Season 1, Episode 3
Are the new healthcare services from Amazon, Walmart, CVS, and many others a friend or foe to traditional health systems? Dr. Paul Keckley (one of the facilitators of the Affordable Care Act), Shari Campbell (a retail health leader), James Gardner (retail health policy analyst and marketing strategist), and more guide us through the ins and outs of the latest care delivery models.
Join Chris Hemphill as they guide us through conversations with some of the people driving change and hear why they’re urging us not to ignore this movement in consumer-first health.
VP, Applied AI & Growth
Dr. Paul Keckley
The Keckley Group
Marketing Director, Retail Health
MultiCare Health System
AVP of Marketing and Customer Experience
Head of Industry, Healthcare
Founder & CEO
Chris Hemphill (00:00:02):
Consumer experiences, major disruptors and AI tech are shaping healthcare for years to come. On Hello Healthcare, we dive deep on these issues with leaders who are driving change. I’m Chris Hemphill, VP of applied AI at SymphonyRM. And we hope that these stories will drive you to demand or create a better future within healthcare. Hello Healthcare, in 2011, Netscape, founder and Silicon Valley legend, Marc Andreessen famously declared, “Software is eating the world.” This was amidst a wave of digital transformations that centered IT systems as the source of truth. There are still many cases for paper and facts, but for the most part, Marc was right. He was right all the way up until 2017 when Nvidia CEO Jensen Huang declared that AI is eating software, AI isn’t quite done with this meal, but we’re seeing it happen. Think about when you’re texting and emailing. When you’re looking for something to watch or when you’re scheduling your next meeting, AI suggestions are becoming so much more convenient and accurate that it’d be hard to revert to just play an old dumb software.
Chris Hemphill (00:01:15):
So we see that convenience is sticky and habit forming, technology and retail companies like Amazon, Walmart and CVS are obsessed with convenience. It’s their main ingredient to attracting and retaining consumers like you and me. So when you think about visiting the doctor or the hospital, does convenience come to mind? Probably not. There are redundant paper forms, unclear procedures and poor care navigation to contend with. Those convenience assessed techs companies and retail giants that I mentioned earlier, they see this inconvenience and this poor experience as their opportunity into a nearly $4 trillion market. So software ate the world, AI is eating software and at each step, convenience was key. Is this convenience really enough for retail and tech to eat healthcare? And if so, how can healthcare leaders respond to this?
Dr. Paul Keckley (00:02:11):
I think there is an occupy healthcare movement that’s breeding.
Chris Hemphill (00:02:14):
That’s Dr. Paul Keckley. He runs a healthcare policy and analytics publication called The Keckley Report. He also helped facilitate vital conversations between the White House and industry that helped make the affordable Care Act possible. This occupy healthcare concept, he brought up. That sounds a whole lot deeper than just a bunch of people who want a little bit more convenience out of their doctor visits. So what’s going on with this thinking.
Dr. Paul Keckley (00:02:40):
It doesn’t represent the majority at this point, but it represents a sizeable vocal and growing minority. And it’s not one dimensional. There are some common features across various groups that you pick up. There’s this growing sensitivity to affordability, which they tend to define as how much am I paying in a premium? And then after that, how much am I paying and out of pockets and what’s not covered? And I go to the drug store and this is not covered and that’s covered and how confusing can it be? And then growing issues of inequity, the bifurcation of haves and have nots, which carries with it, a residual affiliation and a kinship between those that are left out of the system, which is about 15% who basically have no access to the system. And another 25% of the population who are they’re kin. They feel that they believe healthcare is a fundamental right, it’s not a privilege. Shouldn’t be defined by your checking account and your investment portfolio. It should be defined because you’re a part of a community, not unlike the way folks think about public education.
Dr. Paul Keckley (00:03:58):
So the Bernie Sanders, part of the public discussion about, “Medicare for all,” and that group basically are speaking that healthcare should not be treated differently than a public service. And you’re accessing that system without a co-pay or a deductible. The access should be free and accessible, even though that would probably raise taxes. So I think that’s the reason we’re facing a backlash and not surprisingly when you do surveys and focus groups and things and run price elasticity models, and see who’s actually checking out of pocket and who’s going to these shopping tools and this and that. You find out that few people are paying attention to the stuff that’s out there to help them make decisions, depending on which study two to 8% of the population that are actually consumer savvy about healthcare most are basically blindly consuming the system and absorbing it. And I think that’s going to change. So I think it’s timely.
Chris Hemphill (00:05:06):
So, it’s not just a lack of convenience that could drive people toward the so-called disruptors. Paul made the point that out of 100 people, that’s two busloads on the way to Disney World. Only two to eight of them are savvy their healthcare. So it’s not just convenience that’s being targeted here. It’s access it’s cost, it’s transparency, it’s people understanding how to manage their care. And it’s people knowing that there are options for their friends and loved ones. So there’s definitely a motive here. Definitely a strong reason why people may be interested in new healthcare options, but healthcare journeys are so complex. Where would many of these new entrants even start?
James Gardner (00:05:49):
Well, primary care has a special place in everyone’s heart.
Chris Hemphill (00:05:52):
That’s James Gardner, CNBC featured James’ analysis on the retail health sector in their documentary, which was called will Walmart takeover healthcare? His view of primary care as a cornerstone of the patient provider relationship makes sense. Let’s hear more.
James Gardner (00:06:09):
Maybe it was our parents who had truly a primary care doctor. It seems like quaint notion now, because doesn’t really exist in a meaningful way, but primary care was important to the system for a couple reasons. One was that just as a patient, they were the guardian of your long-term health. You would’ve had a position and stuck with them for 15, 20, maybe 30 years. And they had that long-term perspective of caring for your health and wellness, not just caring for you when you were ill, but more functionally. They were also a gateway to the healthcare system. That was your point of access to get specialty care. All of that’s changed. Really I would trace it to two factors. One is just, there’s the national shortage of primary care physicians. It’s a really underappreciated field. Doesn’t pay as well as it should.
