Top Six Healthcare Executive Challenges in 2019

The pace of change in healthcare is not slowing down; in fact, it is accelerating. Healthcare organizations that are most successful in 2019 will know what challenges and changes are coming down the pipeline, and they will prepare accordingly.

To help ensure you don’t get left behind, we’ve assembled the top six challenges the industry will face in 2019.

1. Shifting the focus from payment reform to delivery reform. For the past few years, C-suite leaders at healthcare organizations have been focused on navigating healthcare payment reform—attempting to preserve, improve, and maintain revenue. Amidst those efforts, delivery reform has sometimes taken a back seat.

That will need to change in 2019. Organizations that are the most successful will focus more on patient care than revenue, and they will see improved outcomes and reduced costs as a result.

Many organizations are already exploring delivery reform with initiatives that focus on:

  • Remote health monitoring and telemedicine;
  • Population health management;
  • Patient engagement;
  • Social determinants of health; and
  • Primary care.

In 2019, however, they will need to bring all of these initiatives together to implement sustainable improvements in how healthcare is delivered.

An added bonus? Organizations that accomplish this will see enhanced revenue streams as value-based reimbursement accelerates.

2. Wrestling with the evolving healthcare consumer. Healthcare consumers are demanding more convenient and more affordable care options. They expect the same level of customer service they receive from other retailers—from cost-estimation tools and online appointment booking to personalized interactions and fast and easy communication options such as text messaging and live chats.

Organizations that don’t deliver on these expectations will have a difficult time retaining patients and attracting new ones.

That’s not the only consumer-related challenge healthcare organizations will face. In 2019, millennials (between the ages of 23 and 38), will make up nearly a quarter of the U.S. population.

This generation doesn’t value physician-patient relationships as highly as previous generations. In fact, nearly half of them  do not have a personal relationship with their physician, according to a 2015 report by Salesforce.

Finding ways to maintain or increase the level of humanity and interaction with millennials will be a key challenge in 2019. Patient navigator solutions and other engagement tools will be critical to an organization’s success.

3. Clinician shortages. Physician and nurse shortages will continue to intensify in 2019, creating significant operational and financial challenges for healthcare organizations.

The most recent numbers from the Association of American Medical Colleges predict a shortage of up to 120,000 physicians by 2030. On the nursing side, the Bureau of Labor Statistics projects a need for 649,100 replacement nurses by 2024.

The implications of the shortages, combined with the fact that healthcare organizations face a number of new challenges in the coming years, are many. Fewer clinicians can lead to burnout, medical errors, poorer quality, and lower patient satisfaction.

Healthcare organizations that thrive amidst the shortages will find new ways to scale and leverage technology to streamline work flows and improve efficiencies.

4. Living with EHR choices. Despite the hype and hopes surrounding EHRs, many organizations have found that they are failing to deliver on their expectations.

recent Sage Growth Partners survey found that 64 percent of healthcare executives say EHRs have failed to deliver better population health management tools, and a large majority of providers are seeking third-party solutions outside their EHR for value-based care.

The survey of 100 executives also found that less than 25% believe their EHRs can deliver on core KLAS criteria for value.

As we recently told Managed Healthcare Executive, that statistic is striking, considering how important value-based care is and will continue to be to the industry.

Despite the dissatisfaction surrounding EHRs, switching EHRs may be a big mistake for healthcare organizations. A recent Black Book survey found 47% of all health systems who replaced their EHRs are in the red over their replacements. A whopping 95% said they regret the decision to change systems.

Hospitals and physician may not be entirely happy with their EHR choices, but the best course may be to stick with their system. Highly successful hospitals and health systems will find ways to optimize workflow and patient care which may involve additional IT investments and best of breed investment approaches, rather than keeping all of the proverbial eggs in the EHR basket.

5. Dealing with nontraditional entrants and disruptors. In 2018, several new entrants entered and/or broadened their reach into healthcare.

Amazon acquired online pharmacy retailer PillPack, and partnered with JPMorgan Chase and Berkshire Hathaway to create a new healthcare partnership for their employees. Early in 2018, Apple announced it was integrating EHRs onto the iPhone and Apple watch, and recently, Google hired Geisinger Health CEO David Feinberg for a newly created role, head of the company’s many healthcare initiatives.

New partnerships have also arisen between traditional healthcare entities that could result in significant healthcare delivery changes. Cigna and Express Scripts received the go-ahead from the DOJ for their merger in September, and CVS and Aetna formally announced the completion of their $70 billion merger November 28.

Read more about the top two ways the CVS-Aetna merger could change healthcare.

All of these new industry disruptors and mergers will impact healthcare organizations, likely creating new competition, disrupting traditional healthcare delivery mechanisms, creating price transparency and pressures, and fostering higher expectations from consumers in 2019. Keeping an eye on these potential disrupters will be important to ensuring sustained success in the long term.

