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Will Your Organization Be Left Behind as Consumer Healthcare Transforms?

Offer more value, and be willing to meet your customers in the messy middle.

It’s no surprise that the pandemic has changed the way consumers interact with healthcare. We see it in the proliferation of virtual care across the care continuum, from acute to chronic, episodic and now primary and preventive care. We see it in the embrace of new digital devices and programs designed to monitor chronic conditions at home. And we see it in the uptake of digital pharmacy services that promise ever-faster delivery times and simple, easier, prescription transfers. These shifting consumer need states are forcing companies to action.

Those that will win with consumers in the post-pandemic age are the ones that will accelerate innovation as they reimagine their business models – integrating and re-configuring assets around emergent consumer use cases.

Here are three healthcare business design imperatives for making markets and capturing post-pandemic value through big, bold and transformative moves:

1) Trade the value chain for value exchange

The old news? Payers, providers, pharmaceuticals and MedTech companies once controlled discrete pieces of the value chain. Today, they are operating as collaborators and competitors alongside one another – with non-healthcare entrants (financial services and technology companies) also looking for a piece of the pie.

The new news? “Who does what” doesn’t matter to consumers, instead they value the promise of an integrated approach to health. Whether you build, buy or partner, leaning into the discomfort of superseding the value chain can lead to transformative, new offers. Teladoc Health is a great example of a company that bet big on the idea that virtual primary care is here to stay. It built the Primary360 platform as an entryway to take advantage of its unique portfolio of assets from acute and episodic care (Teladoc Health) to chronic care (Livongo), behavioral health (BetterHelp), and more.

Alternatively, a company that took the partnership route is Cigna. They joined forces with Oscar Health to create an integrated, easily navigable approach to health plans for small businesses. By bringing together Cigna’s provider network and Oscar’s technology platform, they’ve created a relevant solution for the small business population that meets their needs.

2) Meet consumers in the messy middle

If transcending historical value chains is one way to play, another is to exploit the current outages in the value chain and become the middleware that bridges a care gap. Emerging care gaps could include areas like post-acute care, kidney care, pre-and post-Cancer treatment, and health conditions at the intersection of health and wellness (e.g. sleep, behavioral health).

Take recently acquired startup PatientPing, which focuses on the post-acute care space. Through its technology platform, the company can coordinate care by “pinging” healthcare providers when their patients are treated at other facilities. For instance, a provider could be notified in real-time when a patient is transferred from a nursing home to another outpatient setting. Now, with its acquisition by Appriss Health, close to 1 million healthcare professionals across all 50 states can be connected across care settings.

“Those that will win with consumers in the post-pandemic age are the ones that will accelerate innovation as they reimagine their business models.”

In another direction, Alula Health is a startup tackling the “messy middle” of the physical, emotional and financial changes involved with a cancer diagnosis and treatment process. Alula’s platform focuses on patients and their caregivers. They provide organizational tools such as spreadsheets and calendars to ease treatment coordination and a curated list of cancer-specific shopping items (e.g. post-surgery bras and robes with extra room for prostheses or drain management, “Travel to Treatment” bundles with pill organizers, sickness bags, sanitizing wipes, and face masks).

A final example is Talkspace, a platform aimed to make behavioral therapy more accessible. In a world where the dominant method of therapy was administered through expensive 1:1 sessions, Talkspace broke the prevailing mode of thinking and dispensed therapy through bite-sized, text-based interactions – a new modality for meeting the needs of those struggling with mental health challenges discreetly and without confining therapy to a set date/time. In doing so, they normalized therapy for a whole new, addressable market and have since expanded to partner with employers to offer its service as part of workplace benefits.

3) If it doesn’t have their name written on it, it’s not for them

The third hack for making markets through transformation is to address the unmet needs of unique consumer populations. Traditional provider-driven healthcare focuses on triage to identify a treatment path for every patient. But flipping this approach on its head allows for a deeper level of focus, prioritizing time, resources and expenses to solve the needs of one population group more effectively than a general solution.

Segment-specific opportunities are everywhere and can include:

  1. Those with a stigmatized condition
  2. An underserved population with unique needs
  3. An overly generalized population.

A good example of the first opportunity is Ro, self-styled as “the patient company”. Ro started by providing telemedicine and prescriptions for erectile dysfunction via its Roman brand, but gradually expanded to include other medical challenges like smoking cessation (via zero) and weight management (via Plenity). With the technology infrastructure, brand architecture and consumer base established, the company can pursue additional disease states with room for growth.

An example of the second segment-specific opportunity is Included Health, newly acquired by telemedicine provider Grand Rounds / Doctor on Demand. Included Health focuses on the needs of the LGBTQ+ community, who have all too often faced challenges finding culturally competent and affirming providers. The company works with employers to provide benefits to individuals that help them connect to physical care providers, mental care providers, community support and gender-affirming care.

