This assignment includes two questions, one is about FQHC or retail pharmacies business model innovation, another one is the value frontier, each question account for one page, and I will upload the questions word document, please review that very carefully. And the second question is at the bottom.
Question1: Choose either a FQHC (A Federally Qualified Health Center) or a retail pharmacy. What could that organization do to its business model (creating value; inputs to its internal needs; its own processes; the revenue model) to position itself better for the future? Use Harris’s examples in the first half of the chapter for guidance.
BUSINESS MODEL INNOVATION
To tackle the new competitive and financial drivers described earlier, healthcare providers are shifting their perspective and strategies to address consumerism and the total cost of care. A variety of labels have been used to describe business model innovations that align providers and payers, including population health management, the shift from volume to value, risk-sharing, value-based contracting, and accountable care.
Because health systems (including single-hospital organizations) are strong incumbents in healthcare delivery, they are at the center of much of this transformation. This section is therefore focused on the challenges and opportunities faced by health systems, though these challenges also apply to healthcare organizations throughout the continuum of care.
Addressing business model innovation in a strategic plan can be daunting and complex. Innovative business model strategies for health systems might include shifting payer contracting from volume to value, setting up new organizational structures to better coordinate care, or extending a provider’s role to include insurance as well. This section provides a context and basic structure for those considerations.
The first step many health systems take in addressing business model innovation is to begin shifting payer contracting from a strictly
fee-for-service basis to include more value-based payments based on quality and other performance measures. This shift should not only include managed care contract experts in the finance department. Shifting to value-based payment models (bundled payments, shared savings, risk sharing) requires a multidisciplinary effort, including physicians and leadership from finance, nursing care management, quality, and information technology.
A more intensive effort to shift from volume to value may involve setting up new organizational structures to better coordinate care. A clinically integrated network (CIN), accountable care organization (ACO), physician–hospital organization (PHO), or another multi provider network typically engages independent physicians, along with hospital-employed physicians and health system leadership, in a joint structure created to drive improvement in quality and cost- effectiveness. Because these organizations have the power to define standards, contract with payers, and distribute shared savings or incentives from payer contracts, they represent strategic initiatives that must be designed thoughtfully with appropriate legal counsel. Some hospitals or health systems may have existing structures, in which case the task may be to revitalize an existing PHO or CIN rather than to create a new one.
Some health systems believe that they can best serve their com- munities and secure their market position by expanding vertically from healthcare delivery to insurance. This strategic initiative requires significant investment in start-up expenses and capital reserves, as well as new expertise not typically found in health care systems.
Example 1: Three-Dimensional Printing (Also Known as Additive Manufacturing)
Three-dimensional printing—as the term is used in healthcare— refers to a process of recreating a physiological object through the successive layering of organic material via a computer-controlled process. Currently it is being applied to the formation of bones (e.g., jawbones, fingers, toes, vertebrae), bionic ears, facial prostheses (e.g., noses), and other items that are in turn implanted in patients. Work is under way to perfect the 3-D creation of human kidneys, livers, lungs, and hearts. Three-dimensional printing of tissues is based on highly biocompatible materials or even the patient’s own stem cells.
This innovation has the potential to improve the transplant process in a number of ways. Patients who need transplants have historically had to endure long waits for a limited number of viable, tissue-matched organs, and after surgery, patients have received fairly intensive ongoing care at high cost. Generating new body parts would increase the precision while also reducing wait times and minimizing the odds of tissue infection and rejection. Together, these features could contribute to lowering the cost of treatment and enhancing the ability of the patient to resume a normal lifestyle, potentially adding value for risk- bearing providers.
Example 2: Remote Monitoring Devices
Remote monitoring devices allow an individual to monitor her own physiological health and transmit the data directly to clinicians without traveling to the physician’s office, emergency department, or other setting. These devices enable clinicians to monitor patients remotely, supporting bedside testing in an acute, post-acute, or residential setting. They advance the use of the hospital-at-home concept, through which patients may be discharged quickly from an acute care setting and cared for in their homes.
The devices also enable early detection of problems, so that intervention can occur before acuity and cost of care increase. This is particularly helpful for patients with chronic illness (e.g., congestive heart failure, chronic obstructive pulmonary disease, diabetes), allowing wins on bundled payment programs or programs in which providers are at risk for the care quality and cost for a population. In these ways, the use of remote monitoring devices can be expected to contribute to changing the role of clinicians.
Example 3: Physician Kiosks
Physician kiosks use both telehealth and portable diagnostic technology to improve access to care and have been installed in retail pharmacies, shopping malls, workplaces, libraries, schools, airports, and other service locations. With an attendant’s help and clinician direction, the patient interacts with a physician or advanced practice clinician via videoconferencing, using specific diagnostic equipment available in the kiosk. The equipment transmits results directly to the physician or other clinician.
Kiosks may be located in retirement communities to serve a concentration of patients with chronic conditions without requiring them to travel. It could allow a single clinician to serve patients in multiple locations in rapid succession. Because some patients would likely use kiosks instead of the emergency department or a physician’s office, the kiosks could contribute to a reduction in population health costs.
Question2: The “value frontier” is defined as the linking of quality and efficiency data to identify optimum levels of healthcare performance. This shifts us away these days from an efficiency frontier because value also considers quality, What is the role of the following groups in the healthcare value improvement process? Choose 3 of the following 5 and discuss: board of directors, senior leaders, physicians, employees, and payers.