Editor’s Note: John Self is taking off the month of August from his regular blogging and podcast hosting duties. In his absence from this space, we have selected some of his previous posts. This blog first appeared on Dec. 19, 2014.
The Huron CEO forumfrequently produces interesting insights regarding the year ahead and this year is no different with the possible exception that the CEOs seem to be zeroing in on the issues that will count the most.
Gordon Mountford, executive vice president of Huron Healthcare says there is a growing sense of urgency about making sure the foundational pieces are in place. “There is also a sense that refreshed skills and new partnerships are needed. The changes we see coming over the next three to five years aren’t merely incremental – the challenges are transformational.”
The pace of change seems to be the most important question CEOs face, Mountford said in a Huron Healthcare briefing memorandum, WhatWorks, distributed to clients. (Our Firm has supported Huron in their search for project talent.) “Timing the transition from volume to value is crucial in order to maintain the margin in the fee-for-service world while preparing for population health payment models.” The pace of change will not be constant, Mountford believes, but as the industry and individual markets reach a tipping point, that pace will accelerate. “That puts a premium on optimizing financial and operational performance now while building capabilities for broader transformational change,” Mountford added.
From the CEO forum, a list of five areas where leadership and innovation will be needed in 2015, Huron believes:
- The shifting payer mix will increase pressure on costs – Fewer patients will be covered by employer-sponsored commercial rates; government and private pay reimbursement will increase
- Disruptive innovators will compete for price-conscious consumers – A rise in consumerism and an increase in the number of high deductible health plans are drivers here
- Payor and provider lines will blur – Hospitals and other providers will look at taking on more risk as current payment models transition. This will help some organizations time the transition from volume to value
- Patient engagement will become increasingly important –Given that engaged patients are associated with better outcomes, this aspect of relationship management will take on new significance. Patient loyalty will be essential to avoid leakage under population health models
- Building new data capabilities will require a strong strategic focus – Finding the right path forward will require focused strategic planning and investment.