2022 and 2023 have been tumultuous years for healthcare in the U.S. – the after-effects of the coronavirus-pandemic have reverberated far longer and wider than anyone could have anticipated. From Supply Chain, to Revenue Cycle, to Workforce, shortages and shortcomings have both reigned supreme.
In healthcare technology, from the IT departments to the vendor landscape, we have also strayed far from our foundations, for good reason. When the pandemic hit, we needed to be scrappy, nimble, and innovative. Our regard for standards, policies, and in many cases, price tags, was set aside as we mobilized to keep our doors open, our front-line staff protected, and our communities alive during a global pandemic. You have an app that can help me effectively distribute vaccines? Let’s do it. It requires some rather intrusive and awkward integration with the Electronic Health Record (EHR) system? No problem, just make it work. We need to extend our networks to the tents in our parking lots? Buy whatever equipment is available, even if it doesn’t align well with our network architecture, we’ll make it work. We need to communicate better with a hybrid workforce, but have not yet rolled out all the features of our existing productivity tools? Buy another app that can do it for us as a one-off right now. We need to get Telehealth services up and running but our existing system(s) workflows won’t work during a pandemic state of operations? Buy a second/third product that does telehealth outside of our established systems. And so on.
While the imminent threat might have eased off since then, our ways of working and our approaches have not returned to pre-pandemic norms. In fact, I would argue that those norms have been shattered and will likely never return, much like the 100% in-office/onsite IT workforce. This has caused some heartburn across the healthcare industry. One need only look at the headlines from the past two years to see that foundational functions of our very organizations are now at risk; Human Resources (workforce shortages, retention, labor communication), Finances (collections, bad debt, case mix index), Operations (supply chain, gig-workers, quality). This does not paint a pretty picture, however, it might just be the prime opportunity for us to change as an industry; we might finally be at the precipice of an evolutionary leap for healthcare at large, as I wrote in my previous Forbes article entitled Is Healthcare At The End of Its Middle Age?.
And what does this mean for Healthcare Technology? I believe that we will finally begin to strengthen our foundations. We will gather the various pieces of our technology landscape that have become disparate, distributed, overlapped, and we will make them cohesive and streamlined. This will include a renewed focus on optimizing the EHR, yes, but also the entire systems/service catalogue, networking architecture(s), cybersecurity programs, and partners’ inventory. Table-stake technologies and sub-functions, like Telehealth and Patient Engagement, will also see streamlining with a focus on where our Gen-Z and Millennial populations’ expectations are headed.
Why do I believe this? Because technology has come a long way since 2020, as have the offerings out in the market, especially in the realm of Artificial Intelligence (AI). Generative AI, more specifically, has permeated our society and industry in a way that few previous innovations have managed to do. But to fully take advantage of this in favor of that elusive digital transformation we all seek, we will need to have our foundational tech landscape in order.
Another reason why there will likely be a focus on foundations is because the maturity of our organizations has increased, along with the tech-literacy of our c-suites. And finally, because we can no longer afford not to.
I do not believe I’m alone in this;
- Daniel Barchi (CIO at CommonSpirit Health), in an interview with Becker’s Healthcare from November stated: “It’s important to recognize that more technology is not better. We’re not looking for more technology at every turn; what we’re trying to see is what are the best tools we can provide our caregivers so that they’re able to best serve the needs of our patients. That might mean better data, it might be better integration of the tools that we have. It might be simplifying the tools we have, better optimizing them for what we need.”
- Dr. Sachin Jain (CEO at SCAN Group), in his Forbes article from May entitled Coming To Terms With The Healthcare Industry’s Inauthenticity Epidemic talked about how “We have normalized inauthenticity. it’s healthcare’s grand hustle” specifying reasons such as “Pilots that fail to scale and disappear into oblivion. Persistent window-dressing of broken care process. Single-market results that are scaled to represent company-wide performance that aren’t close to being replicable. Regression to the mean being sold as evidence of impact.”
- BJ Moore (CIO at Providence), in his interview on WSJ from October said: “It’s like Maslow’s hierarchy of needs—the most basic needs have to be met before achieving higher-level needs. In this case, without a strong foundation, an organization probably cannot breed technological progress and innovation.”
The trends out in the startup and venture capital world also illustrated a slow-down in 2023, when compared to the past three years; the first half of the year showed some of the lowest funding since 2019-2020. In addition to many well-publicized startups, such as Pear Therapeutics and Babylon Health, either closing their doors or selling off their assets.
Again, I personally believe this lack of interest (compared to 2020-2021) by health systems to spend time and money on digital health shiny objects is due to the extreme financial strain they have experienced in 2023, coupled with the provider organizations’ “basic needs” in IT not being met, as BJ puts it.
All is not doom-and-gloom, however, as we look ahead. The healthcare industry, especially provider organizations, has done some introspection and made honest attempts to get back to basics in a multitude of ways. Operating margins at health systems across the country have begun to stabilize (Kaufman Hall) and turn around in 2023. Much of this was driven by organizations shedding wish-lists and minimizing expenses, while doubling-down on their core strengths and focusing on optimizing their must-do/cannot-fail processes across their backbone functions like Finance, HR, and IT.
We also began to see a new form of competitive landscape emerge in 2023 with several new players entering the provider space, whether through mergers and acquisitions or through the formation of completely new organizations in partnership with VC or commercial firms. This should, again, serve as a catalyst for the existing health systems to focus on strengthening their cores in the year ahead.
As Thomas à Kempis, a priest and author from the 15th century, once wrote: “The loftier the building, the deeper must the foundation be laid.”
There is no loftier purpose than the preservation of human life. And so, our foundations in healthcare, the industry dedicated to such a lofty purpose, must be strengthened. And I believe 2024 is the year we do this in earnest.