The third-dimension type of play is to identify an overly generalized population – and the field of women’s health is a great example. While some companies have developed “female” healthcare brands, women have different needs by life stage. The spectrum of startups in today’s women’s health space demonstrates different focus areas such as reproductive/sexual health, pregnancy and postpartum, as well as menopause. Within each focus area, individual companies target specific challenges. For example within the category of reproductive/ sexual health, some companies focus on areas such as fertility (Modern Fertility, recently acquired by Ro), cycle tracking (Glow), birth control (Nurx) and more.


FINAL THOUGHTS

The pandemic has created new and exciting consumer use cases. Uncommon growth will only be captured through transformative moves that reconfigure assets and ecosystems. To capture this growth, companies can deploy one or more of the three design imperatives.  Incrementalism is a direct path to low growth and missed opportunities,  and capturing uncommon growth will require high-conviction leaders, cultural resilience and organizational agility. To help companies forge a path to uncommon growth, Prophet approaches each organization as though it were an individual – with a unique DNA, Body, Mind, and Soul.

Contact us to learn more about our proprietary Human-Centered Transformation Model and how we can deliver uncommon growth for your business.

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Transforming Healthcare: The State of Digital Marketing and Selling in Life Sciences

Leaders in healthcare need to embrace a marketing and sales strategy that is digital and collaborative.

The pandemic accelerated the integration between marketing and sales – and it’s never going back to the way it was. Leaders in healthcare and life sciences will need to embrace a marketing and sales strategy that is both digital and collaborative to reach business goals. The reality is that if organizations fail to transform their go-to-market approach they will be at risk of losing customers.

Transforming Healthcare: The State of Digital Marketing & Selling in Life Sciences identifies and quantifies the salient trends and key practices used by top companies today. Based on data from Altimeter’s research for The 2020 State of Digital Marketing and The 2020 State of Digital Selling, this industry-specific report provides insights for healthcare and life sciences leaders looking to strengthen their marketing and sales functions and jumpstart a new era of uncommon growth.

Read this report to gain deeper insights on:

  • The top priorities of marketing and sales teams in healthcare and life sciences today
  • The biggest obstacles organizations are facing in terms of digital collaboration and performance
  • Marketing and sales leaders’ candid observations of what their teams are doing well – and how they need to do better
  • Four key recommendations for marketing and sales teams seeking significant performance gains

Download the full report below.

Download Transforming Healthcare: The State of Digital Marketing and Selling in Life Sciences

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WEBCAST

Webinar Replay: B2B Leaders Series feat. Randstad & Boston Medical Center

B2B leaders discuss the challenges of building the right culture and systems for digital transformation.

59 min

Watch the webinar replay in which you’ll learn about the challenges that B2B organizations face in undertaking transformation on a large scale and how they address them. The discussion features Rene Steenvoorden, Chief Digital Officer, Randstad, Heather Thiltgen, President, Boston Medical Center/WellSence Health Plan, and Fred Geyer, Senior Partner at Prophet, who were interviewed by Joerg Niessing, Senior Affiliate Marketing Professor at INSEAD.

Two of the participants, Fred Geyer and Joerg Niessing, co-authored ‘The Definitive Guide to B2B Digital Transformation’. Get your copy of the book here.

If you have any questions or would like to learn how our Marketing & Sales practice helps clients identify a clearer path to a digital transformation that powers growth with real and measurable results, contact us today.

REPORT

Virtual Care: From Rarity to Reality

In their quick pivots to telehealth, leaders learned plenty about patient experiences and the care continuum.

How 12 Industry Leaders Are Shaping the Virtual Care Revolution

The role virtual care plays in the healthcare ecosystem has rapidly accelerated since the onset of COVID-19. In fact, according to research by Doximity, as many as 20 percent of medical visits in 2020 occurred via telemedicine. And it’s clear the trend is only gaining momentum.

To assess how the healthcare universe is responding, Prophet spoke to 12 leaders across the ecosystem to understand how this shift is transforming the patient experience and the broader healthcare care continuum.

Read this report to gain deeper insights on:

  • Four virtual care sub-categories and the ways they continue to blur virtual wellbeing, connected health, virtual health and virtual medicine
  • The changing dimensions of audience and interactions
  • Insights from 12 industry leaders on what organizations are – and aren’t – getting right
  • Three path companies can take to connect virtual care to better serve patients and customers and to achieve exceptional growth

For full insights, download the full report below.

Download Virtual Care: From Rarity to Reality

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Three Ways to Win With The New Digital Care Continuum

The right platforms can fix breakdowns between care settings.

