High Stakes

Healthcare is Changing? Show Me the Data.

Researcher explains the numbers behind healthcare’s transformation

Healthcare leaders everywhere are struggling to predict the industry’s future. In the absence of a crystal ball, the best thing they have is data.

That’s what Chicago-based research firm Sg2 aims to provide. The purpose of Sg2, according to research team leader Jennifer O’Connor, is to arm healthcare leaders with the information they need to transform the industry.

The firm is currently crunching data from a survey about how healthcare leaders view the future of strategic planning. (Feel free to participate.)

Jarrard recently spoke with O’Connor about key insights she’s gained from her team’s research – including the real data behind the claim that healthcare is in a time of unprecedented change. She explains why almost no one builds a 10-year strategic plan anymore and how conversations with CEOs about declining admissions play a lot differently today than they did a decade ago.

An edited transcript of the conversation is below:

Jarrard Inc.: Everyone is talking about how much healthcare is changing. But what does your data actually say?

Jennifer O’Connor: Well, we’re definitely seeing the flattening and declining of inpatient admissions. But when we first said that 10 years ago, we had rotten tomatoes thrown at us by clinicians and hospital administrators.

Do they still react that way?

No. They’ve lived it. It’s a much easier conversion these days.

What level of decline are we talking about?  

For the next 10 years, we are projecting, on average, zero percent growth in inpatient admissions. In other words, there will be no more patients admitted to the hospital 10 years from now than there are today.

How is that possible?

Right? We have this huge aging population, the “silver tsunami,” so how can we possibly anticipate no more patients in the hospital? If you look at Medicare admissions, you will see a slight increase – about 4 percent. But it’s flat for the rest of the population. And what’s really interesting is that there may be no more patients in the hospital, but the ones there will be sicker and stay longer.

What are hospitals doing to prepare for sicker patients?

Many are rethinking space in the acute care center. They’re redesigning inpatient towers to plan for more ICU beds. But in addition to space, they’ve got to think about workforce shortages. There aren’t enough physicians trained to take care of complex patients in an acute setting. That’s why, even though it’s happening slowly, many hospitals are incorporating more advanced practitioners.

We’re also seeing hospitals implement technology to plan and prioritize the work. For example, they can use remote monitoring in the ICU when there aren’t very many critical care doctors. Telehealth is a fascinating enabler of these changes in healthcare.

Besides telehealth, what other technology are hospitals trying?

Take sepsis – a terrible condition that can turn fatal quickly. Hospitals are using advanced analytics to create models to predict who will become severely septic.  This focus on identifying cases before they become severe could reduce hospital mortality and keep patients out of the ICU.

What else are forward-thinking leaders doing to prepare for the future?

They’re looking beyond the walls of the hospital, because major growth will happen outside of the acute-care setting. Some are building ambulatory centers to stay front-of-mind with patients. But there are also efforts to radically redesign primary care. They’re looking at the pathway a patient takes through the system. It’s totally fragmented. So how do hospitals blow that up? They’re trying to totally recreate how we do healthcare today.  

What’s one metric that indicates that the rate of change in healthcare is faster now than it has been before?

Over the last couple of years, we’ve seen a marked decrease in the cycle time of strategic planning. Historically, hospitals would do a 10-year strategic plan for the whole enterprise. Now, they might do a four or five-year strategic plan. In more focused clinical areas, plans that used to span three to five years are now 12-month plans. Very few people will focus on a 10-year plan anymore because so much will change.

Is that a risk though? Could healthcare leaders miss out on planning for the long term?

There needs to be a balance. If you’re constantly worried about the short term, you’re going to lose sight of bigger aspirational and fundamental change. For example, some organizations are very focused on things like population health. If you’re doing that, by default you have to look a little further. You’re not going to move the needle on obesity for your 20-county market in a year or two. That’s a long-term goal.

There’s something to be said for pausing and having a vision. Without that, people never actually make significant moves towards long-term, systemic change.


Have Our Thinking Delivered to Your Inbox »