James Gardner (00:06:55):
So in many parts of the country, even in urban centers, it’s hard to actually get a primary care physician, even if you wanted one, but there’s also a generational factor in play that more and more Millennials and Gen Xers just are impatient or dissatisfied with the traditional experience of primary care. It’s hard to get appointments. It’s hard to accommodate a life work balance, getting access to care. So for a lot of reasons Millennials, the Gen Xers, have gone down different path. And this is where primary care disruptions emerging. We’re going to talk about retail health as one of the disruptors, but this could be everything from urgent care clinics to telehealth, to employer clinics. There’s any number of solutions out there that are blowing up quick notion of primary care physician who you stick with for life.
Chris Hemphill (00:07:44):
When we asked about where healthcare innovators would start, it’s in adapting to how people want to consume primary care, but do these innovators have what it takes to shake up the current system?
James Gardner (00:07:55):
Retail health is one of the bigger disruptors that’s coming, you’ve got large organizations with customer experience or patient experience in their DNA. They’re relentlessly competitive. They’re well resourced. And even if it’s not Walmart, it’s going to be Amazon or it’s going to be CVS, or it’s going to be Walgreens. They smell opportunity for many, many reasons, and they’re not going to stop until they take market share and deliver care that is different and perhaps better than what people are currently experiencing. I think we should all reflect on the public health system is pretty broken right now. There’s north of 100 million people that have had this lack of access problem tracing to uninsured or underinsured status. That’s a crisis for our country and we should all cheer a solution that may be emerging that cracks the code on access to high quality care. That’s actually affordable to Americans so they can get preventative treatments and keep themselves well long before they need catastrophic interventions.
Chris Hemphill (00:08:56):
As both James and Paul noted. Our healthcare system is at a crisis point, but what’s driving big retailers and giant grocery stores like Amazon and Walmart to enter healthcare in the first place? Why would they be the ones focused on this problem?
James Gardner (00:09:12):
Great question. And it’s super logical starting point. I guess I would start with just the observation that Walmart’s not new to healthcare, right? They’ve been operating pharmacies for 15 plus years and are a huge player in that world. They’re also very strong in vision, audiology and obviously direct consumables. So they sized their existing health and wellness business at north of 40 billion. So they’re already a major, major player, but I think what you’re getting at is the hands on delivery of the care, which is what we’re seeing piloted in Georgia, which is causing much discussion. As Walmart describes it, they got into healthcare because their customers led them into it.
Chris Hemphill (00:09:54):
Hold up, pause on that one. Their customers have led them to it. These organizations are obsessed with listening to their customers. If traditional healthcare isn’t good at listening or responding to consumers, it sounds like someone else is.
James Gardner (00:10:09):
There’s a huge problem as we all know, and it’s press even more acute within Walmart’s population base, a people on the outside of the healthcare system and not getting access to care. And in many cases, it’s simply a logistical issue that in many, many parts of the country, there are no primary care physicians let alone mental health professionals, vision care specialists, et cetera, et cetera. So there’s just an of getting access. But Walmart also heard from his customers that they couldn’t afford to get into the system. Many are uninsured, which is a phenomenon that continues to curse our country, but many are what I call underinsured where technically they have insurance, but with copays and deductibles, it essentially makes access to the system cost prohibitive except for catastrophic situations. So Walmart’s customers were experiencing this access problem and like any good retailer, Walmart’s pretty dialed into problems amongst their population base.
James Gardner (00:11:10):
They know more about you than you’d like to imagine. So that led them to explore healthcare. And of course I’m sure the way they checked all the obvious boxes. Their investors and their MBA types would be looking for. Is it large? Yes. Healthcare is colossal, but even primary care and dentistry and some of the other fields that we’ll be talking about very sizeable, is it fragmented? Yes. Are there customer experience opportunities for improvement? Definitely as we all know the systems far from perfect in delivering world class experiences and were there opportunities for operational improvements that perhaps could streamline the experience and take costs out. Walmart checked all of those boxes. So it was in the fall of 2019 that we saw the first clinic open in Dallas, Georgia.
James Gardner (00:11:57):
And let me describe it for people that aren’t familiar with these clinics because they’re ambitious, they’re exciting and they’re different than anything they’ve seen. We’re all familiar with MinuteClinics perhaps at CBS, but what Walmart built was a standalone clinic adjacent to one of its 3,600 super centers, which are the grocery, fast food, a shopping center that I’m sure we’ve all seen. It was sized at about mm, seven to 10,000 square feet that they’ve flexed over the course of the pilot. And within that one standalone clinic, not only were they delivering primary care, but also dentistry, vision, audiology, mental health as well as x-rays, labs and then the adjacent pharmacy. So very, very ambitious. Staffed also a note with primary care doctors, alongside nurse practitioners, physicians assistants, but the presence of a doctor on site, obviously signal still the world that they’re delivering more complex care. And they’re also interested, not so much in episodic care, like an urgent clinic or walk-in, but they’re interested in longitudinal care where over the course of weeks, months, years, they want to be your doctor. They want to be your dentist who keeps you well and prevent you from getting ill and then takes care of you if demand it.
James Gardner (00:13:15):
Very ambitious, the capstone or the icing on all of this was the pressing model, which I think people still find shocking. An example being mental health counseling for stress, depression, addiction. It’s a dollar a minute with a licensed trained professional. That’s 30 to 50% less than what you’re going to see in traditional primary care clinics.
Chris Hemphill (00:13:38):
As of today, James’ today is Q1 2021.
James Gardner (00:13:42):
They’ve got 20 clinics circling Atlanta. So that’s where they’ve got the greatest density of operations. They’ve got one store in Arkansas adjacent to their headquarters. So we can all imagine why that was built. They’ve got two in Chicago in stores that were disrupted last summer during our civil unrest. So they rebuilt the super centers and added clinics. And then they’ve got about 10 more coming in Florida in Jacksonville, in Orlando.
Chris Hemphill (00:14:09):
When we asked why these retail giants are expanding their healthcare footprint, James made it pretty clear that in Walmart’s case that they’re listening to their customers, they’re seeing these customers many healthcare access challenges. Okay. So what about the others like Amazon, CVS, Walgreens.
