Month: April 2022

The healthcare industry is moving away from point solutions

Season 4: Episode #119

Podcast with Kristin Myers, Chief Information Officer, Mount Sinai Health System

"The healthcare industry is moving away from point solutions"

paddy Hosted by Paddy Padmanabhan
To receive regular updates 

In this episode, Kristin Myers, CIO of Mount Sinai Health System, discusses topics related to the digital transformation journey at Mount Sinai – telehealth and access, digital patient experiences, remote care, home health, and more. Kristin also talks about the multi-year cloud transformation journey at Mount Sinai with Microsoft and the key themes that her team is focused on this year.

Kristin discusses why telehealth and virtual health are critical components of healthcare in the future and provides insights into how she makes technology choices in a rapidly changing landscape. She reflects on the changing role of the CIO in healthcare and why she decided to rename the IT organization. She concludes with advice for startups looking to partner in Mount Sinai’s digital transformation journey. Take a listen.

Our Podcast Partners:

Show Notes

01:51What does your digital strategy at Mount Sinai look like? Can you share your top priorities for enterprise digital transformation?
05:21Please tell us a little bit about your recent announcement about a multi-year cloud transformation journey. What led you to do it and how is that going to enable you to accomplish all the goals that you just talked about?
08:24A large part of your application's estate is going to the cloud. Are you moving your EHR, for instance? Can you talk a little bit about what all that means?
09:46 What does it feels like to be one of the pioneers at the front end of this cloud migration wave from the point of view of health systems and health care providers? Are we in very early stages of cloud migration as a sector, as providers?
12:07Tell us about your experience in the investments you've made in your telehealth program. Where do you see yourself today with regards to your patient population and provider community adopting it?
14:32 What are the challenges you've had to overcome and what are your immediate priorities as it relates to the next stage of evolution of this hybrid model of care?
15:54 Can you talk to us about how you approach the platform choices to create this seamless consumer experience?
23:14Tell us about your high-level approach to data and analytics.
26:35What are your thoughts on automation technologies and where you see them being applied in your context?
30:47What's your advice to the startups if they want to approach Mount Sinai to be a partner in your journey?
32:53Why is the industry moving away from point solutions?

About our guest

Kristin Myers is a visionary leader who is steering IT transformation efforts to align and support the strategic goals of Mount Sinai Health System. As Executive Vice President, Chief Information Officer and Dean for Information Technology, her main objectives are to drive agility in the department to support the health system’s mission of clinical care, research, and education; optimize the department’s operations; and enable the Health System for digital change.

Ms. Myers joined the Health System as a Director of IT in 2004. Her many key accomplishments include leadership of the Epic clinical and revenue cycle implementations and the organization’s transition to ICD10 coding, and establishment of the IT Program Management Office and Change Management as a discipline within IT in 2009.

Ms. Myers is a nationally acclaimed healthcare leader. She was chosen as one of Crain New York’s Notable in Health Care list in 2021, selected to join the 2021 HIMSS Future50 Community, awarded the Modern Healthcare 2021 Top 25 Women in Healthcare honoree, and listed as 102 Women to Watch in Health IT in 2020. Under Ms. Myers’ leadership, Mount Sinai was awarded the prestigious Health Information and Management System Society (HIMSS) 2012 Enterprise Davies Award of Excellence for its electronic record implementation to improve quality of care and patient safety. Most recently, Mount Sinai Morningside and Mount Sinai West received HIMSS Stage 7, the highest level of technology adoption.

Before joining Mount Sinai, Ms. Myers worked at Cap Gemini, Ernst and Young, and the Cerner Corporation in Australia. She holds an Executive Master of Public Health from Columbia University and an Executive Chief Information Security Officer certification from Carnegie Mellon. She has been designated a Fellow of HIMSS; has received certifications in Program Management (PgMP), Project Management (PMP, Prince 2), and AIM Change Management; and is a Certified Professional in Health Information and Management Systems.

Q. Kristin, thank you so much for joining us, today, and welcome to the show! Please tell us a little about Mount Sinai.

Kristin: The Mount Sinai Health System was created in 2013 when the Mount Sinai Medical Center merged with Continuum Health Partners. We have eight hospital campuses in New York, and the Icahn School of Medicine. The Mount Sinai Medical Center has had a very long history. We started out in 1820 with the New York Eye and Ear Infirmary, and over time have accumulated hospitals. Our main hospital was founded in 1852. We have around $9.3 bn in revenues, 43,000 employees, and over 7,000 physicians — a very large academic health system in New York.

Q. What does your digital strategy at Mount Sinai look like? Can you share your top priorities for enterprise digital transformation?

Kristin: Everyone is aware of the pace at which technology and digital is transforming health care. It’s just accelerated exponentially, especially with COVID. Given the number of ways of doing business, today, we have to shift to digital workforce, embrace new digital channels in which we can engage our patients and, adopt innovative ways to provide care. My goal has been to reinvent and transform technology and digital as an organization and drive real change in culture so that its innovative and resilient within the department. For me, then, there are three key themes I’m really focused on: first, is customer service, and being able to serve and support and enable our stakeholders. The second is innovation, that must be done at-scale, at the enterprise-level with focus on differentiation, new ways of working, and new business models after which we must examine new opportunities to drive change and transformation.

The third is around digital, where we think about our patient and employee experiences within an overall digital strategy and roadmap. The focus, then, is around digitally enabling Mt. Sinai as the preferred destination for our community. It’s important to anticipate needs so that we can provide that equitable and seamless experience to everyone we interact with.

Also, when I think about digital, I go back to a framework with three key components: digital business models to reimagine the way we do business with digital and technology capabilities; digital experiences that focus on the experiences that our patient and employees are having; digital core, which is around our operating model that revolves around people, process, and technology.

We’ve really taken a step back to think about how we can devise a more experience-led, integrated approach so that we’ve got a digital roadmap that prioritizes the identified key opportunities, understand what the technology implications and changes are that need to be made to support that, and then, incorporate other considerations like program governance, change management before activating it as a whole enterprise-wide.

Q. Mount Sinai has made a recent announcement regarding a multi-year cloud transformation journey. What is its scope and scale? How is that going to enable you to accomplish all of these goals you’ve mentioned?

Kristin: I’ve looked at each functional area in the technology organization — the data centers, our business continuity, and disaster recovery plans etc. Question is, how do we transform that? When I see our target operating model over the next five years, it means that we have to have a Cloud transformation, need to mature our capabilities around business continuity and disaster recovery and then, provide that modern and scalable platform in which we can grow with the Health System.

We’ve partnered Microsoft, our cloud provider and Accenture, our system integrator to really execute on that Cloud and data center transformation and support innovation efforts to enable new business and growth models that can drive research and A.I. efforts. These measures will support an academic medical center with more modern technology infrastructure and increased security, that will improve our uptime recovery and enhance agility while avoiding significant costs to complete facilities, remediation and hiring of additional data center and facility staff.

Just to give you a sense, we have 13 data center and server rooms across the Health System. That’s significant and being able to reduce that to at least one on-prem, eventually, would be good. It’d be great to have none, but one at least will significantly reduce our costs and improve our ability to recover from outages that would impact revenue, patient care and operations. We get to have that geographic diversity and failover capabilities that are in the Cloud, too. This, then, was a large step forward that was necessary for us to do as an organization.

Q. Are you moving your EHR, for example? Can you talk a little about what that means?

Kristin: We’ve gone through our application portfolio and reviewed which applications would be a light lift to move to the Cloud versus a heavy lift. Now, there are some applications that, today, are not ready to be moved to the Cloud, so, we’ll have to work with those vendors over a period of the next few years.

As it relates to the EHR, our intent is to move Epic to the Cloud. We’ll start with the training and testing environments, and disaster recovery before we even move to some of our larger environments, and ultimately, production. But, we’re working very closely with Epic as well as Microsoft and Accenture to make sure that that transition will be successful over the coming years.

Q. You would be one of the pioneers, you know, and at the front end of this cloud migration wave from the point of view of health systems and health care providers. What does that feel like?

Kristin: We’ve seen the financial services and other sectors that have already made this transition. When I speak with other CIOs it’s clear that everyone’s looking at Cloud and Software as a Service. Many applications that are already in the portfolio are SaaS. So, CIOs are taking a gradual approach.

But it also depends on the investments that have been made historically, in data centers. Some CIOs have built their data centers from the ground-up and invested significant amounts of money in doing that. For us, it was a very different picture when we started looking at our investments and how many data centers we had. Overall, the business case for us to move to the Cloud really made sense. For other organizations it may not make sense at this time. But, taking that gradual approach might.

Q. Going back to some of your digital transformation themes, one of the big one of the big shifts in the last couple of years has been towards telehealth models. Do share your experience with this. Where do you see yourself, today, with regard to your patient population at Optum and your own provider community?

