Nashville’s health care scene wrestles with where (and when) disruption will emerge

What you’ll read about: Change and innovation run skin deep in some corners where the status quo of in-patient admissions and fee for service reign.

Is change really going to come from the shiny pixels of apps and software that are supposed to streamline the complex annals of behind-the-scenes care?

For 24 hours, a pair of health care tech leaders from Boston and Denver traveled around Nashville, reminding the city’s hospital-centric industry that change will — eventually — upend the way healthcare is delivered, thus changing Nashville itself.

Tech disruption is a persistent threat and promise to the city’s health care ecosystem, which originally rooted and flourished as companies operated larger portfolios of hospitals. The ecosystem has grown to include a swath of other companies that don’t operate hospital portfolios and are trying to work with the legacy companies while pushing the city into the vanguard of what’s next.

Change and innovation, however, run skin deep in some corners where the status quo of in-patient admissions and fee for service reign. There’s no central force pushing widespread, radical revisions, executives say. Instead, its within pockets of ambitious companies and people who want to compete with innovative powerhouses, such as those around Boston and in parts of California.

“Nashville needs to go to Detroit. We are Detroit in 1985,” Vic Gatto, co-founder of Jumpstart Foundry, about the “fat and happy days” before its auto industry stalled at an April 5 meeting of the Tennessee chapter of HIMSS, a health tech association.

Health care’s massive expense is hitting federal, state, employer and family budgets. It’s expensive, but no one entity is raining down change that will deftly rewrite how people get care.

No one disagrees that transformation is coming: Every U.S. industry has been impacted by the internet and users who want what’s being sold easier, and with more options.  

“We’re pregnant with a lot of hospital costs,” said Jonathan Bush, founder and CEO of athenahealth, to a packed HIMSS.

But panelists and audiences flirted with whether change is really going to come from the shiny pixels of apps and software that are supposed to streamline the complex annals of behind-the-scenes care.

Electronic medical records have made doctors data entry clerks, said Dr. Christopher Rehm, LifePoint Health’s chief medical information officer.

Patients rarely experience any efficiency from that software. And if they do see a change on a digital portal it vanishes when their insurance network changes and they have to switch health systems. They are back to navigating another physical and electronic system and creating yet another password.

Bush pointed out that in the case of Netflix uprooting Blockbuster or Apple unseating Microsoft as “cool” — it wasn’t the company that tried to force a new structure. Each offered a new way for those who were interested, gradually, then rapidly, gaining traction. Market share followed.

A slide from a presentation by Jonathan Bush, CEO and founder of athenahealth, overlapping the rise of Netflix against the demise of Blockbuster. Bush said companies like Netflix and Apple find early traction by designing for a “weirdo tribe” that wants its service before gaining mainstream traction — and market share. Bush is giving a presentation for groups around the country and spoke to the Tennessee chapter of HIMSS on April 5.

Nearly all of the pitches, ideas and proposals that continually float around Nashville — and in healthcare pockets across the country — are about internal structures, software and ideas.

So, what if the disruption isn’t from tech but it’s from a seismic shift in how people live — how long would it take for companies to notice?

Energy efficient products paired with behavioral change in the Great Recession eroded demand for electricity — a shift that reverberated across the power sector. It changed how companies do business.

A water shortage in South Africa is rapidly changing usage and consumption in Cape Town as it nears a crisis.

Behavioral change is hard — doctors and other clinicians across Tennessee talk about the challenge of getting people to make healthier decisions so widespread change won’t be swift.

But cultural movements can snowball. In fact, that’s what Tennessee leaders are trying to spur in neighborhoods and communities across the state: the decision by millions to live healthier.

What if it’s not coders but those who are tired of being — or can’t afford to be — patients who become the agitators?

Gatto told the HIMSS crowd that he used to think the U.S. Centers for Medicare and Medicaid Services would decide where health care was going, but it’s looking like Amazon, whether through its operations or partnership with JPMorgan Chase and Berkshire Hathaway is going to spotlight a path.

WalMart thinks the power will come from people — or at least sees an opening to offer a service that people want to be simpler. It’s courting Humana.

No matter the shepherd of change, Nashville’s health care industry has to be ready for long-heralded disruption.

Executives need to think about the company they will run when people don’t want or need to use the services as currently offered.

“We have to get radical. We have to start trying new things, otherwise we’re going to bankrupt this country,” Mike Biselli, founder of Amplify Labs and Catalyst HTI in Denver, told members of The Disruption Lab on April 6.

“If you’re in this town you worry about who is going to come out of the lower left quadrant,” CEO and founder of athenahealth, Jonathan Bush told the Tennessee chapter of HIMSS.

Nashville’s industry is more about care than health. It’s evident when companies fret about fewer in-patient admissions or less in collected payments from patients, but also in the overall health of the area.

“We need to stop being so damn proud of ourselves,” said Lisa Henderson, chief operating officer of Synchronous Health, at the HIMSS meeting.

The tumult won’t happen next week, next year and is most likely years in the future … after more legacy companies buy other legacy companies and start-ups raise money for fresh approaches.

Phil Gibbs, founder of The Disruption Lab, is planning to open both a Center for Healthcare Disruption in the next phase of OneC1ty, which is also home to the Center for Medical Interoperability.

Nashville’s industry is “smart for a different game (that) you won,” said Bush, who told the Nashville Health Care Council that ultimately “I’m long Nashville. It’s going to happen.”

The standing-room only turnout for the events underscores the interest that leaders and entrepreneurs are showing in shaping the rules about the next era of health.

“It’s probably going to accelerate us toward not being (emergency departments), hospitals, clinics — just care,” said Rehm.

Photo by Tanner Boriack


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