Startup CEOs and Investors: Brian Weiss

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A Tale of Two Healthcare Worlds
By Brian Weiss

Many of my peers in the healthcare IT startup world, like me, are developing applications and solutions intended for a new world of consumer-centric healthcare IT, or CCHIT (I just made up that new CCHIT acronym as part of my contribution to world sustainability. Since what was formerly known as CCHIT has ceased operations, the acronym is ready for recycling.)

Have a seat and join me for a tour of CCHIT-land. You must be this tall to ride, keep your arms and legs in the vehicle at all times, and no flash photography, please.

Over on your left as you look out on the horizon, you can see deceptively colorful cloud-like structures. Those are high-deductible health plans and self-insured employers. See the little figures underneath them with the empty wallets that look like they are about to fall over? Those are consumers who are becoming more conscious of the costs of their healthcare.

Whoops! My mistake. Those are the ones on the right. The ones are the left are actually the physician practices dealing with 30 percent collection rates as the consumers on the right ignore their payment notices. You can tell them apart because the physician practices are the ones with the charts behind their backs titled “Same-Day Cash Discount Rates.”

Watch your head under the overpass. Now back over there, thrashing around between the various giant insurance company logos, are employee health plan benefit managers switching plans every year to get a better deal.

More Like Other Industries?

The CCHIT world is one in which high-deductible-plan consumers and self-insured employers increasingly seek to transact healthcare much as they transact travel services, retail purchases, and employee benefit programs.

Allegedly fueling this trend will be the availability of alternative forms of healthcare services – particularly those intended for people who are generally healthy – that were formally the domain of a traditional primary care physicians and hospitals. Telehealth services, pharmacy-based clinics, urgent care centers, home monitoring and testing kits, employer-provided campus clinics, and in-office wellness visits will compete for healthcare services wallet share.

Similar dynamics will occur in the area of high-margin routine testing from imaging centers and labs. The problematic but already well-established trend of stratification of healthcare services — from low-end, Medicare-reimbursed to high-end, spa-style luxury concierge — will continue. New forms of practices will appear, targeting various socioeconomic groups along the lines of the model of the different types of restaurants from “all the grease you can instantly eat for $1.99” to “hundreds of dollars for food you can’t really find hidden within the art-deco presentation.” An ever-increasing percentage of basic healthcare services will be transacted in cash.

Little Susie Has a Sore Throat. Where’s My Smartphone?

Whether it’s Big Joe tracking his type II diabetes or Little Susie’s mom deciding what to do with the sore throat Susie woke up with this morning, the starting point will be a smartphone for search, comparison shopping, advertising, online ordering, in-drive navigation, loyalty points, and all the rest of what makes us decide where to get our morning cup of coffee, which hotel to book in Barcelona, or how to get a ride somewhere.

In this world, notions like “Patient-Centered Medical Home” (in the sense of a doctor getting the new Medicare CCM reimbursements, not the home where the patient actually lives) takes on many flavors and meanings, from specialty patient advocate/consultant concierge services through “do it yourself” (at your real patient-centered home) with a mobile app.

In this CCHIT world, the idea that patient records are stored exclusively in big EHR systems — which have been networked together with patient matching algorithms (or someday, congressionally mandated national identifiers), record locator services, and on-demand copy-paste of entire EHR records from one system to another – seems about as relevant as the old mainframe-based travel agent systems that spit out those triplicate paper tickets with the red ink.

Fact or Fantasy?

If the CCHIT world is coming any time soon, these efforts seem a bit silly:

• Five-year plans to achieve basic healthcare data interoperability via newly developed standards for provider-to-provider exchange.
• EHR vendor-driven alliances.
• Throwing more government money down the drain on more life support for state HIEs that will never be sustainable.
• Trying to force competing healthcare providers to share their customer data with each other.
• Waiting for acts of Congress to issue national IDs so we can create some grand interconnected database that everyone can access..

Of course, there’s absolutely no guarantee that world is coming any time soon. Even if it does eventually arrive, it’s not clear how it will coexist with the extensive parts of the healthcare system that will likely continue to operate pretty much as they do today.

What happens with the increasingly large percentage of consumers who are not “generally healthy” that can’t be taken care of properly in the CCHIT model? I’m sure many readers are aware of plenty of other flaws in the CCHIT thinking that we can consume healthcare services like online videos and taxi rides.

There are many complex variables impacting how things will play out. Anyone who wants to predict how things will look in three, five, 10, or 20 years is rather brave. No, they’re not brave if they write an article with their predictions — that’s easy. They are brave when they build companies based on those predictions and visions.

The HIT Startup Dilemma

Which brings me to the point of all this.

The innovative and disruptive healthcare IT startups of tomorrow are forced to do two contradictory things. They have to design solutions for a healthcare world that doesn’t exist (and likely will never exist exactly as they imagine and envision it today) while delivering revenue-generating solutions for the healthcare world that does exist today.

This gets surreal when you watch a startup founder with a CCHIT-intended solution pitching to a room full of big healthcare system execs who want to hear nothing about the CCHIT world. Suddenly the founder’s consumer-centric clinical data integration solution is ideal for provider-to-provider data exchange without patient involvement and consent. The directory service for consumer-centric provider or plan selection is ideal for keeping patients in-network. And on it goes. 

Why? Because that is what generates revenue, pays the bills, and justifies the next round of investment funding. For realizing the very different CCHIT vision.

One of the great things about the startup marketplace is that it drives creativity that never ceases to amaze me. I have seen some really great pitches from colleagues of mine that actually had me believing that you can do both at the same time. I’m still figuring out my “have your cake and I get to eat it too” story.

Though it’s not explicitly spelled out that way, I believe that’s what the venture capitalists I need to woo in the coming months expect me to deliver. They want a disruptive vision that offers the dream of future revenues. Value that will only be awarded to those who dare imagine and create solutions for the new CCHIT world, with a clear ROI-driven revenue model for today’s PPCHIT (provider/payer centric HIT) world (yes, I made that acronym up as well, but I don’t think it was ever used or ever will be again, although I just checked and the domain name is taken).

As noted, the CCHIT and PPCHIT visions are not “either-or” alternatives, so it’s not just a question of transition timing. That’s why despite some of my snarky comments that probably have me on the blacklists of some of the big EHR vendors I need to partner with in the future to be successful (hey, nobody said I was really any good at my startup CEO job), we need the incremental next steps along the current path driven by the experienced industry leaders, the established vendors, the standards organizations, and the government funding programs (I’m trying to correct a little, OK?)

In parallel, we also need to allow for the experimentation and disruption that comes from innovative challengers who think that the healthcare emperor’s clothes – which so distinguish him from all the other industries in the kingdom — are increasingly invisible, to the point where we need to question if they’re real.

It’s a tightrope walking act. I find that I regularly fall off the tightrope on one side or the other. Every day I feel the bruises of those falls. Fortunately, as a small early-stage company, the tightrope I’m on isn’t that high off the ground yet, so I can get still brush off the dust and take another step. Forward, I hope.

Brian Weiss is founder of Carebox.