Meaningful Use and Pay for Performance – two of the most talked about programs in healthcare IT over the past several years. They are both based on the premise that if you want to drive behavior change among providers and improve quality of care, you need to offer financial rewards to get results.
But what about the consumer? We have now entered a new era in healthcare where the consumer is rightfully front and center – AHIP is even calling 2014 the “Year of the Consumer.” Payers, and other population health managers, who until recently viewed consumers as claims, now want to “engage,” “motivate” and “delight” them.
The challenge, however, is that we are giving consumers more responsibility, but not making them accountable for the quality of care they provide for themselves.
As a country we have spent tens of billions of dollars on Meaningful Use incentives and Pay for Performance programs for clinicians. Providers need to demonstrate they are making the best choices for patients, being efficient and coordinating care.
They need to educate patients and give them access to information based on the belief that if patients are informed, they will take responsibility and action. Unfortunately, this seems like a “Field of Dreams” spinoff – “If we say it, they will act.”
However, that movie has a different ending. The intentions are good, but the flaw is that consumers don’t simply need more information. They need personalized guidance and support, and they need to feel like they have a financial stake in the game.
So the big question is – why aren’t we spending more time thinking about how the concepts behind “meaningful use” and “pay for performance” could be used as a way to get consumers engaged in their health? Yes, clinicians are important as they direct approximately 80 percent of the healthcare spend in our “sick-care” health system.
However, what most people do not realize is that 75 percent of healthcare costs are driven by preventable conditions like heart disease and type-2 diabetes. And while some consumers may throw up their hands and blame genetics for the majority of their health issues, it’s a fact that 50 percent of what makes us healthy is under our control – as opposed to 20 percent for genetics.
So what if we made wearable technologies such as FitBit more “meaningful” for the consumer? Instead of just tracking steps, what if consumers were financially rewarded for taking steps to improve their health (pun intended) through health premium reductions, copay waivers or even gift cards?
Consider a scenario where an individual who was identified as being pre-diabetic and then took action to prevent the onset of diabetes. What if we required that proactive person to pay less in premiums than someone who was not taking any initiative to improve their health? That would clearly be very motivating.
Continue reading “Should Health Consumers Be Paid for Performance Too?”
Filed Under: THCB, The Business of Health Care
Tagged: Consumer, consumer driven health, Incentives, Meaningful Use, Michelle Snyder, Pay for Performance, Personal responsibility, prevention
Jun 2, 2014
Over past few years, we’ve seen numerous articles about impact of the environment changes on the health of our population. They range from increased rates and severity of respiratory disease to the resurgence of infectious diseases due to increasing temperatures. However, it hadn’t really occurred to me until this weekend while attending a film festival in Colorado (name undisclosed because I don’t want it to get more crowded!) that there were interesting parallels between the environmental and health care reform movements.
And while this should probably not be a surprise given that healthcare and the environment are two of the most “wicked problems” facing our country – tough to describe, multiple causes and not easily solved with one answer – I nevertheless was intrigued by the similarities.
1) Local, local, local– The environmental movement has finally figured out that change will only occur if you make the issues local – it’s not just about the planet but about your backyard. (My father who could not hear me utter the word climate change without breaking into hives or leaving the room, recently told me he thinks “something may be happening because the fish in the river he spends half his days on are starting to die”) Those of us in healthcare have known forever that the organization, delivery and financing of healthcare is local. And while the biggest changes over the past few years have been driven by government policy, the tough part lies ahead and will only be successful because of the actions at the local level.
2) Show me the money- Whether it’s the environment or healthcare – until it impacts the consumer’s bottom line (property damage, rising gas prices, higher out of pocket expenses), it can be tough to get a majority of people to devote their time and energy to change. In healthcare we are still in the early days but are starting to see the impact of people having to pay more out of pocket for their medical care. Time will tell whether the impact is all positive, but at least we are recognizing that financial incentives can play a key role in changing behavior.
Continue reading “What Health Reform Can Learn from the Environmental Movement”
Filed Under: The Business of Health Care
Tagged: Environment, Health Care Reform, Health Habits, InterWest Partners, Investors, Michelle Snyder, Pharma
Jun 20, 2013
Last year was a banner year for digital health, as the market saw significant growth in funding, bigger deals and new investors entering the space. So what’s in store for 2013? According to a survey of nearly 140 digital health entrepreneurs and over 50 health care information technology venture investors, conducted by my venture capital firm InterWest Partners, we are in for another exciting ride this year. In the survey, we asked which sectors will see the most love from investors in 2013; which companies (if any) will see a $1 billion valuation; where they are having trouble recruiting; and which digital health entrepreneur would win “Survivor: HCIT Island” The answers? Well, it all depends who you ask.
