How CEOs are thinking about innovation challenges, interop and tech giants

While a significant amount of innovation has taken place over the past year, there are still challenges to overcome.

The No. 1 threat to innovation that CEOs identified in the survey was culture, identified by 71.4%, followed by staffing and recruiting at just 28.6%.

Randy Oostra, CEO of Toledo, Ohio-based ProMedica, described innovation as sometimes feeling like “playing in traffic.” It’s “being comfortable in not having answers,” he said.

Innovation can be particularly challenging since new ideas often don’t pay off immediately—it requires an upfront investment that will hopefully result in improved health outcomes or cost savings.

Over the past seven years, ProMedica has invested about $75 million into innovation efforts, including pumping money into startups and developing its own companies and products that will one day, hopefully, create multimillion-dollar businesses.

A few years ago, ProMedica formed an innovation council to bring together senior and executive leaders to discuss ideas for new companies. So far, it’s spun up companies related to healthcare at home and health plan benefits navigation. At any given time they’re discussing two dozen to three dozen projects, with closer to seven or eight that they’re actively working on.

Investors from venture-capital firms like LRVHealth, which ProMedica has invested in, also provide feedback on the council’s ideas and what they’re seeing in the industry.

Payment and finances were also a point of concern among write-in responses.

It can be difficult for healthcare providers to innovate in ways that keep patients healthy and at home, since much of today’s fee-for-service system for reimbursement pays to “put heads in beds,” Harrison said.

In 2019, Intermountain started using an artificial-intelligence tool to identify patients in early stages of chronic kidney disease, with a goal of intervening earlier to improve clinical outcomes and avoid costly hospital admissions.

“When payment models that reinforce keeping people well … are in place, it engenders all sorts of terrific innovations,” Harrison said.

That’s something Atlantic Health has been working on, too, joining programs like the Medicare Shared Savings Program and entering into population health arrangements with local commercial payers.

In its first year, a risk-sharing and value-based care program between Atlantic and Horizon Blue Cross Blue Shield of New Jersey led to a 9% reduction in unnecessary hospitalizations and a 5% reduction in the cost of care, according to results shared in September 2020, in part through more tightly coordinating care and sharing medical and claims data.

“We know that this fee-for-service system is just not set up properly to align incentives,” Gragnolati said. “We have the opportunity to do that.”