Ten years ago, it was all about the patient experience. More recently, it was all about healthcare consumerism and now, the focus is shifting towards enablement – the healthcare platforms. For years, healthcare companies have been talking about the full continuum of care but nobody wanted to own it. Even when you look at the so-called Integrated Delivery Networks (IDNs), they weren’t truly “integrated,” meaning their urgent care clinics, surgery centers and home care were all run as different business units by different leaders (often with different incentives).

Back in 2016, Prophet and GE Healthcare’s Patient Experience study found that because nobody owned the full care continuum, patient experiences often broke down in between care settings. At the time, we saw the opportunity for digital solutions to bridge those gaps. Now, enter the modern healthcare platforms and the digital care continuum.

“The biggest disconnect between how patients experience healthcare and how executives rate their performance was around non-clinical aspects.”

With two decades of extensive M&A activity within health systems and little improvement in the patient experiences, healthcare platforms are rapidly scaling to become not only the digital care continuum for patients but THE care continuum.  By now, we all know Teladoc Health and Livongo, as well as Carbon Health and One Medical. And let’s not forget the original healthcare platform, Kaiser Permanente. Love ‘em or hate ‘em, they are approaching $100 billion in revenue. They were half of that a few years ago, and they have the leading market share in most of their markets. While not digitally native, they are more of a true platform business than virtually all of their peers of the same age.

You might be asking, what is a platform? A platform business facilitates value exchanges between two or more interdependent groups, usually consumers and suppliers. The next question becomes, how can I prepare my business for the future of healthcare platforms and digital care?

Here are a few things to consider when building your digital care continuum:

Stop Running Your Business as Self-Contained Units

Enterprises with standalone businesses and distinct P&Ls are great for managing costs, but terrible at delivering integrated care experience. This is not to say you can’t do discrete budgeting and hold people accountable for fiscal performance. But combine that with organizing and incentivizing them to create products and services that integrate into a platform that supports a patient (or any type of customer) continuum. “Warm handoffs” is a commonly used approach with today’s healthcare systems, but it’s no longer enough. It now has to be an integrated handoff. And you don’t have to be digital, Kaiser Permanente has always taken this approach.

Don’t Think About the Healthcare Experience as Care Points

Healthcare execs often say that success resides in delivering the right care, at the time, and at the right place. As patients self-navigate the U.S. healthcare system, the healthcare experience feels more like jumping from one experience to the next. As we learned in our patient experience study, the biggest disconnect between how patients experience healthcare and how executives rate their performance was around non-clinical aspects. University Health has already called out creating a seamless patient experience as a strategic priority with the digital care continuum as a critical enabler, and they intend to, offer programs and digital tools that allow patients to connect with their care team to manage episodic care or chronic diseases. Their orthopedic and pediatric cardiology specialties have utilized these tools for facilitating disease management and patient engagement. The next step for enterprises is to go beyond their specialty practices having a self-contained digital care continuum. Organizations need to view patients as people who often have multiple conditions and use health systems for a variety of care needs.

Start With the Holistic Patient Experience

It’s surprising how many large healthcare companies still don’t view patients as people. Patients with osteoporosis, heart disease and depression, are still seen as independent patients of rheumatology, cardiology, and psychiatry departments. The system is aware of the different conditions, but the experience -from treatment to bill payment to diagnostics- will differ. For pharma companies, that means three independent business units with separate brands providing drug treatments. Patients are seen as three unique conditions, not as a single, person.

Making this shift doesn’t happen overnight.  Prisma Health took its first step toward delivering a holistic patient experience by enlisting the help of PerfectService, a unified platform for clinical communication and collaboration that helps physicians, nurses and care team members improve patient care. You can’t deliver an integrated patient experience if your clinical teams can’t seamlessly collaborate on a single platform. Things like EHR systems have primarily been designed to store medical records and file claims, not optimize care coordination. Restructuring your technology footprint can go a long way to address this gap. And if you’re a digitally native healthcare provider, you’re likely already a step ahead.


FINAL THOUGHTS

The reality is that todays’ care continuum is still largely conceptual. ACOs are designed to own the full care continuum but they are a small fraction of the U.S. healthcare spend. Look at your own company’s claims data. For commercial plans, you’ll be fortunate if 25 percent of the claims are tied to a value-based care model, and don’t be surprised if it’s under 5 percent. We’re still very much living in a fee-for-service world. And while payers have visibility across the care continuum, they don’t often have full control. Providers typically focus on just one area; primary care, specialty service lines, post-acute care, etc. which is why understanding the emerging modern healthcare platforms is so critical. Whether it is the rapid expansion of digital natives like Teladoc Health, legacy players going through a transformation like Prisma Health, or the steady growth of Kaiser Permanente, it’s coming faster you think.