Kristin: We’d developed the infrastructure prior to Covid and had a number of physicians experimenting with telehealth. But it was not necessarily part of the model of care, across the Health System. When COVID hit, we were able to scale very quickly and we saw large volumes with telehealth, too. Today, as we see with the trends of other health systems, it’s dropped, but it’s been very steady — around 15 to 20% of overall ambulatory volume, which is significant. Investments will continue in this.

We’ve made a lot of investments around tele consultations in the in-patient setting, too. And this has resulted in savings in the cost of care leading to alleviation of clinical capacity constraints by diverting patients from higher acuity sites of care. That will also continue to be an area that we invest in. For us, access is really the center of our digital roadmap and a core priority, so, ensuring that we have virtual health as a key pillar that we continue to invest in, will always be important.

Q. We’re now settling towards a hybrid model of care — a mix of in-person visits complemented by virtual visits. Here, the quality of the experience becomes very important. Can you talk about the seamlessness this entails? Also, what are the challenges you’ve had to overcome to get to the next stage of evolution of this hybrid care model?

Kristin: It’s important to make sure that the platforms that we’re utilizing are ones that integrate very well with the EHR. We’ve used a variety of tools that have integrated well with Epic. We’re currently looking at Zoom as part of our overall unified communication strategy. They have been integrated with Epic and may be a good vendor long-term for us to work with. Considering that, we’re looking at them more broadly across the organization.

Q. When you look at your tool and platform choices, there is a plethora of options out there. How you approach these platform choices to create a seamless patient experience? Do you have an Epic-first policy to go with or do you evaluate tools on a case-by-case basis?

Kristin: I always think about the overall Epic roadmap because it is one about foundational platforms similar to maybe ServiceNow, Salesforce and ERP. It’s important for you to understand what the roadmap is and what functionality is coming in the next 2-3 years. There are so many gaps with any of these foundational tools that you always need to be looking at other solutions to complement them.

My approach is looking at the solution in the context of experience, specifically, for our patients and employees. That’s key. How does the platform integrate with some of the foundational products like an Epic is important, too. It’s equally crucial to be really intentional about what the roadmap looks like — Are we implementing a product or point solutions for 2-3 years before it becomes part of the roadmap of Epic? Will we decommission it when Epic releases this function and adopt that? It’s methodical but Epic tools need to be able to have the functionality of these point solutions, and that’s some of the challenges over time.

Q. I think that’s a very valuable and interesting input for, especially for startup founders listening to this podcast Let’s now talk about the remote care and home health part of digital transformation. Can you tell us about your own experience and some of the programs that you’ve got going in remote monitoring and home health spaces?

Kristin: This is a space our teams are working on, specifically with Mount Sinai Health Partners, in population health. Currently, we have approximately 2,000 patients enrolled in remote patient monitoring, specifically around, an area like blood pressure. It’s a priority for us and we need to be able to expand these programs. In the meantime, we’re looking at possible foundational partners overall, for remote patient monitoring. There are a number of vendors since it’s a crowded marketplace! But to have one vendor for many of the capabilities while that’s ideal, I don’t think we’ll get to a 100% of the capabilities with one. However, if we can get a vast majority with one, that would be helpful. I’m interested to hear what your thoughts are about this space.

Q. I see that home health is definitely going to be the default mode of care in the next 5-10 years for a large part of one’s routine and chronic care needs. When one needs to come into the hospital, one comes to the hospital. The big investments will come in from companies like Amazon who will define the space in some way going forward because they’re approaching the market from a different standpoint. The technologies that are emerging can make it a viable reality. So, whether it is remote monitoring, where you can use the sensors and monitors and devices to pull the data and intervene appropriately or whether it is voice recognition technologies, each one will enable the shift towards more of a home health model.

Kristin: What are you seeing with the vendor marketplace? From our perspective, it just seems very crowded. There are also many of the vendors who do not want to integrate with the foundational system.

Q. There is a lot of tension between a foundational system, Epic in particular, I’d say, and the vendor community out there at large, and that’s got to do with the source of the data. How do you get the data to drive the experiences? While the vendor landscape is thriving, it’s also very fragmented so it’s very hard to see who’s going to make it and who is not. There’re a number of things in play there — Integration with Epic HER, EHR and transaction systems, the workflows, how do you really take care of people at home? How do you create a seamless model where they can come into the hospital, go back, do a tele-visit, be taken care of at home etc. There’re al these that need to come together, seamlessly. I think, we’re still some distance away from creating that seamlessness.

Q. Mt Sinai’s got the Hasso Plattner Institute for Digital Health. You have significant research-related data and an analytics program. Tell us about your high-level approach to data and the analytics program.

Kristin: About two years ago, we took a step back and looked at all of our data assets across the Health System. Being a research organization, we have a number of them. But while we have a lot of data assets, we needed to create an enterprise data hub. We’ve been making a lot of investments, looking at data governance and data stewardship, making sure that when we’re providing data to either our researchers, educators or faculty, that it is of high quality. That’s been an area of focus.

We’ve been ensuring that our data is accessible and can be sent to our payers. There are significant incentives that we get owing to this like any health care organization, so, being able to create that real-time data feeds to the payers has also been an area of focus.

Predictive modeling has also been critical for us. We have an amazing clinical data science team that develops predictive models and integrates them with Epic. We’re looking at ways in which, potentially, we could spin-off some of the work that is being done for it has a very large outline and tremendous operational impact in really improving quality and outcomes. So, there’s a lot of exciting stuff going on here, but, predictive modeling is probably one area that stands out to me.

Q. You mention data quality. I often hear about the fragmentation of data sources, devices and absence of a standard data model. Is it fair to say getting data in a standardized format that can be wrangled into a usable dataset is a significant challenge?

Kristin: It is a challenge and something that we’re working through as part of our overall enterprise data hub strategy.

Q. Let’s talk about the acute labor shortage economy-wide that we’re experiencing and the automation technologies that are stepping into the breach in some way. Can you share your thoughts on automation technologies and where you see them being applied in your context?

Kristin: Automating administrative tasks through Robotic Process Automation can reduce human workload and realize cost savings. It can increase employee satisfaction and retention rates because it takes some of the very simple and basic work and automates that so employees can focus on the more complex work. We have an RPA team that works with the business and looks to identify, evaluate, and execute some process automation opportunities.

We’re also investing in some conversational AI to free-up capacity, there.

The IVR is also a tool to automate administrative tasks, improve employee experience and prevent burnout. That’s a real problem that we’re seeing across the board, whether it’s the clinical teams — our physicians and nurses – or frankly, everyone in health care.

Q. You’re the CIO of one of the largest health systems in the country with a long career in technology. How has the role of a CIO changed over the last few years? What are the big leadership qualities expected of CIOs, today? How is this different from what it might have been before?

Kristin: It’s so different. If you asked people what the role of the CIO was pre-COVID, you probably got different responses. So, it goes back to how technology and digital innovation has just accelerated. It’s no longer about managing IT anymore. It’s about leveraging technology and the digital to enable business, drive growth and create value. Being a partner at the executive leadership table means I can influence and help formulate and enable the business strategy of the health system and then, execute on those priorities to really achieve the business outcomes.

So, it’s a huge change in mindset and how people view the IT function, which is why I renamed our function — Digital and Technology Partners. This represents our vision, value, culture, and contributions to the health system.

If we say IT, it doesn’t necessarily appeal to a new digital generation either, right? We want to be able to try and retain and recruit technology talent. This will continue to be an ongoing challenge. Everyone’s aware of the great resignations, so, being able to attract talent is really important. So, it’s a very different role.

Q. There’s a lot of folks listening to this podcast who are from the technology startup ecosystem. What’s your advice to them if they want to approach Mt. Sinai to be a partner in your journey?

Kristin: Be clear on the value proposition and the business model. We’re a large, mission-driven organization and our operating margins are pretty tight. So, we’re always looking for sustainable business models with measurable impact. Some companies will offer a “free pilot before you scale,” but, nothing is free because it means that resources and teams are being redirected and all of this comes at a cost to the organization. Understand that, even if that offer is made, it still requires a comprehensive review.

I’d encourage these startup organizations to think about how the industry’s moving away from point solutions. So, if you’re going to pitch that, you need to ensure that you’re articulating how to address capability and experience gaps and how that could integrate into our foundational products, such as, Epic, the ERP, etc. Health care organizations are going to start focusing more on the patient and employee experiences, so, having so many digital health vendors that don’t integrate with one another, only dissatisfies our patients and employees.

Q. This may be a topic for a much deeper conversation but I’d like your thoughts on is this lack of integration causing the friction that you’re alluding to and is that why the industry is moving away from point solutions?

Kristin: I believe so, because we have frictionless experiences in our everyday life with other industries. With health care, there’s a lot of friction. Some of this is really down to the lack of a focus on that experience. If there are so many vendors that aren’t interoperable and providing that seamless experience to patients, it is dissatisfying, right?

