The Week in Disruption goes beyond the headlines to uncover the significance of emerging trends in healthcare and beyond. 

The funnel business model
The funnel business model is a reality for healthcare

 

New healthcare entrants and legacy providers invested heavily in the funnel business model in 2019, with emerging competitors to legacy health systems launching new ways to attract consumers into the funnel and engage and retain them inside the funnel. Telehealth services from retailers and hospitals, bolstered by a wave of new home-based health products, allowed patients to “virtually” visit with clinicians, take tests or administer their own care without leaving the couch. CVS and Walgreens dramatically revamped the decade-old retail clinic model, eschewing flu shots and non-acute care for the potential of repeat interactions with insured customers in need of chronic disease care and products.

Large employers reacted to rising healthcare costs—and uneven results—by steering their workers to a handful of high-performance providers. Lyft, Uber, and UPS invested in new ways of moving patients and medical supplies alike in and around hospitals.

This edition of the Week in Disruption takes a look back at the biggest healthcare innovation stories of 2019.

Drugstores pivot to chronic disease care

Amid declining retail sales, CVS Health and Walgreens both began transforming their square footage to attract consumers looking for health services and products in a single location. In February, CVS Health opened its first HealthHUB stores in Houston, signaling a larger effort to remake its retail stores into one-stop-shopping for people with chronic conditions, including Aetna members. The company recently gave investors tangible evidence of the effort’s promise, with a third-quarter earnings report that included a jump in revenues to $64.81 billion, up from $47.49 billion a year ago.

Not to be outdone, Walgreens recently opened its first Village Medical at Walgreens in Houston, a standalone primary care clinic next door to one of its stores. The clinics are also expected to focus on chronic care management. Walgreens recently closed 160 in-store clinics, in what was framed as a shift away from the treatment of non-acute conditions; the new clinics will focus on chronic care management.

Walmart dips its toe in primary care, digital health

With a massive nationwide retail footprint and 140 million weekly visitors, Walmart is uniquely suited to building a powerful healthcare platform. In September, Walmart opened a new standalone health clinic in Dallas, GA and launched WalmartHealth.com. The service lines available on the site include a wide range of primary care services, dental care, and behavioral health—all at substantially lower prices than industry benchmarks. For now, the website only serves the lone new clinic in Georgia, but the company is expected to roll out the platform more broadly in 2020.

Amazon tests healthcare expansion with employees first

Track athlete performing high jump
The bar is rising for hospitals and health systems

 

56% of respondents to the 2019 Kaufman Hall State of Consumerism in Healthcare survey cited Amazon as a strong or extreme threat to hospitals and health systems, the third biggest threat behind UnitedHealth/Optum and CVS Health/Aetna. What’s more, 98% of respondents said their organization’s digital experience is inferior to Amazon’s.

Amazon reignited those fears this fall, with the launch of its pilot Amazon Care virtual medical clinic for Seattle-based employees and their families, in partnership with Oasis Medical. The service offers text chats with nurses for health-related advice, video visits with physicians and nurses, house calls from nurses to homes and offices for exams, tests, and treatments, and door-to-door delivery of prescriptions. While the services are still only available for employees and dependents, it stands to reason that Amazon Care has its sights set on serving a much larger population in 2020 and beyond.

Centers of excellence model spreads

In the last few years, a growing number of employers have started directing their employees and dependents to faraway hospitals and physician practices singled out for clinical excellence or cost-effectiveness. Amazon has begun paying travel costs for employees or dependents with cancer diagnoses to see physicians at the City of Hope cancer institute in Los Angeles, while Walmart’s Centers of Excellence program has steered its 1.1 million employees and dependents to a select group of high-quality hospitals and health systems. Walmart also recently announced it will begin pointing employees in three regions toward “featured providers” identified by data analytics for providing “appropriate, effective, and cost-efficient care” in exchange for lower out-of-pocket costs.

UnitedHealth’s $100 billion healthcare vision

67% of respondents to Kaufman Hall’s consumerism survey described UnitedHealthcare and Optum as a strong or extreme competitive threat to their hospitals or health systems. And the company has set an exceedingly ambitious revenue goal for its OptumCare unit: grow from $16 billion in 2018 to $100 billion by 2028.