For more help in getting your healthcare organization ready for the new world of healthcare platforms, and winning with the new digital care continuums, connect with our healthcare team.

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Four Healthcare Trends to Watch in 2021

Why healthcare companies may never be the same.

Because 2020 torched so many assumptions in the healthcare and life sciences universe, making predictions about the year ahead feels a little like tempting fate. And while the odds are good (at least one would hope) that ’21 will be less tumultuous, four trends are likely to continue their rapid acceleration. 

Each of these changes was well underway before anyone had heard of COVID-19. But as the pandemic sparked massive shifts in regulations, priorities, technology and consumer expectations, they took off–and will continue to do so in the coming months. 

“We need to build out a digital continuum with the use of automation to seamlessly escalate someone from an asynchronous e-visit, to a video virtual visit, to an in-person visit.”

Diagnostics and Services Go Home 

After years of building vast multidiscipline medical campuses, systems are looking to decentralize, with more lab tests moving from provider offices to people’s homes. Brands like Cologuard pioneered home testing.

And such companies as Abbott Laboratories and Ellume Health are getting into the game with kits that detect the COVID-19 virus and antibodies. Others include Let’s Get Checked, which detects kidney disease, and Tyto, a device that makes it easy for parents to diagnose ear infections and sore throats while CVS is conducting clinical trials to offer dialysis to patients at home.  

This healthcare trend will continue to go mainstream, only as a matter of convenience. Once people are aware that they can get reliable test results without having to brave the doctor’s office, they’ll expect more. 

Redefining the Care Continuum

Telemedicine exploded last year, and that will continue. But the best care comes not from thinking about whether care is delivered digitally or in-person but how it’s all sewn together into a single experience. “We need to build out a digital continuum with the use of automation to seamlessly escalate someone from an asynchronous e-visit, to a video virtual visit, to an in-person visit,” says Nick Patel, MD, Chief Digital Officer of Prisma Health.

Look for providers to back away from the approach of handing patients off from one care point to another. Instead, they will seek newer, better ways to link and unify the complete care experience. As the multichannel experience goes from drawing board to reality, there will be a growing realization that high-quality patient experiences are either made or broken in the cracks of this digital healthcare consumerism continuum. 

Digital Selling Becomes More Human—and More Effective

Over the years, sales teams have resigned themselves to ever-decreasing direct contact with healthcare systems. And they’ve been investing heavily in digital selling tools to compensate. So, when COVID-19 triggered a drastic decline in in-person sales, they wanted to believe they were ready. But too often–digital tools aside–they were relying on outdated processes, thinking and talent. Yes, they have the technology to deliver targeted emails instantly. But that doesn’t matter if it still takes months to get internal approvals for their messages. 

It’s clear that virtual sales calls are here to stay, with SERMO reporting that 84 percent of physicians are expecting more remote interactions. Smart companies are focusing on what they must do better. Remote calls, for example, are 20 percent shorter than in-person visits. And what providers want more than anything – at 55 percent–is information about new products. 

The most modern selling organizations are changing the way they microsegment audiences, creating targeted digital content for every audience’s customer journey. Of course, this stepped-up content approach is technology-driven (and often requires hiring a new type of sales professional.) But the real change enabling it is at the human level, with an appreciation of speed and an increase in empathy. 

Reinventing the Employee Relationship

The basic “deal” between employers and employees–what each expects to get out of the relationship–is undergoing a rapid shift. The ability to work remotely is part of the equation. While many providers have to be on-site, others–administrators, procurement specialists and even hands-off providers, like radiologists–can work from the comfort and safety of their homes. 

And that’s changing recruiting and retention because it means, at least potentially, that someone could take a job hundreds of miles away without having to leave their home. 

And all that is occurring at a time when awareness of the importance and perils of healthcare peaks. Even as doctors and nurses are leaving the field in record numbers,  medical schools are fielding more applications than ever in a trend they’re calling “The Fauci effect.” Many fields are regaining luster they haven’t seen since the days of Jonas Salk. 

Organizations are redefining the employee value propositions, looking for ways to build and improve their cultures, providing engagement opportunities that are as meaningful for remote employees as they are for those who work in person.  


FINAL THOUGHTS

Even with cases rising and the cost implications of the pandemic building, expect the most agile healthcare companies to find new ways to enrich the patient and customer experience, meeting changing demands and expectations. While 2020 was chaotic in many ways, the months ahead offer many opportunities for innovation and growth. 

Contact our healthcare team today to learn more about driving consumer-led transformation for your organization. 