We hope you enjoyed this podcast. Subscribe to our podcast series at  www.thebigunlock.comand write to us at  info@thebigunlock.com

Disclaimer: This Q&A has been derived from the podcast transcript and has been edited for readability and clarity

About the host

Paddy is the co-author of Healthcare Digital Transformation – How Consumerism, Technology and Pandemic are Accelerating the Future (Taylor & Francis, Aug 2020), along with Edward W. Marx. Paddy is also the author of the best-selling book The Big Unlock – Harnessing Data and Growing Digital Health Businesses in a Value-based Care Era (Archway Publishing, 2017). He is the host of the highly subscribed The Big Unlock podcast on digital transformation in healthcare featuring C-level executives from the healthcare and technology sectors. He is widely published and has a by-lined column in CIO Magazine and other respected industry publications.

We are unlikely to see digital health investments doubling again this year

Season 4: Episode #118

Podcast with Justin Norden, MD, Partner, GSR Ventures

“We are unlikely to see digital health investments doubling again this year”

paddy Hosted by Paddy Padmanabhan
To receive regular updates 

In this episode, Justin Norden, Partner at GSR Ventures, shares his personal story to inform the investment thesis behind GSR Ventures’ health tech-focused venture fund. Justin is both a physician and a computer scientist by training and has a real passion for the Medicaid sector. He discusses the many challenges in healthcare for startups and points to the potential that lies with the Medicaid population and how technology can help turn it into an opportunity. GSR Ventures specializes in funding early-stage digital health companies.

Justin talks about the digital health funding environment and why he thinks that in 2022 we won’t see the same levels of investment as in previous years. He shares his advice for founders looking to launch digital health companies and what it takes to successfully sell to and partner with health systems. He also offers thoughts on how the entry of big tech in healthcare will open new opportunities for startups. Take a listen.

Our Podcast Partners:

Show Notes

05:41Last year, USD 30 billion was pumped as venture capital into digital health startups. What's your outlook for 2022?
09:25There's a lot of risk for health systems betting on a startup that is unproven or surviving from one funding cycle to the next. How do you square this influx of capital here with growth in the number of startups?
11:21The big techs are making big investments. What does it mean for your portfolio companies and the competitive landscape they are operating in now?
13:57 When you talk to your portfolio company founders and teams, what do you see as significant challenges they grapple with on an ongoing basis?
16:59There is a criticism that technology startups tend to look at everything through a technology lens. How would you respond to that on behalf of your founders in your portfolio?
18:52 What is your piece on the Medicaid space? Where do you see an opportunity to serve the population and make money?
22:32 There’s an acute talent crisis in the tech sector. How does that factor into your investment decisions? How are your startups working through this challenge?
24:45If I were a startup founder with a great team of engineers, a great idea to serve the Medicaid population, and listening to this podcast, how would I be able to appeal to you?
25:34What is your advice to founders listening to this podcast, wanting to build a digital health startup and make a difference?

About our guest

Justin Norden is a Partner at GSR Ventures, where he focuses on early-stage investments in digital health. Prior to GSR Ventures, he was the CEO and co-founder of Trustworthy AI which was acquired by Waymo (Google self-driving). He worked on the healthcare team at Apple, co-founded Indicator (an NLP based platform for biopharma decision making) and helped start the Stanford Center for Digital Health.

As an academic he is an award-winning machine learning and bioinformatics researcher with 20+ publications. Finally, Justin is a former professional athlete and 3x world champion in ultimate frisbee.

Justin received his MD from Stanford University School of Medicine, MBA from the Stanford Graduate School of Business, M.Phil in Computational Biology from the University of Cambridge, and BA in Computer Science from Carleton College.

Q. Justin, welcome to the show and tell us a little about the fund and how you got into launching it.

Justin: GSR Ventures is a health-tech focused venture fund based in the U.S. My partners and I share a common vision to transform healthcare through new technologies that really have yet, in our opinion, to disrupt the healthcare ecosystem. So, I can walk you through my own personal journey and we’ll see how that informs our investment thesis with the fund.

I started out as a computer scientist — my undergrad and master’s are in computer science and computational biology, where I focused on machine learning and genomics. The plan was always to be a physician coming from a family of physicians, and this was something that I always felt was such an amazing thing — getting to care for patients.

Through my journey, I ended up coming to Stanford for medical school, where armed with this computer science and tech background, I felt like I kept banging my head against the wall of “why are we not able to do things better with technology? Why don’t we augment what we’re able to do, augment the repetition, automate some of these processes and really spend more time with patients and deliver that better care?” Ultimately, I took some clinical detours, which ended in launching our Stanford Center for Digital Health. We’re doing some of the first telemedicine visits out of Epic, taking care of our ACO population.

From there, I left to join the team at Apple, where we were doing some amazing things at-scale. I want to talk a little bit more about what big tech companies are doing, today. You can’t spend this long in Silicon Valley without getting the startup edge, so I tried my hand a few times, as a founder of one of the companies focused on algorithm safety and trust. “How do we know what client is doing, what it’s meant to do?” Ultimately, I ended up selling that company to Waymo, Google’s self-driving car company, and then came to GSR Ventures where we just shared this common vision to change healthcare through technology.

Some of my partners here have similar backgrounds as physicians, former entrepreneurs or former technologists. And fundamentally, we saw this opportunity to take that technology into health care and make it happen. Now, it’s not easy, we know. Many of us have tried to do this for years but in the recent past, we’ve really seen transformational changes — with COVID, with adoption, with physicians finally buying in that this will be the future. We think that is really only going to accelerate.

So, for us at GSR Ventures today, we’re focused on companies that don’t offer incremental improvements, but focus on 2, 3, 10, if not 100x X improvements through the use of new technologies, such as, asynchronous telemedicine, digital therapeutics, and companies working in Medicaid, which have previously been ignored. These are things that really get us excited.

Q. Let’s now talk about the big picture. Last year, USD 30 billion or so was pumped as venture capital into digital health companies. The corporate sector and many health systems — Providence, UPMC, Kaiser, Unity Point — launched their own funds. So, what’s the outlook for 2022?

Justin: I just spoke with Matthew from Unity Point and Craig from Cigna Ventures at a conference in Chicago and I think, it’s really accelerated — more than doubled for the past few years — so, I don’t think we’re going to see that doubling again this year.

You mentioned a few of the parties who’ve come to the table in the past few years — health systems, payers who’ve jumped in but the other group that’s really jumped in from the investment standpoint is people who traditionally work outside of health care. There’s a lot of former technology investors, very big inventors, hedge funds and venture capital firms who previously had been on the sidelines for health care, but who during COVID said, “Hey, this is a market we should jump into.” It’s really all of these parties who’ve created this rapid acceleration in funding.

Is that going to double this year? No. It’ll be fairly close to where we were in 2020 to probably 2021 from a venture capital dollars standpoint, because there are many great companies and amazing opportunities, as companies have really good fundamentals, are growing and again, have the four trillion dollar health care market to go after.

What’s going to be different, though, is there were some companies that — especially of investors, who maybe weren’t as familiar with how health care works and had little idea how long it takes to sell into some health systems and payers — saw some overhype in certain categories and valuations and which looked more like software companies, when really some of these that were recently funded, were more traditional health care services with software on the fringes.

There’s just really going to be an awakening. It’s been seen on the public market-side of these companies that were valued like true tech companies, when in reality, underneath the hood they’re really more health care services companies that trade at very different multiples. That has already corrected some on the public market-side. Many of the companies that went IPO over the past few years went through SPAC mergers, however, have come down significantly as people realize, “Hey, health care is hard.” And fundamentally, these businesses look a little bit different than we expect. So, we’ll see that traction in valuations in the private market side, but there’s a lot of room for growth here, so we remain incredibly optimistic for our companies going forward.

Q. Companies that have gone IPO have seen a drop in their overall market cap. No one’s making money. Privately held companies that are VC funded are operating perhaps at subscale, individually, and fragmenting the market. There’s a lot of risk for health systems betting on a startup that is unproven or surviving from one funding cycle to the next. For the startup, too, long sales cycles are fatal. How do you square this influx of capital here with growth in the number of startups?

Justin: You offer a fair assessment. A lot of money has gone into startups, ideas and some early traction but what’s really needed for them to successfully sell and partner with health systems is, proven ROI clinical validation of the solution. That’s something I’m hoping to see more of as we progress.

Take mental health, for example, one of the leading areas for investment the past few years. There’re so many solutions on the market, most of which have never published results that their methods are working, or that their patients are really getting better and instead, rely on some very soft ROI metrics. I think this is an area, in particular, that we’re going to see consolidation and companies moving around.

Have you really proven your results? Does your technology solution actually work to make patients better? Are people really seeing ROI from a health system repair result after implementing these solutions? We’re starting to see that. In crowded areas, this is a way that startups will break-out and the health systems will say, “Oh yeah, this startup has clinical evidence to prove this. This other one, doesn’t.” So, we’re going to go with that and I expect to see more of both this year and in the future — just how people pick and sift through the many options for certain conditions.

