Can healthcare companies do well and do good?
We’ve reached a crisis point in healthcare and we can’t financially engineer our way out of it by simply shifting risk and costs. It’s time for healthcare finance 2.0.
We need to start looking at the big components that make up the financial framework. Historically it’s been hard for publicly traded and for profit companies to strike a balance between maximizing shareholder return and serving the broader needs of Americans.
With business leaders calling for a new version of capitalism that balances the needs of all stakeholders, it gives us the opportunity to challenge our old financial frameworks and business practices.
I’ve compiled a few questions and insights to help you think about the changes needed for the industry to move toward value based care.
1/ Can healthcare companies profit by better serving all stakeholders?
Under the new rules of capitalism, the healthcare industry should be considering all stakeholders including consumers, patients, providers, employees, vendors and payers in their policies and business practices.
Leading retailers such as Nordstrom and Patagonia have achieved sustained financial success by serving all their stakeholders. Both companies invest in technology to better serve customers and work closely with their vendors to reduce their environmental impact. They do well by doing good.
Plus they give back a portion of their profits to the communities they serve. They realize that without customers who can afford their products, they don’t have a business.
2/ How should healthcare providers be compensated?
Risk sharing arrangements [capitation and bundled payments] are tough models to sell because there are so many variables that can affect a patient’s outcome that are beyond the direct control of physicians.
In Dare to Lead, Brene Brown talks about vulnerability and how many of us are tasked with engineering vulnerability out of systems. The reality is that we can’t engineer all the risk out of healthcare no matter how many apps, sensors and devices we incorporate into the delivery of care.
Healthcare is still about people and people are fallible. We can’t penalize providers for issues that they can’t influence or control.
Eric Topol MD may be correct in calling for a new organization that gives physicians a collective voice about their pay and public policies that affect the health and wellbeing [aka: medical risk] of Americans.
3/ How can we empower healthcare consumers?
The Gates Foundation published an article recently about governments and foundations needing to take targeted action to solving problems rather than making broad sweeping changes. Some healthcare organizations are taking steps to give community based vendors priority but as an industry, we can do more.
Leading retailers also invest heavily in their people whereas healthcare organizations often do the minimum required.
Speaking from experience, healthcare organizations are in a better position than vocational programs to offer formal training programs, mentorships, jobs and meaningful career paths.
Investing in people is better than pursing and jailing patients for medical debt when they have no means to pay. Plus improving someone’s financial health often helps improve their physical and mental health too.