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What Amazon Pharmacy Means for Organizations Looking for Post-COVID Growth Moves

This latest disruption is potentially enormous. It also exposes plenty of behavioral white spaces.

Amazon just announced its online pharmacy, news the healthcare world has long expected. And while much will be said about what Amazon Pharmacy means for the $1.2 trillion prescription drug business, we believe there’s something even bigger going on here. And it offers lessons to every company seeking growth in the post-COVID-19 world.

Amazon is proving once again that digital transformation isn’t just about technology. It’s about moving at “the speed of digital” and giving customers what they need. The e-commerce giant is merely acting on a template for growth that works in every industry and for every brand: When people begin to start moving through their lives differently, it creates upheaval, revealing new pockets of need. And the space between these changed behaviors offers abundant growth opportunities for every business willing to study them closely and act. We call these pockets of new opportunity behavioral white spaces.

Amazon’s timing offers an important lesson. This move has been brewing for years, even before its acquisition of PillPack in 2018. The company’s value proposition–getting people what they need, fast–made pharmacy an obvious extension. Who wouldn’t like to get routine prescriptions filled online, as quickly and seamlessly as every other Amazon Prime purchase?

But while it had been laying the groundwork for years, COVID-19 changed the way the world views healthcare. Consumers have always been eager for digital solutions to staying healthy and making their lives more convenient. The pandemic is clarifying, crystallizing and augmenting these new preferences, creating the perfect moment for Amazon’s launch.

Assessing the new playing field

Growth strategists should look beyond the inevitable “Amazon set to crush yet another industry” headlines. First, we are not sure it will prove to be true. Secondly, the news is more significant than that, highlighting an equal-opportunity growth moment. While there are multiple moves available, the best choices will differ depending on each company’s purpose and value proposition. Amazon is just following the universal rules of innovation and customer-centricity: What are the new customer needs, and how can we meet them in new and better ways?

There are many ways to win within today’s environment. Other companies have capitalized on the need for home care and the benefits and convenience of home delivery. Take Express Scripts Pharmacy as an example which relaunched its enhanced digital experience and consumer-centric brand earlier this summer. Unlike Amazon or new entrants in the pharmacy space, they’re building upon their deep clinical expertise, legacy in practicing pharmacy, ease and convenience of home delivery, coupled with 24/7 access to specially trained pharmacists.

“The space between these changed behaviors offers abundant growth opportunities for every business willing to study them closely and act.”

Express Scripts Pharmacy used key insights to understand that for many consumers, particularly those with multiple chronic conditions, pharmacist expertise matters more than convenience. And it’s worth pointing out that Americans have enormous trust and respect for their pharmacists, with Gallup reporting they are just behind nurses and doctors.

That’s just two players attacking the space from two different angles. There are certainly many other moves still available.

One way to analyze potential growth moves is to think about three different roles organizations can play as consumers continue to speed through these rapid changes in both needs and expectations. We like to use the “transformers, creators and invaders” framework when thinking about industry disruption. Healthcare provides some stellar examples.

Express Scripts Pharmacy is a transformer. It’s an example of a company reinventing itself and its offerings, using experience-first initiatives to reach its customers in new–and better–ways. Companies, like Teladoc, Oscar and Higi, are creators. And then there are invaders, like Amazon, moving from one category to another.


FINAL THOUGHTS

Whether one’s ambition is to be a transformer, creator or invader, the lesson is the same: For enterprises prepared to meet the moment, dive into these behavioral white spaces and listen to consumers, the opportunities for uncommon growth are there for the taking.

Wondering what behavioral white spaces are opening up for your organization and how to map out the best growth opportunities in the post-pandemic world? Contact us today.

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Five Healthcare Shifts: Pandemic Pressure Creates New Possibilities

As patients speed-race through their own digital epiphanies, they’re demanding consumer-centricity in healthcare.

Healthcare organizations have long acknowledged they’re digital slowpokes. Businesses aren’t likely to disrupt themselves until they have to. However, COVID-19 forced–and perhaps freed–them to accelerate change in ways they couldn’t have imagined.

And while much of the progress providers, payers and life-science companies have made in the pandemic’s early months is surprising, it also underscores problems we’ve been talking about for some time. With patients speed-racing through their own digital epiphanies, they’re demanding consumer-centricity in healthcare. And the more digital experiences become normalized–buying groceries online, taking app-based Spanish lessons or dressing up for Zoom weddings–the more they expect from healthcare.

“With patients speed-racing through their own digital epiphanies, they’re demanding consumer-centricity in healthcare.”