James Gardner (00:14:28):
You guys may be familiar with Amazon’s offerings. As I described earlier, they began by offering care solutions for their employees, which is the mall very familiar to those who follow Amazon. More recently they’ve expanded to multiple states and are absolutely on track to offer telehealth solution nationally, probably within the next three to six months. So very exciting to see. Walmart competing based on the physical assets in real estate they have, and Amazon competing based on the technology. That’s so familiar and comfortable to them. So you’ve got two parallel, but very different strategies in play. CVS got a very advanced retail health strategy. They’ve got pharmacies across the country, the largest of its kind, but they’ve accumulated a adjacent assets. One of which is the MinuteClinics which we’re all familiar with. We probably have been in one and seen them at our local stores.
James Gardner (00:15:18):
These are urgent care facilities, not staffed by primary care physicians. So they’re offering a different level of care, but obviously a very convenient model if you’re looking for a flu shot or a vaccination, so services that the nurse practitioner or physician’s assistant can offer, but different from what you would find at a Walmart health clinic or what’s offered through Amazon. More interestingly they’re now rolling out what they’re calling health hubs, which is carving out a section of their stores and devoting real estate in the clinic to those with chronic conditions. And you’ll be able to get access for instance, to a dietician. And if you’re suffering from diabetes or COPD or another chronic condition, they’re going to have services and merchandise that would be very spot on for your condition.
James Gardner (00:16:02):
Alongside what’s going on in their stores, we can’t overlook the Aetna insurance that they acquired a few years ago, as well as the pharmacy benefit manager that they acquired. So it’s an incredible collection of assets, perhaps the strongest of its kind in the world of retail health. And I watched them with great interests because they’re moving very quickly and are building on a strong collection of assets that are now working more and more in an integrated fashion. Last but not least, I would point out what Walgreens is doing. They’re a bit of a lagger, a little late to the party, but they now have announced a partnership with VillageMD, which will carve out space in their stores and build in a primary care offering somewhat similar to the Walmart offering, but not nearly as disruptive.
James Gardner (00:16:47):
These are not standalone clinics. They’re much smaller. The pricing is not at all as exciting as what Walmart is doing, but nonetheless, it’s a large partnership and they’ve got a big, big footprint of stores to build into. So this would be another competitive offering to be aware of if you’re a hospital or primary care physician.
Chris Hemphill (00:17:07):
Along with retail health, another model that’s really focused on addressing the inconveniences and difficult of the typical healthcare experience is concierge medicine. A great example of this concierge primary care experience is San Francisco based company, One Medical, their CFO Bjorn Thaler is actually on the record as saying that they’re doing this because the market is ripe for disruption. She told Shah, a SymphonyRM board member has done extensive research into their concierge model.
Sheetal Shah (00:17:41):
In a nutshell, what is One Medical? I found this at the title of one other documents really interesting. We are a membership based primary care platform, membership based. We look at the world of where was Blockbuster and then what happened to Netflix, a different market once transactional, the other is a member relationship based sort of model. And they pivot in this statement with seamless digital health. And they recognize, We want to be convenient.” Wherever people work, shop, live and click. That’s a real interesting perspective. We have One Medical’s filing for their initial public offering. We have their quarterly earnings report. We’re going to pull through the terms of services well, and then the social reviews, it’s about 821 pages of document. And it lays out who they are, what they do, their financials, their membership volume and the like, so what I’ve done is I’ve taken a few subsets of it, but what you’ll notice in some of the first sets of pages, a lot of focuses on human centered.
Sheetal Shah (00:18:49):
A to focus is on the word, proactive and outreach. I found it interesting that they mentioned patient very few times, but they use the word human centered. They use the word consumer, they use the word proactive 10 times and they talk about outreach. It’s no longer of you coming to us when you need care it’s us informing you. So you pick a lot of that up about their core values and their mission. So it reflects back on ourselves as a healthcare organization, how much energy are we consuming in this space that is investments in that is in terms of how we go to market on really managing relationships? When we look at some of these disrupters and what they’re doing.
Sheetal Shah (00:19:29):
The next interesting piece I found was, and is how they think of what part of the market are they trying to attack? And they speak to the fact that 81% of consumers are dissatisfied with their healthcare experience. And they name a few reasons why. Hard to access long, wait times, inconvenience. It’s all about those friction points that we know so well in healthcare. And then they pivot quickly to how they expect to differentiate and they’re, “Hey, we are starting with 247.” And kind of speaks to the fact that they were designed for a world of the pandemic that we live in today, from their start.
Sheetal Shah (00:20:07):
They talk about their technology. They don’t mention the word EMR. They don’t mention any other thing other than, “Our technology platform allows us to advance consumer engagement and health through proactive, digital health. Screenings and outreach, and around the clock availability.” I also found interesting. When you look at the rest of the value prop, you get a bit of a clue about how well is it working for them. They say they regularly, proactively engage their members digitally and in person, again, proactive continues to play on repeat in this 800 page document. But they call it that 47% of their members interacted with them monthly via their website and their mobile app.
Sheetal Shah (00:20:49):
That’s interesting. And I mean, we are really curious to know if the healthcare organizations that are out there today see a similar number. But the idea there is, again, it’s not about patient. They call out the whole person aspect of life care. In fact, Chris we hear a lot about One Medical and what was interesting is their company name is actually OneLife. And so they really are thinking about that holistic approach to how to care for a person. And then their goal and their team’s goal is really to be that trusted advisor. If you took away all the health words in here, kind of sounds like other industries and how they manage relationships. That was really interesting.
Sheetal Shah (00:21:30):
And then I think they actually then spell out in their strategy on what a modernized membership based model looks like, they call out the fact that they have a 97% retention rate and they call out again, the word proactive there in the second line. And you find out that, hey, being proactive, being personalized in the outreach, driving high quality actually leads to that quality number or their loyalty number in terms of the fact that they have 97% retention, which is great. They really are turning the world a bit upside down. What I found really interesting was in the conversations that we have in the industry today, we always hear about, there’s so many barriers for us to engage. And we call out HIPAA and PHI and PII and consent.