Q. Consolidation is definitely one path for many of these startups showing some potential and promise. Let’s talk about the big tech companies. They’re making big investments as well. What does it mean for your portfolio companies and the competitive landscape that they’re operating in now that Amazon, for instance, is getting directly into the business of healthcare services?

Justin: It’s exciting to have so much interest in the market. Fundamentally, we all chose health care, not because we were hoping to make a quick buck but because we wanted to make this better. It’s fantastic that we’re getting all of the big tech companies and people interested in doing that.

In terms of what it means for our startups, we need to figure out how to work with them. Take for example, CVS announced a large partnership with one of our companies, Marable, around making clinical trials better, creating an access point for those patients. As start-ups are really able to prove that they’re delivering their solution, these Big Tech companies become a wonderful partner to take that distribution channel and really scale it across the country. So, that’s the first example we’re really excited about as our startups really begin to prove that they’re winners in their field. These tech companies become a fantastic partner to really grow and continue to build that relationship.

In other areas, it’s always a joke. It’s the easiest thing to say, “What if Google or Amazon, you know, does this?” It’s real now, in this space. Know that if you’re trying to deliver medications to someone home, you are now competing directly with Amazon. It’s exciting and interesting to see that growth there.

Fundamentally, some things we think about as early-stage investors are — What is going to beat them up? How are you going to build a network proprietary distribution IP around what you’re doing? As long as you do a good job of those things, you’ll be able to compete against some of the big tech companies as you are growing able to be successful. It’s interesting partnership opportunities for if things go sideways, I’m assuming we’re going to see more acquisitions from some of these big tech companies. But fundamentally, it doesn’t change if you’re taking an interesting idea, figuring out a way we can really find this position in the market and grow from a position of strength, then, startups will just be fine. Health care is so big it’s going to take many, many hands to make this better.

Q. When you talk to your portfolio company founders and teams, what do you see as a one or two big challenges that they grapple with on an ongoing basis? How do you help them think through it?

Justin: So many challenges! It depends on the day of the week for what things are coming up but, one of the most important ones within health care is — How do you build real fundamental partnerships that are win-win?

As an early-stage company, this is one of those big challenges — Do you take strategic capital from a potential big player? Does that hurt your financing options, later? Do they have too much control so you can’t partner with one of their competitors? How do you structure a contract such that there’s real buy-in that they’re not just buying your IP, buying the option value with no kind of real guarantee that they’re going to deliver on their app?

These are fundamental things — How do you contract a partner with some of these bigger players so that, if it goes well, it can be a huge boon to your business but, if it goes badly, it could really hinder you from other potential partners without any kind of real upside. Navigating a few simple things like that whether it’s pharma payers or health systems, quickly, is something that comes up again and again, especially for early-stage founders.

Q. Are you saying that taking on more risk is something that start-ups should be prepared for when contracting?

Justin: Not necessarily; it’s just being really smart about how you’re thinking about a distribution channel. So, it’s about ensuring that there’s real skin in the game and that they’re excited that you’re going to move through a procurement process, quickly, and not going to get stuck in a two-year cycle.

This future version that you’re talking about around value, is every digital health company’s dream of saying, “yes, we’re going to work with a payer and take on value when ensuring the cost savings.” But, in reality, it’ll take you multiple years to get there.

We work and talk with our advisors at many of the big payers and often, find that you’re going to have to start in a fee-for-service world. But, make sure you have those conversations upfront so, in the next 12 months, you’re going to move from fee-for-service to a bundled payment and then, ultimately try to move towards capitation or something else, if you can do that with your patient population.

There’re many versions and ways to do this. One of the things that’s just so important is ensuring we set expectations correctly with our founders. When we connect them with someone on the other side, we’re making sure everyone’s ready and prepped for the conversation and not just talking past each other, which happens just too frequently when Silicon Valley tries to interact with some of the legacy health care players.

Q. Fairly or unfairly, I hear the criticism that technology startups tend to look at everything through a technology lens. You’re both, a technologist and a physician and healthcare is a people business workflow. So, how would you respond to that on behalf of your founders in your portfolio?

Justin: I would say, at large, as a field, I mostly agree with that criticism. And that’s part of our job, especially, when we have founders who don’t come from the healthcare industry. To coach with them and work with them, get them to understand that health care is a people business, that health care is more risk-averse — it is going to take longer to build that trust because that’s how health care works.

I teach at Stanford — for medical school – and work with early students. So, sometimes, we tell them, often physicians are the last players to build trust and move towards a new solution. That’s something we work with our founders on, on a daily basis to make sure they know that and understand what’s happening.

Yes, technology does have this potential to absolutely transform what we’re doing. But I thought myself, both, going through school as a clinician and then, again as a technologist, understanding it is a different world sitting in the hospital, taking care of a patient and, writing lines of code on your computer. We need to bring people closer together if we’re ever going to make it work.

Q. Let’s talk a little bit about Medicaid. There’s a lot to be done there and some real challenges as well — Medicaid members rely on their caregivers and their hospitals to actually offer rideshare because they can’t afford Gas to drive themselves to their appointments, can’t afford the bandwidth or data plans for their mobile devices. Plus, this being a government-run program, there’s a whole reimbursement component to it. What is your piece on the Medicaid space? Where do you see an opportunity to serve the population but also make money?

Justin: Absolutely. Every complaint you just mentioned is a challenge in Medicaid, today. But I would argue almost in each of those categories, that things have got better and the opportunity has got closer for the past few years.

So, why is there an opportunity here? Historically, Medicaid has been mostly ignored by every player in the health care system. For the payers, hospital systems are losing money. It’s just a question of how much. So, they need to think of how few Medicaid members can be served, but making sure they keep their nonprofit status. None of the digital health companies has, for the most part, save a few exceptions, targeted Medicaid early because why would I take a third 20% of the reimbursement I could get elsewhere? It just doesn’t work. That’s where technology has come into play and there’re a few trends I’ll point to. I’ll speak to why it’s so exciting.

So first, from a mobile standpoint, for over the past five years, the amount of Medicaid members and just even the US population as a whole that is connected now to High-Speed Internet and has a smartphone, has gone up considerably to the point where it can be more of an expectation rather than a reality. From a mobile connectivity standpoint, things are fundamentally different than they were five years ago.

Two, from a technology standpoint, this is where technology can make a difference in health care. When if you’re traditionally giving services or even just a pure telemedicine visit, yes, the economics don’t work. If I’m a psychiatrist doing a telemedicine visit, I fundamentally just don’t make the same money per hour seeing a different patient. That’s where technology solutions can come in. All of a sudden, when I can deliver an application, an FDA-approved digital therapeutic for a treatment, it can be done at a fraction of the cost and I can treat these patients at-scale. This is where software has the potential to deploy things across millions or billions of phones; an opportunity to deliver asynchronous telemedicine. That’s a tenth, if not a hundredth, of the cost to reach these patients. Fundamentally, the technology tools are now available to treat these patients for a fraction of the cost.

That last part you mentioned, yes, now, we’re working with government and the states. It’s even worse than Medicare Advantage, where we have to work with one plan. We have to figure out how we’re going to contract with 50 states and the MCOs that work with those states. But more and more dollars have gone from state-funding to MCOs, which really allows for more creative options. So, when I’m responsible for the total cost of care, I can do the rideshare, the food delivery, and other things for those highest cost Medicaid patients.

All these things have really pointed to an area with less than a total of a billion and a half dollars flowing into Medicaid startups. Contrast that with almost $20 billion in Medicare Advantage. I focus on that market, whereas Medicaid’s almost twice the size of an annual spend. This has been an ignored area, but the tools are coming together as is the climate and there’ll be some huge winners that we’re going to see over the next few years.

Q. Let’s talk about your startups and your own business. You’re investing in all these startups where a big factor is talent. There’s an acute talent crisis in the tech sector, so how does that factor into your investment decisions? How are your startups working through this challenge?

Justin: I absolutely agree that is such a challenge to hire the best right now in terms of how it factors into our investment decision. The most important thing from our investment decision at any stage is the team — Is this a founding team? Is the management team one that can succeed in the market? Are they on top of their game?

And such an important part of that is, are they going to be able to recruit those most talented employees at cheaper than they’re going?

Every one of our startups, the top engineers, could make double or triple their salaries by jumping over to Big Tech. So, question is, do they believe in the mission of the company that they’re going to help people? Do they believe in the trajectory of the company that has become a unicorn or decacorn and from a financial side, give them upside as well?

That’s the most important thing. A key component of that is how they, as leaders, managers and recruiters, are able to attract talent. That’s what we think about from an investment decision. That has always been one of the most important criteria, if not the most important criteria, as we think about investments and that really just carries over to the tough hiring landscape, today.