In 2019, Scott Davis and I published a book, Making the Healthcare Shift: The Transformation to Consumer-Centricity, and we think it’s more relevant than ever. Based on more than 70 in-depth interviews with healthcare executives at companies like Pfizer, Novartis and Eli Lilly & Company, Mayo Clinic, Anthem and Intermountain Healthcare, followed by a survey of 240 global healthcare leaders, it outlines the five most critical changes organizations need to make to keep pace with demanding consumers.

There are many ways the pandemic has accelerated the shift towards consumer-centricity. Virtual care is perhaps the most obvious example.

“We’ve done 400,000 virtual visits so far in 2020, up from approximately 20,000 visits last fiscal year,” says Nick Patel, M.D., Chief Digital Officer at Prisma Health, in a recent interview with Prophet. “I didn’t expect to hit numbers like that for many years.”

For Prisma, a nonprofit healthcare system in South Carolina, COVID-19 continues to accelerate digital transformation in dizzying ways. Patel says his teams are learning to use data differently, linking virtual visits to chatbot follow-ups, sending devices to patients’ homes and expanding in-office virtual health solutions. “I don’t think I ever thought I’d see that level of adoption in my lifetime.”

All five of these healthcare shifts are intensifying and organizations need to pay attention or risk business disruption from unexpected places:

First shift: From tactical fixes to a holistic experience strategy

Pre-COVID, healthcare organizations often started enhancing consumer experiences with one-off initiatives. But the pandemic has made it clear that experience strategy can’t just be based on location–the idea that treating people well only when they are on the premises falls apart in a virtual universe. Of course, it’s critical to make the physical experiences meaningful. People expect safe and respectful treatment. They want to see COVID-era innovations, like streamlined check-ins, minimal wait times and practical text messaging.

But attention to experience must extend far beyond the four walls of the provider’s office. It must encompass virtual-health offerings, accessible patient portals and mobile experiences that are at least as good as other non-healthcare brands.

Our book highlights how Geisinger Healthcare, Piedmont Healthcare and Intermountain Healthcare are making this shift by breaking their business models, writing manifestos and increasing investments.

Second shift: From fragmented care to connected ecosystems

Payers, providers, device and pharma companies had been making limited progress on their ability to collaborate, awkwardly stitching together fragments of the healthcare journey. But COVID’s destruction of the healthcare economy underscores just how inefficient their operating models are. U.S. hospital systems are drowning in losses of $323 billion this year. And provider compensation is under pressure, with 97 percent of medical practices reporting negative financial impact.

My prediction? I believe these losses will continue, illuminating the absurdity of healthcare operating models, with overcrowded hospitals losing more money than ever. And that will make organizations fight harder to transform toward value-based reimbursement.  This healthcare trend will become obvious to all as organizations continue to strike partnerships across the ecosystem that enable the success of these new reimbursement models. And from the current chaos, they will find their way to a business strategy that is more stable and orients financial incentives with the wellbeing of patients.

In our book, we illustrate how companies like MyFitnessPal, Zocdoc and Eli Lilly & Company are developing wrap-around solutions that embrace consumers all the time, not just when they’re in a provider’s office.

Third shift: From population-centric to person-centered

After years of talking about how data would lead to more personalized healthcare, the pandemic is finally bringing that data-driven healthcare trend and promise to life. With the increase in digital interactions, providers are getting closer to integrating personal preferences with primary research, behavioral data and clinical insights, producing a more holistic view of patients.

Increasingly, consumers are driving this healthcare shift. They recognize that it’s smart to give up their data–as long as they get something meaningful in return. An example we love: The Multiple Myeloma Research Foundation, devoted to finding a cure for cancer of the blood, partnered with Prophet to launch the MMRF “CureCloud.” Based on free at-home genomic testing, the digital dashboard displays personalized treatment options for myeloma patients, democratizing access to clinical insights. Customer research uncovered that the most important benefits to patients in a partner like MMRF is personalized communication and recommendations in exchange for their data–including insights they can bring to their providers for smarter care.

Our book looks at how companies like Medtronic Care Management Services are learning from personalization wizards like Spotify and Netflix, making sure people get content and messages just right for their condition.

Fourth Shift: From incremental improvements to pervasive innovation

We think the most beneficial byproduct of COVID-19 is that it has shown healthcare organizations how fast they can move and that they don’t need to settle for small tests and micro-progress.

As an example, Advocate Healthcare, a large Midwestern health system, used the approach of starting with a minimally viable product, or MVP, when introducing the radical idea of same-day scheduling. With the goal of improving both access and flexibility, it started with just one area–mammograms. “Call Today, Be Seen Today,” tripled the number of appointments made and increased awareness of its breast cancer efforts. More importantly, it showed the entire organization that this shift could be made and that it was well worth the effort.

