"We have a long way to go [on innovation], but we are making a difference."

Kaufman Hall: How are you pursuing innovation at Froedtert Health?

Catherine Jacobson: Several years ago, I began to be more exposed to various kinds of disruption in healthcare—digital applications, the impact of consumerism, new ways to deliver care, and new technologies like remote monitoring. I realized that we needed a focused effort around healthcare disruptive innovation.

We started to look at different models from leading health systems that were getting into that space. Also, we had an internal leader who was very enthusiastic about the rapid changes in healthcare, so we sent him out to learn more.

We created a wholly owned subsidiary corporation called Inception Health, with this internal leader as president. It’s controlled by Froedtert, but at the same time gives its staff some freedom to run. Their number one charge is to drive innovation to solve key healthcare problems and make an impact on the health system.

Now here we are two years later, and we have 65 initiatives in various stages of either exploration, pilot, or scale. These address everything from improving what we do today to transforming the organization.

Kaufman Hall: Can you tell us about some of the projects in development?

Jacobson: One project that will support population health is a digital app called Silver Cloud. The app provides cognitive behavioral therapy that helps people with depression, anxiety, and other mental health conditions. The app shows great promise in broadening our impact both through patient self-service and as an adjunct to in-person care. Silver Cloud is getting up and running in our patient-centered medical homes, in selected behavioral health clinics, and as a service to manage stress for our employees.

A potentially transformational project involves using sensors to improve medication adherence and effectiveness. We’re working with a company called Proteus Digital Health in California. Ingestible sensors are combined with medications, and transmit information to a mobile app. Both patients and physicians get data about medication use, physical activity, and certain biometrics. We believe this holds great promise to help the care team optimize therapy, resulting in improved outcomes and reduced overall costs.

Kaufman Hall: How do you think about profitability for these innovations?

Jacobson: To a certain extent, you have to exempt these kinds of projects from your traditional business planning process. Our study of other innovation companies led us to conclude, first, that this is a three-year bet; we will measure our success over three years. Second, we are not going to look at the profitability of each project individually, but at the projects as a portfolio, because some of the things you try inevitably will fail. Your success is quick trial, quick fail, and quick scale. So we’re not going to measure ROI for every single pilot. We want to know how many projects we have been able to take to scale and the impact when projects go to scale. The projects each have to be able to meet one of Froedtert’s strategic long-term goals and performance measures.

Kaufman Hall: What changes in culture have been necessary for the organization to embrace this approach to innovation?

Jacobson: One of the biggest things I wanted us to achieve as part of Inception Health was to start to change the culture of the organization—to become more innovative at all levels. I’m happy to say that, two years in, there has been a great impact on our culture. The leadership accepts the need for innovation. Also, there are internal champions for each of our innovative projects. An administrative leader at a minimum, or an administrative leader and a clinician, have to agree that a project has some validity, and be willing to put some of their own sweat equity into piloting it in the organization. This involvement has gone a long way toward spreading a culture of innovation in the organization. Inception Health has 40 advisors inside the health system to review ideas and get buy-in. However, only the board of Inception Health can say “no” to a project, so there is some protection from any cultural antibodies in the health system that may resist a new way of doing things.

One example of the cultural change is a virtual urgent care clinic that we launched two years ago for our employees. The medical group pushed back initially because they were going to lose their RVU revenue for those visits. I had to say, ”We’re doing it, and wouldn’t it be great if paying patients actually got those slots as opposed to our own employees?” Today, two years later, people get that. And they understand that these innovative care models are the way we are going to solve problems like improving access.

We just had our annual leadership meeting, where about 600 physician and administrative leaders from across the organization came together. We were talking about consumerism, patient engagement, and healthcare in 2025. Resoundingly, almost every comment we got from leaders was about Inception Health. They know what we’re doing and they understand why we’re doing it. We have a long way to go, but we are making a difference.