptional nuance. All of the world’s knowledge, best practices, precedent, and computational power will be available, tailored to you, to your specific needs and circumstances, instantaneously and effortlessly. It is a leap in cognitive potential at least as great as the introduction of the internet.” 

These capabilities will be infiltrating every aspect of our lives – and they will not stop at the doorstep of healthcare. In fact, the health industry is a direct target for growth identified by those outside of the industry. Big tech, big retail, and the national for profits are not slowing their pace so that regional and nonprofit organizations have a chance to catch up. Rather, they would try to use this delay as a chance to advance their business goals, and in so doing, changing the script.  

The historically siloed healthcare industry is facing blurring boundaries and greater connectedness with other sectors of the economy. Organizations focusing on getting better and better at how healthcare has always been, may find themselves to be masters in a few years of services that are soon to be abandoned.  

According to our survey of 47 healthcare executives from regional, nonprofit, and community-based healthcare organizations, 90% reported that growth was either critical or very important to their long-term plans. Most were looking at geographic or service line expansion, but about a third were beginning to explore revenue areas outside of their core business. This is an indication that local healthcare organizations are beginning to think more broadly about their business models and how they fit into the future healthcare landscape. 

Such innovation provides an alternative approach to revenue that can reinforce the current business while also bringing in higher margins, new partners, and fresh approaches to fulfilling the organization’s mission. Many of the seemingly intractable problems that have plagued the healthcare industry for decades have been limited by the technical infrastructure. We can embrace new tools to solve these familiar problems, perhaps even offering an opportunity to leap over the historical interventions. It requires an update to our understanding of not just what is possible now, but also what will be possible in the coming years.   

A simple intervention establishing a discipline with future visioning can shift this dynamic. Committing to a half day visioning session each quarter could keep an executive leadership team looking up and out even as they approach the day-to-day challenges before them. This type of engagement can take place ‘before ducks are in a row’, and without disrupting current organizational structure. There will always be a need to remain focused on the near-term needs even while beginning to look forward. That said, taking time to collectively step back will help leaders to think-future as they approach problems coming their way and is likely to shift the direction of the ship over time.  

We also advocate for the development of a discipline around managing innovation. Without a specified process it can be too easy for the pressing needs of the now to eat into planning for the future. This involves a process to collectively monitor the environment, evaluate opportunities according to agreed upon criteria, identify problems internally to solve in fresh ways, and develop organizational muscle memory around innovative thinking.  

Many organizations may choose to develop this on their own. For those seeking an innovation process for a lower total cost and with national-level insight and resources, we offer this service in an outsourced manner. Our solution is tightly coordinated with your own teams internally, ensuring engagement with leadership across disciplines and roles, but with minimum disruption day to day.   

Some of you know that I am deeply worried about the future of community-based healthcare. As pundits offer predictions on the impact of accelerating consolidation, many are foreseeing a healthcare industry characterized by oligopoly among a few for profit entities. Those who are close to the day to day benefits that local organizations offer to their communities recognize the dramatic loss such an oligopolistic system would mean for our country, especially with impacts to the historically medically underserved.  

The good news is that this is not the only scenario possible. Local payers and providers are more creative and nimble, with deeper connections in the community. They often have more engaged employees who are inspired by the mission. Engaging leaders and employees in exploring the landscape of the future can provide some level of assurance to those who are concerned about the changes around them. It can also spark energy and greater purpose to be working toward a rich future vision.  

Let’s us not let ‘busy’ keep us from doing something great. Let us not wait until these ducks are in a row before embracing this moment. 

All my best,
Nancy W.

Spring Street Exchange offers a structured innovation with national-level insight and resources; we can administer this for lower cost than an organization developing it internally. Connect with us for more information. connect@springstreet.exchange

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:  

• High Cost Exposure: People avoid care due to costs and are stressed about their ability to pay for care, even when they have coverage 

• High Difficulty Rate: Those with coverage report problems using it, and more than half of those with problems are unable to resolve them.  

• Inconsistent Quality: In relation to comparable countries, we have the highest maternal mortality rate, the highest hospital admissions rate, the lowest life expectancy, and the highest premature death rate.  

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