TODAY'S DISRUPTORS IN HEALTH CARE

How Is Disruption Changing Health Care, During COVID and Beyond? 

Before the COVID-19 pandemic, health care was seeing an influx of disruptors, from large organizations such as Amazon and Apple to numerous startups and innovators entering the space. The pandemic changed the face—and pace—of the disruption, causing consumers to gain comfort with new technology, and injecting historic levels of capital. 

How will the ongoing pandemic and current economic pressure affect this change? According to Sam Glick, the global leader of Health and Life Sciences at Oliver Wyman in San Francisco, while “health care has been evolving for some time,” the pandemic period will signal remarkable changes that will in many ways transform the field over the next handful of years.  

“What do we know about health care?” Glick asks. “We know that in the U.S., health care does some really amazing things, and there has been progress in terms of improving the quality and safety of what we do. But there are still many people who don’t have access to health care, or don’t have affordable health care. In many cases, affordability is the single greatest barrier to access. And, for a lot of us, even if we do have access and we can afford good health care, the experience just doesn’t look or feel like the experience we have in the rest of our lives,” such as when shopping or conducting online banking. 

Different Approaches to Addressing Complexity 
Indeed, unlike retail experiences, for example, health care has often been seen, particularly by consumers, as overly complicated and difficult to navigate.  

“There are certainly parts of health care where the complexity is warranted,” Glick says. “Health care is far more complex than many other industries, but there are a lot of places where that experience is suboptimal, and there’s no good reason for it, or the complexity was designed for legacy reasons which don’t serve the consumer well.” 

Leading up to the pandemic, innovators of all sizes were eyeing the field, confident they could improve aspects of the health care experience. This, according to Glick, led to a battle between traditional health care players who believed they understood the space and could innovate in more consumer-friendly ways and newer disruptors eager to shake up the industry. These outsiders and startups, particularly from the tech and consumer worlds, believed they knew how to engage patients in affordable and accessible ways, and could learn enough about the particulars of health care to make notable inroads.  

“COVID took all those forces, and then some, and accelerated them by five to 10 years,” Glick says. 

The COVID Era: Innovation and Funding

As an example, during the pandemic, tens of millions of people in the United States tried telehealth for the first time—“not,” Glick notes, “because telehealth suddenly got so much better but because it was their only option.” Essentially, COVID-19 forced levels of change that typically could have taken years, if not decades, into a near-immediate period. 

And data showed that when people tried technologies such as telehealth, they tended to like them. The challenge was getting people to try the new approaches. 

“Some of our data show that if you try a new way of accessing care, like telehealth, you are twice as likely to come back a second time,” Glick says. “It’s getting somebody in that first time that matters.” 

In addition, the pandemic created a unique economic situation where extreme cost pressures were put both on health systems and individuals, coupled with previously unheard-of levels of available funding once pandemic aid programs went into effect.  

“A year ago, there was tons of money flowing around,” Glick says. “More money invested in venture capital and public company acquisitions than we had ever seen before. All going after exactly these kinds of themes.”  

What Will the Future Hold? 

The result, Glick says, is a “perfect storm for vastly accelerated disruption.” So, will this massive wave of innovation continue? 

“I think so,” Glick says. Although he admits that due to the current economic outlook, what we see may be “a little less jubilant and a little more painful” than the rush that was experienced during earlier stages of the pandemic. 

Funding, while not drying up completely, is returning to more normal levels, and fears of a coming recession are causing an increase in economic pressure, particularly on smaller companies and startups. 

“Companies that don’t have a great product/market fit or aren’t as focused may not survive,” Glick says. In addition, an increase in acquisitions is likely as larger companies see good value in buying smaller innovators.  

“We’ll see a lot of gleaning and a lot of focus,” Glick adds. “But there is a lot of opportunity and innovation in this kind of economic uncertainty, particularly as consumers are now more willing to try new options. The need for health systems to bring more affordable, technology-enabled options becomes more acute than ever.” 

Will Health Systems Adapt?

Despite the obvious presence of disruptors, Glick says he has observed certain levels of cognitive dissonance among health care system executives. 

“Everyone I speak with says they understand this type of disruption is needed,” he says. But the realities of what such changes may mean, such as replacing some jobs with technology, place unique pressures on those in charge, he adds. 

“I expect we’ll see health systems that have leaders who are forward-looking and willing to make the leap,” Glick continues. “They will do quite well and really play an important role in their communities in bringing together all the resources somebody needs to get high-quality, affordable, accessible, value-based care. But there will be others who will hang on too tight to the old ways and might not make it.”

In many ways, Glick sees similarities between health care and retail, where large innovative players are using technology in unique, intelligent ways, creating experiences that provide consumers with better access and lower cost in ways that people like.  

This, Glick says, has raised the bar for everybody else. While brick-and-mortar stores still exist, they need to improve their experience, and offer something unique that isn’t replicated in the online environment. The same may hold true for health care.  

Those interested in how strategic planners and marketers can revisit strategy and marketing in order to align with consumer needs and stay ahead of these trends can listen to Glick’s SHSMD podcast. Further insights regarding the evolution of health care are available via SHSMD’s Futurescan, which explores key forces that are transforming the future of health care. The annual digital publication is available for free for SHSMD members, watch for a new release coming out in November, and you can order Futurescan 2023 print or digital copies for your leadership teams. 

“If you are providing primary care and people have to wait three weeks to get an appointment, that’s not really competitive with something being available 24/7 in one’s pocket or purse,” he says. “On the other hand, if you do a great job curating and integrating, helping people get better health outcomes by using multiple approaches—just like a good retail store—you can survive.”