Applying Moneyball principles to healthcare

Paul DePodesta, the brains behind the statistical strategies in Moneyball, likens the business strategies of baseball to healthcare.







“Well, I apologize – I’m not Jonah Hill,” said Paul DePodesta, as he took the stage at this week’s Transforming Medicine: Evidence-driven Mhealth conference at Scripps Translational Science Institute.

Close enough, though. He’s the brains behind the game-changing baseball recruitment strategy highlighted in the lauded book and film Moneyball – and described this business savvy as it relates to healthcare. Here’s the upshot:

“So many things are the way they are because they’ve just always been that way,” he said. “In baseball – but also in healthcare.”

Indeed, when DePodesta read Eric Topol‘s book, “The Patient Will See You Now,” he drew some parallels between healthcare and baseball. In both cases, thoughtful, data-driven disruption’s the way to go.

DePodesta is known for turning the financial tide of the Oakland A’s in 2002 – and for making baseball recruitment a data-driven activity. He now is the vice president of player development and scouting for the New York Mets.

But when DePodesta joined the Oakland A’s, baseball was “really at a time of crisis.” Players’ salaries were escalating at an alarming pace, and smaller teams – like the Oakland A’s – were disappearing from the competitive landscape. An analogy, of course, could be the skyrocketing costs of healthcare.

“Subjectivity really ruled the day when it came to evaluating players. A lot of the time, we were flat out wrong,” DePodesta said. “So – is it the recruitment process, or the diagnostics, that’s wrong? Or is it the people, the evaluators?”

DePodesta said it’s key to reinvent the processes that have been so ingrained in the way our healthcare system works – and it’s important to look to other industries for inspiration in how to do this.

“We had to look outside of our industry for inspiration, because things had been done a certain way in our industry for a long time,” DePodesta said. “We had certain metrics – you could compare them to biomarkers – that people looked at, like batting average or RBI.”

DePodesta drew the most inspiration from venture capital, saying it’s very similar to the amateur draft in baseball. Baseball scouts select 40 players a year – and yet the average draft just produces one major league player. Similarly, a VC might wind up with one highly profitable exit from a pool of 40 startups it’s funded.

“It was a situation where we asked: How can we use the data to stack the odds in our favor?” DePodesta said.

So then, if you’re relying so heavily on data, what’s the role of doctors? Just to teach patients how to use their respective apps?  There’s a deep need for doctors – and baseball scouts – to contextualize the data, he said.

“Data itself doesn’t tell the future, or give the answer – but it can limit the field for you, and make it manageable for you,” DePodesta said.

Of course, comparing baseball to healthcare clearly isn’t apples to apples – lives aren’t on the line if the Pirates don’t make it to the playoffs. Also:

“I think one of the primary differences with healthcare is how personal it can be, and how each individual can really own their own situation,” DePodesta said. “But if you remember nothing else from what I said, remember this: Root for the Mets.”

[IMAGE: Courtesy of Flickr user Pursue the Passion]