In 2019, UnitedHealthcare announced a series of moves to hasten further progress toward that $100 billion goal, including a partnership with Walgreens to open 14 Medicare service centers in Walgreens stores in 2020. Visitors will be able to schedule annual at-home wellness visits, sign up for a Medicare Advantage plan, or simply attend informational sessions on Medicare. And while the company has no plans to buy acute care hospitals as part of its growth strategy, UnitedHealthcare did announce a novel collaboration with northern California-based John Muir Health to administer the hospital’s billing and revenue departments. The partnership helps John Muir achieve “systemness” while remaining independent while increasing UnitedHealthcare’s presence in acute care without direct ownership.

The rise of telehealth

Retailers made major investments in a litany of new telehealth services and products in 2019, from at-home kits that allow patients to take their own blood pressure or administer dialysis to video-enabled telehealth primary care visits.

Providers and insurers also invested in developing or expanding consumer-focused telehealth platforms. St. Louis-based SSM Health began offering $25 virtual visits for non-urgent health conditions within an hour of an appointment request for residents of states where the health system is active. And Humana and Doctor on Demand launched On Hand, which provides plan members with a medical device kit with a digital blood pressure cuff and thermometer, in addition to video visits and secure messaging with dedicated primary care providers.

Your ride to the doctor is three minutes away

The race between Lyft and Uber to become healthcare’s ride-hailing service of choice heated up in 2019. This summer, Lyft announced its approval as a Medicaid provider in Arizona, in the wake of the state’s passage of new regulations for non-emergency medical transportation. Uber, meanwhile, recently agreed to provide transportation services to healthcare start-up Grand Rounds, which provides healthcare services to more than 100 large employers and 4.5 million covered lives.

Haven health plans test the Triple Aim

While Haven Healthcare, the joint healthcare venture from Amazon, J.P. Morgan Chase, and Berkshire Hathaway, has released few specifics about how it plans to improve care, lower costs, and increase patient satisfaction for their employees and families, the company’s elite backers, and the presence of Haven CEO Atul Gawande, MD, has piqued the field’s curiosity since the partnership was initially announced.

And while Haven is still officially mum on its plans beyond a vision statement on its website, the venture reportedly plans to offer 30,000 Chase workers insurance plans operated by Cigna and Aetna as its first test case, officials familiar with the initiative recently told Bloomberg. All of the health plans launched under the Haven umbrella will reportedly not require members to pay deductibles for care, with co-pays ranging from $15-$110 for most services.

The virtual emergency room

While rural healthcare has long relied on telemedicine to serve far-flung patients or counter physician shortages, the provision of emergency care has typically remained in-house. But at least one major “virtual ER” operator is finding success providing rural hospitals with emergency physicians from the other end of a video screen.

Avera eCare, a virtual ER operating out of a suburban industrial park in Sioux Falls, South Dakota, is “rural America’s busiest emergency room,” with more than 15,000 cases a year, the Washington Post reported this fall. The company now provides remote emergency care for 179 hospitals in 30 states. Avera eCare’s 15 physicians and 30 nurses work out of cubicles equipped with remote-control operated cameras, helping clinicians at faraway hospitals manage heart attacks, traumatic injuries, and other emergencies.

Drones deliver the (health) goods

In 2019, drones emerged as a fast, energy-efficient, cost-effective delivery platform for health supplies. In the spring, WakeMed Health & Hospitals in Raleigh, N.C. used a UPS drone to transport lab samples across its campus, the first such flight sanctioned by the Federal Aviation Administration. Beyond saving money and time on costly deliveries, system leaders envision drones may ultimately enable them to consolidate lab operations and free up more space for patient care. In the fall, UPS received federal approval to deploy unmanned drones to deliver health supplies in rural and suburban areas.

Meet the Authors
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Haydn Bush

Haydn Bush

Vice President
Haydn Bush has two decades of experience as a journalist and communications professional in healthcare and related fields. He currently serves as VP of Thought Leadership.
Learn More About Haydn

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