Sheetal Shah (00:22:20):
What I found really interesting is if you look at their terms of service, the stuff that we always scroll really quickly through when we’re registering a site or the like, they call out in section seven, hey, OneLife, that’s their company name, right? “May contact you via email, phone, text, or mail, and you consent to do that.” So you’re opted in and you’d have to raise your hand to opt out and they cover all the interactions they have or about your health and your wellness. So I thought that was really interesting.
Chris Hemphill (00:22:57):
How does this human centered approach play out for patients to find out? We use natural language processing, which is AI that extracts meaning from free texts, like articles and reviews across thousands of reviews that patients left on Yelp. You can access the study and the show notes, but here’s some quick highlights. One Medical was doing video visits long before the pandemic. And this was one of their biggest patient satisfiers. They are obsessed with eliminating wait times. And that was another one of their largest patient satisfiers. But of course, it’s not all perfect. Some of the bigger dissatisfiers were issues that people had with the billing department or being seen by nurse practitioners, rather than physicians. You can check out the show notes below for the full study, stepping back so far, we’ve looked at why consumers aren’t happy with traditional care and the business motivations of those who are offering alternatives, business motivations, healthcare, business, health, don’t those two sound rather glam together?
Craig Kartchner (00:24:03):
I’ve founded career that providers, doctors, nurses, those who have followed the noble art of healing people, caring for people. They are reluctant to call healthcare a business because it seems like it focuses on profits when you do that, you’re focusing on the almighty dollar instead of on the noble business of healing people.
Chris Hemphill (00:24:22):
We’re hearing from Craig Kartchner, who is assistant vice president of marketing and patient experience at Arizona based health system HonorHealth.
Craig Kartchner (00:24:31):
What they fail to remember or to acknowledge is that successful businesses across all industries, focus on the customer. If you focus on nothing but profits, then you’re not going to do very well. You have to focus on what your customers want and need. And that’s precisely what these caregivers, these doctors nurses want to do is focus on their patients, their customers. So if you can just align those thoughts, that acknowledging it’s a business means you need to do what you want to do even better. That is focus on the needs of your patients and customers. That’s what I mean when I say it’s like a business. I think sometimes ego or past processes can get in the way of focusing on the customer.
Craig Kartchner (00:25:15):
I’ll give you a couple examples. Physicians historically have been the gods of healthcare. They’re the ones who call the shots, they do all the training. So they have the knowledge to treat people, to heal people. And so nurse, at least historically it’s changed of course now to be a team based approach, team based care. But historically the nurses didn’t ever make decision or call shots. They waited to be told what to do by the physician. And that, to some extent, applied to the patient too, they didn’t decide for themselves. They weren’t part of the decision making process. That’s what the doctor told them to do that’s what they would do. And that has changed over the past couple decades really, but needs to change more. I think I’ve seen some providers who assume with like open notes, sharing their notes on patients publicly and transparently. So their patients can read what they said about them in their notes during their visit or releasing lab results really quickly.
Craig Kartchner (00:26:07):
As soon as you get a lab result from the lab, release it to the patient. A lot of providers oppose to that, because they say, “Well, the patients don’t understand the lab results and they’re just going to get upset and frustrated and call in to get an explanation.” And they might be right. But customer centricity would mandate that you figure out a way to educate them and explain it in a way that’s convenient for them. Don’t make them wait two or three days until the doctor can get around to calling them with the lab results, release them immediately with an explanation video or with other things that can educate them on which item means what in that lab result. Those are a couple examples.
Chris Hemphill (00:26:47):
So healthcare as a business doesn’t have to be bad, but it’s important that we put patients, the customer at the center, the retail tech and concierge disruptors we’ve discussed so far are great at this, it’s in their DNA. Changing the DNA for incumbent health systems is no simple task. It’s a really tall order. And if we want to change anything, we’ve got to dig into how. To help us with that. We spoke with Carrie Liken who got her master’s in public health at Harvard University, and now heads up the healthcare vertical at Yext.
Carrie Liken (00:27:21):
A health system needs to look at the patient first and I could be provocative here, but I don’t think that health systems are thinking first about the patient. They’re thinking about themselves, the system, and they’re thinking about the providers. And so Netflix is thinking about the viewers. That’s subscribers, basically. Amazon is thinking about the customer, CVS is thinking about the customer. “How many customers can we get to walk through, literally go fill the pharmacy prescription, go fill the prescription? But also in front of store, what can I do to get them to spend more money in front of store?” The health systems aren’t thinking about the patients first. And so I talk to a lot of organizations about things like creating personas and actually sitting in your shoes, your patient’s shoes, sitting in a 26 year old shoes, sitting in a 33 year old, pregnant woman’s shoes, who’s looking for a pediatrician for her newborn when she gives birth or looking for an OB-GYN, sitting in a 55 year old shoes, sitting in an 87 year old shoes and go through that experience.
Carrie Liken (00:28:26):
I think it’s astonishing when we go through this with our customers and the customers say, “Well, we’ve never done this before.” And I think, “Oh my gosh,” don’t be inward facing, be outward facing and think about that patient and or consumer, what is their experience there? And then you always be thinking outwardly, instead of thinking about how great we are. If I see another U.S. news ranking and plastered across whatever the banner might be or whatever the article or press release or whatever that might be. I know that’s great, but that’s so inward thinking, it’s all about us. CVS is not saying, “We’re the number one drugstore.” They’re saying, “We want to make people healthier.”
Carrie Liken (00:29:08):
They’re thinking about the consumer. “We want to make people healthier.” How do we think about that from a health system perspective and saying we want our entire community, our entire population to be healthier? And then make every decision off of that based every decision afterward off of that. It’s everyone saying, “Oh, consumer experience. We’re now going to be talking about a consumer.” Think there’s always been a consumer experience and a patient experience. And I think that the consumer experience is the experience that you have with healthcare. When you’re looking for care, when you’re interacting with an organization, when you’re trying to interact or transact in that way, you’re literally basically anything that you would be doing on Amazon. Take that parallel. And let’s talk about it for healthcare. That’s the consumer experience, but there’s also the experience of what happens when you’re getting care?
