Accountable Care is Healthcare’s New OS: Now What?

In my last post, I made the analogy that Accountable Care and value-based payment models are doing what Microsoft did in the 80s, creating a new “OS” that simplifies care delivery, creating a platform on which new solutions can be developed. Tim O’reilly says it best:

“Along came Microsoft with an offer that was difficult to refuse: We’ll manage the drivers; all application developers have to do is write software that uses the Win32 APIs, and all of the complexity will be abstracted away.”

They simplified the architecture from the developer’s standpoint, allowing for more innovation, more of what you can allow the system to do for patients.

question_markIs accountable care and value-based payment driving the system from a complex, largely hierarchical architecture, toward a more open “distributed” health architecture with much of the complexity abstracted away?

A few sources seem to point in that direction:

According to Jim Hansen of Lumeris:

“The journey to value-based care is complex. It requires both business model and care delivery model transformation. It is dependent on changing physician behaviors and workflows and having the right engagement methods, information and tools in place to deliver better care at lower cost. [Electronic medical records] are a part of the solution, but not the solution. To accomplish population health management, providers need a platform that can aggregate both in-network and out-of-network clinical data, as well as cost-of-care data from claim.”

That does sound a lot like an OS, and what Aetna and UnitedHealthcare are admittedly attempting to become, a new health care platform that pulls in information from a widely distributed system of apps. Skeptical? see Carepass, Aetna’s strategic play to become a literal technology platform for health improvement. Why are they heading in this direction? Take a look at my post from early 2012, on Risk-reduction Architectures.

This is not by any easy change for a system, and not what the original U.S. health system, steeped in hierarchy and industrialization, was designed to accomplish. This is disruption. Payers are driving this new system, developing this new architecture of care delivery, likely knowing how critical it is to control the OS in a “new” marketplace. With incentives aligned toward patients, this will work to their benefit more than the previous system.

What does this mean for providers? Can existing providers, the existing hardware, be reused with this new business model that’s driving a new healthcare architecture? How will the new model fit onto the existing one? Similar shifts, and effective methods for delivering on them, have been described by Clayton Christensen, author of The Innovator’s Prescription.

Resources, Processes and Priorities

Christensen offers great perspective and a blueprint for this kind of massive change process in his Resources, Processes and Priorities Framework (HBR). Processes are how resources are arranged, driven by culture to complete the tasks with the priorities that are driven by the business model. When you change the business model, as is happening with accountable care, the priorities shift. When the priorities shift, the processes and the culture have to change, and companies are left to shift existing resources (people, assets and knowledge) into new processes, and often new culture, to deliver on that business model.

Christensen says “when the capabilities have come to reside in its processes and business model and especially when they have become embedded in culture, change can be extraordinarily difficult.”

In other words, when you change the business model, capabilities for one business model can become liabilities for another. It’s daunting, but Christensen offers some great tips on how to succeed with this kind of change in the midst of massive disruption. The HBR Framework article focuses on how to create the right teams to redesign and re-architect, and overviews some common mistakes. Re-architecting teams to create new capabilities is important, but before that, the first step is to ask a question.

Hat tip to Mark Ott at RoundingWell for picking up on how Christensen’s work fits with the “new OS” analogy.

The Question: What is the Job The Customer Wants Done?

This is the first question to ask in rearchitecting the health care system around value. Peter Drucker has said “The customer rarely buys what the business thinks it sells him.”

Christensen and others have said that finding disruption often comes with asking “What’s the Job to Be Done for the customer?”

The Job of a Milkshake

There’s a famous example where a fast food chain, looking to increase sales on milkshakes, discovered that, surprisingly, most milkshakes were bought in the morning. When they researched further, they found that customers were buying milkshakes as breakfast or as a meal replacement. So while the restaurant thought they were selling milkshakes to go with fries and a burger, customer were buying them for a different job, leading to a very different way to sell them. The point is, the answer to the question may surprise you.

“What is the job to be done for the customer of our health care system?”

Asking this question is a first step toward user- or customer-centric design. So while quality measures are important in accountable care, leading organizations will begin to ask for themselves what job they are doing and for whom.

Abstracting Away Complexity for Value

Once organizations focus on the job to be done for consumers they will likely find that they can abstract much of what they do to a new, virtual environment that’s anytime, anywhere. That’s where health decisions need to be made, and it’s what patients likely want. One recent poll shows that 76% of patients would choose virtual visits over office visits.

Organizations might also find that physicians want to treat (not do administrative work) and patients want decisions and actions, not to come to the hospital or clinic. That comes down to scaling effective decisions over scaling resources and physicians’ time (often by reducing office visits to less than 10 minutes), which will almost certainly lead to lower cost and better experiences.

Each patient and each diagnosis will have a slightly different answer to the job to be done, but asking that question is a great place to start and has been suggested as a new way to segment the market in health care.

Premera’s Neil Sofan said at Healthcare Unbound Conference two weeks ago that “Patients don’t care about health, they care about their lives.” Health care is a vehicle to the rest of their lives, so focus on where they want to go. Asking what job they want done is another way of asking what the patient goals are.

This kind of work will be imperative in understanding how to help patients make effective decisions. After all, most of the decisions we make that will keep us away from the health system (thankfully) are decisions we make every day, moving through our lives.

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Leonard is Principal and Co-Founder at VivaPhi, an agency that solves multi-disciplinary business problems involving data science, software, biomedical science, behavioral science, health care, product design, community development, marketing, consumer engagement and organizational design. He has been quoted in Forbes and other top-tier publications for thought leadership on patient and consumer engagement. In addition to his role at VivaPhi, he is Chair of the Marketing and Communications Group for the Collaborative Health Consortium. Prior to VivaPhi he held the position of Vice President of Operations at Capitis Healthcare International as well as executive positions with several startups. He started his career as a software requirements analyst on Qwest Communication’s highest priority IT project while earning a triad of advanced degrees from the University of Colorado. These included an MBA, a Master’s of Science in Information Systems and a Master’s in Biomedical Sciences (Thesis on System Dynamics in Parkinson’s Disease). Leonard earned a Bachelor’s in Zoology from Miami University in Oxford, Ohio. He’s interested in how systems evolve, and how to help them evolve, in a variety of unique contexts. Connect with Leonard: @leonardkish, LinkedIn and Google+