All too often referral leakage occurs because an in-network primary care physician actually refers a patient to a specialist outside the network. Chicago-based Human Practice is working to address this problem through what it terms "meaningful networking." The startup has identified three levers that address referral leakage: physician awareness of colleagues, quality of physician communication, and convenience of patient access. Based on their findings, the team has designed digital solutions to equip physicians and patients with the knowledge to find the right care provider and improve care coordination. Oliver Wyman Associate Terrance Wallace connected with CEO Moses Hohman to learn more about the Human Practice approach:
Terrance Wallace: I imagine there are still a few people who haven’t heard the Human Practice story. Could you give us a brief overview?
Moses Hohman: We were inspired to start Human Practice by the simple observation that human relationships are central to good healthcare, and large shifts occurring in the industry are increasingly driving a wedge in these relationships: between patient and doctor, between physician and physician. And yet outside healthcare we’ve experienced a revolution in how technology can support relationships in novel ways.
Our mission is to design technology to foster stronger healthcare relationships as doctors and hospitals undergo these larger industry changes. Our focus today is on the referral relationships between doctors, because these relationships have such powerful effects on the entire ecosystem.
TW: How does your solution work?
MH: Doctors use our mobile app to strengthen relationships with their colleagues. This helps doctors build the practice they want, and helps the organizations they work with cultivate a cohesive community of physicians. In this age of healthcare consolidation and accountable care, the former goal has become much harder for physicians to achieve, while the latter has become one of the primary objectives of hospital systems.
We customize our platform for clients based on their unique circumstances, but common elements include 1) a way for physicians to find experts within a hospital system quickly and meaningfully; 2) seamless access to direct contact with other physicians to coordinate care and build clinical relationships; 3) and a way for physicians outside the hospital system to provide referral information to their patients.
TW: What level of readiness do providers need to implement your solution?
MH: We try to meet our clients where they are. As an early stage company, we seek out clients who embrace innovation and like to work with younger organizations because of the opportunity to develop a deep partnership.
TW: How does the transition to value-based care impact the healthcare ecosystem?
MH: The goal of this transition from volume- to value-based care is to maximize the health benefits of each dollar spent, to reduce care costs while maintaining or improving care quality.
We are still in the very early stages of this evolution. Most hospital systems today still make the majority of their revenue from the volume-based fee-for-service system. The major impact of the transition today is seen in the carving up of payer networks into a much larger number of plans serviced by smaller networks of doctors who are accountable for the health of plan members.
Current methods for measuring “value” (simply defined as quality divided by cost) operate at the level of either an entire organization or the individual physician. But data shows that significant value creation occurs between those two extremes, driven by the relationships physicians form with one another in smaller groups. The patients of a group of physicians who coordinate care well with one another enjoy lower costs, shorter hospital stays, and fewer visits to the doctor.
The quality measures we do have, especially at the individual physician level, are also still in their infancy. Most are based on checklists (did you do X every time?) rather than outcomes (how good was the result?).
So we’re not great at measuring quality yet, and as a result, payers who assume value-based risk are focusing primarily on the component of value they do know how to measure, cost.
The most pronounced value-based efforts in the market today (accountable care organizations, value-based purchasing, bundled payments) center around negotiating contracts to constrain costs. This naturally leads to an arms race, in which hospital systems try to grow as large as possible to gain market power over payers. Or, in a development that I think better foretells the future, they vertically integrate to offer their own insurance plans.
TW: What role will Human Practice play in that transition?
MH: These large systems are trying to be all things to all people. The problem is, nobody can be good at everything.
There’s also this insidious problem that I believe we’re just starting to see the effects of. As these huge systems are put together, they are creating much bigger and more complex physician networks than have ever existed before. This complexity and size coupled with increased pressures on physicians’ daily schedules have outstripped physicians’ ability to remain connected with their colleagues. Simply put, doctors don’t know each other anymore.
One of the most important things people have learned about work in this information age is that knowledge workers need connection with their peers in order to remain creative and thrive. This is why Facebook and Netflix have internal company hackathons. It’s why they have flat company hierarchies and self-organizing teams. If they treated all of their software developers and designers like disconnected, autonomous robots, they would lose their ability to compete.
You’ve probably heard the jaw dropping statistics about the level of physician burnout these days. Over 50% of doctors would leave medicine if they could. That’s real discontent with their work. We usually hear things like the EMR time sink being to blame, but I think that’s just one part of a much larger problem here, which is that physicians are increasingly feeling disconnected from their real work, from their patients, and from their colleagues. That’s what’s driving this discontent.
TW: We know that big change in healthcare is possible. What big changes do you see driving what healthcare looks like in the future?
MH: Everyone says this, but it’s one of those things whose magnitude is hard to fully appreciate. Healthcare consumers (patients) are gaining much more prominence than we’ve had in the past. It used to be that we did whatever our doctor told us to do, because they knew best, and we weren’t paying for it directly anyway. We’re now paying much more out of pocket for our healthcare, and the rise of consumer power in other industries is carrying over to healthcare as well.
I think there’s been this assumption that because patients don’t have a good way to judge the quality of their surgery or of the clinical decisions made by their doctor, the rise of consumerism means that healthcare organizations must shift their focus to things like the quality of their customer service and how nice their doctors are, rather than the quality of care.
But I think that’s cynical and temporary, because I just don’t think patients are that stupid. Of course we know that the quality of care is more important. We’re willing to overlook the other things if we truly know there’s a difference, and when we’re really sick we desperately want to know which doctor will give us the best chance to get better. Better customer service is a great goal, but I think outside of healthcare organizations’ incremental improvements, the most interesting innovation in the next decade will focus on disruptive ways to give patients what they really want to know.
TW: What advice do you have for other healthcare innovators?
MH: Stick with it. It’s a long, tough, and wild ride!