Healthcare executives often ask us: “Who will be the Amazon of healthcare?” Our answer: “Why not Amazon?”
Recent news reports have suggested that Amazon is developing a healthcare platform that would integrate data from legacy electronic medical records and offer services such as virtual consultation on demand. The company’s Echo virtual assistant could be part of that – WebMD and HealthTap are said to have already integrated with the device to provide responses to patients’ health-related questions.
These reports suggest Amazon is serious about moving into healthcare, and they also reinforce a key point we’ve been making for the last few years: that the healthcare industry is not immune to widespread business model upheaval. The turbulence may very well emanate from a consumer-to-business (C2B) “on-demand” healthcare platform that reshapes the industry’s supply and demand equations.
The technology exists for a healthcare platform to deliver care using pretty much the same model Netflix relies on to deliver entertainment: any movie, any time, on-demand, to any location via many devices.
Powering these platforms will be new systems of intelligence, combining insane amounts of processing cycles, artificial intelligence (AI) – and machine learning (ML) in some cases – as well as data and analytics. Add in ubiquitous smartphones, the app economy and digitally savvy consumers who are able to connect to any healthcare provider they choose, and you have a recipe for rendering the traditional value proposition for health plans obsolete.
No Time Like the Present
Health executives may believe they can wait until the day after tomorrow to respond to this new model of healthcare delivery. We beg to differ. Tomorrow comes very quickly with platform plays. Platforms have busted business models in publishing, music, transportation and hospitality, and platforms are making inroads into such seemingly impregnable industries as manufacturing, logistics, and banking and financial services. Healthcare is next.
With Amazon and other tech giants like Apple and Google breaking through the industry’s boundaries – and industry stalwarts like United Healthcare/Optum and Aetna shoring up their data plays – the on-demand healthcare economy is taking shape. Health plans especially must take steps to stay relevant as their gatekeeper role is diminished by consumers becoming empowered to pick and choose care via the C2B healthcare platform.
An effective strategy is to make “no-regrets” investments in capabilities that add value today and enable health plans to create new roles in the emerging C2B on-demand economy. Smart investments include:
- Putting mobile first. Healthcare organizations must appreciate how dependent consumers are on their smartphones and ensure they design optimal mobile experiences.
- Minimizing, simplifying and modernizing IT assets. Public, private or hybrid cloud services enable organizations to rent rather than own infrastructure, software and processes, with the goal of reducing costs and gaining next-generation capabilities while minimizing capital investment.
- Investing in AI, ML and automation. Doing so will advance near-term goals of applying robotic process automation, resulting in lower costs and higher productivity, while also offering consumers new ways of engaging with highly curated health products and services.
- Collaboration. Health plans, healthcare systems and biopharma companies could increase clinical data sharing to distill rich insights for use in developing new processes and platforms of their own. Health organizations can also choose to partner with a tech company – like Amazon – to obtain expertise that new-to-the-industry players can’t acquire quickly.
- Enabling real-time transactions. Consumers choose Uber drivers based on up-to-the-minute route pricing and passenger reviews. Healthcare organizations must match this level of detail and timeliness.
To begin identifying the smartest investments to make, organizations should develop a vision for how they might fit into an on-demand C2B healthcare economy. We also suggest creating a digital owner, such as a chief digital officer, to vet initiatives and technologies, and keep investments aligned with organizational objectives.
Finally, the industry needs to get comfortable with perpetual innovation. Upstart platforms can grow into dominant positions, and then find themselves facing new competitive threats. Netflix no longer has the streaming video market to itself, Uber must contend with Lyft, and Amazon must stay vigilant vis-à-vis Walmart’s redoubled e-commerce efforts.
While the C2B on-demand marketplace threatens the healthcare industry’s status quo, it also creates opportunities for health organizations that invest now in moving faster, generating new ideas and offering consumers a better experience.
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