AVIA’s Guide to Scaling Healthcare Innovation
Eric Jensen, Chief Product Officer, AVIA
Another JP Morgan Healthcare Conference is in the books. This is the 6th year I’ve attended the San Francisco event that brought around 50,000 healthcare executives from across the country to talk healthcare and technology for 5 days.
I left my first conference in 2014 with a sense that I had just traveled to the center of the healthcare universe, hobnobbing with all the movers and shakers in the industry. Back then, I got a hotel room three blocks from the conference for less than $200 a night and “big data” was the hot topic.
This year, hotel rooms routinely topped $1,000 a night, and instead of feeling energized after rubbing elbows with the who’s who of healthcare, I felt like I was in group therapy. Amongst the digital health crowd, of which I count myself, the conversations felt like a support group for innovators making less than desired progress. Most people who entered this space did so as idealists with a passion to make healthcare work better. The idealism seems to have worn off. If life is a marathon and not a sprint, the same can be said about working in digital health.
On the one hand, this year’s conference saw a wave of health systems talking about more of the same strategies to drive “innovation,” from multi-billion dollar brick and mortar investments to “value-based care” with very limited risk-taking models. I sensed that few incumbents are buying digital solutions that are innovative or disruptive at scale. What seems to be selling is better versions of legacy tools that legacy needs, not truly transformative technology.
Yet this year I saw more digital health M&A deals announced at JPM than ever before, highlighting the maturity of the space, with deals moving away from point solutions and toward platform plays. It was particularly gratifying to see several entrepreneurs I have come to know over the years announce successful exits, including Hani Elias at Lumere, Sterling Lanier at Tonic, and Joel French at SCI Solutions.
I also experienced a beacon of hope from the most unexpected of places. While attending the HealthTech 4 Medicaid (HT4M) event on Tuesday, I heard an inspiring group of speakers, including Andy Slavitt, Molly Coye, and a variety of entrepreneurs committed to improving the health and lives of patients with Medicaid. As Andy stated in his speech, the current health system has been designed by and for the Peloton crowd, and we need to redirect our attention to those who are most vulnerable. If you walked to the event, rather than taking a taxi or Lyft, this need is visceral and apparent. Held at the Kelly Cullen Community Center in the heart of the Tenderloin neighborhood, I encountered homeless communities on every block, many of whom clearly face a variety of physical and mental health conditions.
The HT4M was inspiring because it brought together a group of individuals who will not be deterred in working to tackle these social ills. I saw the best combination of passion, energy, and know-how in every individual who spoke on stage that day.
Other sprinklings of hope came from a lively discussion I participated in about the CMMI Direct Contracting initiative that went into effect this month. While still in early days, this initiative makes it easier for would-be risk-taking providers to sign up Medicare fee-for-service beneficiaries for risk-sharing or global capitated arrangements.
Despite the day-to-day challenges for those in the digital health space that seek to dramatically improve healthcare in this country, I am still a firm believer in Stein’s Law, which is best paraphrased as “Trends that can’t continue, won’t.” The cost trend in healthcare can’t continue, nor can the inequality in access and outcomes that different populations face. I sense and believe that an inflection point is close on the horizon that will disrupt healthcare for the better.
What will be the driving force that pushes us towards this inflection point? That is anyone’s guess. Will it be Amazon Care opening up access to others beside employees? Will it be Babylon Health, which aspires to provide digital care to 1 billion people across the globe? Or will it be collective efforts, large and small, of all the others who are working in this space? Only time will tell. What I do know is that incumbents that don’t disrupt themselves stand to lose when this inflection point hits.