In terms of what we say to our startups and how we work with them, we tell them — talent is important and if they need to make a hire, they need to go above what they have to do to attract and get those people. Talent drives everything and so they have to compete in whatever way to get them.

What we’ve seen with most companies, today, is that people maybe have a historically geographic constraint but that’s loosened across almost all our startups so that, that best engineers with us even if they don’t want to come into office, even if they aren’t in the city where the majority of employees are. That’s something we’ve seen just very tactically across the board.

Q. If I were a startup founder with a great team of engineers, a great idea to serve the Medicaid population and listening to this podcast, how would I be able to appeal to you?

Justin: If they said those things, sent me a cold email, I’d definitely be inclined to respond. In that meeting, when I’d be speaking to them – through a recorded pitch or a 10–20-minute practice pitch — the real key would lie in how they’d respond to questions when you started digging in — Why are you doing it this way? How does this happen?

That’s when the real magic would happen. In terms of, at least for me, I’d pitch in evaluating the founder of the team to kind of see if they’re ready for it.

Q. We’re coming up almost to the end of our time here. What is your advice to founders listening to this podcast, wanting to build a digital health startup and make a difference?

Justin: There’s never been a better time to jump into digital health. For many years personally, I found myself banging my head against the wall. We have to use technology. It’s got to be this way. But I felt mostly ignored by my peers within medicine, who didn’t believe that technology would ever make a change.

Fundamentally, that has shifted across all stages of a company with more people saying, “I want to work on something meaningful. I want to work on something that can really change the world and make a mark.” Digital health is the perfect place. So, in terms of advice, I’d say, if people are thinking about this, this is the perfect time to jump in. There’s so much room for growth. It might be not as frothy or as high a market as it was for the past few months. That doesn’t matter. There’s so much room and capital available to fund good ideas and good teams, so, I’d love to work with you.

We hope you enjoyed this podcast. Subscribe to our podcast series at  www.thebigunlock.com and write to us at  info@thebigunlock.com

Disclaimer: This Q&A has been derived from the podcast transcript and has been edited for readability and clarity

About the host

Paddy is the co-author of Healthcare Digital Transformation – How Consumerism, Technology and Pandemic are Accelerating the Future (Taylor & Francis, Aug 2020), along with Edward W. Marx. Paddy is also the author of the best-selling book The Big Unlock – Harnessing Data and Growing Digital Health Businesses in a Value-based Care Era (Archway Publishing, 2017). He is the host of the highly subscribed The Big Unlock podcast on digital transformation in healthcare featuring C-level executives from the healthcare and technology sectors. He is widely published and has a by-lined column in CIO Magazine and other respected industry publications.

Even in a small market, we’re looking to utilize technology to expand access to care while improving outcomes and quality.

Season 4: Episode #117

Podcast with Brian Davis, CHCIO, Chief Information Officer, Magnolia Regional Health Center

"Even in a small market, we’re looking to utilize technology to expand access to care while improving outcomes and quality."

paddy Hosted by Paddy Padmanabhan
To receive regular updates 

In this episode, Brian Davis discusses the perfect storm of competition for patients, labor, and medical supplies that even a small hospital in remote Mississippi, such as Magnolia Regional Medical Center now faces. Brian describes Magnolia as a large ambulatory facility that happens to own a hospital. He explains how he uses federal grants and state programs for rural broadband access to drive telehealth and improve technology adoption among patients and caregivers.

As a long-time user of Meditech EHR, Brian talks about their deep commitment to Meditech and their efforts to build mobile experiences for patients and caregivers. He also shares his thoughts on the recent Meditech partnership with Google Health. Brian shares his excitement on the emerging technologies such as voice in making care accessible and convenient for consumers. He also muses on how emerging entrants, less limited by geographic boundaries, could be extremely disruptive to their primary care services and, ultimately their referral path into their specialty services. Take a listen.  

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Show Notes

00:27Tell us a little about the Magnolia Regional Health Center and the populations that you serve.
03:42Tell us how you make technology choices and what makes your challenges unique?
06:03What does digital transformation mean in your context?
09:15 When you talk about telehealth, can you give us an example of what you've implemented that benefits your patient population and your providers?
10:57You’re a Meditech shop and they recently signed a partnership with Google. What do you make of that and how will that impact your roadmap with Meditech?
16:03 What are the competitive forces you see emerging for a somewhat insulated regional health system like yours and how do you prepare to meet them?
19:57 You talked about several technologies that you use to transform the patient experience. What about things like automation? Have you deployed those to address the labor shortage in particular?
23:31 What are the challenges that you have to overcome to make sure that the investments are well thought-through, and well deployed while delivering results in the shortest possible time?
24:41What are your big priorities for 2022?

About our guest

Brian Davis is Chief Information Officer of Magnolia Regional Health Center in Corinth, MS, where he oversees all the information systems for the 200-bed medical center and 21 medical offices. He is a CHIME Certified Health CIO with over 15 years of healthcare IT experience. Brian has been instrumental in leveraging technology at Magnolia in innovative ways to consistently deliver business value, whether by creating competitive advantage, optimizing business processes, enabling growth or improving relationships with customers.

Magnolia Regional Health Center earned a 2021 Most Wired designation for both acute and ambulatory services. He holds a Master of Science degree in Information Technology Management focused in Computer/Information Technology Administration and Management from Western Governors University.

Q. Tell us a little about the Magnolia Regional Health Center and the populations that you serve.

Brian: Magnolia Regional Health Center is a 200-bed acute hospital located in the North-east corner of Mississippi and jointly owned by the City of Corinth and Alcorn County. Our mission here is to improve the health of the communities we serve; one patient at a time. We are a fully accredited joint commission facility servicing a seven-county region including four counties in North-east Mississippi and three in South-west Tennessee.

We supply over 20 service lines to the community, including a level-three trauma ED. Also, we operate around 20 ambulatory clinics that are comprised of primary and specialty care and have a residential-based home health and hospice facility.

Our primary service area has a population of around 37,000 while our secondary service area has a population of around 141,000. We do have a higher the national average or higher than national average median age, and about 18% of our families do fall below the poverty level. So, we do have a higher percentage of governmental payers within our payer mix. We also have a higher average of individuals without health insurance that are under the age of 65. And within those populations, we see about 30,000 patients annually through our ED. We have about 90,000 annual outpatient visits, 10,000 inpatient visits and about 33,000 ambulatory visits. So as my CEO likes to say, we’re really an outpatient organization that happens to own a hospital.

Q. You mentioned several interesting facts about your unique health system. You’re in a unique place, geographically and very uniquely defined by your population. Tell us how you make technology choices? What makes your challenges unique?

Brian: Ultimately, I don’t think this is unique to our organization, but we do like to align our technology choices with our organizational strategic plans so that we’re all driving in tandem with the rest of the organization towards the same goals.

At a high level for us, those goals are to engage our teams, provide our patients with high-quality, personalized care, strengthen our financial position, and create a stable future for our staff so that we can continue to deliver our mission to our patients and the community. We are also looking to expand our care by connecting patients with the right care at the right time, delivered by the right caregiver. These are what ultimately drive our technology decisions.

However, being a smaller regional hospital with finite resources, we have to be mindful of the operational impacts of technology and modernization — the costs of both, the short-term, long-term resource commitments to the technology and the associated cyber security implications. We want to provide our staff and consumers with the latest and greatest in technology that helps drive improvements in quality and safety but, we also want to minimize the risks to the organization.

So, we’re constantly asking questions like — Can this technology address multiple challenges intra-organization? Can we leverage existing technology to drive additional product value? Does the technology drive efficiency within our workflow processes? How would the technology complement our existing technology stack? Can we support the solution within the current framework? Do we have the right skill mix in place to support the technology? If not, how much effort will be involved in training the staff to support this? Is there a staff pool available out there for such support? What are the educational requirements for our users? Now, we don’t have a large staff base, but we have to be mindful about it when we’re choosing technology.

Q. What does digital transformation mean in your context?

Brian: I say this year-over-year that, it’s just an exciting time to be in healthcare IT and I may be starting to sound like a broken record to this point, but the level of innovation keeps progressing at a rapid rate, and the insights that are being gleaned from analytics continues to improve and keep pushing the boundaries of what is possible in health care. The pandemic has escalated the adoption of digital technologies.

Despite being in a smaller organization and a smaller market, I’m not sure my answer’s very different from other counterparts or the larger organizations. If you look at our technology roadmap, you’ll see the digital transformation for Magnolia lies in the use of digital technologies to create or transform our processes, culture and experiences from both, our consumers, and staff to enable improved care delivery and potentially, even in a small market, create a competitive advantage.