A team from the Carle Illinois College of Medicine, a partnership between the University of Illinois and Carle Health, developed a prototype for a new ventilator in days, as did the Massachusetts Institute of Technology. Gilead got FDA approval for Remdesivir in weeks. And accelerated trials have us holding out hope for effective vaccination in 18 months, not the usual four years.

One pharma exec put it to us this way: “If Dyson can pivot from making vacuum cleaners to ventilators in 10 days, we should be able to get an email campaign approved in less than 80.”

Business models are also flexing. Sales reps have lost physical access to providers, so the digital marketing healthcare trend is intensifying. Companies are stepping up their e-commerce offers, from medical devices to pharmaceuticals, targeting healthcare clients and consumers.

Our book examines the ways executives from companies like Teva Pharmaceuticals, Tonic Health and Boehringer Ingelheim are accelerating the corporate approach to innovation.

Fifth shift: From insights as a department to a culture of consumer obsession

With the world changing rapidly, tracking consumer preferences and expectations matters more than it did six months ago. Organizations are beginning to explore ways to build what we call Insights Operating System (IOS), to help organizations get to the right insights, drive the right decisions at the right time and win with the right consumers.

As enterprises pursue this new consumer-centricity healthcare trend, they have to stop relying on occasional research reports to shape their path forward. They must recognize that there are signposts to the future in every patient and customer interaction.

Our book looks at the ways companies like Novant Health and Amgen are striving to become constant listeners, so they can respond faster to emerging needs.


FINAL THOUGHTS

Healthcare organizations should all be shifting toward this consumer-centricity. If you’d like help staying up to date with healthcare trends, building an Insights Operating System, elevating the innovation process or improving personalization efforts, contact Scott or Jeff today.

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CEO Perspectives: The 5 Most Pervasive Mistakes in Acquiring a Healthcare Startup

Acquiring small companies can open many doors for healthcare brands. Here’s how you can do it right.

Over the past three decades, acquisitions have shifted from acquiring for scale to acquiring for capabilities – often to accelerate digital transformation efforts. Prophet’s M&A team has noticed an unfortunate pattern of these new “acquisitions-for-capabilities” failing. This topic is often studied from the acquirer side, normally around the deal structure and integration management office (IMO).  However, less is understood from the side of the acquiree side, particularly the younger, smaller startups that are quickly picked up by large multi-billion-dollar enterprises.

I sat down with three leading CEOs in the startup space – Taylor McPartland of ScaleHealth, Lakshmi Shenoy of Embarc Collective and Jamey Edwards of Cloudbreak Health – to better understand both sides of a startup acquisition deal.

Based on our discussion, here are some of the more pervasive mistakes in acquiring a healthcare startup:

Mistake #1:  Thinking the startup views the acquisition as the finish line

As Jamey puts it, “Most people don’t realize that entrepreneurs view an exit as one chapter ending, and another beginning. But, it’s still the same book.”

Many founders want to see their vision continue to flourish and grow.  There is a misperception that founders are in it for a big payday, but that’s not always the case.  Particularly in healthcare, where most startups are mission-driven,  the acquisition is the beginning of something newer and better for the founder.

Lakshmi added, “Even if you’re not working 24/7 after the acquisition, as a founder, you’re thinking about your startup 24/7.  Founders need to consider whether they want to part ways and let someone else be the custodian of their vision.”  This is equally important for the acquiring enterprise to understand these intentions as well (beyond the contracted incentives).

Mistake #2:  Not being clear on the “why”

“You have a 50/50 chance in creating value from an acquisition,” Jamey explains.  “So, the ‘why’ is really important.”

The “why” often gets lost in the contentious negotiating phase, where each side is more focused on the price of the transaction, and little attention is paid toward life afterward.  As Taylor puts it, “One of the first pitfalls is that a lot of hope is put on the acquisition, and one way to mitigate that is to have a clear understanding of the purpose of the transaction.  Is it for the talent?  The culture?  Technology?  Market access?  Either way, the mission and intention of the acquisition need to be kept front-and-center.”

Mistake #3:  Letting process get in the way of problem-solving

Most multi-billion-dollar healthcare enterprises are not digitally native.  As a result, their heritage stems from scaling research (pharma), services (health systems) or engineering (med-devices). Hence their DNA is process and mastering and repeating that process.

“Most people don’t realize that entrepreneurs view an exit as one chapter ending, and another beginning. But, it’s still the same book.”

– Jamie Bradley Edwards

Process is often a good thing, but if not viewed with open eyes, it can accidentally become limiting. The intricacies of enterprise decision-making can be very foreign to a startup. As Jamey explains, “There’s a lot of enterprises that have been very successful being focused on the process.  If you go from getting decisions made in a week and it now takes a month, that is going to be very frustrating for development teams that are used to working in agile.”

