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Panic, adapt or innovate: Consider the options for healthcare executives in 2017

Perspectives
May 16, 2017
by Ed Jones, PhD
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I well understand why clinicians in various segments of healthcare are quitting. A physician recently told me that he is not going to invest $50,000 in some new EHR system at this stage in his career, and so retirement, even before age 65, made sense for him.

Healthcare systems are buying physician practices for little money. Some doctors delay retirement and choose a guaranteed salary, along with payment for their accounts receivable and their furniture. That’s it. They agree, for no additional compensation, to hand over information on thousands of their patients to a large healthcare organization.

As a consultant, I have found this to be true for large behavioral healthcare group practices as well: Practice leaders are offered a buyout deal that treats the practice as relatively worthless, in exchange for the opportunity to draw a salary going forward. Depending on your perspective, this is either panic, or knowing when to fold in a high-stakes card game.

The successful operators of the day in any industry figure out how to survive in the circumstances they face. Making a profit within the constraints of that day’s environment will always be admirable, and there are healthcare executives who figure out how to manage the clinical needs, the funding streams, the regulations, and the billing gymnastics to sustain profitability. They are not innovators. They are successful at adapting to ever-changing business realities when few people can master this. Their success is grounded in either business acumen, scientific wisdom or luck.

Innovators are an even more rare breed, and they are not all successful. We desperately need innovators in science and business, and yet the aspiring innovator should be wary about the challenges they are accepting. Potential innovators need both encouragement and warning from us. Most fail. We very much need innovators to get us out of the rut of accepted wisdom, and yet they generally suffer on our behalf as they test out new ways of thinking and operating.

I will offer some ideas on what healthcare innovators might be thinking today, but I do not pretend to be a companion on the innovation healthcare highway. I am merely a reporter who values their work.

Today’s options

Let us recap the main options for healthcare leaders (and for clinicians/administrators at mid- to senior-level executive roles) in 2017, before attempting to understand the challenges for innovation today.

Panic: Sell, retire or just freeze. Wait for a minimal sales price, a decent salary or a miracle.

Adapt: Deliver traditional services where the funding is adequate today, if not for the future.

Innovate: Pursue many paths, not well-understood, including:

  • Solve healthcare delivery problems in ways that few are choosing today;
  • Engage new funding sources and be ready for the next wave of investment; and
  • Identify and promote effective healthcare services with a solid return on investment.

What should a healthcare innovator be exploring today? This has not changed over time. A successful healthcare innovator needs these elements:

  • Solid business strategy, differentiated from the rest (as described in books such as Blue Ocean Strategy);
  • Detailed product development plan, supporting the business strategy;
  • Sales and marketing plan with achievable goals and tactics over a three-year period;
  • Clinical program development plan, supporting all of the above, ensuring clinical excellence;
  • Metrics for demonstrating operational excellence, reviewed quarterly;
  • Evaluation of all stakeholder outcomes (participant engagement, clinical and economic outcomes, satisfaction of all stakeholders, quality measures); and
  • Chronic care engagement plan (critical sub-population) with ongoing reporting.

Considerations for innovators

While I am not offering any blueprints for innovative healthcare structures here, I am proposing some ideas on how to get started. First of all, behavioral healthcare practitioners need to collaborate with other healthcare specialists to begin to see how innovation can occur across specialties. Silos are, justifiably, among the most maligned features of healthcare in the United States. People have healthcare problems that don’t exist in solos. There are many intersections for health and illness, and only a coordinated approach can help people truly lead healthy lives.

Agreement on this point is easy, and yet behavioral healthcare specialists should start from an assumption of professional equity with other healthcare disciplines, if not a position of primacy, based on the prevalence and devastation of behavioral healthcare disorders. At the very least, behavioral healthcare clinicians should recognize the importance of their specialty, both clinically and financially, as they begin inter-disciplinary discussions. Breaking down silos is not the same as treating every healthcare discipline as having an equal impact on the health status of a population.

Your primary care physician takes your blood pressure at each visit, and your mental health status should also be taken at each visit. We don’t have a measurement tool today with overwhelming endorsement for mental health status. However, we are quite close to this scientific goal, and the impediment is simply the lobbying by for-profit and not-for-profit entities for their preferred tools. Let science decide, and we will clear this hurdle.

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