Health IT, Hospitals

Kaiser Permanente CIO: Time for fundamental rethinking of business models

At HIMSS17 last week, Richard Daniels spoke about healthcare transformation via a consumer-driven model.

Kaiser Permanente Thrive Bar

Maybe incremental improvement in healthcare is no longer good enough?

“We’re going to have to revisit some of our fundamental business models because if we don’t, someone else will,” Richard Daniels, CIO of Kaiser Permanente, said during last week’s Healthcare Information and Management Systems Society (HIMSS) conference. At HIMSS17 in Orlando, Florida, Daniels spoke about healthcare transformation via a consumer-driven model.

While the consumer-driven transformation of healthcare has been predicted for a decade or more, Daniels said that the upward distribution of wealth in the U.S. could finally force radical changes. “It is going to change how people look for care,” he predicted.

According to Daniels, socioeconomic realities will lead to more people on Medicare or Medicaid, so government involvement in healthcare may actually grow, despite current efforts to roll back the Affordable Care Act.

By 2025, the KP CIO said, six of every 10 Americans will have government-subsidized coverage up from 4 in 10 in 2013. This means that government programs will have to operate more efficiently and demand more value from care providers.

“We’re going to have to put in better technology and we’re going to have to rethink some of our business models.” Daniels said. Based his HIMSS presentation, Kaiser Permanente isn’t doing anything all that unique with technology, other than the fact it’s doing so much with so many different technologies and spending billions of dollars doing so.

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The Oakland, California-based, not-for-profit health system is trying to innovate with a new hospital in San Diego that is set to open in April.

That hospital will have a smart screen in each room to deliver personalized educational material, facilitate telemedicine, provide internet access and let patients order food, watch TV and Netflix and, eventually, Skype with family members. Daniels called this an example of KP’s move toward a connected health system, driven by consumers and enabled by technology.

Each ambulatory exam room in the new facility will have a custom-designed chair that can measure weight, fold flat and be disinfected between each patient visit. This innovation, already in place at several California clinics, replaces the ubiquitous exam table that needs to be covered with paper. (A model

Nurses at that hospital will carry ruggedized mobile devices built for integrated healthcare communications. “We really hope this is going to free up a lot of time for nurses so they can pay more attention to patients,” Daniels said.

As with some other new KP locations — including a year-old facility in Manhattan Beach, California, the San Diego hospital will have a customer-service center that takes a page out of Apple’s playbook. “We didn’t call it a Genius Bar. We called it a Thrive Bar,” Daniels explained.

At the organizational level, Daniels believes KP will have opportunities to integrate with social services in the communities around its health centers. That makes sense, since Kaiser Permanente founding physician Dr. Sidney Garfield believed in a concept called “total health” that considered physical, mental and social well-being.

He also said he still sees consolidation happening in health plans, despite recent breakups of the proposed Anthem-Cigna and Aetna-Humana mergers. However, the consolidation will happen at the regional level, not at the national scale of the two failed megamergers, Daniels predicted.

Photo: Kaiser Permanente