Global Healthcare Trends.ppt

Global Healthcare TrendsPresentation to IBM Public Sector Leadership Forum,Friday,February 7,2003Presenter:Neil Stuart,IBM BCS Canada,2,Overview of Presentation,Purpose of presentation:to provoke thinking about the future needs of our clients/customers and opportunities for IBMThe big trendsSome potential surprisesImplications for our customers/clientsDevelopments in the market Opportunities for IBM,3,Thought Leadership Lots Done,More to Come,Futures analysis PricewaterhouseCoopers HealthCast 2010,and HealthCast TacticsE-Health Transformation PWC EuropeIBMs Healthcare 2012More in the worksMulti-client study on payor operations/performance in U.S.Canadian POV Health on demand,4,The Big Trends,More demanding,better informed consumersGenomicsE-worldDemographic changeFinancial sustainability of healthcare coverageHuman resources concernsEvidence based-practicePatient safety,5,Consumers will be a Continuing Story,Consumers are and will be transformed byNew attitudes demanding and aging boomers,paying for a bigger part of their careNew expectations a voice,choice,personalized care,partnerships with providersNew tools report cards,patient charters,personal electronic health recordsThe Internet-information,new knowledge,much greater health literacy and new models of accessing servicesGenetic foresight knowledge of their own genetic futuresDemand driven healthcareConsumer-inclusive solutionsHealth organizations that do not get it will fall behind,6,Genomics,a Sleeping Giant,Accessible genetic testingIndividual awareness of our genetic futuresLonger disease life cycles and greater demand/costsDemand for new kinds of preemptive servicesGene specific,designer drugsMuch more effective drug therapyHuge cost escalationConsumers anxious about their genetic futuresGreatly increased clinical precision and clinical complexity Much greater density of clinical information Costs pressures,7,E-world-Larger Markets,Extended reach for Healthcare,E-delivery of servicesRemote diagnostics,specialist consultations,even remote surgery!Remote monitoring of chronic conditionsTeletriageE-mail primary care consultsInformation,appointments,test results,prescriptions,referralsElectronic health recordsE-markets and e-purchasingIncreasing the reach of providersGlobalization and blurring of old health jurisdictionsPatient access to EHRs giving consumers one more lever to increase controlScale challenges for suppliers,8,The Sustainability Question,Multiple pressures on the the cost and affordability of healthcareDemanding consumersDemographics aging populationExpensive drugs that work even betterCosts of new technologies-IT,Dx,RxCosts of updating old infrastructure/facilitiesHealthcare consuming ever larger part of government spend the healthcare monsterOpportunities for new players and the private sectorIncreasing health inequitiesFocusing resources on interventions that produce outcomesPressures in the U.S.for a national health plan,9,The“Healthcare Monster”a headache for governments and payors that will not go away,“The rising cost of healthcare has brought on a fiscal crisis in many(U.S.)states.Their combined budget deficit is estimated to worsen to$60-$85B in 2004,which is equivalent to 13 18%of their total expenditure.”-Kaiser Family Foundation,January 2003,10,Potential Surprises,Prolonged war in the Middle East leading to an economic downturnTaking money from health budgets,particularly capital budgetsMassive bio-terrorism offensive against major Western citiesDiversion of health resourcesGlobalization of infectious disease continues West Nile,Mad Cow,etc.Global health surveillance and collaborationIncreasing numbers/prevalence of drug resistant disease strainsReturn of long inpatient stays,isolation careSooner than expected breakthroughs on gene therapyNew ball gameSurprises always reveal new needs/gaps(think of HIV,anthrax)Look ahead,spot the customer need,respond smartly and quickly,11,Four BIG PICTURE business directions for our customers/clients,Managing demand for servicesMeasuring,managing and paying for performanceProviding ready access to health informationMaking health care organizations employers of choice,12,1.Managing demand for services,Consumerism is changing the way clinical/service decisions are made decisions no longer just with providersConcerns about sustainability and overwhelming growth in demandStrategies to manage demand and channel consumerismPartnerships with patients/usersMatching providers and patients and team based careInforming and educating patientsTools for self-monitoring,self-care,self-serviceDevices that offer/require choice,e.g.defined contribution plans,MSAsTaking advantage of of opportunities for e-serviceDisease management focusing on chronic diseases(cancer,diabetes,asthma,cardiac,etc),13,FUTURE,TODAY,For U.S.health plans,the need to address costs and consumer demands will fundamentally alter their role,Employer-drivenInsulated consumer Defined benefit/limited choicesNo decision