Healthcare is in the midst of an unstoppable transformation. The pressure to reduce costs, improve quality, and provide a better patient experience is relentless. How will providers respond? Which organizations are best positioned to succeed?
These changes have been a long time coming. Forces favoring consumerism have completely transformed the airline, manufacturing and retail sectors. Now its healthcares turn. The primary drivers are information technology and high-deductible healthcare plans. Patients didnt shop around when it was the insurance companys dollar they were spending. But when youre paying for routine healthcare, x-rays, and colonoscopies out of your own pocket, you start looking at the price tag.
Information technology is going to be the comparison driver. Consumers can already compare rates for hotels, airlines and appliances with the swipe of a finger. Soon there will be apps showing you which healthcare providers provide which services at what costs. Youll be able to sort them from lowest to highest cost, and make your choice: Does it matter to you if your angioplasty (a minimally invasive procedure to open blocked arteries) is performed by a highly regarded academic medical center backed by full cardiac surgery capabilities, or if it is performed less expensively at a private cardiology practice, where you would have to be transported elsewhere for life-saving surgery in case of an emergency? I know what I would choose, but you, as a consumer, will have to make your own risk-benefit calculations.
In addition to consumerism, the Center for Medicare and Medicaid Services (CMS) will be exerting its own pressure, paying doctors and hospitals less for their services and demanding more accountability for quality, safety and patient experience. Private insurers, who usually follow the lead of CMS, will also be paying less and demanding more. Toss in all the unknowns that accompany the federal governments Patient Protection and Affordable Care Act, and you are looking at Force 5 cost headwinds.
There is no escaping the conditions that are forcing this transformation. The providers who succeed will be those who lean in to the changes hospitals and medical centers who embrace cost awareness not as an onerous duty, but as a patient care issue. Because along with lowering costs, we are improving efficiency, reducing variability of outcomes, and accelerating medical innovation. All of this adds up to better patient care, and thats what were here for.
Written by Toby Cosgrove, CEO and President at Cleveland Clinic and author of The Cleveland Clinic Way: Lessons in Excellence from One of the World’s Leading Health Care Organizations.