6. Turning innovation into an opportunity. From new diagnostic tests and machines to new devices and drug therapies—the past few years in healthcare have seen exciting and lifesaving developments for many patients. But these new devices and treatment approaches come with a cost.

One of biggest 2018 developments that best exemplifies the challenge between innovation and cost is CAR T-cell therapy. This new cancer treatment is already saving lives, but it racks up to between $373,000 and $475,000 per treatment. When potential side effects and adverse events are accounted for, costs can reach more than $1 million per patient.

Finding the best way to incorporate new treatments like this one, while balancing outcomes, cost, and healthcare consumer demands, will be a top challenge for healthcare organizations in 2019.




Digital Therapeutics: The Future of Health Care Will Be App-Based

Image result for clinical mobile applications

Last month, healthcare startup Omada Health secured a $50 million C round led by major insurer Cigna, which brings the 5-year-old company’s total funding to over $127 million.  That kind of nine-figure investment isn’t unusual for a company with the next blockbuster drug or game changing medical device, but Omada’s core product is a diabetes-preventing mobile app!  Omada is a leader in one of the hottest new sectors of the app economy: Digital Therapeutics.

Digital therapeutics are a new category of apps that help treat diseases by modifying patient behavior and providing remote monitoring to improve long-term health outcomes.  Depending on the disease, they can encourage patients to stick to diet and exercise programs or help them adhere to drug intake regimes.  Wait a minute, doesn’t that sound a lot like wellness apps?  There are already hundreds of apps that help us manage our workouts or meditate more effectively!

The key difference is that digital therapeutics implement treatment programs tailored to specific ailments, especially major chronic diseases like diabetes, heart disease, high blood pressure, and pulmonary diseases like COPD.  Because patient behavior is so crucial in preventing and limiting the severity of these life-threatening illnesses, the early evidence is that these digital health programs, often combined with human coaching/interaction, can make a significant difference in health outcomes.

To provide hard data of their efficacy (and differentiate themselves from wellness apps), newcomers like Omada have taken a page from the pharma industry and have performed clinical trials with major healthcare networks like Humana.  In recently published research, prediabetic patients that participated in a year-long  Omada-based program lost 7.5% of their initial body weight and showed improved glucose control and decreased cholesterol.

These results are one reason why health insurance firms are among the big investors in the leading startups.  Mobile app-based digital treatment programs can be delivered at massive scale and low cost, and by helping to prevent disease progression, can potentially save insurers billions of dollars.  On the other side of the equation, the prospect of health insurance covered recurring subscription revenues has VC’s salivating.   Omada proved early validation of this prospect when last year it got Medicare to agree to reimburse the cost of its digital diabetes prevention program.

Another reason the insurers are excited about the potential of mobile-delivered health programs is data.  Once clinical trials are complete, most pharmaceutical companies don’t track real-world results for their drugs.  With precise regimes and daily monitoring, digital therapeutics can offer mountains of data that can potentially provide doctors unprecedented insights into patient behavior and create feedback/optimization loops for individual patients.   Enabling patients to take greater control over managing their chronic illnesses and preventing disease progression could yield huge cost savings throughout the entire healthcare system.

Some digital therapeutics is meant to entirely replace medication with behavioral-based treatment, such as apps that use visualization exercises to help insomnia sufferers as an alternative to sleeping pills like Ambien.  Others are designed to work in conjunction with medications by helping patients better manage their treatment regimes.  A company that has taken this approach is Propeller Health, which makes a sensor that attaches to inhalers used by people who suffer from chronic asthma and COPD.  The sensor monitors inhaler usage and provides feedback via a mobile app.  Propeller has partnered with GlaxoSmithKline to create a digital therapy platform to guide patients in using its asthma medications.

Another innovative digital drug adherence platform is the one created by startup Proteus Digital Health.  Proteus has built an ingestible radio tag the size of a grain of sand.  It can be put inside a pill and can send data to a wearable patch on the patient’s torso.  For elder patients managing multiple chronic conditions with an array of daily medications, Proteus’ sensors and the app can send alerts to patients as well as family and primary care providers when a key dose has been missed.  Trials have shown that Proteus’ system has shown reductions in blood pressure among patients taking medication for hypertension.

From these examples, it becomes clearer to see how digital health programs, which can be tailored and optimized for individual patients and delivered at scale via mobile, represent a transformational development in healthcare.  As Andreessen Horowitz partner Vijay Pande calls it, digital therapeutics, by enabling the kind of behavioral meditation which is the only effective way of managing chronic illness, represent a true “third phase” of medicine, after small-molecule drugs and protein biologics.  I predict that someday, apps that help people manage illness and prevent long-term disease will no longer have a special name.  They will just be another form of software on our phones.  More than anything else, the rise of digital therapeutics demonstrates once again the power of mobile computing as the most transformational technology platform the world has ever seen.