As far as what we’re investing in right now, if you go back to what drives our technology decisions, we’re looking to utilize technology to expand access to care while improving outcomes and quality. We recently submitted for and received funding as part of the FCC Telehealth Grant to expand access to telehealth services within our region. The state of Mississippi is also investing heavily to make broadband more readily available to residents in rural areas throughout the state. We’re looking to leverage these funds in bringing free methods, provide acute-based telehealth consults for those scarce regional provider resources like infectious disease intensivist and behavioral health sources. We’re also looking to build an urgent care telehealth platform that provides immediate access to provider resources for those non-emergency issues, because, being a smaller hospital, it isn’t easy to get through health care resources within the area as it might be in some or other metropolitan areas.

We’re looking to create a remote patient monitoring platform to help improve outcomes for our patients, post-discharge. We’re also working to develop a richer online mobile experience for consumers with access to self-service tools that deeply integrate with the EHR. Such tools not only provide a better experience for our consumers, but they also provide improve staff efficiencies. However, staffing has become a real challenge within the organization.

Q. When you talk about telehealth, can you give us an example of what you’ve implemented that benefits your patient population, but also your providers?

Brian: We’re using video-based parts with Amwell to provide resources to our clinicians and patients. We had an infectious disease provider on staff but during the pandemic, they moved to a larger area to provide services. That left us with no resources available for our patients. When we investigated if it made sense to continue that to provide those resources locally, we decided instead to utilize telehealth platforms to provide those services. We have expanded on that using the intensivist within our medical intensive care unit and behavioral health. We have an inpatient behavioral health and we’re using telehealth services across parts within the organization to provide those video-based consults for those patients.

Q. You’re a Meditech shop and they recently signed a partnership with Google. What do you make of that? How is that likely to impact/influence your roadmap with Meditech?

Brian: We are a smaller hospital, our EHR is one of the largest financial investments, both from a capital and operational funding standpoint. Here, at Magnolia, we’ve been a Meditech client for over 25 years now, and so, we have a significant investment in the Meditech technology stack.

Within the state of Mississippi, we have eight hospitals that form a CIO collaborative that are Meditech users, and this is kind of a routine topic of discussion for us. If you look at these eight hospitals, it is eerie how similar these organizations are from a technology portfolio standpoint. And I think that’s because there tends to be a smaller vendor pool developing within the Meditech space and Meditech really has a limited number of preferred relationships that they really built deep integration again, into the EHR. So historically, we’ve tried to leverage the EHR or as much as we possibly could, even if it did not provide the exact experiences or outcomes that we were looking to achieve because of that deep integration, keeping our users working within the workflow and the context of the EHR.

Meditech’s been a great partner to us over the years, and it’s really developed some great digital tools and we’re very excited to hear about this next generation of collaboration with Google.

But today we’re taking a little different approach to our selection process. We’re taking a more focused approach to discover what solutions work best for us and our organization, our long-term goals, users, and consumer experiences. There’s been some debate as recent as to whether the EHR should remain at the center of the healthcare digital ecosystem and for Magnolia, the EHR still is our core source for clinical and demographic information. However, we are looking at how we can use APIs, new HL7 capabilities, contextual efforts and launches, and other interoperability standards to create sustainable and scalable solutions around the EHR that continue to deliver on our goals to drive efficiency, quality, and experience.

One example is that we currently are working with Meditech and a vendor of ours to develop a Magnolia-branded app out that will wrap the Meditech-branded portal with necessary integration. If you’re familiar with Meditech, there is a mobile app that has been developed by Meditech that all Meditech hospitals use to provide access to care for patients for functionality. Since it’s a single app for all that, the app really provides no site-specific customization outside of branding. So, this branded experience that we are currently developing in unison with Meditech will be the first of its kind for the Meditech site and give our consumers access not only to their medical records and patient portal functionality, but also, all the other digital tools that we’re looking to offer and provide. So, we’re really looking to balance the digital roadmap to help us achieve our goals.

Q. It’s so interesting to hear that. Now, when we talk about the broader context of the competitive landscape, what are these competitive forces you see emerging for a somewhat insulated regional health system like yours? How do you prepare to meet them?

Brian: The competition for patients is going to be greater and greater. Now, we not only have to continue to contend with the larger health systems around us — the largest health care system in the United States is actually just 50 miles south of us – but we have to continue to contend with those encroaching upon our service areas.

You’re also seeing a growing digital health market with emerging entrants that tend to be less limited by geographic borders. Growth within the telehealth space and offerings like the integrated access to Alexa connected devices make accessing care extremely convenient for consumers.

Services like these could be extremely disruptive to our primary care services and ultimately, our referral path into our specialty services. So, we have to continue to innovate and come up with new and creative ways to set ourselves apart, build upon our foundational relationships with our patients to set ourselves apart from those competitors.

Also, another competitive force is the competition for labor resources in our market. That’s increased drastically over the pandemic, which has driven an increasing number of workforce out of health care industry. Remote workforce capabilities are extending the traditional geographic boundaries of labor pools, and we now find ourselves competing with other industries and non-local organizations for labor resources. This is a big challenge and a big change for an organization like ours who is the largest employer within the region. We’ve historically had an abundance of applicants to choose from and filling our labor opportunities. We’re just not seeing that any longer. So we have to continue to design our talent strategies to create the right culture within the organization that creates employee experience advantages, keeps our employees engaged, and attracts the right potential candidates to the organization.

Lastly, kind of a new entrant into the competition is the competition for suppliers – that has become more fiercely intense due to the limited availability and general disruption supply chain. As a small organization, we have struggled to procure everything from electronics to specimen collection cups and crutches — just things you would have never even given a second thought to about availability. Items that we have historically ordered and had onsite within 14 days are now taking months to deliver.

On top of that, our supply cost is increasing in an alarming rate. So, for an organization that doesn’t have large margins to deal with, we’ve really got to think and rethink some of our operational processes as we continue to move forward. Bargaining power for supply purchases will play a pivotal role in hospital operations over the foreseeable futures.

Q. So you’ve got a perfect storm there. Now, you talked about a number of technologies that you use to transform the patient experience. What about things like automation? Are you seriously considering those or have you deployed those to address the labor shortage in particular?

Brian: Labor shortage has been a real challenge for our organization as it has for a lot of health care organizations out there that are being challenged by shrinking labor pool, increasing operational costs associated with staffing due to higher wage rates and overtime associated with store shortages.

You know, this has affected our organization on multiple levels — from our entry-level positions all the way through our skilled labor force. It really doesn’t seem to be slowing down anytime soon, so, we are looking at multiple avenues to counteract these challenges.

One of the avenues is to leverage technology to drive efficiency and effectiveness in workflow automation and repetitive task production and keep our staff members working at the top of their skill set. So, we’re leveraging Microbots and Robotics to perform processing of repetitive tasks.

We’ve also invested in new bedside monitoring platform and nurse cost solutions to integrate with the EHR and eliminate manual tasks and automate workflows within the care environment.

Another area that we’re focused on, is improvements in mobility and communication platforms to complement workflows by providing our clinicians with access to information when, where, and how they really need it.

The goal of these technologies is to remove those friction points and improve satisfaction by keeping our staff doing what they enter the workforce to do in the first place – serve people.

And I touched on it a little bit earlier, but another area that we are leveraging technology in is, within our patient self-service tools. We’ve already begun giving patients access to tools to schedule appointment, complete paperwork online prior to arrival, and for which we’ve received really positive feedback in our satisfaction surveys. But we’re now evaluating giving our patients access to additional tools, unify that experience between prior-to-arrival and point-of-service. This strategy helps streamline that registration process that satisfies patients and aligns the process for our registration staff while eliminating some of that staff burden there as well.

Outside of technology, we’re reevaluating the way we operate by centralizing access to resources and eliminating shallow pools of resources to help drive additional efficiency within our labor force. We are creating some flexible staffing positions and implementing safe scheduling opportunities to give workforce more control over their schedule.

We’re also looking for opportunities to expand our remote workforce capabilities in order to potentially expand our labor pool outside of our normal geographic footprint. But we want to do that in a manner that keeps that workforce healthy and engaged in the organization.

Q. What are the challenges that you have to overcome to make sure that the investments are well thought-through, and well deployed while delivering results in the shortest possible time?

Brian: One of the biggest things is to keep the technology engaged with our organization. We’re working with our leadership, end users, frontline staff members to understand their challenges and making sure that we’re deploying technology that fits their needs and is the best fit for the organization.

Keeping those conversations going is probably the top priority there and probably also one of the biggest challenges because of the reduced staffing across the environment. We’ve got a lot of our leaders pulling frontline shifts just to keep the organization rolling. So, not only is it probably the biggest need is probably also one of the biggest challenges to ensure that we’re deploying technology in the right manner.

Q. What are your big priorities for 2022?

Brian: It’s kind of a loaded question because we have so many priorities right now that when everything’s a priority, nothing’s a priority. So, if I was to break it down into a few areas, I would say that talent recruitment and retention is a big priority for us. You know, we’re seeing people leave the workforce and the industry like never before, and the competition for people and labor has increased dramatically.