Carrie Liken (00:29:53):
I think that becomes the patient experience. I think the consumer experience fairly is fairly poor. Generally speaking. I always thought that providers want to be able to provide really good care. So the patient experience from a provider to patient standpoint, the providers are not out there to give you a bad patient experience, but they’re all of these elements around the experience itself that may lead to a poor patient experience. But I think, and define it as consumer experience is the interaction. And then the patient experience is what’s happening when you’re actually receiving care. People don’t know that an auto repair place is local or is nearby until they have a tire that needs to be changed. And I think it’s similar to healthcare. You don’t really utilize your healthcare until you have a need to utilize your healthcare. But the Optums of the world and the Blue Crosses of the world, and even Google and Apple, they’re starting to get into this world of, “How do we start to engage you in your healthcare before you even need your healthcare?”
Carrie Liken (00:30:58):
And I think that’s where health systems can start to look at how they can start engaging beforehand, because if they don’t engage beforehand, it’ll always be a reactive mode, always be a reactive mode from the patient or the consumer perspective. And everyone else will be out there being like, “I can be your trusted health advisor. I can help you. I have access to all of your Apple Watch data. And I can see that there’s all of this stuff going on your heart rate’s been high for the last three days. Is there something going on? We need to do some type of monitoring. Here’s a signal, here’s an alert.” They’re already in that game. They’re already in that mode of being able to advise on health. And I think the health systems are going to have to play catch there. And they’re not even thinking about it right now, at least to my knowledge. I think it’s going to be a big issue.
Chris Hemphill (00:31:46):
We’ve been pretty heady so far, talking about the overall strategies among healthcare providers and disruptors, but what’s actually going on with these fancy high tech, high touch experiences? What’s the patient experience? To find out I became a patient. I went to a Walmart health clinic. You can watch the full story on that. If you click the link in the show notes, but here’s the short version. It was awesome. I signed up online for a primary care visit and I knew what my total out the door costs were going to be before I even clicked register. No paper forms to fill out and no wait time, even though I was a little bit late. The doctor and yes, I do mean doctor, physician four years med school residency, the whole nine yards, the doctor was courteous, but strikingly different from many that I’ve worked with in the past.
Chris Hemphill (00:32:35):
How’s that? He’d suggested some immunizations and some services that I should consider. But after each one, he told me the price completely off the top of his head from memory, super convenient as I was leaving, I paid for the visit on my credit card and it was around 40, 50 bucks. Easy, transparent, affordable. But if I keep talking like this, I’m going to sound like a Walmart ad. They’re not paying for me for this. I promise I was just there for science. If that’s the level of service to be expected from disruptors, then entrenched healthcare systems should definitely be worried. Will they do nothing as consumers take their loyalties elsewhere? The truth is that many will, but not all of them. In fact, many people at healthcare systems have wanted consumer focused innovation for years. Now that it’s high on the competitive radar. This is their time. Maybe your time to shine.
Chris Hemphill (00:33:28):
Let’s hear from someone at a traditional provider. Who’s doing great things. We spoke with Shari Campbell, who was at the time, the marketing director of retail health for MultiCare Health System. An eight hospital system in the Pacific Northwest. Let’s learn how they focused on disrupting themselves with their Indigo brand. Indigo is the brand name for MultiCare’s retail health operations.
Shari Campbell (00:33:53):
Indigo was born about five and a half years ago. Our CEO and leadership really wanted to disrupt within our system. And was really looking at the landscape. And our system I should mention is in Tacoma, Washington. So we are virtually 30 minutes from all those big office building and towers with Amazonians in Seattle. We’re also a place where One Medical, Carbon Health, Forward and Zoom, another disruptive brand are all in our space. So I think it was a smart move to do that. So he wanted to disrupt, have some disruption within our system, disruption within urgent care as well because we operated urgent care clinics, but I think they were in many respects born out of primary care and born out of a physician extension and how do we take care of patients after hours short of having them land in our emergency departments.
Shari Campbell (00:34:45):
I’m oftentimes asked, and a lot internally in our own system. Why do we need Indigo? And I think this is really the question that my Millennial daughters say, and a lot of Gen X moms say, “Why can’t I get the care I need when I need it?” That means quickly and conveniently too much like Chris described with his Walmart visit. It’s got to be around my lifestyle. And if I’m a full-time working mom and have a couple kids like Audrey from Symphony, I need weekend hours, I need after hours. So all those things need to be available to me. So we really look at Indigo is trying to channel consumerism and disruption.
Chris Hemphill (00:35:25):
Awesome. When I asked earlier, if retail and tech would eat healthcare, it’s apparent that they don’t have to, this is a taste of what health systems may be able to do to keep up with the pace of innovation. Let’s hear how they’re doing this and how they’re measuring it.
Shari Campbell (00:35:41):
Some of the things that we look at every day, and again, this is every day. These are the four KPIs that we’re really focused on. And that’s probably, again, a little bit different from my peers that are running a hospital. We’re looking at employee engagement. We’re looking at that for two reasons. I think we feel like when our employees are really happy and satisfied and engaged within our clinics, that they’re going to give good service, but we also look at something that James alluded to. There’s a shortage of physicians and there’s a shortage of nurse practitioners and PAs. So we’ve got to become an employer of choice. We always look at door to door time, biggest satisfier and biggest dissatisfier for our customers is the speed of the visit. Does it start on time and do they get in and out the door quickly?
Shari Campbell (00:36:25):
Because again, when you are a Millennial mom, Gen X mom, or just a lot of us that are busy, we want that appointment to start on time and we want our visit to be efficient. We’re looking at the number of visits we have per day. There’s just not a lot of margin in urgent care and urgent care platform is I should have noted it’s in person and online, and then finally net promoter score. So how do we compete? If we can really deliver an experience that’s better than Amazons and better than Starbucks. And right now our NVS scores are better than both of those organizations. Then we feel like we have an operated to compete. So we’re looking at that every day. Another thing that we really focus on and it was started before I joined the system and it just keeps getting better is what we call the Indigo experience or creating wow moments, one patient at a time.
