The COVID-19 pandemic is the global challenge of a lifetime for healthcare organizations, stressing their economic, strategic, and human dynamics in every way imaginable.
Through August 2020 year-to-date, the median operating margin at U.S. hospitals dropped 89 percent compared to the prior year. Inpatient and outpatient volumes were down 20 percent and 35 percent respectively from the year before, while expenses were rising. At the same time, patient, provider, and payor behaviors were rapidly changing. Seemingly overnight, for example, telemedicine moved from an interesting option to a reimbursable patient service that may permanently alter care delivery.
The task ahead for healthcare leaders is immense: to simultaneously solve for rebuilding revenue and business operations while radically reducing costs and reimagining the patient care portfolio to meet new expectations around safety and access—all at speed.
The potential to emerge stronger through transformative change is real. With a structured framework, an agile approach to change, and intense execution, healthcare leaders will advance their organizations to a new future.
The Path Forward: Protect, Secure, Advance
The rebuild process is well underway and it will continue to span many months in a non-linear fashion for most healthcare organizations. An end-to-end plan will help to continuously guide the leadership team with the critical steps needed to adapt to a new future.
Our leading clients have accelerated their virtual care strategies across the care continuum in response to COVID-19. One health system has increased ambulatory telemedicine visits by more than 500 percent and scaled its virtual ICU beyond the health system to an ecosystem of participating regional hospitals. The system is also investing in virtual care at home to free up hospital capacity and reduce hospitalizations at a time when bed capacity is scarce.
The key to a successful virtual care journey lies in an intentional, evolving approach that leverages and connects new virtual care focus areas to support enterprise strategies—all supported by an operating model and governance structure to ensure new value is created and strategic priorities are met.
Charting your virtual care path forward
We have outlined a nine-step approach for providers to navigate the path forward. The first step—one that can deliver swift returns—is to hardwire the successful, rapid virtual care initiatives your organization implemented during the pandemic. The immediate changes made by provider organizations in response to COVID-19 prioritized convenience, access, and affordability for consumers to avoid becoming commoditized parts of the healthcare continuum. Leading providers are making these practices the new norm.
The next step is to broaden and scale virtual care to support your enterprise strategies.
Enterprise Strategy & Rebuild Plan
Virtual care will play an important role as leaders embrace the challenge to ramp-up revenue while at the same time significantly reducing costs and reimagining the patient care delivery model. Key steps in the planning process will include important integrations of virtual care into the broader enterprise strategy. Providers should start by completing a virtual care market study. Evaluate emerging competitive threats and opportunities and identify unique consumer, community, and provider needs.
Stress testing of strategies is required, using a wide range of scenarios to prepare the organization for extreme situations and a very different post-crisis reality.
Financial and Non-Financial Value Testing
Build a comprehensive financial and non-financial value model defining the current and future effect that virtual care initiatives will have on operational and clinical outcomes.
Technology Partner Selection
In recent years, medical technology companies have made a significant investment in developing comprehensive, platform-centric virtual care solutions—and this effort has only intensified with the pandemic. Providers will discover a growing array of technologies to help position their organizations for long-term growth leveraging virtual care.
Governance and an Integrated Operating Model
To be sustainable, it’s critical for virtual care initiatives to align with enterprise strategies, be visibly supported and sponsored by leadership, and have governance structures that guide decision-making, use of data, transparency, and accountability.
Provider and Consumer Engagement
Based on insights from the market analysis and provider needs assessment, develop a robust consumer engagement strategy and provider change management plan.
Relentless Performance Measurement
The COVID-19 crisis has levied a significant financial toll on hospitals and health systems. There is no margin for error with investment decisions going forward and each one must be vetted stringently and monitored relentlessly so that the desired return is realized.
Optimize and Scale High-Value Service Lines
Optimize and standardize the solution across your portfolio of facilities. Ensure value priorities are exceeded and activate a comprehensive stakeholder communication plan.
Refresh your virtual care roadmap to include high-value service lines and create an adaptable plan to align with evolving strategic priorities
Virtual care platform technologies have the potential to scale in the same manner as a smartphone, where the value of the upfront investment expands based on app extensions. Once the upfront technology investment is made in virtual care, adding new service lines to enhance value requires incremental costs with exponential benefits as the footprint scales (ex: virtual ICU scaled to ED, L&D, Radiology, et al).
An unprecedented opportunity to evolve
The COVID-19 pandemic forced an industry-wide challenge to rethink and reshape healthcare for the better. How will healthcare organizations adapt and evolve going forward?
Across GE Healthcare, we rapidly mobilized to drive innovation in response to the global pandemic. For example, to help hospitals better manage critical care patients by scaling scarce physician and nursing resources, GE Healthcare swiftly adapted its Mural virtual hospital solution to a cloud-based solution. This allowed rapid deployments in as few as 30 days – and we’re expanding this capability beyond the US to global markets. In addition, GE also announced research to test how AI can help predict COVID-19 severity in collaboration with the University of Oxford and Paris hospitals. As the saying goes, “necessity is the mother of innovation” and there are other examples within GE and GE Healthcare and across many organizations that have risen to the challenge during these unprecedented times.
The commonalities among these initiatives—creative partnering, rapid product development and deployment globally, and flexible use of capacity—are all powerfully effective principles we hope to expand on in the future. In a similar vein, hospitals and health systems will have opportunities to move more aggressively into mutually beneficial partnerships and mergers that leverage individual strengths, direct more capital investments toward intelligent health technologies that improve clinical and non-clinical outcomes, and rethink physical and virtual capacity in new ways to achieve cost-effective growth.
COVID-19 has highlighted the need to build, invest in, and scale a modern digital infrastructure that enables an intelligence-based health system. The pandemic has created a new urgency to evolve, and the opportunity to make real progress is here.