CbusineZ presentation on the Innovation for Health 2014 conference. It's sometime said that innovation only add to the cost of healthcare. Is it true? In this presentation we explore why this could be the case and how to solve it. - don't focus on the technology and don't add technology to the process but use the technology as an enabler to create more efficient processes - the 'free capacity turns around and created additional costs' we need a financial method to creative reconstruct

1. Does innovation lead to lower
cost?
J. de Groot
RvB CbusineZ
www.cbusinez.nl
Jgbdegroot
CbusineZ

2. Many people state that technology sometime add
costs instead of saving it..
2
Wouter Bos
(last year)
Technology
sometime add
costs instead of
saving it
Director care procurement:
“eHealth is not cost effective”
“we have invested a lot in quit
smoking programs, but don’t see
the savings”

3. Pitfalls in technological innovations causes
costs increase instead of the expected decline
3
Better specifications…
no added value
Technology as add on
to existing process
‘Free capacity’ not
withdrawn from the system
+ Hospital
Cardiologist
Nurses
“free
resource”

4. Pitfalls in technological innovations causes
costs increase instead of the expected decline
4
Better specifications…
no added value
Technology as add on
to existing process
‘Free capacity’ not
withdrawn from the system
+ Hospital
Cardiologist
Nurses
“free
resource”

5. Technology is often used as an add to an existing
process rather than facilitate process changes
5
+
In many cases blended
care is not a redesign but
an extra on the current
process
EHealth depression
advice
Check
up
Reworked diabetes management process is
Using eHealth as an enabler
+

6. Don’t add on technology! Use it to enable better
processes
6
+ advice
Check
up
No more technology
as add on
Use technology as an enabler for
processes optimalisation
Health care
professionals
Learn to use
technology as an
enabler
Learn BPR
Dare to question
the current
process and
experiment
Don’t add on!
Technology
providers
Stop pushing
technology, start
facilitating better
processes
Dare to question
the use of your
product
Don’t add on
Don’t add on… create better processes

7. Using BPR instead of add on….. We created a
sustainable gamified autism treatment
7
Kosten'
emodule
%'
tijdsbesparing
Psychiater GZ:psycholoog SPH'''''''''''''''''''''Kosten' Opbrengst
Uren tarief Uren Tarief Uren Tarief
Eerste&doorrekening 0 0 0,5 €&87 2 €&214 5,75 €&483 €&784 €&711
*&Toevoegen&kosten&emodule&
*&Verlagen&SPH&uren 50 0 0,5 €&87 2 €&214 5 €&420 €&771 €&2
*&Toevoegen&kosten&emodule&
*&Verlagen&SPH&uren& 75 0 0,5 €&87 2 €&214 4,75 €&399 €&775 €&72
*&Toevoegen&kosten&emodule&
*&Verlagen&SPH&en&GZ7
psycholoog&uren& 100 0 0,5 €&87 1,75 €&187 4,5 €&378 €&752 €&21
*&Toevoegen&kosten&emodule&
*&Verlagen&SPH&en&GZ&uren&&&&&&&&&
*&%&tijdsbesparing&toevoegen 50 10 0,5 €&87 1,5 €&161 4,75 €&399 €&697 €&71
*&Toevoegen&kosten&emodule&
*&Verlagen&SPH&en&GZ&uren&&&&&&&&&
*&%&tijdsbesparing&toevoegen 75 10 0,5 €&87 1,5 €&161 4,25 €&357 €&680 €&16
*&Toevoegen&kosten&emodule&
*&Verlagen&SPH&en&GZ&uren&&&&&&&&&
*&%&tijdsbesparing&toevoegen 100 10 0,5 €&87 1,25 €&134 4,25 €&357 €&678 €&18
Current process:
They analysed the time saved per
care provider by using EHealth
€ 800 per treatment
BPR process:
Client goals central
Ehealth and group support
Professional as coach
€ 400 per treatment
Current process: € 750

