Chelsea Piers on Manhattan’s lower west side hosted CBInsights “Future of Health” conference On October 2nd and 3rd. Reviewing the agenda over a cup of coffee, it became clear that this event would highlight technology’s promise, threat and opportunities in healthcare fueled by an abundance of capital looking for a home.
Why healthcare? Why not. Every aspect of our lives is being impacted through technology. As US healthcare spending approaches 20% of GDP, an aging global population and disparate access to healthcare, technology holds a promise to revolutionize health in this 4th Industrial Revolution.
Walking the few blocks to the sessions, I thought about Peter Diamandis and his thesis on technology that it “(Technology) takes what is scarce and makes it abundant.” Countless examples come to mind whether it Moore’s Law and computational power / costs or the story of Napoleon III serving the King of Siam on Aluminum dinnerware (Aluminum was more valuable than gold or silver at the time and that’s why six pounds of it sits atop the Washington Monument) or the fact that laboratories can now produce flawless, harder diamonds than the Earth, coal and pressure can.
Technology will democratize healthcare, providing broader access to services, lowering the costs, improving the quality and disrupting the current network in ways that we can see and even more that we likely cannot yet see. To deny these changes is burying your head in the sand.
During his keynote address, Anand Sanwal, CEO and Co-Founder of CBInsights made clear that a) “Technology is no longer just about supporting the business. Technology is the business.” and b) adoption, disruption and opportunities will happened faster than we think. Just as Hemingway muses on bankruptcy in The Sun Also Rises, it happens “gradually, then suddenly.” Look at those adoption rates for Gmail, Facebook and Ping An Good Doctor!
What healthcare tech will be next to accelerate like a hockey stick? Telehealth? Wearbles? Oscar? PillPack? Google? Amazon? Apple? Well, last January, Apple CEO Tim Cook did say about their future, “Apple's greatest contribution…? It will be about health. We're democratizing it. We're taking what has been with the institutions and empowering the individual to manage their health." That’s a long way from PCs, iPods and Apple Music or is it?
Returning to “Technology is the business”, it is remarkable how many healthcare firms are embracing technology, data, analytics, AI, mobile et al to define their businesses and guide their decision processes. MIT agrees stating in the Harvard Business Review “In particular, companies in the top third of their industry in the use of data-driven decision making were, on average, 5% more productive and 6% more profitable than their competitors. It was statistically significant and economically important and was reflected in measurable increases in stock market valuations.”
Dr. Luca Finelli of Novartis says “In reality, we are a data company. We are used to generating and working with huge amounts of data, analyzing it, and using this knowledge to research and develop new therapies.” At Northwell Health, New York’s largest healthcare provider and largest private employer, Dr. Puma Prasad states “We are a tech company offering health services.” Health insurer, Anthem, has been heavily recruiting Apple employees to help modernize and digitize their business. If healthcare firms do not embrace tech across their enterprises, they might be the next Blockbuster or Blackberry or Edsel.
On the evening of October 2nd, I was invited to attend a roundtable discussion sponsored by Collective Health featuring Jeff Immelt who earlier in the day kicked off the Future of Health sessions. Immelt’s was an interesting perspective given that he ran the GE healthcare business for a long time before becoming CEO and responsible for the benefits of GE’s 250,000 employees and thousands of retirees. He described how every aspect of healthcare is being scrutinized, augmented, disrupted, improved and replaced through technology. Investment capital is abundant and flowing into the space like a flash flood. Why? Well our costs are too high, access is still limited, solid quality metrics aren’t standardized and the whole system is opaque.
What does this mean for employers? According to Jeff, employers need to treat employee benefits as an integral part of their business. In 2009, benefits costs at GE were higher than the cost of steel. Focus, analysis and benchmarking should be placed on a) Cost per employee b) Absenteeism and c) Turnover. “Consultants are thought leaders and companies should “lean in” when their consultants speak.”
My head was swimming after these few days in New York. The amount of optimism, capital, opportunity in the healthcare market is almost indescribable. You can see the session summaries on CBInsights twitter pages using their #FutureHealth hashtag. I’ll end with another quote from Jeff Immelt which IMHO encapsulates the event, “Healthcare will consume 25-30% of our economy and we ‘ain’t seen nothing yet’. It is the quintessential challenge of our generation – how to expand access, manage cost, know and promote quality, expand globally and blow the clouds of opaqueness away.” The winds are blowing. They may be starting gradually but suddenly…