So, some of the questions that we’ll continue to evaluate over the near future is how can we increase workforce support and decrease burnout? How do we utilize our digital technologies to improve productivity, automation and collaboration? How can we leverage hybrid remote workforce as a recruitment tool? What can we do to create a more meaningful employee experience that really reinforces the individual’s connection back to the organization and our mission?

Secondly, I would say that we’re doing a lot to upgrade and improve our digital infrastructure in a manner that positions ourselves to be more nimble and better prepared to react to the changes in the marketplace and is really a primary priority for us. This allows us to continue to evaluate moves to digital automated processes and away from those manual processes.

We also continue to evaluate opportunities to leverage cloud infrastructure for scale and within this area, it helps that there’s intense focus on improving our customer experience.

And last, but not the least, I would say cyber security remains a top priority. The attack surfaces for health care continues to expand. So, be proactive with our security measures to protect our systems, and our patient data is probably one of the biggest challenges for our organization and one I’m sure that keeps a lot of CIOs across the country, up at night. So, you know, how can we better leverage our technology to identify risks and better position our users to make good sound decisions? It’s going to continue to be a focus area for us.

We hope you enjoyed this podcast. Subscribe to our podcast series at  www.thebigunlock.com and write to us at  info@thebigunlock.com

Disclaimer: This Q&A has been derived from the podcast transcript and has been edited for readability and clarity

About the host

Paddy is the co-author of Healthcare Digital Transformation – How Consumerism, Technology and Pandemic are Accelerating the Future (Taylor & Francis, Aug 2020), along with Edward W. Marx. Paddy is also the author of the best-selling book The Big Unlock – Harnessing Data and Growing Digital Health Businesses in a Value-based Care Era (Archway Publishing, 2017). He is the host of the highly subscribed The Big Unlock podcast on digital transformation in healthcare featuring C-level executives from the healthcare and technology sectors. He is widely published and has a by-lined column in CIO Magazine and other respected industry publications.

Digital health startups must ensure that they have a good business case based on reality

Season 4: Episode #116

Podcast with Paula Turicchi, Chief Strategy Officer, Parkland Community Health Plan

"Digital health startups must ensure that they have a good business case based on reality"

paddy Hosted by Paddy Padmanabhan
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In this episode, Paula Turicchi, Chief Strategy Officer, Parkland Community Health Plan (PCHP), talks about how the organization went from a completely outsourced service model to taking more control over their operations. PCHP primarily serves a Medicaid population of pregnant women and children in North Texas. Paula discusses how they use digital engagement tools and technologies with their members to improve the quality of care and health outcomes. She outlines how economic factors such as rising gas prices impact their members and their ability to afford access to healthcare.

Paula also discusses their data and analytics programs in partnership with their sister organization PCCI, and how they have repurposed existing applications to serve emerging healthcare needs over the past couple of years (listen to our podcast episode with Steve Miff, CEO of PCCI). 

Paula advises startup founders to have a good business case before they approach them with a solution for their target audience. She discusses at length the various considerations for digital engagement for their member population and the risks/trade-offs that they must address while making investment choices. Take a listen.

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Show Notes

00:42About Parkland Community Health Plan.
07:06In the last couple of years how have the needs for the Medicaid, low-income population changed and how has that impacted your own strategic direction and priorities?
09:58What kind of digital enablement have you invested for your patients?
16:26 Can you share a few nuggets that you've learned in the work that you've done with PCCI, and the analytics work that you have invested in?
17:54You're investing a lot in technology, data, and analytics. Can you talk to us about the economics of it all?
20:10 What's your advice to the startup founders who want to approach you with an interesting solution and offering that you could apply to the population?
22:23 Are all these cool tools and digital health solutions serving the needs of your low-income population? How do you make it easy for them to adopt this solution?
24:09 Do you end up subsidizing some of the costs as well to your patients?

About our guest

Paula Turicchi is the Chief Strategy Officer of Parkland Community Health Plan (PCHP). In her role, Paula strives to make a difference for patients and their families by strengthening the business of the organization through processes, systems, partnerships, and new ventures.

She has more than 30 years of experience in the healthcare industry and previously served as the vice president of hospital operations and administrator of Women and Infant’s Specialty Health (WISH) at Parkland Health & Hospital System, where she oversaw operations for one of the largest maternity services in the United States.

In addition, Paula was instrumental in the design and construction of the new Parkland Hospital facility and the Moody Center for Breast Health. She is board certified in healthcare administration by the American College of Healthcare Executives and holds a Master of Healthcare Administration from Trinity University and a Bachelor of Business Administration from the University of Arkansas.

Q. Can you tell us about Parkland Community Health Plan and your role as the Chief Strategy Officer?

Paula: We are a very large system. Most people know Parkland because it is the hospital where JFK was brought in way back in 1963 and since that time Parkland has grown tremendously. We have the main hospital, plus many community clinics, school-based clinics, lots of really great specialty programs, one of the largest maternity services in the country, a very large burn center, trauma center. So, it’s just a really sophisticated care institution.

A part of the system includes the Parkland Community Health Plan, which has been in service to our community since the late 1990s. We have a contract with the state of Texas to administer Medicaid benefits through the STAR CHIP and CHIP perinatal programs. And so, unlike Parkland Hospital, which serves Dallas County, we serve a seven-county area in the North Texas community. We partnered with about 35 hospital systems, plus 6000 providers in our network to take care of our 220,000 members in the North Texas area. We provide them benefits, ensure that they get access to care. We partner with many community organizations to make sure that we’re meeting social determinants of health and really serving the community through our health plan, as well as through the system.

As the Chief Strategy Officer, I’ve been helping design our path for the future. We started out as a very small plan when I joined about two-and-a-half-years ago. We were really more of a vendor management type of health plan. We had outsourced all of our activities, primarily, and really only had about 15 employees in our health plan. When our new CEO John Wendling, came on board in 2019, he said, “You know, I really want to be in charge of the service we provide. I really want to be connected to the members. I want to be connected to and provider network. And I really want to be the plan of choice.” The best way for us to do that was to take on responsibility for that service, directly. So, we’ve spent the last year transitioning away from our third-party administrator, bringing many of those services in-house and being responsible for that administration of the benefits ourselves. My role has been trying to create that path forward, taking John’s vision and creating strategic documents, work plans and action plans, along with the leaders throughout the organization to really fulfill on our mission, vision and values and our goals to be the party of choice.

Q. You mentioned running such a large enterprise with just 15 full-time employees while outsourcing other functions. Is it fair to say that you are now trying to reverse that, bring more of it in-house for greater control over resources and directly influence the quality of the services that you provide?

Paula: Yes, especially for the health plan, specifically so Parkland, the system, has about 16,000 employees and a huge service. But the health plan was almost a department of the hospital and really not even considered a separate organization. We’ve tried to mature the health plan as a related but a different organization with a different set of priorities and a different set of stakeholders because certainly, if you’re at the hospital, at the center is the patient. Our focus as a health plan, is the member, the provider and then, also our state agencies. Since our contract is with the state of Texas, we want to make sure that we are following the state’s priorities and their strategic mission for the Medicaid programs, STAR CHIP, CHIP Perinate programs. It’s really kind of aligning our priorities with their priorities and we thought the best way to do that was to really become more responsible and more responsive directly as opposed to indirectly. And so, look at all of the services that we are responsible for in our contract and determine the best way to do that in the most responsible way.

Q. You’re serving largely a Medicaid, low-income population. In the last couple of years how have the needs for this population changed and how has that in turn impacted your own strategic direction and your priorities?

Paula: The changes that have taken place over the last two years during the global pandemic have been very dramatic. We have seen an immediate shift to digital options, whereas we were very reliant on in-person healthcare and our members were very used to going to the doctor. Our physicians were very used to having patients in their offices. So, this dramatic shift to digital options has been rapid and I think, very exciting. I think that everybody’s been surprised at the way folks have embraced it, as well. There was always some trepidation – “I don’t think our members will use it. I don’t think our patients will use them.” But we really have seen this dramatic acceptance of the digital options.

We’ve also seen a lot of social determinants of health — needs for housing, food, different sorts of social services — as the pandemic kind of morphed and changed how people were working, whether they were working or not, whether they had transportation. Now we’re seeing a lot of requests for rides because gas prices are so high. A lot of folks are calling and saying that they can’t afford the gas that it takes to get to the doctor or to get to an appointment that they have to fill out their applications or that type of thing. So, they’re requesting help with transportation a lot more these days. So, we’re seeing these shifts in the different types of social needs that our members have and then, we’re trying to very quickly respond to those to meet their needs and to make it easy for them to access those services.

Q. One thing I must comment on is how remarkable that you say you made some assumptions about your population and that those assumptions need to be reviewed because they may be wrong. You talked about rideshares and enabling these through mobile apps. What kind of digital enablement have you invested in response to this in the last couple of years and the emerging demand from your patient?