8. Pitfalls in technological innovations causes
costs increase instead of the expected decline
8
Better specifications…
no added value
Technology as add on
to existing process
‘Free capacity’ not
withdrawn from the system
+ Hospital
Cardiologist
Nurses
“free
resource”

9. In many cases the costs per unit decreases but
…. increases the total costs
9
Costs per unit decreases…
&
Total cost increases
Before After
technological
innovation
Before After
technological
innovation

10. Heart failure case
10
New process for heart failure
using tele monitoring
In 5 hospitals the process for
heart failure treatment were
redesigned using tele
monitoring
50% less hospital admissions
50% less exurcebations
8 patient satisfaction
20% reduction in professional time
25% reduction in fee cardiologist
40% reduction in revenue hospital
€ 83 mln. potential cost reduction
Great results…

11. A technology based redesigned process should
require less professional time
11
Hospital
Cardiologist
Nurses
Implementation of new Heart failure
processes would free up resources

12. A technology based redesigned process should
require less professional time
12
Hospital
Cardiologist
Nurses
“free
resource”
Implementation of new Heart failure
process would free up resources

13. The “free resources” are used to treat new
patients and hence the total costs will rise
13
Hospital
Cardiologist
Nurses
“free
resource”
Implementation of new Heart failure
process would free up resources
If the ‘free resources’ are not
withdrawn from the system they
tend to find a new function…
- Lower intervention boundaries
- New patient groups
- New treatment
If the ‘free resources’ find new
treatment (revenue) the total
costs for the healthcare system
rises!

14. The challenge of the “free resources” is faced
by all innovation projects
14
Hospital
Cardiologist
Nurses
“free
resource”
vv Blended care
3 Face tot Face + an ehealth
program
Or
F2F + tel support + eHealth
Cost: € 400 - € 500
g Depression treatment
in current situation
1st line: 8 consultations
€ 640
2e line: 8-12 consultation
€ 1200
Reductie
50%
+
Same outcome
advice
Check
up
Your
innovation
Innovative heart failure
treament
Blended depression
care
Blended diabetes care
Reduction
60%

15. How to withdraw the ‘free resources’ from the
healthcare system?
15
Hospital
Cardiologist
Nurses
“free
resource”
Hospital
Less revenue, more profit
Compensation for creative
destruction costs
Professionals
Fixed capacity: compensated for
revenue loss
Variable capacity: step by step
transferred to other areas
Overhead: reduced
Insurer
Lower prices
No financial
instrument
available…

16. Let’s finance creative destruction!
16
Hospital
Cardiologist
Nurses
“free
resource” Health
Insurer
Creative
Destruction
Fund
Less revenue, more profit
Lower prices
(incl. deprecation)
Profit protection
Contract
Finances:
- The innovation
- The Creative destruction
cost
Care provider

17. We will start a creative destruction! fund
17
Hospital
Cardiologist
Nurses
“free
resource” Health
Insurer
Creative
REconstruction
Fund
Less revenue, more profit
Lower prices
(incl. deprecation)
Profit protection
Contract
Finances:
- The innovation
- The Creative
REconstruction
cost
Care provider

18. Imagine … if we together would reconstruct..
18
Let creative destruction….
Labs ….. From 400 to.. Saves ??
Derma …
Heartfailure..
Diabetes
Depression
A solution to our
Healthcare cost problem
Hospital
Cardiologist
Nurses
“free
resource” Health
Insurer
Creative
Destruction
Fund
Less revenu, more profit
Lower prices
(incl deprecation)
Profit protection
Contract
Finances:
- The innovation
- The Creative destruction
cost
Care provider

19. It doesn’t only take a financial instrument… we need
cooperation, vision and a lot of courage too..
19
Scaling up
innovation
Co operation to jointly tackle big problems
instead of power games
Vision of how WE want OUR healthcare to be
instead of finding arguments to defend your
own positions
Courage to choose the hard path to find a
solution and face our own colleagues
Instead of ‘to indulge the hostility’