Roy Smythe–(Forbes)–As I sat in a café last week waiting for someone to join me so I could have my tenth meeting of the day at the 32nd Annual J.P. Morgan Healthcare Conference, I looked through the large plate glass window at the passers-by on the sidewalk outside. It seemed as if some huge, dark blue and grey-suited army of executives had invaded the Union Square area of San Francisco and was engaged in haphazard military maneuvers – moving in all directions with a great deal of intent, but in no particular formation.
I thought about the experience over the past week, and the irony of a statement of a clinical mentor years earlier in my career while I was a resident trainee – “Just remember boys, just remember because this might just be what saves your career someday: The business ethic and the medical ethic are not miscible in one another – they are like oil and water.”
At the time, this seemed logical. I was a product of a well-known highly academic non-profit training program. I was also someone, like many of my colleagues, who imagined a career as a “pure” academic clinician focusing on patient care and research – “unburdened” by the intrinsic financial issues related to the delivery of health care, and the extrinsic issues that impacted it.
Later on, I happened to find myself working as a staff doc mere blocks from Enron headquarters when the excrement its shady dealings produced hit the moving blades of public opinion. Like many others in and out of health care, I was righteously indignant at the headlines on the front page of my Houston Chronicle each morning. Increasingly, I believed that Napoleon was right when he said that “financiers are without patriotism and without decency; their sole object is gain.” Included in my personal definition of “financiers” was anyone who seemed to be focused on profit – including banking institutions and investment firms.
In my last stop in traditional health care, I was an operational leader and was therefore by necessity introduced to the concept of the balance sheet. As a result, I adopted the oft quoted “no money, no mission” mantra – one that still echoes in the halls of many well-known health systems. In other words, the money was important, but only as much as was necessary to keep the doors open, the grants coming in, and the doctors around. I still felt that those “financiers” were just passing funds around in a perverse profiteering polka-dance and not creating anything of real value.
I was wrong.
In my current role as Chief Medical Officer for AVIA, a provider-oriented innovation and investment firm, co-founded by Eric Langshur (former creator of CarePages, now at Abundant Venture Partners) and Ted Meisel (former Yahoo YHOO -0.33% and Overture executive, now with Elevation Partners), I met with investment firms, health systems, and a number of new companies at the J.P. Morgan Health Care Conference. All of them are trying to develop and market technology-aided tools for value-based care delivery – i.e. improving health outcomes, removing non-value added costs, moving care into more efficient venues, and encouraging health consumer engagement.
Outside the conference proper, in cafes and bars, hotel rooms and lobbies, and almost anywhere there was a place to sit down – all situated within about a five block square area of downtown San Francisco – a form of health care investment speed-dating took place, as it does every year.
The contrast between these meetings and those from my previous life in traditional health care could not be any more dramatic. No matter the great content and earnest intentions, the undertow of desire to protect the status quo in the former settings was always strong, and washed most of us back to the same bloody ocean in which we were swimming before attending.
At J.P. Morgan, however, it was obvious that the market and social forces that are in play in health care now have ignited activity and action. I left San Francisco excited about the clear, blue oceans that are being discovered and created by the energy, imaginations and, yes, the money of those in attendance.
I now firmly believe that the force with the best chance of accelerating change to the American healthcare delivery system is entrepreneurism. Although it might sound counterintuitive, the application of capital and the focus that it brings has the best chance to move health care from a fee-for-service enterprise that seeks to maximize revenue to one that is value-based and seeks to maximize health.
Bob Kocher, a former practicing physician himself who worked in the Obama administration, agrees. He is now a partner at Venrock, the venture capital arm of the Rockefeller family enterprise. I asked him about current health care policy, and the response of the investment sector.
“As an investor, I am able to accelerate change in our health system. It is this interplay that leads to innovation, imagination, and amazing things.”
I certainly have no desire to channel Oliver Stone’s “Gordon Gekko,” but while greed may indeed not be “good,” the desire to invest and create financial value among the “financiers” I once thought so little of will likely be increasingly “good for you.”
Roy Smythe is a Forbes contributor and the Chief Medical Officer for Valence Health, a Chicago-based health care consulting, services and operating company that seeks to facilitate the ability of providers of care to manage medical and financial risk.