Lakshmi highlights that process -in the worst cases – can push away great talent.  “You might have the right tech.  You might have the right people.  But the messiness occurs within the process.  If you are impeding the team’s ability to solve problems – which is what founders of startups do – that is a very fast way to demotivate them.”

Mistake #4:  Assuming the acquisition deal is understood throughout the entire organization

It’s important to recognize that a founder is often negotiating with the enterprise’s deal team.  Those individuals will often not be the people (s)he interacts with daily after the transaction.  More importantly, you’ll have dozens of people that need to gel and work together who are not part of the deal conversations at all.

As Lakshmi puts it, “You must think of the team members who are not in the room when promises are being made, as many did not necessarily join that startup to be part of a giant organization. It can challenge the many motivations as to why they do their job.”

Taylor added, “It can be hard to quantify what culture means but it really is the through-line that made the company attractive to begin with. If you’re not hyperconscious of the new culture you’ve created, you run the risk of alienating team members before you ever realize the value you hoped for.”

Mistake #5:  Letting perfect be the enemy of good

It’s important to know that larger enterprises have different risk tolerances than smaller ones.  According to Jamey, “Large organizations have existing cash cows that they want to protect that.”  And that risk-averse culture often weaves its way into excessive processes.  This in-turn begins to work against the agility of the acquired startup, and that agility is often the desired trait that the acquiring company wants to adopt.

He continues, “Founders start by doing a bunch of missionary selling with scrappy individual reach-outs, and over time that begins to morph into more tech, Salesforce CRM, SEO, etc…  And we’ve learned, as a startup, that perfect is the enemy of good.  Get something out there and continued to learn via continuous improvement.”


FINAL THOUGHTS

Broadly speaking, everything comes down to alignment and empathy throughout both organizations.  It appears that when things go wrong, too much emphasis is on the “thing and processes.”  And when they go well, there is a strong connection through a shared purpose, an understanding of where each side thrives and a shared ambition around where they are collectively moving next.

WEBCAST

Webinar Replay: Common Mistakes in Acquiring a Healthcare Startup

M&A offers healthcare companies an ideal way into disruptive tech. Here’s how to make sure deals go well.

58 min

Watch the webinar replay to hear from a panel of CEOs from leading startup incubators, where they discuss common mistakes large healthcare companies make in acquiring startups.

Webinar panelists include:

  • Jamey Bradley Edwards, Co-Founder & Chief Executive Officer, Cloudbreak Health
  • Lakshmi Shenoy, Chief Executive Officer, Embarc Collective
  • Taylor McPartland, Chief Executive Officer, ScaleHealth

Interested in speaking to someone from our healthcare team? Get in touch today.

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The Cultural Levers of Pharma’s Transformation

Cultural transformation requires a human-centered approach, in order to bring along their broader workforce.

Our latest research with pharma executives from around the globe offers an actionable playbook for driving cultural change, helping organizations to focus their efforts and ensure culture is fully aligned to support transformation.

From where to start, to where to go next, The Cultural Levers of Pharma’s Transformation helps business leaders understand where to focus their efforts based on their greatest needs for cultural change and how to bring their broader workforce along on this important transformation journey.

In this report you will learn:

  • Why culture – and taking a human-centered approach – remains a key element in any successful transformation
  • How to determine key cultural levers on which to focus, based on your organization’s greatest needs for cultural change
  • The critical characteristics for leaders to embody in bringing their organizations along on the transformation journey
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Organizing for Digital Marketing Excellence in Life Sciences

We offer a practical guide to help life sciences execs evaluate how well their digital marketing is working.

Over the past few years, the life sciences industry has experienced shifts in how sales teams interact with customers. And with onset of COVID-19, many of those demands accelerated rapidly. Companies must find ways to adapt and enhance digital capabilities to avoid disruption and drive strong business outcomes.

In this report, co-authored by Prophet and Altimeter, we offer a practical guide to help life sciences executives evaluate how their digital marketing organizations are working today and how to organize for the future. Finding the best digital marketing operating model can be complex – and may require rethinking operational hierarchies and legacy structures – but organizations must prioritize the changing demands of customers and find a model that meets their needs.

Read this report to learn:

  • Three organizational models that will help identify your best organizational fit.
  • The key questions to ask when evaluating the success of your digital marketing structure
  • Relevant examples from life sciences and B2B healthcare executives and their organizations’ approach to digital marketing

This report specifically looks at digital marketing within life sciences organizations but for cross-industry examples, you can read more in Altimeter’s research, “Organizing for Digital Marketing Excellence”. In addition to the three operating models, it also includes a four-step process for organizing your digital marketing team. Read the full report here.

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