To fix healthcare, remember the 80/20 rule
Spend enough time in the business world and you're bound to come across the 80/20 rule, which states that 80 percent of an effect comes from 20 percent of a cause. A small group of customers represents the bulk of a company's sales, for example, or a small number of features requires the most time and effort in a development project.
The maxim holds true for healthcare, as well. Generally speaking, 20 percent of the patient population--those with multiple comorbidities or rare and/or complex conditions--uses 80 percent of the nation's healthcare resources.
The industry readily understands this. Unfortunately, much healthcare innovation focuses on the opposite end of the spectrum: The 80 percent of the population that only consumes 20 percent of healthcare resources. Even developing health and welness apps for the majority tends to fail; Payers struggle to develop mobile apps with any lasting impact.
On Twitter last week, I jokingly suggested a drinking game at HIMSS15: Take a sip every time you hear the term "Uber for healthcare." (I did not specify the type of drink. This is a family-friendly publication.)
I said this not to mock Uber or belittle the efforts of anyone trying to bring innovation to an industry that desperately needs it but, rather, to point to the copycat nature of innovation. (To be fair, the same can be said of "Uber for X," wherein "X" represents any industry that exists anywhere.)
However, two statements from last week's World Health Care Congress--both referencing the 80/20 rule--suggest that payers understand the growing need for more meaningful innovation.
- During a panel discussion about how payers can improve customer engagement, Pranav Mehta, Harvard Pilgrim Health Care's senior vice president of product development and business planning, said today's insurers must balance the desires of the 80 percent--who want features such as wellness incentives, mobile apps and Yelp-like physician ratings--and the needs of the 20 percent.
- Amid a discussion of accountable care organization (ACO) implementation, Chet Burrell, president and CEO of CareFirst BlueCross BlueShield, noted that those 20 percent typically don't shop for healthcare services. They're too sick to do that.
"Uber for healthcare" isn't solely reserved for the 80 percent: Brett Edelson of UnitedHealth said he sees the service (or something like it) as one way to reduce appointment no-shows. That could mean the difference between outpatient and inpatient care, which is more expensive and less convenient for all parties.
That kind of innovation will transform healthcare. Millennials will drive future healthcare trends, but they don't need another mobile app to offer them a badge for eating kale, running a 5K or drinking a lactose-free protein shake. (Before you write an angry comment, I eat kale, run 5Ks and drink lactose-free protein shakes, though some days I'm millennial and other days I'm generation X, especially when it comes to music.)
Too often, we equate innovation with technology. Yes, it's 2015, so technology obviously plays a key role. I for one haven't spoken to a bank teller or travel agent in months. But, to borrow a phrase, innovation for the most part means little more than teaching an old dog new tricks.
Take the work that Blue Cross and Blue Shield of Louisiana is doing to help doctors care for chronically ill patients. Yes, sharing claims data to develop best practices for managing conditions such as diabetes, kidney disease, high blood pressure takes tech. So does communicating with patients about taking medications or coming to appointments (whether they ride with Uber or not). However, it also takes a willingness to approach healthcare in a manner different than what one has done for decades.
Whenever I talk to anyone in a position to make even a modest difference in healthcare, I implore them to stop trying to solve my problems and start addressing my parent's problems. Those of us in the 80 percent want better healthcare, but the 20 percent need better healthcare. - Brian (@Brian_Eastwood and @HealthPayer)
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