Two leading CEOs comment on how health systems can reorient healthcare beyond traditional settings. These remarks are excerpted from a panel discussion at the Kaufman Hall Healthcare Leadership Conference, Oct. 18, 2017.

James Skogsbergh, President and CEO, Advocate Health
Eugene Woods, President and CEO, Carolinas HealthCare System

Skogsbergh: Much of what’s done on an inpatient basis today will absolutely be done on an outpatient basis tomorrow. We’re trying to be deliberate and intentional about where our capital spend is going, and we are trying to make that commitment more to the outpatient footprint. In some cases we’re replacing existing, older facilities, and in other cases we’re creating a new presence in a new market. We have an outpatient diagnostic approach, in which you can get a number of services in one location.

Woods: One thing that’s shifted our mindset related to inpatient and outpatient investment is the way we measure patient volume. Increasingly, we are focused on patient encounters. Each year, we have 12 million patient encounters across 900 care locations and nearly 30 urgent care centers. And if you look at the data, we know that nine out of 10 encounters actually occur outside of our walls. The question then becomes what do we know about these encounters? Who and where are they? How do people access us and what do they want? We’re asking these questions, and this mindset is causing us to shift our investment portfolio.

The tough part is that if you invest in the inpatient chassis—for example, in cardiology—you know you will get a return. And on the other hand, if you invest in a virtual care platform, you may not get an immediate return. However, you have to make some bets on the future. Our bets have been more on the virtual care and innovation side, and we’re extending the hospital campus into a bigger circle. We are now in people’s homes, in their cars, and at the grocery stores, so we need to calibrate our investment with this new concept in mind.

Skogsbergh: The kind of change that’s required in healthcare is not incremental. We have to completely redesign and reinvent it. Who does the work? What work gets done? When does it get done? We need to rethink how care is delivered.

I’d love to start with a clean sheet of paper and say, if we want that good clinical outcome, let’s work backwards and figure out the best way to get there. I daresay we would design a system that is very different than what we currently have. We will need some dramatic changes in how care is delivered, where it’s delivered, and who delivers it. I imagine that in five or 10 years we’ll have very different job titles—ones that don’t exist today.

Woods: What I don’t think we do well enough is piloting those blank-slate ideas. For example, we have a pilot underway for a program that’s called Proactive Health, which is a new approach to primary care. Instead of a traditional primary care office, our patients walk into an environment that looks more like an Apple Store, including access to more holistic and personalized care options like exercise, health and wellness coaching. Our results speak volumes. Within only 30 days, our program reduced hypertension for 80 percent of patients, and at a radically improved cost structure, versus traditional primary care, where hypertension is reduced for only about 30 percent of the people treated within year. The challenge now is to continue to show that the pilot works and then scale it.

Skogsbergh: I don’t know that all the solutions will come from folks in our industry. We have to have some very creative thinking. I remember the movie The Martian, when the team on the ground is trying to get Matt Damon back to Earth. They were telling him to throw stuff away, take the roof off, saying you don’t need this, and you don’t need that. I think we need to approach healthcare delivery with the same dramatic approach to change.

I don’t know how to do that, but I know it needs to be done. We’re going to have to engage with some really smart people to challenge our thinking because it will be very hard to move this industry to think in a dramatically different way.