Shari Campbell (00:37:12):
So if you look at that picture that I put in every intentionally, one of our staff members is handing a water bottle to a patient, each of our Indigos has a coffee bar with a little refrigerator. So we’ll make hot coffee, tea, apple juice for the kiddos. And in addition to that, we usually have goldfish crackers. So one of my friends says that her daughter actually likes to go to Indigo when she’s sick, because she runs in and goes straight to the little coffee bar and gets her goldfish crackers. So our Indigo experience though is much deeper than goldfish crackers and water bottles. Every employee myself included, goes through not that traditional healthcare NEO, but through what we call Indigo experience training. And what we’re trying to do is very intentionally train our staff on customer experience so that it’s part of their care from the moment the patient walks in the door.
Shari Campbell (00:38:05):
And we actually train if possible for our folks to open the door for patients. Again, think of the mom, who’s got a baby in her arms and a toddler by her side and is getting outta the car. And if our staff is at the front, they will run and up the front door for the patient. So it’s again, creating that experience. The other thing we do that I talk about a lot is we use very specific language and words. So that employee that I mentioned and is in the picture, she’s a medical assistant, but we don’t call her a medical assistant. We call her a clinical concierge. And when our team talks about it, we have social pictures or we’re running a campaign. We say that she’s your guy, or he is your guy. And that they’re going to be there from the moment you walk into the door to the moment you leave our clinic, and they’re going to guide you through the visit and unlike traditional urgent care, or maybe even a primary care setting where you might have 14 to 15 people touch you.
Shari Campbell (00:39:02):
We only want to have a provider and that concierge, so it reduces the handoffs and it reduces you communicating your story to a lot of different people. Of course, one of the things that you have to do is with a disruptor is you have to always be adapting and evolving. I think in the last, like I said, six months Carbon Health, Forward, One Medical, Amazon continues their expansion. So I think a couple things we’re really focused on is how can we keep disrupting within our own organization and how do we evolve? I think that we every look in the mirror and say, “How are we disrupting ourselves?” So I don’t think you can buy any stretch of imagination, just sit back and say, “We’ve arrived.” Because when I look at Walmart, Forward, Amazon, all those folks, they’re changing every day. And if we’re not doing the same thing, we’re going to lose out. So I think we have continued to have year over year growth. We’ve built more because we’re having success, but success can be fleeting.
Chris Hemphill (00:40:01):
Wow. So we’ve heard from Shari about how MultiCare is keeping ahead of the pace of innovation. That’s great, but how can a health system know how to approach this? Is it from listening to this podcast word for word and copy pasting MultiCare strategy into their own? There’s probably a better way than that to understand what your patients and consumers want. earlier, we spoke about how the disruptors are obsessive about listening to their customers. HonorHealth is obsessive about this too. Let’s revisit with their VP of marketing and patient experience Craig Kartchner on how they listen and learn and what their patients want.
Craig Kartchner (00:40:38):
I’m super excited about that. So I’m glad you asked, actually. So we started doing a customer experience index study at the beginning of this year, to my knowledge had never been done because I looked, I wanted to see if a healthcare organization was doing that a broad index that takes several things into account to composite an actual index for a customer experience. So we have four components that go into that there’s NPS, so likely to recommend, there’s overall satisfaction, there’s brand trust, and then there’s customer effort. So how much effort did it take the customer to do what he or she wanted to do when they came to your site when they went to your clinic? Whatever. So those four components make up the CX index. So we do that broadly for HonorHealth and for our competitors in the market.
Craig Kartchner (00:41:26):
And then we’ve done journeys. We do about 12 different service line or area journeys with that same mentality, that same approach, these components that make up the overall experience and really dive into the individual steps that people go through when they go through a healthcare journey. So that research has been just incredible. We’ve gotten so many insights. What we’ve done in addition to that is, and that’s a whole wealth of data that, again, our clinical teams, when we present this, it’s so useful to them. They see firsthand what customers are saying, and we have very specific things to work on, to improve. It’s been great, but then we also dive in deeper and brainstorm solutions. Think how we can solve things and go back to customer and say, “Hey, here are the things we want to work on. What’s most important to you? How would you prioritize these possible solutions to these problems? If you were controlling the pocketbook and controlling our priorities?” So we go directly to find out what they would do, and that’s been another really insightful exercise.
Chris Hemphill (00:42:31):
It’s great to see that some health systems are listening, adapting, and looking at their patients in a fundamentally different way. By looking outside of just the patient experience, by acknowledging the whole person and experience around their healthcare. It changes the strategy, changes the game. So how should health systems overall look at their pay? Dr. Paul Keckley, the Affordable Care Act facilitator that we heard from earlier had some great perspective on this.
Dr. Paul Keckley (00:43:02):
They’re not in enrollees, they’re not patients, they’re not clinical trials subjects, they’re persons, and they’re in the population that we manage. Not because they visited our doctor, showed up in the ED, or enrolled in the health plan. It’s because they live in the community. So it’s a whole different paradigm. If you think about consumerism in healthcare, and we’re still living under presumptions of an archaic pretty well antiquated it system, where we want to talk about consumers and choice and rational decision making and all that. But we honestly make all of our money and like it, if they’re treated as enrollees, patients or clinical trial subjects, because we control that, we just don’t want to take accountability for outcomes. We’ll take everything up to that point, but not outcome because we say, “Oh wait a minute, outcomes are something that’s dependent on their behavior.” But we do very little to actually manage their behavior.
Dr. Paul Keckley (00:44:08):
So I think it’s a great opportunity in healthcare. I think it’s our biggest challenge. I think it’s the only way that we’ll actually bend a cost curve. And I don’t think that it’s simply a matter of going to the 85% of the population for whom they can respond potentially in a rational way. I think it applies to all of them. I think it applies to even those in the dual eligible population about all the things we know they could be doing, that we don’t manage. We don’t manage it well. So it’s going to be a while before we know. By the way other industries have gone through this, we’re late to this party.
