Embedding Consumers in Your Corporate Strategy
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1 Embedding Consumers in Your Corporate Strategy Health Forum / AHA Leadership Summit San Diego, California July 18, 2016 Please note that the views expressed are those of the conference speakers and do not necessarily reflect the views of the American Hospital Association and Health Forum.
2 Topics to Cover Why should health systems worry about consumers and not just patients? What does it mean to embed consumers in your strategy? How do you do it? What embedding strategies are bearing fruit? Copyright 2016 BDC Advisors, LLC. All rights reserved. 1
3 Over the next decade, health care will be driven by two forces: (1) Population health management and (2) Consumerism. Triple Aim Goals Value-Based Payment Systems Provider Integration EHRs, Data Registries HMOs, Narrow Networks Population Health Management Consumerism Health Insurance Exchanges Retail, Concierge Healthcare Marketing Care Bundles Personal, Portable Health Records PPOs, HSAs, CDHPs Distributed Care, ecare Copyright 2016 BDC Advisors, LLC. All rights reserved. 2
4 Several key trends will make consumers and their choices much more important to health systems in the future. Increased consumer cost-sharing Changing health system economics Demographic shifts Development of personalized / precision medicine Copyright 2016 BDC Advisors, LLC. All rights reserved. 3
5 Increased cost-sharing is giving consumers more skin-in-thegame and forcing them to make more price-based choices. Past Future Financial Exposure Limited Co-Pays Expansive High Deductible Access to Health Insurance Moderate Expansive HIX Access to Routine Health Care Physicians / ER Expanding Retail Outlets Access to Cost & Quality Data Limited / EOBs Explosive Castlight Health Care Literacy Dismal WebMD 13M Monthly Copyright 2016 BDC Advisors, LLC. All rights reserved. 4
6 At the same time, changing health system economics have made high-end outpatient services much more important to margins. High High 1990 Consumer Involvement in Choice Profit Margin Low Flu Shot Service Complexity Low Open Heart Surgery Note: Shading denotes services of greatest economic leverage. Copyright 2016 BDC Advisors, LLC. All rights reserved. 5
7 At the same time, changing health system economics have made high-end outpatient services much more important to margins. High High 2015 Consumer Involvement in Choice Profit Margin Low Flu Shot Service Complexity Low Open Heart Surgery Note: Shading denotes services of greatest economic leverage. Copyright 2016 BDC Advisors, LLC. All rights reserved. 6
8 These changes make health systems much more dependent on consumer choice than they were a decade ago. Cost of Common Procedures One large metro health system s vulnerability: $75-100M in annual operating income Source: Advisory Board, BDC Advisors client Copyright 2016 BDC Advisors, LLC. All rights reserved. 7
9 Another key trend is demographics the rise of Millennials, who thrive on using digital tools to make quick, easy choices. Millennials Source: Pew Research Center, Array Health Solutions, Copyright 2016 BDC Advisors, LLC. All rights reserved. 8
10 Health 2.0 has become a super-accelerator for healthrelated consumer apps targeted at millenials. Sample Sessions Health 2.0 s Startup Championship [face-off with VCs, angel investors, entrepreneurs] Designing Interventions for Health Behavior Change Designing Innovative Healthcare Apps Meet Holland s Hottest in Health Tech Technology for Improved Patient Experience & Outcomes The New Consumer Health Ecosystem [retail, wearables, IoT] The New Landscape for Digital Diagnosis Free the Data: Consumer Data Ownership Sleep Technology Summit & Expo 10 Wearable Adoption Myths At Your Digital Door: Interfaces for Remote Care Clinical Tools for Provider Workflow & Patient Engagement Caregiving Technologies for the Elderly Tools to Fix the Clinical User Experience Borderless, Constant Care in the Current Digital Age [IBM Watson] The Informed Consumer: Physician Search & Price Transparency The Measured Life: Tracking from Head to Toe Health 2.0 Developer Challenge Announcement: Code-a-thon Winner Source: Health 2.0 website Copyright 2016 BDC Advisors, LLC. All rights reserved. 9
11 Winner was to be announced in January, 2016 extended to 1Q17 for consumer testing. Copyright 2016 BDC Advisors, LLC. All rights reserved. 10
12 Personalized or precision medicine customizes treatment protocols based on molecular therapies and patients genomes. President s 2016 Precision Medicine Initiative $130 Million to NIH to build a large-scale, national research cohort $70 Million to NCI to support oncology research $15 Million to FDA to study regulation of genomic tests Copyright 2016 BDC Advisors, LLC. All rights reserved. 11
13 Emerging technologies are extending diagnosis, monitoring, and treatment into everyday living. Ingestible sensor co-encapsulated with medication that records time of ingestion, heart rate, etc. + Small wearable sensor patch + Self-care feedback application for patient / care-giver Proteus Discoverer = Improved medication adherence Greater reduction in systolic and diastolic blood pressure and lowdensity lipoprotein-cholesterol (LDL) Source: Proteus Digital Health web site (accessed 6/5/16). Copyright 2016 BDC Advisors, LLC. All rights reserved. 12
