My Last Bowl...

Yesterday, I brought my family to the coffee shop at serangoon gardens, where I have my regular weekend breakfast, for the last time.

The coffee shop will make way for new development. A Shop-and-Save grocery will take its place. Across the road, what used to be a 3-storey building housing the NTUC Fairprice supermarket, the coffeebean, DBS Bank and the mama-shop has also disappeared. We are told there will be more exciting development in its place, but I am unexcited by all these changes.

Serangoon Garden is one of the last frontier in Singapore where busyness is still confined to small shop houses in a kind of homely environment. My estate at Seletar Hills is yet another.

Every weekend, when I turned up at the coffee shop with my wife and order my usual Mee Kia and Kopi-C, the hectic pace of life seems to slow down, the worries fade and there is a sense of taking in the private moments amidst the other patrons. Most of the other people at the coffee shop are familiar faces - one who always brings his Straits Times and faces the road, an old man who collects old cardboard boxes will rest at his usual corner, the coffee lady will shout out the order often prefaced with a "Lai" (come in chinese)... At the same familiar table where I sat, I remembered sharing with my wife the good news when I was first appointed as CEO of Jurong General Hospital.

There is so much about the silly coffee shop that mean so much to me.

My job now is to find another coffee shop somewhere, where the same feelings will beckon...

Disrupting the business model of the physician's practice - Chapter 4 Clayton's Book

This chapter carries a simple message.

The physician practice comprise 3 business models in one organisational setup, similar to that of the general hospital. In trying to be all things to all people, physician practices align resources to maximise flexibility rather than cost effectiveness.

The 3 business models are:

1. straightforward diagnosis and treatment of disorders in the realm of "precision medicine", eg. ear ache, flu, red eye, sore throat.

Clayton proposes that the "retail Clinic" such as MinuteClinic staffed only by nurse practitioners will disrupt this business model.

2. Ongoing oversight of patients with chronic diseases eg. diabetes, high cholestrol, lupus.

As in Chapter 6, Clayton proposes that transfer of patients to network facilitated models including disease management networks and network of patients/ families will disrupt this business model.

3. Disorders in the realm of intuitive medicine - primary care physicians, having freed themselves from (1) and (2) above and with the help of disruptive technology enabling diagnosis and testing onsite can disrupt the practice of specialists.

Clayton proposes that there are at least 3 types of technological innovation that will help propel primary care physicians in their move upstream:

(i) technology that brings analytical and imaging capabilities to point of care

(ii) online decision tool that distill massive volumeof published information algorithm that guide diagnosis

(iii) telemedicine.

To "heal" the physician practice, care integration at the system level (not local) will be critical. To do this job well, there is a need for a system level electronic health records. While this need is long recognised but progress has been slow because at the local level physicians do not have the incentive to implement electronic medical records and at the larger healthplan and health system level (eg intermountain, mayo), progress has been made largely in proprietory systems that is difficult to integrate at the systems level.

Healthcare can take a leaf off how standards are developed in other industry in this regard.

Role of Value Network to Disrupt Healthcare - Chapter 6 of Clayton's book

I have been disciplined indeed. Today, I am on to Chapter 6 "Integrating to make it happen" of the Innovator's Prescription book.

Disrupting hospitals require separating the business models of "Solution Shop" for intuitive medicine, and "Value Added Process" clinics for diseases where precision medicine is available.

Specifically, for chronic diseases, what is needed is the development of coherent solution shops to come out with focused diagnosis of what cause the disease, valued-added process clinics to address diseases where rule-based therapy is available; and the creation of the right incentives for patients and providers to ensure that therapy and behavior changes so necessary for managing chronic illnesses, are complied with.

Disruptive Innovation require 3 enablers:

(1) Techonology

(2) Business Model

(3) Value Network.

Value Network, in clayton's words "is the context within which a firm establishes its business model, and how it works with suppliers and channel partners so that together they can respond profitably to the needs of a class of customers".