Dr. Paul Keckley (00:44:49):
And I think some industries that are even further behind us or higher education and public education generally, and some others. But I think the analog most meaningful is to go to the financial services industry, which is about 20 years ahead of us. Who would’ve thought that the fastest growing banks don’t operate branches? And that you segment markets and certain types of banks focus on certain segments of the consumer population and offer different range of services than the bank across the street? Or that for the most part, the checkbook is a relic of the past? So the common thread, I studied retail banking and branch locations as I was beginning my research around the government’s approach to dealing with consumer driven healthcare.
Dr. Paul Keckley (00:45:46):
And I found it fascinating that ironically, when we displaced tellers and branches with ATMs, and then we lived out the life cycle of ATMs to electronic banking, the cycling of three was about 15 years in each cycle. Before you saw a prominent lead brand take ownership of that next trend. And there are in healthcare lots of fast followers, but the innovators tend to be few and far between, and we rail against those that are on the bleeding edge of anything. So it’d be interesting to your audience. How many organizations are actually known for having implemented a consumer driven model of health, not of healthcare, consumer driven model of health that’s person centered. That presumes people are rational and can make decisions that it’s about tools, not rules. That’s a big difference. Tools, not rules. The changes that have occurred in these other markets especially in services have been technology enabled, they’ve been driven by lower cost and higher value.
Dr. Paul Keckley (00:47:15):
It’s actually cheaper for the folks that operate the banks to do this electronically than it is to put a ATM on the corner, or put a couple of branches up. So there’s a value proposition for the operator and there’s a perceived value proposition for the consumer. Consumer doesn’t have to now take a check from the employer somewhere, it’s going on its own. So I just find that intersection between value to the sponsor, who could be an insurance company, could be a hospital, could be a medical group and value to the patient. The part of that equation that healthcare misses on is we’re defining value to the sponsor. We’re saying, “Boy, this is awesome. We’re going to get paid more to do the right thing.” Well, if that was the case, why aren’t we sharing those incentives with the individual consumer?
Chris Hemphill (00:48:18):
This is the radical thinking and questions that healthcare institutions can start addressing to drive the pace of innovation. So far, we now better understand what consumers want and how to learn and adapt to what they want. Awesome. So because of this podcast is healthcare now in the clear will retail and tech eat healthcare?
James Gardner (00:48:40):
Walmart is not going to take over healthcare. I don’t think Amazon’s going to take over healthcare. I don’t think CVS is going to take over healthcare.
Chris Hemphill (00:48:47):
Mission accomplished. Thank you, James Gardner. James is our retail health analyst friend from earlier.
James Gardner (00:48:53):
Healthcare is too big, too complex, and people have such diverse needs that no one can, “Take it over.” That being said, they will drive disruption. Both Walmart and others. It’s inevitable that there will be winners that emerge from this disruption in retail health, but more generally the disruption of primary care. So absolutely there will be winners that fare very well going forward. And there will also be laggers and losers who don’t don’t change, don’t adapt, don’t revisit their customer experience. Don’t revisit their value proposition and don’t keep up with what people now expect as state of the art in the delivery of care.
Chris Hemphill (00:49:35):
Perhaps rather than fearing an impending takeover, health systems should look at the new care models as part of a broader health care ecosystem. James, shares what it might look like to work alongside these institutions.
James Gardner (00:49:49):
Imagine yourself, a typical health system, maybe one in the Georgia area, where Walmart’s built out 15 plus clinics surrounding Atlanta. It could be said is both a friend and a foe and or a competitor and a collaborator. Because on one hand these large health systems have employed physicians, many of whom offer primary care. So they’re somewhat in the crossfire, but at the same time, there’s a nuance there because a lot of the Walmart customers are new to the system. They lack insurance, or they have poor insurance. So they’re not seeing traditional doctors. So in that situation, it would depend on your patient population. You may see some attrition to Walmart from your population base, or you may see very little, it would depend on the makeup of your patient population. The other group of employed physicians are the specialists. There’s actually an exciting opportunity for collaboration because Walmart’s not a hospital. They don’t employ oncologists or people in the orthopedic field or college field. There’s a huge gap there. These are strictly primary care physicians.
James Gardner (00:50:50):
So it’s an open question right now as to what Walmart’s referral strategy will look like. Clearly it’s not going to be haphazard. It’s not going to at the physician’s discretion. I would imagine there will be relationships and partnerships struck. Let me just put a little exclamation mark on that. Because I’ve also heard speculation that Walmart may take an approach similar to how they treat their employees. So if you work for Walmart and you’re one and a half million of them, Walmart is very intentional with your access to care. If you need a hip replacement for instance, they’re very, very data driven around both outcomes, because they want you to get the best possible outcome for their dollar. But they’re also very conscious and are data driven around the cost.
James Gardner (00:51:33):
Because we know that costs for different procedures vary widely even within small community. So let’s just imagine what that would look like if Walmart applied that model to it’s patient referrals and was very intentional about steering patients where they’re going to get the best outcomes for their dollar. Why would they do that? It’s a huge customer win, of course, but those savings inevitably people say are going to make their way back into Walmart’s cash register. So you can do well by doing good in a situation like this. So it’s fun to speculate where that might take us.
Chris Hemphill (00:52:07):
It’s worth noting that Walmart is extremely data driven and cost conscious when it comes to their approaches. So that’ll result in some interesting calculus to determine how they prefer their referral relationships. Speaking of relationships, what’s the impact of these retail health initiatives on the consumer relationship outside of my review from earlier, James had some more thoughts to share.