making toolsFull service health plansAntiquated business infrastructure,Member-driven,with member more financially accountableMovement toward defined contributionEmergence of assisted decision makingMore specialized health plan focusFlexible technology infrastructure Emergence of non-traditional competitors,Banks/Financial Institutions,Health Advisor/Broker,Employee,$,TPA,Network,Care Mgmt,Other,Insurance,Employer,Employee,Health Plan B,Health Plan C,Health Plan A,Benefits Consultant/Broker,$,Employer,Health BenefitPackage,The Pain Transplant,14,1.Managing demand for services,Some relevant IBM offeringsCRMPayor systems,including outsourced services(Empire-Blue Cross-U.S.)Consumer surveys(HealthInsider-Canada),15,2.Measuring,managing and paying for performance,To date there has been little financial reward for quality and service excellenceEscalating costs and concerns about sustainability highlight the importance of focusing resources for maximum impactResearch on preventable errors is underlining concern re patient safetySome actions that will shift more attention to performance include:Developing and implementing patient safety and quality indicatorsMeasuring and rewarding for patient satisfactionGiving quality incentives to service providersInforming stakeholders on what works and what is excellentTransparent resource allocationPayor concerns with efficienciesPaying attention to system performance too,16,2.Measuring,managing and paying for performance,Some relevant IBM offeringsData warehousingMany BCS assignments on report cards(Canadian Institute for Health Information)Program evaluationConsumer surveys e.g.IBM HealthInsiderAddressing payor performance,17,3.Providing ready access to information,Access to health information to support the patient care process is slow and fragmentedInadequate access to information has been an impediment to evidence-based practices and linked to patient safety issues Strategies to support ready access to useful information include:Point-of-care computing Ensuring privacy and securitySetting realistic timetablesDeveloping open,flexible architecturesInvesting in data warehouses and performance monitoring metricsProviding ongoing trainingPatient access to and even control over their EMRConsumer access to system/provider performance information,18,3.Providing ready access to information,IBMs offeringsHIPAA work in U.S.Vendor alliances e.g.CernerHealthcare integration e.g.Alberta we/net,19,4.Making health care organizations employers of choice,Health care organization used to be a prized place to work-security,helping people,statusNew entrants to the job market are looking for other features to their work-flexibility,team-based,learning/development opportunities,state-of-the-art technologySome strategies to make health care organizations a work place of choiceFlatter organizations pushing decision making down the hierarchyCareer options/development/trainingTeam environmentsB2E/employee portalsFlexible pay and benefitsLinking employee and patient satisfactionAbove all,respect for employees,20,4.Making health care organizations employers of choice,IBMs offeringsBCSs Human Capital Solutions,including Learning SolutionsExamples of assignments completed(hospitals as employers of choice,HR retention)B2E portals,21,Some nearer-term market trends,Consumer driven health plansWireless/mobile solutions(mainly from established vendors)get tractionGrowing use of web in healthcare supply chainConvergence of electronic physician order entry and e-procurementOutsourcing takes off offered by vendors an answer for customers lack of capital Healthcare spending on outside IT services surpassing internal IT spendHealthcare IT spend will have to a show strong business caseIT will be seen more as answer for human resource shortages,22,IT Opportunities for IBM*,Consumerism and demand management drive CRMCRM opportunity will grow 25%from 2003 to 2006E-world drives SCM opportunity,e-markets and e-procurement20%plus growth rates projected in SCM and e-markets for IBMServices are the biggest IT opportunityServices are the largest and generally fastest growing segment of opportunity by geography and solution market*Source of projections:IBM Market Intelligence Sales&Distribution,23,IT Opportunities for IBM(more.),Mobile computingImplementation application vendor alliancesSecurity issuesHardware product to compete with Compaq/HP,Microsoft,Palm?OutsourcingPayer systems,claims management,back office,PC/network supportPrivacy and securityUS market being driven by HIPAA,parallel interest in other jurisdictionsHealthcare integrationE-business integration,portals,B2E,B2B,B2CBusiness on Demand,Information on Demand,Healthcare on Demand,24,Questions and Discussion,25,Healthcare Solutions by Geo and Solution:CRM and ERP are Largest Opportunities,26,Healthcare Solutions by Geo and Solution:CRM and ERP are Largest Opportunities,27,Total WW Healthcare Sols Opportunity 2003(Large Enterprises)$6.8B,28,Total WW Healthcare Sols