Stanford University’s Anesthesia Informatics and Media (AIM) lab is doing seriously innovative, cool stuff with healthcare, including offering a Patient Engagement Healthcare Design Class this fall. Today I’m sharing some of the key learnings from Week One, appropriately named, Introduction to Patient Engagement Design. Our lecture for week one was led by Kyra Bobinet, MD, MPH from the Persuasive Technology Lab at Stanford.
Dr. Bobinet’s presentation focused on key stakeholders in healthcare, and “what’s in it for me?” in regards to patient engagement. One of the underlying challenges of behavior change is that at the core, the entities involved need to clearly understand what’s in it for them or it is difficult to get a stakeholder on board. If you have ever led an adult learning session then you know exactly what I’m talking about. Describing healthcare as an ecosystem, Dr. Bobinet encouraged us to consider three key points as we followed her presentation:
- We are all part of the healthcare ecosystem ergo,
- We all have “dirt on our hands” and thus,
- We shouldn’t judge each other within the ecosystem because it IS possible to find incentive alignment among stakeholders.
Ultimately, engagement is about improving the health of patients and helping us all to lead healthier, more productive lives, so finger-pointing gets us no where, wastes resources, and limits possibilities. I like this concept. Let’s examine the major stakeholders of the healthcare industry and their respective incentives for encouraging and championing patient engagement. Here’s a summary what I learned from Dr. Bobinet’s lecture:
STAKEHOLDER #1: PATIENTS
What’s in it for me, if I am a patient?
- Better health
- Fewer healthcare costs
- Improved patient experience
We learned that patients who are more engaged and activated about their healthcare have all three of these benefits, even when compared to other patients going through similar health experiences. Data from Patient Activation and Self-Management behavior guru, Judith Hibbard from the University of Oregon demonstrated that activated, engaged patients are more likely to seek care sooner, be up to date on their preventative care measures and are more likely to have normal ranges on basic physiological measures such as weight, blood sugar and blood pressure.
STAKEHOLDER #2: HOSPITALS
What’s in it for me, if I am a hospital?
- Bundled Payments
- Risk Based Contracts
- Patient Loyalty
The Bundled Payment for Care Improvement Initiative is an agreement that ties financial and performance accountability measures to reimbursement, in hopes of creating better coordinated (see: quality) patient care that costs less. Bundled payment agreements result in one payment for multiple services provided. In older payment models Medicare reimbursed a hospital for each individual care interaction that a patient had and therefore provided little to no financial incentive for care coordination or cost effective care. In fact, older reimbursement structures potentially encourage quantity of touch points instead of quality touch points.
With the growing number of ACOs and risk sharing contracts, engaging patients makes sense for hospitals as well. By participating in an ACO, risk is shared and quality care performance is rewarded. The emergence of ACOs has also resulted in significant consolidation in the healthcare market. Hospitals and providers have consolidated, providers have consolidated among themselves, and this leaves fewer players all teeing up for the same patient. This means patient loyalty is at an all time premium and hospitals must do whatever they can to activate and engage their patient population to ensure they return.
Here’s a little refresher of Porter’s Five Forces for your viewing pleasure:
STAKEHOLDER #3: PROVIDERS
What’s in it for me, if I am a provider?
- Patient Satisfaction
- ACO/Risk sharing reimbursement
- Brand Equity
Patient satisfaction is increasingly becoming a metric with which providers are measured for reimbursement, internally, and for contracting with hospitals. For more information on patient satisfaction and its role in increasing revenue within a healthcare practice, please head on over to my previous post and scroll down to the middle. Again as with hospitals, consolidation is a major trend in the physician market place, so building some real brand equity for a medical practice is crucial in getting new patients in the door and keeping the ones you’ve got.
STAKEHOLDER #4: PAYERS
What’s in it for me, if I am a payer?
- Employer Customers will be happier
- Payers bear all the risk of Risk Based Members
From an insurance company’s perspective, employers or companies are their big customers. Insurance companies vie for the business of employers and employers pay for wellness programs for their employees. Wellness programs are great, unless no one in the company takes advantage of them. In that case, employers will believe wellness programs to be a waste of money. The point of a wellness program is to ensure that patients stay healthy and avoid missing work due to illness (absenteeism) or attending work while sick (presenteeism). Both absenteeism and presenteeism have a negative effect on productivity and overall patient health. From a payer’s perspective, a patient who is up to date on preventative care and who sees the doctor sooner when they are less ill, is a less risky (generally lower cost) patient. This lowers the risk that the payer must bear.
STAKEHOLDER #5: INDUSTRY
What’s in it for me, if I am pharma or a device company?
- Refill sales
- Desirable prescribing habits
- Reimbursement for devices
Activated and engaged patients will refill their medications. A pharma company’s favorite patient is the patient who religiously fills their prescription every month, and pharma will go to great lengths to pay for data that allows them to track how many prescriptions filled are new vs refill. As such, it can be inferred that patients who refill also have better outcomes (assuming the medication was prescribed correctly) and as a physician sees disease improvement consistently, will be more likely to choose that prescription drug each time. Device companies need engaged patients because they need to demonstrate their product works in order to get reimbursed by payers, and the data to demonstrate the utility of a device comes from increasing the number of patients who receive their product.
STAKEHOLDER #6: Entrepreneurs
What’s in it for me, if I am an entrepreneur?
- A viable business idea
- Helping people
Healthcare entrepreneurs are constantly trying to make real change in healthcare. That is no easy task. For an idea to receive funding you must show interest from the patient population you are trying to serve and most importantly, your idea must address an unmet need or be markedly better than other options available on the market currently. Participation by patients and providers demonstrates need and that will ultimately generate revenue and funding. I am intimately familiar with this category as a Board Member of Breast Care for Washington. We’ve opened our doors and are serving patients. In fact we are serving so many patients we have exceeded our strategic projections for the year. What we need now is funding. Lots of it. Check us out if you are interested in funding our efforts.
There you have it. A summary of the six major players in the healthcare ecosystem and their incentives to champion patient engaged healthcare design. Underlying all six categories is the shared goal of improving the quality of healthcare and patient outcomes. As I have said many times, I truly believe that favorable patient outcomes and business success are not mutually exclusive. They can and need to both exist at the same time. Business needs favorable outcomes to succeed and patients need business successes that drive healthcare innovation. That’s the crux of the ecosystem. Everyone plays a unique role.
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