3.19.2008

Big Healthcare || Big Trends
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In peering out over the healthcare landscape, it's easy to see that change is coming. For one, "Big Healthcare" loosely defined as HMOs, insurers, networks of hospitals,e tc.-with some notable exceptions-seems to have forgotten who its customers are.

I'm reminded by the classic essay "marketing myopia" which demonstrates how easy it is for companies who have earned industry leadership to become constrained by their operating legacies. Over time, the 'product' that is being produced for consumers becomes less and less relevant.

What's worse, this erosion in creativity and ability to innovate is oftentimes obscured by lack of substitutes. Service erodes and gets increasingly expensive. Monthly fees or plan costs increase by high-single digit percentage points every year, as management rationalizes this as "our operating costs increased, therefore, we are passing the costs on to you-but don't expect innovation-for that, we would have to charge far more."

The endgame is an uncompetitive, expensive, no-frills product or service. Is this not the case in healthcare today? Does anyone recall being "delighted" by the outcome of routine, systemized care? In this, we refer not to individual caregivers who do indeed make a difference and can be delightful, but the process itself, which may resemble more Alfred Sloan's flexible model approach to manufacturing autos: "We have one engine, and three basic body types-mix and match and add trim and you can have up to nine models for nine different pricing levels."

Information

Your healthcare information is treated like a tablet inside the ark of the covenant. No one should see it but the high priests - not even you - since you're really not qualified.

Combine the universal K-martization of healthcare with information silos and bureaucratic ennui - and no wonder that entrepreneurs and innovative web companies are tilting at windmills with grand strategies that seek to dissemble and then recombine the atoms of the healthcare system in a new, pleasing fashion.

The new life forms are evolving...it will be great to see what emerges out of the petri dish in a year or two.

We're mad as hell, and we can't take it anymore.






Fu

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