A week has passed since the 2012 Connected Health Symposium, a prominent event that brings together a passionate crowd of people working at the intersection of healthcare and technology. What I loved about this event is that it mirrored the ever-evolving healthcare ecosystem by bringing together an impressively diverse mix of stakeholders to discuss how to improve care. Providers. Payers. Pharma. Employers. Non-profits. Financiers. Technologists. Entrepreneurs. Incubators. Activists. Academics. Patients. They were all represented.
Cognitive Dissonance: From ACOs to Avatars
The first session I attended was a discussion on ACOs by Elliot Fisher, MD MPH of Dartmouth. During his talk, he eloquently made a case for connected health, discussing how there has been a flawed perception that health is produced during face-to-face visits. Yet the fee-for-service system that has grown up around this has led to high variability, poor coordination, overuse, and cost. Enter ACOs. But immediately after this discussion, I moved to a session highlighting a diverse array of innovators in the digital health arena. This included avatars for gamifying health. And speech behavior analysis on mobile phones. And sensors and apps to tackle asthma.
In the wake of a policy discussion on ACOs, it’s hard not to feel some cognitive dissonance when you start talking avatars, apps and sensors. How do these ‘micro-level’ solutions fit together with the macro-level problems in our healthcare system? I was struck by the potential amongst the innovators at this event, but also by the challenges that they face – how to scale in such a dynamic, uncertain healthcare environment.
Scaling Challenge #1: Finding a monetization foothold
There was a strong theme amongst the conversations I had with innovators… monetization strategy. Many entrepreneurs seem to be on islands right now deciding which direction to swim – toward providers, payers, pharma, employers, or perhaps just directly to patients. It was rare to meet an innovator focused on just one of these markets. Indeed, this is because it is hard to know which customer group will open up to what innovation, whether it will it be adequate, and when such a ‘tipping point’ will happen.
You have to start somewhere, and there were prominent folks from each customer group there to offer insights. Naomi Fried, Chief Innovation Officer at Boston Children’s Hospital, gave her advice:
- Solve a problem that needs solving: Yes, simple. Obvious? Maybe, but isn’t not doing this the main reason so many start-ups fail? Chances are that if you are addressing a problem your target customers have, they will talk to you.
- Find an internal champion: Fried spoke to the importance of relationships. An internal champion can help navigate the large, complex organizations. Helpful for providers – but also payers, pharma, and large employers.
- Prove your value: Ultimately, this means collecting data, likely through clinical pilots. Another case for an internal champion. They can help you get these pilots off the ground.
Fried gave this advice in the context of working with providers, but it really applies regardless of which audience innovators target.
Scaling Challenge #2: Dealing with the Details
One of the most successfully scaled programs in the field of connected health can be found within the US Department of Veteran Affairs. They now reach over 460K veterans with telehealth services, and are forecast to reach over 800K in a few years. Adam Darkins, Chief Consultant for Telehealth Services at the VA, spoke to what enabled this success:
- Strong processes: Eventually you have to replace relationships with processes, because relationships aren’t scalable.
- Excellent user experience: Make sure things are well worked-through before you try to scale. He referenced the infamous Steve Jobs example. His point – truly ‘serve’ your customers by understanding and mastering your user’s experience.
- Passionate people: While the processes must be there, people must be passionate about creating and spreading them. You must instill passion to enable this.
Scaling Challenge #3: The System-Level Swing Factor
During his talk, Elliot Fisher made the poignant remark that if there is no tension within a system, there is no catalyst for change. Healthcare certainly is riddled with tension.
How long will providers be able to make good money in the traditional fee-for-service model? When will ACOs become commonplace? Will they? How long will it be before consumers reach a tipping point and are actually in a driver’s seat when it comes to healthcare decisions? When premiums rise even more? How much? If they do, will there be enough cost transparency to enable rational decision-making?
So what can entrepreneurs do in the face of such uncertainty? For a start, heed Fried’s advice and focus on solving a significant problem. Then prove that you have solved it. Establish this foothold, seek scale, but do stay nimble.
And finally, build and maintain diverse connections that you can tap into during changing times. Luckily – as witnessed at the symposium – there is a mass of passionate people eager to help digital health entrepreneurs. From incubators like Rock Health, Blueprint Health, and HealthBox, to an array of foundations, service providers and financiers… and of course those at the Center for Connected Health that pulled this amazing event together. Thank you!