Omnichannel care is here to stay. Consumers have an abundance of choice today in how to engage the healthcare system – convenient care sites, self-service, clinically-proven digital apps, and of course virtual care. Delivering consumer-centric care is now a requirement for growth. But how can traditional health systems — that cannot upend their care delivery technology stack — keep pace with new demands?
Rising risk of disintermediation
Competitors from all corners are leveraging flexible technology infrastructure to rapidly push out offerings that further blend the virtual and in-person environments. That includes such non-traditional players as Carbon Health, Crossover Health, and Amazon Care. We are also seeing “payviders” press forward with solutions that offer consumers a range of options: Aetna and CareFirst have both launched virtual primary care models. Cigna’s Evernorth acquired MDLive.
These models are gaining traction in inserting themselves between incumbents and patients and influencing downstream care. Consider these details from UnitedHealth Group's 2022 first quarter earnings update: Nearly 90% of new exchange enrollees picked plans with “significant virtual components” and 30% opted for a virtual-first plan.
A Harris Poll tells us that virtual capabilities are critical to capturing patient loyalty. That’s not to say that in-person care is going away anytime soon. But the acceleration of virtual care over the past two years means that traditional health systems, which have spent billions of dollars and years of toil building their delivery technology platforms, need to think differently about their technology stacks.
The Spectrum of Care Delivery Tech Stacks
Health systems can take a variety of approaches to keep pace with updating their infrastructure. While no solution fits every provider type, we’ve identified three technology stack archetypes.
1. EHR is the stack: In this model, the health system’s current EHR is essentially the care delivery technology stack. This approach offers some convenient benefits:
- Simplicity and cost-effectiveness: Health systems deal with a single vendor with one service-level agreement to manage, one set of integration and implementation costs to take care of, and one point of contact to ensure the system is running and optimized.
- Decreased cybersecurity risks: While this archetype doesn’t eliminate cyber risk, it minimizes exposure. Every external application that plugs into a health system’s network is an opening for a cyberattack.
- Continuity: Interoperability has been the buzzword for years, but it has yet to fully emerge. There’s some optimism that consumer-facing applications will push the industry forward. In the meantime, a single vendor reduces the need for additional data pipes.
But there are also some significant trade-offs. While customization is possible, health systems have historically been held back for various reasons:
- Timelines: New features, customizations and the like are dependent on the vendor’s existing roadmap, with limited ability to influence it.
- User interface: The “look and feel” of EHRs has historically lagged innovators born in the consumer-driven digital age.
- User experience: Workflow customization is possible, but often requires significant investments compared to out-of-the-box templates offered by point solutions.
How to win:
The potential to win in this model remains high — if you’re willing to disrupt yourself to streamline how work gets done. Exciting as tech innovation is, operations are often the bigger rate limiter as systems seek to preserve legacy processes and accommodate internal variation in practice. Health systems in this archetype should keep these points in mind:
- Differentiate through operations: Simultaneously ask “what technology do I need to change?” and “which operations must we re-evaluate?” Reducing consumer friction by simplifying visit templates and rules, opening access through team-based care, improving messaging platforms via standard guidelines all can have a much bigger impact on consumerism than a “shiny toy.” And as technology does change, providers must look at the operations around the technology and evolve accordingly (e.g., independent of the virtual visits vendor, the rooming process must adapt to allow providers to switch seamlessly between in-person and virtual visits).
- Invest in technology workflow optimization: Chief Information Officers will remind us that every EHR implementation is different, even between hospitals in the same health system. And with that, there are opportunities to optimize how systems work. Optimizing e-visit functionality can make the difference between providers having to spend three minutes to resolve a concern versus 10 minutes. Closing gaps in data collection can bolster everything from clinical care to revenue cycle to targeted marketing campaigns. Poor deployments can have a negative impact on both clinicians and patients. As Cerner CEO David Feinberg, MD, said at ViVE in March, vendors have a “moral obligation” to get the redesign of EHRs right.
2. EHR at the center of the stack: Here, health systems build on and around their EHR using other vendor technologies and levering ever-growing marketplaces. Several third-party integrators have entered the market offering health systems plug-and-play solutions, and the dominant EHR vendors have opened app stores to facilitate those integrations. Leveraging this allows health systems to quickly push innovation and differentiation into the market. While this has increasingly allowed for differentiation, health systems must watch out for these risks:
- Death by a thousand cuts: CIOs have remarked that the push to implement best-in-class point solutions can result in unsustainable financial pressure - stemming from direct contract fees but, most importantly, from indirect IT expenses to upkeep systems and build connections to the core infrastructure. As one health system executive shared recently, “The cost from point solutions is killing us.” Health systems need to be mindful of the direct and indirect work required to vet, integrate, and operate a new platform.
