Digital innovation moving slowly in healthcare, study shows

A new study of healthcare innovation shows progress toward new approaches to care delivery could use a nudge.

A new study of healthcare innovation shows progress toward new approaches to care delivery could use a nudge.

The report, entitled, “Trends for Scaling Innovation in Health Care,” was based on a survey of 29 health system executives from 28 unique health systems, and found that while many health systems and their affiliated health plans name healthcare innovation as a top priority, two-thirds of the executives say innovation is coming along “very slowly.”

Additionally, fewer than half of responding systems have formal innovation departments, says the research, conducted by the Center for Connected Medicine—which is jointly operated by GE Healthcare, Nokia and the University of Pittsburgh Medical Center—and the Health Management Academy.

Health plan ownership among the organizations surveyed included Medicaid managed care plans, commercial health plans, Medicare Advantage plans and employee health plans.

The research, conducted last October, included surveys from chief strategy, operating, information, innovation, financial, medical and quality officers from organizations.

Researchers found consumerism comes into play, as healthcare sector executives hustle to match digital experiences consumers are getting in other sectors. “Executives often point to the use of technology as a means to improve the patient experience and satisfy changing consumer expectations,” the study found.

“Digital health is now part of our system strategy,” one anonymous surveyed chief strategy officer said. “This focus includes additional revenue generation, cost reduction, quality improvement, patient activation, and operational improvement. We see it as a key competitive differentiator.”

When respondents were asked to select two reasons driving plans for innovation, revenue generation was the reason given 52 percent of the time, according to the study. Cost reduction strategies were mentioned by 33 percent of respondents; quality improvement, 33 percent; diversification strategy, 19 percent; consumer experience and engagement, 19 percent; and other, 19 percent.

Tal Heppenstall, president of UPMC Enterprises, the commercialization arm of UPMC, says one of the big takeaways from the study is that it indicates it’s time for health plans to start acting like health systems, and vice versa. “As healthcare changes, the lines between payers and providers will begin to blur,” he says. “They each will have to look like each other more than they have historically.”

“It’s safe to say that healthcare in this country needs innovation to work,” Heppenstall says. “Everybody on either side of the eco-system—payer or provider— believes innovation is what’s needed.”

Of the health systems that are ready to move on innovation, it appears structure and planning are key. Of the one-third of health systems reporting that they can implement and scale innovation “somewhat quickly,” most have a formal process in place for doing so. And despite that, not a single respondent said his or her organization can scale innovation “very quickly.”

Most health systems with an innovation department—typically larger organizations—also have a defined innovation budget, and they’re more likely to have a single executive in charge of innovation, commonly reporting directly to the chief executive officer, the study found.

“Health systems that will be most effective in executing their innovation agendas will be those that reconcile competing priorities by developing a clear, aligned vision across the C-suite leadership team,” said Sanjula Jain, executive director of research and advisory for The Health Management Academy, who led the research in partnership with the CCM.

The report also provided a checklist of six “actions for innovation,” which include defining what innovation means (sometimes technology isn’t even on the radar for this); aligning goals, including through the use of data analytics; structuring people and process to scale for innovation; empowering decisionmakers and giving them a budget for innovation; simplifying sign-off policies; and maximizing strengths with internal initiatives, partnerships and technology.

The report can be downloaded at

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