Continue reading “Investors Are from Mars. Entrepreneurs Are from Venus”
Filed Under: THCB
Tagged: digital health, entrepreneurship, Funding, Health Insurance Exchanges, InterWest Partners, Michelle Snyder, Practice Fusion, venture capital
Feb 20, 2013
Practice Fusion, Castlight or ZocDoc will be the next digital health IPO. That’s according to a survey of over 100 innovative digital health entrepreneurs, conducted by my firm, InterWest Partners.
Nearly one third of respondents said Practice Fusion was most likely to be the next digital health IPO with approximately 20% of entrepreneurs voting for Castlight and ZocDoc, respectively. Among the trio, all three have been impressive generating media coverage and raising money (collectively raising over $320m in the last 2 years alone with valuations ranging from $450m to upwards of three quarters of a billion dollars), in addition to having some of the most visionary leaders in the space.
Contrary to popular belief that digital health is primarily about the next iPhone app for weight loss, sleep or exercise, it was interesting to note that all of the leading “IPO” candidates in our survey have B2B models. This is consistent with an insightful RockHealth report ( which found that nearly 80% of digital health companies have B2B models. Future growth in this category is likely to continue as the leading healthcare accelerators such as RockHealth, BluePrint Health and Healthbox are all seeing more applications from B2B companies.
The responses to the IPO question reflect an interesting industry trend. Though often classified as “B2B”, many of the leading digital health companies are really B2B2C – meaning that without the C there is no B2B. Pricing transparency tools (Castlight), scheduling platforms (ZocDoc), employer based wellness programs, medication adherence solutions – they all must find a way to engage the end user or they won’t be purchased by the employer, physician, healthplan, hospital, or pharma company. And though it’s impossible these days to sit through a day of pitches without hearing the phrase “consumer engagement” twenty times, I’m excited that people are starting to ask more of the right questions. Why will someone want to use this? Does it really solve a true need? Is the product easy to use, intuitive, and fun? Continue reading “The Next Digital Health IPO?”
Filed Under: THCB
Tagged: Blueprint Health, Castlight, Healthbox, InterWest, Michelle Snyder, Practice Fusion, RockHealth, Startups, Zocdoc
Nov 12, 2012
Over the 11 years I spent building the network at Epocrates, I learned a lot about physician behavior, motivation and the use of incentives. And while influencing nearly 50% of U.S. physicians to use a product requires that it meet a true need, fit into their workflow and be extremely easy to use – building one of the most trusted brands in healthcare goes beyond the product. It’s about being fanatical about understanding your users, engaging them at the right time, helping them support you and ultimately creating incredible loyalty.
Though we had a very analytical approach to user acquisition and brand strategy, I want to focus this article on something more fundamental – behavioral psychology. Truly understanding not just physician behavior but human behavior was core to the business at Epocrates and permeated throughout our business, marketing and product strategy. We focused early on in engaging physicians as consumers – B2C rather than B2B. Though a significant percentage of MDs are characterized as “small business owners”, we saw them as consumers first – hence, understanding human behavior, motivation, and influence drove product adoption and usage.
I was reminded of this recently listening to Dr. Robert Cialdini, speak at the 4th Annual Consumer Medicine Summit. If you haven’t read it, “Influence: The Psychology of Persuasion” is one of those dog eared marketing “bibles” that has remained on my shelf for years because its lessons on how to influence people are universal and timeless. In fact, I made it required reading for some members of my team. (Future postings on other favorites such as Nudge and Predictably Irrational, coming soon!).
Continue reading “The Psychology of Persuading Physicians”
Filed Under: Health 2.0
Tagged: Adoption, behavioral psychology, Consumer Medicine Summit, entrepreneurship, Epocrates, InterWest Partners, Marketing, Michelle Snyder, physician behavior, Social Proof
Jun 10, 2012
How many of us can remember a world without cell phones? Today’s medical students would undoubtedly be among that group. So it is no wonder these future physicians rely heavily on technology as they embark on their career path. We surveyed more than 1,000 medical students who are Epocrates subscribers about technology (software, hardware and EMRs) and other pressing industry topics.
The survey found 45% of respondents currently use an iPhone or iPod-touch, followed by Palm and BlackBerry devices. Even prior to the launch of the iPhone, Apple has connected with this younger generation and continues to play to its strengths. Our survey did not address carrier preference, but it appears students may be more device focused; nearly 60% of non-smartphone users planning to purchase an iPhone within the next year. It is also worth noting that students may be looking at what device residents or attending physicians are using as well. In the first year of availability, over 100,000 physicians are actively using Epocrates software on an iPhone/iPod touch. We still see a significant number of physicians using BlackBerry and Palm devices, so we expect those respective populations to grow as well.
Continue reading “Medical Students Want You to Know”
Filed Under: Physicians
Tagged: iPhone, Medical Students, Michelle Snyder, Technology
Sep 15, 2009