Opportunity 2003(Large Enterprises)$6.8B,29,Total WW Healthcare Sols Opportunity 2003(Large Enterprises)$6.8B,30,CRM Has Highest Growth Rates in Geos,While ERP Has Lowest Growth,31,CRM Has Highest Growth Rates in Geos,While ERP Has Lowest Growth,32,CRM Has Highest Growth Rates in Geos,While ERP Has Lowest Growth,33,Services is Largest Solutions Opportunity in Americas for CRM,ERP and SCM,34,Services is Largest Solutions Opportunity in Americas for CRM,ERP and SCM,35,Services is Largest Solutions Opportunity in Americas for CRM,ERP and SCM,36,Services is Largest Solutions Opportunity in Americas for CRM,ERP and SCM,Services(SI,IT Consulting,Bus.Consulting,Other Services)total 73.2%of Americas CRM oppty,69.3%of ERP oppty,and 73.5%of SCM opptyHW(Servers,Clients,Technology)is a relatively small portion of Americas solutions oppty(8.2%for CRM,16.8%for ERP,8.2%for SCM)CRM,ERP and SCM Apps SW are relatively small portions of total Americas solutions oppty(15.2%to 18.1%),but will drag many Services purchasesSI is the largest segment of Americas SCM oppty(40.5%),more than double the percentage for CRM and ERP,37,Services is Top Opportunity for CRM,ERP,SCM in EMEA,38,Services is Top Opportunity for CRM,ERP,SCM in EMEA,39,Services is Top Opportunity for CRM,ERP,SCM in EMEA,40,Services is Top Opportunity for CRM,ERP,SCM in EMEA,Services(Bus.Consulting,IT Consulting,Other Services,SI)is largest part of all 3 EMEA solutions opportunities:72%of CRM,59%of ERP,83%of SCMHW is a small part of CRM,ERP,and SCM opportunities in EMEA:14%of CRM,16%of ERP,6%of SCMSI is much larger part of EMEA SCM oppty(50.9%)than for CRM(24.2%)and ERP(16.2%)Application SW is a relatively small part of EMEA solutions opportunities(13.1%of CRM,21%of ERP,8.8%of SCM),but drags through many services dollars,41,Services is Top Opportunity for CRM,ERP,SCM in AP,42,Services is Top Opportunity for CRM,ERP,SCM in AP,43,Services is Top Opportunity for CRM,ERP,SCM in AP,44,Services is Top Opportunity for CRM,ERP,SCM in AP,SCM is largest solutions oppty in AP($125M in 03),and SI is largest single segment of the AP SCM oppty(36.8%)Services(Bus.Consulting,IT Consulting,Other Services,SI)are largest oppty for solutions in AP:76.5%of CRM,62.1%of ERP,63.2%of SCM)HW(Clients,Servers,Technology)is relatively small segment of AP solutions oppty:12.1%of CRM,13.5%of ERP,20%of SCMApplications SW is relatively small part of AP solutions oppty(10.4%of CRM,18.9%of ERP,and 13.6%of SCM),but drags other IT dollars,45,Solutions Definitions:Customer Relationship Management(CRM),Customer Business Goal:Increase customer loyaltyIncrease profitabilityIncrease productivityGain competitive edge through access in new sales,service and marketing channelsBusiness problems/functions addressed:Improve the analysis and understanding of the customer preference&purchasing behavior across the CRM value chain including the marketing,sales and service functions aimed at providing direct personalized customer sales,service and marketing activities through multiple channels or touchpoints High level definition:CRM encompasses the business processes an enterprise performs to identify,select,acquire,develop and retain its customers through multiple communication channels.I/T functions involved:*Focused Definition:Sales Force Automation,Customer Service&Support(including eService and contact center),Marketing automation(including analytical and content mgmt capabilities),Voice Interaction,Text Interaction and Multimedia InteractionExclusions:*Generic business intelligence*Telephony based hardware*Billing and payments*ATMs and ATM networks,*Reservation and ticketing systems*Internal help desks*Store operationsInclusions:*Market information retrieval*Sales transaction initiationExamples in products and players:Siebel,PeopleSoft,Oracle,SAP,Onyx,Pivotal,Nortel,Avaya,Accenture,PWC,CGE&G,Deloitte,KPMG,eLoyalty etc.,46,Supply Chain Management(SCM),Customer Business Goal:The Supply Chain Management solutions allow customers to improve responsiveness,lower cost,reduce cycle time by optimizing internal logistics and by linking suppliers and trading partners to deliver the right products at the right time and price to the right place.Business problems/functions addressed:Sourcing,distribution,warehousing and transportation,Production logistics,Customer order fulfillment and services,Forecast and demand planning High level definition:A.Focused definition-Linking two or more I/T applications and functions supporting the supply and production of goods.B.General definition-I/T applications and functions supporting the supply and production of goods.I/T functions involved:A.Supply Chain Planning:1)Forecast and Demand Planning,2)Distribution and Warehouse Planning,3)Manufacturing Planning,4)Transportation Planning,5)Advanced Scheduling,6)Order Promising,7)Data IntegrationB.Supply Chain Execution:1)Order Management,2)Order Promising,3)Inventory Management,4)International Trade Logistics,5)Transportation Management,6)Warehouse Manag