Who Will Be The Winners And Losers In The Verticalization Of Healthcare IT?

By Megan Williams, contributing writer

Healthcare evolving past an obsession with EHRs (electronic health records) means much more than a chance to focus on new and different technologies. It means that a foundation for the future of healthcare has been laid, and that smart organizations will need to pay attention to movement and changes in the industry if they want to survive in the resulting environment.

A Health IT Outcomes HIMSS15 interview with athenahealth CEO Jonathan Bush sheds some fascinating insight into not only the direction in which the industry is headed, but also who the survivors and thrivers will be as things shake out.

The Challenge Of Innovation

Healthcare has an innovation problem, and Bush attributes that largely to the firm establishment of larger players in the market.

Innovation is usually a result of disruption and in an industry where disruption is slow, costly, and sometimes highly unwelcomed, change doesn’t come quickly. While Bush acknowledges that people have to be protected in the path of innovation, and that things will move more slowly than they do in social networking spaces, he still believes that healthcare is unnecessarily dragging its feet.

“We actually want to innovate a little slower than we would in, say, social networking, but probably not as slow as we are going to day. The road not taken is costing us probably more than the accidents on the road we could go down.”

Bush also states that many “cool” new healthcare companies presenting at HIMSS15 would not be around for HIMSS16, largely because they fail to find balance in their sales and implementation cycles in a “cautious healthcare system.”

Companies that do though, will find opportunities that didn’t exist even a short time ago, “Five years ago, if you wanted to clear a room of venture capitalists as quickly as possible, you would just say “healthcare” and … they'd be gone. Now, we see guys like Kleiner-Perkins pay ten times, twenty times revenues backing these little, cloud-based startups that are possible as the health-care internet starts to emerge.”

Vendors Lagging Behind

So what vendors will fall by the wayside? Bush offered a few bits of insight:

• Those who view doctors as luddites: Doctors overall use and embrace tech … they simply will not jump to adopt tech that slows them down, causes problems, and costs them huge sums of money. He invokes the movement of EHR to the cloud to illustrate, “We are wading through the early, crappy dinosaur technology that is being wiped out and replaced in cloud-based apps like ours and others in this room, stepping into the relationship which is creating … layers of other, vertical apps that can easily snap in.
• Those who ignore tribes: Connectedness has to happen, but in a way that connects via specialization and extra-organizationally. According to Bush, “you can't have your five oncologists on the same app — you need the five oncologists to be connected to the primary care doc and the surgeon, et cetera, in your local health system, but those oncologists really also need to be connected to all the other oncologists in order to do research, in order to evolve.”

Those who dismiss the culture shift: Healthcare is moving in ways that are similar to many other industries, but still, many vendors and smaller companies have siloed themselves and are not making efforts to proactively respond to the industry-specific type of disruption that is going on. Bush says that these are the organizations who struggling now and who will continue to do so if they survive at all.