The innovative disruptions for hospitals and the management of chronic diseases require the context of a NEW value network to work effectively.

NEW value network because when disruptive innovators attempt to commercialise their innovation within the established value network, that system either rejects it or co-opt the potential disruption, forcing it to conform to the existing value network in order to survive.

Clayton asserts that the mechanism that governs how players act and interact is reimbursement. Current mode creates an interdependent, mutually reinforcing bond between players in the current value network and unfortunately funnels volume to the highest business cost provider because they are the most comprehensive. Money still makes the world go round!

Only a few players can play the role of integrator of various players in healthcare to create a NEW value network. Clayton's book proposes that (a) Fixed Fee Providers and (b) large employers are the best candidates to perform the role of integrator to bring this about.

Why Fixed Fee Providers/ Health Systems?

Examples include Kaiser Permanente in California, Intermountain Healthcare in Utah, Geisinger Health System in Pennsylvania, Via Christi Health System in Kansas, and Veterans Health Administration.

I. They have a long term view and willing to spend money today in order to save money tomorrow

II. Make money by keeping members well, no sick

III. Has electronic medical record of patients to know and care personally

IV. Be in geographic positions where care can be provided conveniently

V. Capable of implementing the needed changes with decisiveness

For the same reasons, large employers are also in the position to be good integrators to create a new value network. Examples in the US are Purdue farms, Toyota, Pitney Bowes, Sprint, general Mills and Qualcomm.

Clayton went on to propose that as large employers begin to do so, it almost appears that the old mantra of "stick to your knitting" and focus on core competencies may be violated. He clarified that vertical integration in a supply chain happens because employers cannot at this time be assured of cost and performance effective services from other health stakeholders. They need to play an orchestrating role to bring about disruptive innovation. When the system settles down and employers can now expect healthcare for their employees to be low cost, high quality and conveniently accessed, the company can then get back to their knitting.

Based on the discussion in this chapter, it is quite obvious to me that Jurong General Hospital can play the role of "integrator" of healthcare players in the population in the west (see point above about "geographic position") to create a new value network and in the process "disrupt" the way healthcare has been provided in Singapore.

Onwards to chapter 4 tomorrow, "Disrupting the business model of the physician practice (Specialist Outpatient clinics in Singapore context)"...

In Memory of Michael Jackson...

Michael Jackson passed away today at 52.

I received the breaking news via sms at 6.23am that he is dead, but I ignored it because I figured it must be one of those unconfirmed stories and the media trying to generate some interests.

In a sense, I did not want it to be true. Michael Jackson is a fantastic singer and I best remember him through his song "Heal the World". Here it is, in tribute to you Michael Jackson. May you rest in peace...

There's A Place In
Your Heart
And I Know That It Is Love
And This Place Could
Be Much
Brighter Than Tomorrow
And If You Really Try
You'll Find There's No Need
To Cry
In This Place You'll Feel
There's No Hurt Or Sorrow

There Are Ways
To Get There
If You Care Enough
For The Living
Make A Little Space
Make A Better Place...

Heal The World
Make It A Better Place
For You And For Me
And The Entire Human Race
There Are People Dying
If You Care Enough
For The Living
Make A Better Place
For You And For Me

If You Want To Know Why
There's A Love That
Cannot Lie
Love Is Strong
It Only Cares For
Joyful Giving
If We Try
We Shall See
In This Bliss
We Cannot Feel
Fear Or Dread
We Stop Existing And
Start Living

Then It Feels That Always
Love's Enough For
Us Growing
So Make A Better World
Make A Better World...