14 Healthcare is likely to evolve like other consumer services toward greater personalization, choice, and social interaction. Common Themes Primary engagement shifts from B2B to B2C Consumer control and transparency grows Services become increasingly personalized Accelerated move to self-service Focus shifts rapidly from tools content integration experience Health Care Employer-sponsored health insurance Provider-driven care delivery Private & public health insurance exchanges Increased price transparency Proliferating choices, custom packages Condition-specific social networks Source: McKinsey & Company; BDC Advisors Copyright 2016 BDC Advisors, LLC. All rights reserved. 13
15 As genomics advances, personalized healthcare will be augmented by consumer services like 23andMe. Source: 23andme.com web site Copyright 2016 BDC Advisors, LLC. All rights reserved. 14
16 Global social networks will develop around clinical conditions, especially uncommon conditions like multiple myeloma. Research foundation for MM patients world-wide Also acts as a web-based clinical affinity group convener for MM patients Simple, clear mission: Accelerate development of next-generation multiple myeloma treatments to extend the lives of patients and lead to a cure. Strategic approach to funding research: Fund end-to-end solutions to accelerate drug discovery and development Extraordinary results Research momentum continues to build: "With the recent approvals of daratumumab, ixazomib, and now elotuzumab, we have seen an unprecedented pace of progress in myeloma therapy Paul Richardson, MD, Director of Clinical Research, Dana Farber s Jerome Lipper Multiple Myeloma Center, 2015 Copyright 2016 BDC Advisors, LLC. All rights reserved. 15
17 Embedding Consumers in Your Strategy: Development Stages Four Stages of Embedding Consumers in Strategy Stage 1 Patient- Centered Care Stage 2 Segmented Marketing Stage 3 Engaging Consumers Stage 4 Empowering Consumers Delivering customized care to meet patient needs Customized outreach to specific patient segments Integrating consumer behavior into care delivery Augmenting consumers ability to manage care and health Copyright 2016 BDC Advisors, LLC. All rights reserved. 16
18 Patient- Centered Care Kaiser Permanente places the consumer at the center of its delivery system. Home as the Hub The home, and other settings, will grow significantly as a locale of choice for some care delivery An individual s care delivery support system has expanded to explicitly include other community and family resources Integration & Leveraging Medical services are integrated with wellness activities; care delivery processes are integrated with health plan operations IT functionality enables us to leverage scarce or specialized clinical resources - MDs, RNs and other clinical staff. Secure and seamless transitions Warm Handoffs - The human skill sets and operational processes to deliver care and service effectively, efficiently, and compassionately. Customization Occurs at any level of the members journey with KP (choosing health plans, cost sharing, individual care pathways, and communication modalities.) The member drives customization and KP responds. Source: Kaiser Permanente Blue Sky Vision Copyright 2016 BDC Advisors, LLC. All rights reserved. 17
19 Segmenting Consumers Engaging Consumers Segmenting & Engaging Consumers 1 Manage the golden profile for customers 2 Deliver cross-channel, segment-based marketing campaigns 3 Cross-sell / Up-sell through marketing-driven next best offers 4 Personalize content delivered through digital channels 18
20 Segmenting Consumers Managing the golden profile for customers & patients Precision Marketing: Technology Framework A centralized hub to manage multiple channels of engagement. Mobile Web CRM Analytics PRM Campaign Tracking Phone Events Social 19
21 100 Multi-Channel, Segmented Campaigns Gateway / Landing Page Segmentation Strategy Marketing Automation for nurturing leads into patients Deep Keyword analysis Mass Media Digital Social 20
22 Digital Campaign Acceleration Off to the Races Start your Engines 2015: 43 Campaigns Segmentation Best Practice 2014: 25 Campaignsß Multichannel Add Nurturing 2013: 20 Campaigns Optimization Add Social 2012: 13 Campaigns Pilots Templates 21
23 Real-Time Campaign Management Awareness Conversion 22
24 Outreach Optimization (IVF) D I G I T A L C A M P A I G N S Phase 1 (4 Months) Phase 5 (3 Months) Facebook Experiment (1 Month) Landing Page Visits 3,935 3,098 1,972 Respondents Per Week (total) 6.75 (81) 28 (270) Quadrupled Response (83) Cost Per Acquisition $370 $170 Cut Cost 46% $96 Request for Consultation Exceeded Goal 55% 67 23
25 Engaging Consumers 1. Engage Consumers 2. Harness Data 3. Use Analytics 24
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27 Increase Engagement Options for the Non-Stop Customer 24x7 Scheduling and Nurse Triage Access Online Bill Pay Mobile tools; activity journals, integrated into EMR; real-time feedback TODAY: 26
28 Patient Engagement, Clinical Adherence, Care Management Deliver incentive-based campaigns directed at customers predicted to be high-risk for attrition. Facilitated tools for targeted audiences Reminded care. Outbound calls. Monitoring. TOMORROW: 27
29 Empowering Consumers What is Watson? 28
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32 Welcome to the era of Watson Health The road forward will be more informed. Our decisions, more confident. Care will be truly personalized, everywhere for everyone.
