By Brian B. Sanderson
While the Covid-19 pandemic has affected every type of organization, the health care sector sustained the most immediate and direct impact. Health care was ground zero for the pandemic. Many health systems provided care for those infected while simultaneously struggling to survive the same disruptive forces that were affecting all businesses.
Today, many health care organizations are at a crossroads as they work to regain financial stability, adapt to telemedicine and other new medical care delivery models and restructure their business and operating processes to reflect the new, post-coronavirus realities. To meet these challenges, health system executives and boards of directors will likely encounter four areas of concern will demand much of their attention:
- Innovation to advance the way clinical care is delivered.
- Automation to help manage costs and improve efficiency.
- Collaboration to share what works with other health systems.
- Integration to achieve synergies with other providers and third parties.
One consequence from 2020 at many health care organizations has been an acceleration of the shift from an improvement mindset to an innovation mindset. Today, the subject of innovation dominates many health system board and executive discussions, often focusing on one or more of these general categories:
- Using innovation to spark and accelerate operating model reform.
- Adding organizational structure to innovation by creating teams or departments whose primary focus is accelerating change.
- Accessing innovation in the open market, both from startup companies that have the flexibility to innovate freely and from health system venture capital efforts.
Most organizations do not lack innovative ideas, but they do lack the structure to transform those ideas into reality. To overcome this shortcoming, many health systems have found it advantageous to implement an institutional, executive-supported innovation track that provides more support for experimentation and fresh approaches and encourages early adopters to actively embrace new ideas.
At a recent consortium sponsored by Crowe, leaders from eight prominent health systems gathered to identify practical, realistic applications of automation within their operations. Through group discussions with various vendors, the participants shaped a shared vision of where automation is headed.
One of the most striking takeaways was the realization that most health care system employees will eventually have a digital assistant — a set of automated applications that an employee triggers to perform job functions. The participants also predicted a greater emphasis on complex logic sequences rather than true data science as organizations work toward more immediate gains in efficiency within the next three years. Participants assert that for automation to become more practical quickly, the effort needs to be driven by practitioners: functional managers finding operational opportunities rather than technology specialists.
Purposeful collaboration can improve health care on many levels, including gains in efficiency and improvements in operations. Today, health care entities engage in three basic types of collaboration:
- Health system professionals gather in conferences and other settings to share perspectives and experiences.
- Building and designing. Professionals gather with the specific purpose of collectively developing solutions to common challenges. This type of collaboration can be particularly stimulating.
- Sharing operations. Separate health systems form a shared operating entity to execute common administrative tasks. This process currently is done through centralization and outsourced vendors, but the future could see separate organizations fully sharing finance, revenue cycle, and supply chain functions.
Health system integration via merger and acquisition likely will increase in the near term, driven by traditional factors such as balance sheet performance and access to capital. Ideally, such activities also could result in some operational synergies, although these often are not the primary motivator.
On the other hand, synergy is the dominant driver behind platform integration. In this second type of integration, health systems join together to access third-party platforms such as telemedicine, data management, private provider networks or commercial insurance.
Functional integration is a third type of integration that takes synergy further by restructuring separate health systems into a single operating entity. Such integration is often led by entrepreneurial health systems or private investment entities.
Improving the patient experience
As health system boards and executives address these four areas of concern, their initial focus likely will center on immediate opportunities to update operations for the post-pandemic environment. Ultimately, however, their long-term success will be determined by how well they can apply these operational and technological improvements in the pursuit of their overarching objectives: to better serve their patients and communities and improve the overall patient experience.
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