At this morning’s Health Innovation Summit – part of the Stanford Medicine Xconference now underway – I had the opportunity to listen to a number of compelling presentations, and to moderate an author panel with UCSF Professor of Medicine Bob Wachter (book: The Digital Doctor) and Athena Health co-founder and CEO Jonathan Bush (Where Does It Hurt? – my WSJ review here, additional Forbes commentaryhere).
Based on an informal “raise your hand” survey I did when I started my session, it seemed like the audience was about 40% tech people who had moved into healthcare, and 60% healthcare people who had embraced technology. The majority of attendees reported trying to obtain their health records at some point, and many, it seemed had been successful (suggesting the audience was either particularly well-connected or unusually persistent). A large number – perhaps half – had obtained consumer genetic information, via either 23andMe or Ancestry.com – suggesting, again, an unusually high level of interest and engagement.
(Disclosure/reminder: I work at a cloud genomics company in Mountain View, CA.)
Four points from this morning seemed especially relevant to aspiring healthcare entrepreneurs.
EMRs: Extract My Revenue
One highlight of the morning was a compelling interview of entrepreneur Christine Lemke (Chief Product Officer of Evidation Health) by Rock Health’s Managing DirectorMalay Gandhi. One point made by Lemke, and echoed by some of the other speakers and attendees, is that the key factor driving EMR selection for major hospitals (Epic was often called out, but perhaps only because it are said by many to do this the best) is the capability to enhance “revenue-cycle management.” Translation: – it’s all about the Benjamins. Perhaps more than anything else, hospitals want to maximize their revenue, and ensure they capture, and extract the most (permissible) value for the services they provide.
This matters for two reasons. First, if you are an entrepreneur selling into the healthcare system, then you really need to understand the business of healthcare, and more specifically, must appreciate how and why the money flows. There are a lot of lofty words and lofty intentions in healthcare, but at the end of the day, hospitals executives – the folks who make the large purchasing decisions — are driven largely by the financialbottom line, and entrepreneurs need to understand this.
Second, media coverage of EMRs tend to focus on interoperability – the ability to connect with external EMRs; provider discussions of EMRs often focus on the endless, soul-crushing data entry and aggravating workflow. While hospital executives would probably say happier staff represents a “nice to have,” and improved interoperability is a “nice to say we aspire to have” (see here), neither of these factors seem to truly drive decisions around EMR choice or EMR implementation (with some exceptions, of course). Mostly, it seems to be about the ability of the EMR system to be implemented reliably, and then generate revenue for the hospital. In the prophetic words of H. L. Mencken, “When somebody says it’s not about the money, it’s about the money.”
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