33 Watson: a cognitive system 32
34 Bringing the power of cognitive technology to health Understands Watson can read & understand documents & data both structured & unstructured at a massive scale. Reasons Watson searches & analyzes data, returning evidence-based recommendations. Learns Decisions made by leading experts feed the engine. Watson learns and improves over time. Interacts Interacts with humans in a natural way. Page 33 IBM Watson Health 33
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36 The partnership People excel at: Common sense Dilemmas Morals Compassion Imagination Dreaming Abstraction Generalization Cognitive systems excel at: Natural Language Pattern Identification Locating Knowledge Machine Learning Eliminate Bias Endless Capacity Page 35 IBM Watson Health SOURCE: Barbara J. Sowada, A Call to Be Whole: The Fundamentals of Health Care Reform, July 30, 2003, Praeger 35
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38 Only 10% of health outcomes are related to healthcare 60% Exogenous Factors 1100 Terabytes per lifetime Consumer-contributed data from non-medical sources: wearables, social media activity, public records, socio-economic standing 30% Genomic Factors 10% Clinical Factors 6 Terabytes per lifetime Genetic research, personalized medicine, clinical trials 0.4 Terabytes per lifetime EMR, EHR, claim systems SOURCE: Barbara J. Sowada, A Call to Be Whole: The Fundamentals of Health Care Reform, July 30, 2003, Praeger. IBM Watson // 2015 IBM Corporation 37
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41 The Future: Cognitive Connected Messaging System PATIENT DATA Cognitive Analytics System Behavior Analysis Phenotype Matching Health Risk Prediction Early Indicators of Health Decline Engagement Orchestration Coordinated Health Engagement Engine Provider Office Visits Care Manager Calls Automated Phone Communications Campaigns Pharmacist Interactions 40
42 Watson Health for ResearchKit HIPAA-enabled cloud platform for researchers to onboard and process more study data in less time and at a lower cost, yielding more significant insights and greater statistical validity International Business Machines Corporation 41
43 Watson Health for ResearchKit American Sleep Apnea Association Sleephealth app allows users to track and improve sleeping habits. Thousands of participants. An order of magnitude larger than traditional sleep studies, with less investment Expands sleep research with deeper insights into sleep patterns, human behavior and the connection to overall health 2016 International Business Machines Corporation 42
44 American Cancer Society (ACS) and IBM Watson Oncology Advisor A Watson-based advisor for people fighting cancer. Will provide cancer patients, survivors, and caregivers with trusted ACS resources and guidance Personalized to an individual s unique journey against cancer. 43
45 Partnering to transform health and wellness for millions of people Page 44 IBM Watson Health 44
46 A Growing Ecosystem 350+ Watson ecosystem collaborators 8,000 New IBM Bluemix platform users per week 77,000+ developers Globally using IBM Watson Developer Cloud Services 45
47 A healthier tomorrow starts with each person s engagement, today International Business Machines Corporation 46
48 Embedding Consumers in Your Strategy Stage 1 Patient- Centered Care Stage 2 Segmented Marketing Stage 3 Engaging Consumers Stage 4 Empowering Consumers Thank you! 47
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