Heal The World
Make It A Better Place
For You And For Me
And The Entire Human Race
There Are People Dying
If You Care Enough
For The Living
Make A Better Place
For You And For Me

And The Dream We Were
Conceived In
Will Reveal A Joyful Face
And The World We
Once Believed In
Will Shine Again In Grace
Then Why Do We Keep
Strangling Life
Wound This Earth
Crucify Its Soul
Though It's Plain To See
This World Is Heavenly
Be God's Glow

We Could Fly So High
Let Our Spirits Never Die
In My Heart
I Feel You Are All
My Brothers
Create A World With
No Fear
Together We'll Cry
Happy Tears
See The Nations Turn
Their Swords
Into Plowshares

We Could Really Get There
If You Cared Enough
For The Living
Make A Little Space
To Make A Better Place...

Heal The World
Make It A Better Place
For You And For Me
And The Entire Human Race
There Are People Dying
If You Care Enough
For The Living
Make A Better Place
For You And For Me

Heal The World
Make It A Better Place
For You And For Me
And The Entire Human Race
There Are People Dying
If You Care Enough
For The Living
Make A Better Place
For You And For Me

Heal The World
Make It A Better Place
For You And For Me
And The Entire Human Race
There Are People Dying
If You Care Enough
For The Living
Make A Better Place
For You And For Me

There Are People Dying
If You Care Enough
For The Living
Make A Better Place
For You And For Me

There Are People Dying
If You Care Enough
For The Living
Make A Better Place
For You And For Me

You And For Me
You And For Me
You And For Me
You And For Me
You And For Me
You And For Me
You And For Me
You And For Me
You And For Me
You And For Me
You And For Me

Disruptive solution for the care of chronic illnesses - Chapter 5 Clayton's book

Having the right incentive structure is very important.

Over the last 2 days, I have been diligently reading Clayton's book Innovator's Prescription. The keyword here is "diligent", ie read relatively intensely and with a highlighter in hand to highlight key points and a pen nearby, to scribble notes along the margin of the book. It does help too that my copy of the book was personally autographed by Prof Christensen himself when he was recently in Singapore.

Buy why? One major reason, although I personally love reading, is that my Chairman has started a series called "Talk the Walk, Walk the Talk". This is a regular session where we will discuss possible disruptions to public healthcare using ideas from the Innovator's Prescription book. The first session has been scheduled on 1 July! Hence, got to push on the reading...

Tonight, I finished Chapter 5 - the chapter on "Disruptive solution for the care of chronic illnesses". Here, Singapore has started some work to push the boundaries by incentivising people to start treatment early by allowing the use of medisave in the outpatient setting and tracking the improvement of health outcomes over time. But more remains.

Why a special chapter on disrupting care for chronic illnesses? It is widely known for example that 5 chronic illnesses - diabetes, congestive heart failure, coronary artery disease, asthma abd depression account for majority of the healthcare cost. In fact, the large share of expenditure by patients in the last 18 months of their life is largely due to the impact of treating the manifestation of symptoms from chronic illnesses.

What have I learnt from the discussions in this chapter?

1. The current business models used to care for patients with chronic illnesses are primarily set up to deal with acute diseases, ie they make money when people are sick and not when they are well.

2. There are 2 types of chronic illnesses, (a) intuitive chronic illnesses, ie those where diagnosis and treatment lacks clarity eg. lupus, chronic fatique, etc and (b) rule-based chronic illnesses, ie those where precision medicine is/ almost available and treatment are rule based eg. diabetes, chronic hepatitis, blood cancers.

3. Intuitive chronic illness require coherent solution shop approach, ie organised teams of specialists coming together to arrive at a correctly defined diagnosis and treatment protocol. Mayo clinic is well known in this regard and practices what is popularly known as Team Medicine.

4. Rule-based chronic illnesses is easy to manage but require long term compliance by patients to therapy and behavior modifications. The keywords here are "compliance" and "behavior changes"

5. Clayton invests a significant proportion of the chapter to identify categorization of types of chronic illnesses, the likelihood for compliance by patients and the various business models that may incentivise both the provider and the patient's behavior. There are essentially 4 types of chronic illnesses:

i. High immediate consequences + low behavior dependent eg. Epilepsy

ii. High immediate consequences + High behavior dependent eg. Chronic back pain

iii. Low immediate consequences + low behavior dependent eg. hyperlipidemia

iv. Low immediate consequences + high behavior dependent eg. Type II diabetes

6. Group (i) is already quite effectively managed by current business model. As consequences are immediate and low behavior change is required, patient will comply to treatment and doctors simply must schedule follow-up and they get paid.

