Healthcare reform – what a hot potato! Most everyone agreeing the system is flawed but getting to the essence of where the problems lie and equally import how to “fix” the issues is a challenge which is difficult to fully grasp.
One theory of reform comes in the Innovator’s Prescription – A Disruptive Solution for Health Care by Clayton Christensen et al. The book centers on “Disruptive Innovation Theory”, which according to the author is “the process by which complicated, expensive products and services are transformed into simple, affordable ones.” Cited are illustrations this theory, as a vehicle of reform ranging from Ford with the Model T, Target, Google and Second Life among a great many other examples.
As with previous business books, I find the concepts intriguing but have to remain a bit skeptically in believing that the golden ring is immediately within our rasps (even the author acknowledges this point). That said this book is very provocative in its critical evaluation of healthcare. At the same time, it is powerful in stimulating ideas and thoughts as to the future of healthcare through innovations (technology).
My intention is to present the key concepts through a series of blog (and as I work through the book), with this being the first in a series to follow.
So what is at issue here? – Background
The author’s intent is show how healthcare can become affordable. A message that comes out immediately is that healthcare is stuck in business models that are no longer effective and “screams” for reform.
Briefly disruptive innovation involves:
1. “Technological enablers” – changes in systems and tools that make them simple and easy to use
2. “Business model innovation” – determine and developing the model that is most effective/efficient in delivering service or products to the customer
3. “Value network” - interactive/dynamic “infrastructure” for connecting all the components of the systems
Each of the components is dependent and interrelated but with that said, central to the process is determining the appropriate business model needed to support the particular service or product to be delivered.
The business models are outlined as:
1. “Source-Shop Business” – fee for service “institution structured to diagnose and recommend solutions to unstructured problems.”
2. “Value-Added Process (VAP) Business” – business model which converts resources to “output” with higher value. Payment is for product or service delivered.
3. “Facilitated Network Business” - operating systems that allow customers to exchange product or service. This model is membership based
From the outset there exist a bias and distain for the Source-Shop Business model. Concerns expressed with this model are what the author labels as “intuitive medicine”, isolated care and the difficulties in providing an efficient system due to lack of rules, standards and/or protocols. This is seen as core issue in medicine today – being locked in a model that no longer serves the needs of the profession and in particular the patient.
How will we move away from “intuitive medicine?” Will it be Clinical Decision Support Systems? How will Electronic Health Records play a role in bringing general practitioners and specialist together? Are there other factors that will lead to disruptive innovations? Answers to these questions have relevance to all aspects of delivery of medical care.
Stay tone
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