Paula: One that has been a great success is an app called – Pyx. It was originally developed to combat loneliness in an older population and when we were approached by Pyx, we said, “Well, is it possible to change the focus of the app for our pregnant women and children’s members?” My history and career have been spent mostly in the women’s and children’s arena and I’ve felt that oftentimes just after delivery, women are somewhat isolated. They may not have the opportunity to interact with friends and family as much as they normally would or during their prenatal period. So, is it possible that this app could be used to combat loneliness in the postpartum period for women? It turned out to be a really great tool.

What we’ve found is that women will engage with the app in the wee hours — between, say, midnight and 2 am — maybe they’re up for a feeding in the middle of the night and they just open their phone, and they engage with the app. It’s designed to really almost be an engagement tool to offer information, resources, tell a few jokes, create a little humor and lightness and so we realized from our members that are using the app that it really was addressing a need. Some of those needs that have come up even include say, for example, women who have experienced a pregnancy loss – and this is often an overlooked group of women who need assistance. So, connecting them with behavioral health services or counseling for their grief has been addressed.

The other thing that we found is that women will engage with the app to find things like food or rides to the doctor. And we have also incorporated our value-added services into that app and often ask — “Did you know that we offer home-delivered meals for women in our health plans? Have you taken advantage of that value-added services? If not, this is how you get it. Did you know that we have rides? Did you know that we could connect you to a resource that can help with your rent?”

It really has been a great tool that folks can use on their own time — it meets them where they are and addresses their needs in a unique way. And it’s been highly successful. We’re really proud of that.

Q. It’s a very targeted need for a very targeted population segment. I’ve had the CEO of the Parkland Center for Clinical Innovation, Dr. Steve Miff, talk about some very interesting work that he and his team do in the context of looking at risk factors for things like preterm births, etc. Can you talk a little about that? I’m assuming part of that work relates to your work as well.

Paula: Indeed, it does. We work quite closely with PCCI, and they have pioneered some programs with the health plan to address kids with asthma as well as preterm birth. And so, some of the things that they are doing with us is to identify those members who are in need of additional help with their disease state or maybe, to take a look at how do we predict, for example, preterm birth? Are there indicators that will help us to prevent, say, a second preterm birth? We have refined preterm birth to over time to ask — What have we learned from this iteration? How can we change the algorithm to identify more women who may be at risk? Is there another factor that we can insert into that algorithm to improve our results even more with the pediatric asthma program?

They’ve really helped us to take a look at what are those factors that can contribute to exacerbation of their asthma. Are there things that we can do either in an interaction with the member or the patient or the family to enhance their knowledge of their medication utilization? Or, are there environmental factors, say, in their neighborhood or in their apartment complex or in the house that they live in? How can we partner the PCCI data with our disease management vendor to identify who we need to actually go out and visit in the home? And is there something that we can do, for example, partner with the Dallas Housing Authority to or the city to say, perhaps there’s a code violation in the location where they live, that needs mold remediation or perhaps they need some type of environmental change, pest control, things like that so that we can remove that environmental trigger or their exacerbated asthma. So, it really is a unique way to use the data to then create an action to improve the outcomes.

Q. And I couldn’t help but notice that most of the data that you refer to is as more in the nature of social determinants than clinical or medical. In the work that you’ve done with PCCI and the analytics work that you have invested in, can you share a few nuggets that you’ve learned that otherwise you might not have?

Paula: I think that one of the things we have learned is that all of these factors go together. You can eliminate or at least minimize one factor, but then, another pops up. So, you really do have this iterative process of addressing one need or one factor, and then, the next will appear. The data helps you identify the next factor that you need to address. So, I think that it is a continuous learning and improvement process. And just by using that data, refining it and looking at the next option to address it is just a continuous learning process in a highly collaborative way — What data do we have, how can we use it, how can we develop conclusions from this data and how can we incorporate it into our day-to-day work?

Q. All this also raises questions around who pays for all this. You’re investing a lot in technology, data and analytics. Can you talk to us about the economics of it all?

Paula: That is one of the things that we struggle with. We’re always on the receiving end of, “Hey, I’ve got a great idea for you, or, have I got a great product for you?” So, one of the things that the strategy department does is helps the rest of the organization really value whether something is a good deal for us or not by asking — Is there an ROI, an actual dollar amount that we can quantify, a clinical benefit to this program?

One of the things that we were presented with recently was an opportunity to look at a maternal intervention, sort of a disease management strategy, and the proposal looked like it could save us millions and millions of dollars, but it’d also cost us millions of dollars! We dug into our own data to see if we had that many women in our health plan with that particular type of issue. Going in and fact-checking that proposal made us decide that probably wasn’t our best expenditure to make.

We’ve tried to refine that process over time to really look at the offerings that we get with a critical eye to see if it really is a good expense because our funds are limited and we really do have to be very thoughtful about where we put our funds and so that we’re not just sort of taking a chance, risk or gamble. But we really do want to assess those opportunities to see if they make good business sense.

Q. So if a startup founder with an interesting solution that could apply to the population, wants to reach out and share their story and their offering, with you, what’s your advice to them before they even approach you?

Paula: I would say — make a good business case and make sure that it is based in reality because some of the things that I’m going to ask, if you tell me you’re going to save me 10 million dollars, is — How did you come up with that amount? Which members are you going to affect? What types of interventions would this take? Who’s going to make those interventions? How is this going to work?

It’s always like, you’re going to have to prove it to me. You’re going to have some solid details behind it, and there must be some homework to it. How is it that you can do this for me that I can’t do myself, because in some cases I often wonder, could I just take that and do that internally because it’s essentially a make-by decision, right?

So, you’re going to have to convince me that I need to buy it versus make it. And is there some special sauce that you have that I don’t have? So, I think those are the kinds of questions that I would ask, and I think that it behooves someone who is trying to really convince someone else to buy their product. You know, “What’s in it for me? How am I going to benefit from this? And how can you show me that that cost is going to pay off?”

Q. Where does your patient figure in all this? You’ve got a low-income population, there’s the emerging digital divide so, are all these cool tools and digital health solutions serving the needs of those that they’re meant for? Or are they just exacerbating the gap? How do you factor that question into your decision-making and how do you make it easy for your population to adopt this solution knowing that they are looking for these?

Paula: One of the things that we have always asked is – “Is this tool or digital intervention going to cost our member money? Will it require more data or bandwidth? Will members have to pay for a service in some way? Certainly, during the pandemic, we heard a lot about digital deserts and whether low-income pockets of communities had access to the internet or to data. So, that was one of the questions that we asked — Can anyone with any model of phone use this? Are there barriers to engaging with this digital option?

What we found, especially with that one, is that there were very few barriers and it was very easy to use. It was open to lots of different types of phones — old or new. So, there were just very few barriers and that led us to really engage with them because removal of those barriers is key.

Q. Do you end up subsidizing some of the costs as well to your patients?

Paula: One of the things that we do offer as one of our value-added services is the Lifeline Program. We try to encourage our members to take advantage of these federal programs that are available to get access to data phones to enable better engagement. We also look, for example, across our provider networks, and some of our pediatric providers already have a digital option. So, working with them to make sure that we connect our members to that information is something we do.

Parkland as a system uses Epic and we have care everywhere. There are digital ways to engage with our providers who offer telehealth services. We want to make sure that we communicate that to our members to ensure they understand what’s available to them.

How do we get them the tools? Certainly, with our health system, one of the things that we have talked with them about is how to bring telehealth services out to the community in a location where the community gathers. So, rec centers, community centers, FQHCs and different locations out in the community, if they have space and equipment, we can assist them with setting up those digital hubs so that is one way that I would say, is not a direct subsidy, but it is a creation of that access point. So, trying to think innovatively and trying to identify those locations where the community gathers so that they have sort of automatic and inherent access to it – that’s how we do it.

We hope you enjoyed this podcast. Subscribe to our podcast series at  www.thebigunlock.com and write to us at  info@thebigunlock.com

Disclaimer: This Q&A has been derived from the podcast transcript and has been edited for readability and clarity

About the host

Paddy is the co-author of Healthcare Digital Transformation – How Consumerism, Technology and Pandemic are Accelerating the Future (Taylor & Francis, Aug 2020), along with Edward W. Marx. Paddy is also the author of the best-selling book The Big Unlock – Harnessing Data and Growing Digital Health Businesses in a Value-based Care Era (Archway Publishing, 2017). He is the host of the highly subscribed The Big Unlock podcast on digital transformation in healthcare featuring C-level executives from the healthcare and technology sectors. He is widely published and has a by-lined column in CIO Magazine and other respected industry publications.

The Healthcare Digital Transformation Leader

Stay informed on the latest in digital health innovation and digital transformation.

The Healthcare Digital Transformation Leader

Stay informed on the latest in digital health innovation and digital transformation.

The Healthcare Digital Transformation Leader

Stay informed on the latest in digital health innovation and digital transformation.