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“Innovation” is one of those words that sucks up all the oxygen (Part 2)

Written by Andrew Le, MD

PublishedMay 13, 2021

Welcome to the CEO Corner, where Buoy CEO and Co-founder Andrew Le, MD sits down with industry leaders to chat about the provocative topics of healthcare today. Andrew recently spoke with Joshua Liao MD, MSc, FACP, a practicing physician who studies the connection between healthcare policy, payment models, and personal decision-making. In Part 1, Josh shared his perspective on why intention and implementation must be aligned in order for healthcare to be effective.

In Part 2, Josh describes the four types of healthcare innovation. Which are the most important to invest in now to create a more equitable healthcare system?

This interview has been edited and condensed for clarity.

Andrew Le, MD: You’ve mentioned that sometimes there’s a mismatch between the intention behind a healthcare policy and its implementation. How do human behavior and decision-making affect healthcare innovation?

Joshua Liao, MD: “Innovation” is one of those words that sucks up all the oxygen. Some people think about robots sorting pills. Other people think about process improvements like changing clinic protocols.

I try to clarify whether we are talking about change that is disruptive or incremental. Another thing to clarify is whether it is adjacent to the space we're already in (we are adapting something for another use) or is it a proverbial moonshot (we are talking about a fundamentally transformational change). If you categorize innovation that way, we're doing better in some areas of healthcare than others. I think we've made good gains with incremental innovation in the healthcare system, but we’ve made more nominal gains when it comes to moonshot-type innovation.

Andrew: I love that nuanced answer. You’re describing four versions of innovation: the incremental — where we are doing well – the adjacent, the disruptive, and the moonshot. Let's say you had $100 to invest. Across those four dimensions, where would you put your money?

Joshua: Overall, I think there needs to be harmony between payment and delivery models and on-the-ground decision making. The floor is higher with incremental investments, so putting dollars there secures a certain amount of gain. The moonshots are moonshots. So long as one recognizes them as such, it’s okay to miss.

What's the right balance? I think it depends on the organization. An incumbent is likely already doing the incremental improvements and should give serious consideration to putting more in the other categories. If you're new in the healthcare space, it may be worth focusing on more disruptive or transformative innovation and partnering well with those making incremental changes.

"The moonshots are moonshots. So long as one recognizes them as such, it’s okay to miss."

Joshua Liao, MD

Andrew: Your answer is so interesting in light of Amazon, Google, and other big tech names coming into healthcare. The incumbents are hesitant about working with them, which then forces these tech companies to either acquire whatever semi-overlaps with the incumbents, or to try and do moonshots. (I think that is Google's mantra.) Disruptive players like Walmart and Amazon take that "I'm going to undercut on price" approach. Which route do you think has the most impact for society?

Joshua: If I were taking an approach to achieve the greatest societal gains, starting with policy would be really important. Look at the ACA. Whether you think about it, it was a frame shift in how we approach health care – one that allows us to tether innovation to that policy. For instance, if we know that policy is driving momentum toward improving access to primary care, then an extension of that is to answer the question, "What payment and delivery models are extensions of that policy?" And then the next question: "What is my technology and business case within that policy and delivery model context?" And then, "Who am I partnering with to make that case?" I think that is where you get the alignment.

But in making the most impact for society, I would also caution against what I think is one of the fallacies in healthcare: If I can just get the policy right, or the technology right, or if I can just take that moonshot and land it, I'll fix healthcare.

Do we want the biggest bang for the buck? Or the most even or equitable bang for the buck? In a lot of policy, delivery and decision-making work, leaders are looking for the biggest possible effect: How can I make the biggest changes in outcomes or decisions? That's great. But that’s often a pursuit of an overall effect that risks losing important variation – variation in whose outcomes or decisions changed more than others’.

So getting the policy or technology right may fail to make the most impact for society because by going for the biggest bang for the buck, you risk leaving equity on the cutting floor. Let’s say I want to increase societal welfare. That requires not just better overall average quality and cost-efficiency, but meeting the needs of all different groups, some of which are vulnerable, and some of which have been historically marginalized.

Andrew: You get to take a step back and look at these trends from policy and behavioral science perspectives. Then you get to see patients on the ground. So you see the ramifications of decisions that look good from a 10,000-foot view, right?

Joshua: Sometimes decisions look good in a policy brief or revenue model, but not on the ground in direct patient care. On the other side, clinicians often have to manage the things in front of them and lack the time or ability to consider broader policy or behavioral strategy. There needs to be a collaboration among people with different perspectives. As a group, we can all benefit from a meeting of the minds.

"Going for the biggest bang for the buck, you risk leaving equity on the cutting floor."

Joshua Liao, MD

Andrew: How do we invest for the biggest impact on equity?

Joshua Liao, MD: If we want equity in healthcare, I think there are three things to consider.

First, set an intention.

We don't get the ACA unless there's an intention to provide people with insurance coverage. Likewise, I truly believe that we have the best chance of meaningfully improving equity when the work is driven by a clear intention and goal to eliminate disparities.

Second, recognize that there's a trade-off when we focus on achieving equitable gains rather than largest possible overall gains.

You may not get the biggest effect, the biggest cost savings, the biggest utilization reduction, the greatest net promoter score, the best patient satisfaction, or whatever your metric is. And that's okay if you're looking to make sure there is equity across marginalized groups like racial and ethnic minorities, socioeconomically vulnerable individuals, and people with unstable housing or limited access to healthy foods.

Third, commit to payment, delivery, and decision-making solutions that support equity goals.

That means existing health care stakeholders have to consider changing how we allocate money and how we design and implement models of care. And it means new groups – including companies that use technology or other innovations to fill spaces in or adjacent to those models — are also vital as links between goals and solutions.

About the participants:

Joshua Liao MD, MSc, FACP, a board-certified internal medicine physician, Associate Professor, and Principal Scientist of the Value & Systems Science Lab at the University of Washington (UW) School of Medicine.

Andrew Le, MD, is the CEO and Co-founder of Buoy Health