James Gardner (00:52:30):
All we know about consumer response is what Walmart has told us. So let’s take it with a grain of salt. They’re painting a picture of consumer satisfaction. They’re painting a picture of repeat visits and then overall positive experience. So that’s one data point. I think we also have to just realize that Walmart obviously is polarizing because of the success they’ve had in retailing and swath of challenges that they’ve created in that world of retailing. So there are Walmart detractors. We know they’re out there, there’s entire parts of the country that don’t have Walmarts, but at the same time, there’s a huge part of America where Walmart is part of the community, is a huge employer, is the go-to shopping destination for dry goods, but also grocery. And there’s actually a lot of brand affinity that perhaps we don’t see in Boston or San Francisco or other major metro area where they don’t have that same presence, but in a lot of America, Walmart is seen as a force for good, especially as they offer healthcare, that’s newly accessible and affordable. So I’m mindful of that as I think about the consumer response.
Chris Hemphill (00:53:31):
We’ve heard some great things about what the experience may be like for people and consumers if healthcare keeps innovating. There’s the other side though. What if they don’t? The future can’t happen without the right financing, capital expenditures and turnaround could put a stop to these efforts if they can’t fuel profits fast enough. To take a pulse on this, I asked James, whether Walmart’s low cost model is financially viable within healthcare.
James Gardner (00:53:59):
Can Walmart deliver healthcare with these prices and this model profitably? So starting point to that answer is Walmart insists these clinics are profitable and will remain profitable if and when they’re scaled. So there’s no sense of them being altruistic and offering these clinics somehow out of loss. At the same time, we all have to scratch our chin and ask, how is that possible with the pricing that we’re seeing? Now let’s parse that a little bit. We know in the world of retailing, that Walmart’s notorious for squeezing their vendors. So I imagine with the actual build out or the clinic for instance, it was probably no fun to be their furnishings vendor or their construction. I’m sure Walmart struck incredible deals, but that’s a fraction of their overall cross structure. If you look at what it costs to run a clinic, it’s the people and you can’t squeeze labor costs especially with clinical professionals, it’s a market. And if they feel poorly paid or poorly treated, they’ll walk, so are no economies there.
James Gardner (00:54:59):
So if that makes the question, how are they making money? If a mental health professional is charging a dollar an hour, we can do the math that there’s 50 weeks in a year, there’s 40 hours a week. That’s 60 minutes in an hour. They’ve only got like $120,000 worth of inventory if they were at 100% utilization. So the numbers are challenging even for Walmart who lives in the world of pennies on the dollar. But what we’ve all uncovered as we’ve spent more time looking at the model is Walmart’s thinking much more holistically about what it means to be profitable. And what they’re finding, I’m told is that the clinics are actually a powerful, powerful way of getting people off the couch, away from their computers, where they’re shopping on other players in the space and getting them physically into the store. So it’s activating lapse shoppers, who’ve gone digital. And it’s also, I’m told, at increasing the frequency of store visits and at the margin increasing typical basket sizes. So combined with that holistic model, they’re painting a picture of these centers being economically viable.
Chris Hemphill (00:56:05):
We’re aware of the constraint that the future must make financial sense. Still, if we’ve learned anything today, foremost, we must be prioritizing the needs of the people that we serve. Some thoughts on this balance between business and care from SymphonyRM’s CEO, Mike Linnert.
Michael Linnert (00:56:24):
I think a critical part of the future is getting value based care right. It is getting incentives aligned that people, health systems payers make more money if consumers stay healthier, I think that’s important. Well, in value based care, it gives them the incentives to keep people healthy. So still consumed care, but the care that they need not care for care’s sake. And I think that’s where things are headed. And that means to me, the emergence of technology and really the battle front right now in healthcare, where things are changing rapidly, is primary care. And you can see primary care. There are new entrants, I guess they’re not so new anymore, but One Medical, Village, you see Walmart, CVS coming in. And what all of those people having, and by the way, the payers are getting aggressively. They’re going to use data aggressively to try to figure out, “How do I provide better care? How do provide better health in addition to care?”
Michael Linnert (00:57:17):
And I do think that is one place where health systems are behind. That truly nobody has data that can compete with what the health systems have. Payer data, claims data, invaluable. EMR data, even more valuable in terms of helping predict, how do I keep people healthy? If we can start using that more aggressively again, to drive both health and loyalty, the economic rewards in addition to keeping people healthy rewards are enormous.
Chris Hemphill (00:57:45):
When we start looking at healthcare from a whole person, rather than just sick person perspective, how far does that take us? Let’s hear some final thoughts from Dr. Paul Keckley.
Dr. Paul Keckley (00:57:55):
We got to start building the system of the future instead of just feeding incremental change and calling that innovation. We’re not innovating in consumer driven healthcare. We’re just putting a new coat of pain on it, putting a little chrome on it. Let’s go all the way. And if the healthcare system of the future ends up as one system for individuals who are purchasing and responsible for the cost and outcome of their care, which could be as many as 40% of the population. And another 60% of the population who say, “I want to use the public schools. I want to stay in the system that has been created for me.” It’s like going through McDonald’s. I don’t think I’m going to necessarily get the best, most nutritious meal, but I know what to expect. And I don’t have to think about it. That’s the way others systems of the world have evolved into a bifurcation between a consumer directed semi-private system and a public system. And I think that’s where we’re going.
Chris Hemphill (00:59:08):
All right. So let’s ask it again. Will tech and retail eat healthcare? Nah, if you’re listening to this podcast, what tech and retail are doing is an opportunity. If you’ve been trying to drive consumerism in your organization for years, you now have examples and competitive incentives. Learn what’s working and how people are responding and use that. The organizations that will be eaten are simply the ones that choose not to adapt. To close it out, Keckley outlined a hypothetical where 40% of people purchased their care. And some 60% went for a public option, 60 and 40 make 100, which means 0% room for people to be unable to afford and engage their care. Be it through private innovations or public sector options, a future where everyone can afford their care is a future that’s worth fighting for.
Chris Hemphill (01:00:04):
Thanks again for tuning into Hello Healthcare. If you like what you heard, please spread the word, tell your friends and colleagues to subscribe on Apple, Spotify, or anywhere that they listen to podcasts. This conversation is brought to you by SymphonyRM. To get the latest on what these healthcare leaders are saying, subscribe to our newsletter at hellohealthcare.com or join us on Fridays for our LinkedIn live sessions. Thanks, and when we see you next time, hello?
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