- Bifurcated patient experience: Allowing independent business units to drive the technology agenda without central coordination can create disjointed patient experiences (from disparate scheduling workflows, uneven practice operations, etc.), even if financials are managed. Likewise, point solutions may come with functionality beyond their immediate use case, causing patients to have to switch between applications or websites, driving attrition.
How to win: This model is higher risk but comes with a higher potential reward. Systems on this route are often seeking to keep pace with innovators — take this journey only if you know your True North. As you set off, keep these points in mind:
- Let the enterprise strategy set the direction: Applications need to be tied into the health system’s overarching strategy and DNA. Mandates to improve care for patients with chronic illnesses, embracing consumerism through virtual care, patient-friendly billing, price transparency, and addressing clinician burnout through further automation all tie into a different set of technology priorities. Without a clear mandate, leaders are hard pressed to hold back the tidal wave of point solutions demanded by the business.
- Prioritize the clinical user experience: Anything that is layered on top of caregiving needs clinician champions and clinician adoption. Desktop medicine continues to be a major cause of burnout in clinicians, and new applications that add to — rather than subtract from — that burden, risk aggravating the problem.
- Systemically re-evaluate and update: The pace of change is tremendous. Just as health organizations assess what’s working, leaders should set success metrics and implement a systemic review of their care delivery tech stack, pulling the plug on applications or platforms that aren’t meeting their needs (from an operational, security, or financial perspective) or consumer expectations. And as the health system’s technology stack grows, they must have dedicated efforts around managing their technical debt, ensuring they stay nimble.
- Optimize operations and technology workflows: The impetus from the first archetype bears repeating — operations and processes remain critical. No point solution can mask lack of access/availability, poor quality, or frustrating in-person experiences, and no deployment will be successful if the operations around it don’t change (lest we see providers tell patients to simply come in every time they request a video visit).
3. EHR as a component in the stack: As the evolution of archetype number two, health systems are either building capabilities themselves or going outside EHR marketplaces to integrate substantial care-delivery technologies. The cost-benefit analysis is reversed from archetype No. 1 and comes with additional considerations:
- Built to specification: A new custom build or integration allows for true differentiation that is tailored to the health system’s operations. It borrows from the likes of One Medical, Iora, or Oak Street Health which have built their own capabilities to ensure the technology accelerates their strategic priorities. We are seeing similar scenarios play out with such incumbents as the The Clinic by Cleveland Clinic and Intermountain’s virtual hospital.
- Beware of sticker shock: This model comes with great costs stemming from more diverse internal resource mix to build and support, heavier compliance burden, greater integration burden, multiple applications to maintain, and increased cybersecurity vulnerabilities.
How to win: This is for those seeking to lead the market and not for the inexperienced or faint of heart. Pursue this route only if there are grand growth and diversification aspirations and if you have access to significant capital. Systems considering this route should keep these points in mind:
- Commitment from leadership: Leaders must go into the endeavors fully embracing the idea of becoming a technology-driven organization and managing a new business venture. This may take the form of teams dedicated to managing substantial vendor contracts, strengthening the IT bench to have staff that can build and update new capabilities, and / or staffing sales and business development teams. Strong leadership is also vital if a decision is made to stop work on a project, either because it isn’t working or there’s another player doing it better.
- Commercialize beyond the core: Significant investments in new platforms often call for a commercialization case that allows for growth beyond what can be achieved organically. We are seeing this with several incumbent health systems like Providence, Henry Ford Health System, and Novant Health either spinning off innovation units or bringing new technologies to the market.
- Consider a partner: Competition for talent is fierce, and health systems often lack the expertise to launch new ventures or drive a technology agenda. Health systems should look to partnerships to speed innovation and complement their gaps.
As our colleague Ashley Smith pointed out at last year’s Oliver Wyman Health Innovation Summit, healthcare needs to move to a tech stack that works in real-time, recommends actions proactively, and is connected across sites of care to provide a longitudinal view of the patient’s journey. For as much as they’ve spurred innovation, EHRs are often pointed-to as barriers to this vision. It doesn’t have to be the case. Being more strategic about the tech stack is table stakes in this consumer-driven environment. Proactive organizations – regardless of the archetype – will adopt strategies that elevate the consumer and clinician experience. Reactive organizations will fall further behind.
Santiago Doria Principal, Digital and Health and Life Sciences, Oliver Wyman
Heiyab Tessema Partner
Bryce Bach Partner, Health and Life Sciences, Oliver Wyman