Group (ii) and (iv) where it is high behavior dependent, the ideal approach is through facilitated networks eg. alcoholic anonymous where patients share information and teach each other how to overcome alcoholism.

Group (iii) and (iv) needs to be overseen by providers that profit from keeping their patients well rather than from their sickness. The entities that can profit are those who are integrated providers who are also insurers, or those who provide health care to a group of patients at a fixed fee. Employers like GE, HP have started have been using "disease management networks" to contract care for employees with certain costly chronic illnesses, and have proven to be successful in containing cost while improving outcome.

7. Patients are generally more interested in their financial health than their physical health. One approach to incentivise patients' compliance to therapy is to tie compliance to financial wellbeing.

Some ideas are already in action in Singapore. The national "Delivering on Target (DOT)" programme first started by SingHealth has proven early success but more needs to be done from the reimbursement angle.

It is also interesting to note what Cleveland clinic has reportedly started to do. They have moved away from the traditional departmental approach of medicine, surgery, paediatrics etc into "institutes" which comprise an integration of various specialists working together in "coherent solution shops".

I started this blog talking about incentives. It is therefore fitting to end to note that even in healthcare, the correct incentives built into business models can drive both provider and patients' behavior in a manner that will provide better outcomes and make healthcare more affordable!

Disrupting the hospital business model - Clayton's prescription

It is so nice to be able to make a new entry into my blog after a long period of hiatus.

The truth is, my new responsibilities at the new Jurong General Hospital has been keeping me extremely engaged. All exciting stuff and a marvelous learning experience, but more about it next time.

I am now catching up on my readings.  A key read is the Innovator's prescription by Professor Clayton Christensen from HBS.  Chapter 3 of his book focus on the theme of disrupting the general hospital that we have come to be familiar with.

Professor Clayton asserts that there are fundamentally 3 business models:

(a) the Solution shop - this is the sphere of intuitive medicine where "hypothesis testing" usually within the domain of diagnosis is carried out.  To facilitate discovery, highly skilled professionals are required and equipped with the most sophisticated technology.  It is little wonder here that the "value" of medicine is less clearly classified and the costs are much higher.

(b) The Value-adding Process (VAP) - once a definitive diagnosis is made, and it is clear what the patient needs then the next steps would be "how to fix the problem" effectively, affordably and conveniently.  Here trained healthcare professionals can follow a series of "proven value adding" steps to get the job done.

(c) Facilitated network - where multiple parties in the health eco-system are sufficiently capable to do their jobs, then what is needed to deliver value is to facilitate their effective interaction to deliver value.

Prof Christensen says in his book that because general hospitals tries to co-mingle the business models of solution shop and VAP services, there is substantial internal incoherence, escalation of costs and impossible to measure "value".  The current model of reimbursement in healthcare system whose payout is undifferentiated for services delivered through solution shops and VAP clinics serve to perpetuate this co-mingling.  

The proposed solution is to establish "Hospitals within Hospital" where integrated/ coherent solution shops eg. for treatment of Asthma like National Jewish Medical and Research Centre in Denver; and VAP specialised hospitals eg. The Aravind Hospitals in India for Eye surgery and Coxa Hospital in Finland for hip and knee replacement may be established.

General hospitals who try to be all-things-to-all people incur high cost of complexity.  General hospitals will always be needed, it is just that over time we will need lesser of them as the machineries of disruption begin to work.  As technology improves, more sophisticated care for more patients can be carried out in VAP hospitals with equal or better quality than general hospitals.

It will be interesting to see how this disruption to general hospitals will pan out in Singapore. It will be useful lessons for me as my team plans for JGH.