August 2013

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Innovation Hardwiring an innovation culture August 2013

Who am I? • Executive Medical Director for  Tele‐Health and clinical  innovation. • PhD St. L. Univ. (pharmacology) • MD Univ. of Mo. • Residency – Internal Medicine • Northwestern ‐ MS – Medical  informatics

HOSPITALS & AMBULATORY SITES 28 acute care hospitals 4 managed hospitals 4 heart hospitals 2 children's hospitals 2 rehab hospitals 1 long‐term acute care hospital AMBULATORY SITES 673 physician practices  9 outpatient surgery centers 14 urgent care sites 21 convenient care centers MEDICAL STAFF & CO‐WORKERS 39,000 co‐workers 1,960 integrated physicians 700 advanced practitioners 5,320 active medical staff UTILIZATION 4,235 staffed beds 174,596 inpatient discharges 2,976,598 outpatient visits 4,894,162 physician office visits 663,400 ED visits FINANCIAL INFORMATION $4.6 billion total operating revenue $5.2 billion total assets $240 million in charity care

Mercy is the 7th largest Catholic Health System in the US (31st overall) based on  Net Patient Service Revenue, serving in over 140 communities and seven states.  Source: Modern Healthcare Survey, June 2013


Innovation is elusive "There is nothing more difficult to plan,  more doubtful of success, nor more  dangerous to manage than the creation of  a new order of things..... Whenever his  enemies have the ability to attack the  innovator, they do so with the passion of  partisans, while the others defend him  sluggishly, so that the innovator and his  party alike are vulnerable."

Niccolo Machiavelli The Prince 1513


What is Innovation and what it is not? • Invention – a device, contrivance, or process originated  after study and experiment. • Creativity – the ability to view the normal and see what  is not there. • Innovation – is change – being able to connect existing  “dots” in a new fashion – changing the paradigm. – – – – –

Existing platforms and processes within an organization Platforms and processes outside the organization New inventions Old ideas Creativity

The The obvious obvious isis sometimes sometimes hard hard to to see see !

Innovation is about change

Examples of not responding to radical  innovations • IBM and the PC, Xerox and Lisa (forerunner to  Apple) – In health care this is represented by the transition  from FFS and Population Management (FTB & GTV)

• Block Ice • Kodak – In 1975 Kodak engineer Steve Sasson created the first digital camera. • Eight track tapes – cassettes – compact discs • Health care – stethoscope, aspirin, tele‐health &  population management

Innovation is the most difficult in successful  organizations.

Opportunity for Change

Radical Innovation

Change to the next paradigm

Disruptive Innovation Entrepreneurial Bias for Action

Ten Types of  Innovation Doblin

Ten Types of Innovation Mercy’s approach • Business Model • Networking  • Enabling process

• FFS  Managing Populations • E‐ ICU collaborations, tele‐health

• Core Process

• Increase access to primary care,  utilize the internet for 24/7 access • My Mercy PHR – e‐visits • Bundle Tele‐health Services • Lean design ambulatory offices • Buxton Data • Access to health care 24/7 • Make Healthcare easy

• • • • • •

Product Performance Product Systems Service Channel Brand Customer Experience

Pay physicians incentive bonus on top of  market comp to manage populations

Incremental Innovation • Exploits existing forms or technologies • Improves upon and existing product/process  or utilizes existing product/process for  another purpose • It can be a modular approach or architectural • Less likely to be disruptive • Most common

Radical Innovation • Something new to the world • A departure from existing technology or  methods • Radical innovation is a “big step” – continuous  improvement is a “small step” • May be disruptive

Incremental and Radical innovations

Radical Innovation

Incremental  Innovation

Innovation A Health care example


What If… • You discovered a new “wonder drug” that was incredibly useful in a very common, devastating and expensive disorder • that cut patient mortality in half • had no side effects • was relatively inexpensive • and drastically reduced hospital costs associated with the disorder Are you interested?

Sepsis Sepsis represents a continuum of conditions  beginning with a local inflammation secondary to an infection evolving into a systemic inflammation and infection which can result in to generalized organ failure and death


Local infection and inflammation

Systemic infection and inflammation Mortality 35% – 40%

Systemic infection and organ failure Mortality 45% – 60%

Severe Sepsis Is Common Severe sepsis is more common than AIDS, colon cancer, and breast cancer combined




Colon Cancer2


Breast Cancer2 1. 2. 3. 4.

Severe Sepsis4

National Center for Health Statistics, 2001. American Cancer Society, 2001. American Heart Association. 2000. Angus DC et al. Crit Care Med. 2001.

Severe Sepsis Is Deadly • •

Severe sepsis is the #1 cause of death in non-coronary ICUs More patients die of severe sepsis annually than AIDS or breast cancer Mortality


Breast Cancer3

AMI4 Sands KE, et al. JAMA. 1997;278(3):234-240. National Center for Health Statistics, 2001. American Cancer Society, 2001. American Heart Association. 2000. Angus DC et al. Crit Care Med. 2001.

Severe Sepsis5

Sepsis Treatment Resuscitation Bundle – 6 hrs

Management Bundle – 24 hours

• Serum Lactate measured • Blood cultures obtained prior  to antibiotics administered • Perform imaging studies  promptly to find source • Administration of broad‐ spectrum antibiotics within  one 1 hour of diagnosis of  septic shock and serve sepsis  without shock • Fluid resuscitation and  vasopressors • Maintain perfusion

• •

Low‐dose steroids administered  for septic shock n accordance  with standardized ICU policy Drotrocogin alfa (activated)  administered in patients with  severe sepsis and clinical  assessment of high risk of death Glucose control maintained (<150  mg/dl) Maintain tidal volumes and  inspiratory plateau pressures for  mechanically ventilated patients.

Mercy’s innovative approach to Sepsis Problem Identification

What was the impact?

The CIC along with  Booze Allen  Analyzed our  Sepsis Data Incremental Innovation

HR Resp. Rt.

Added known Risk factors To monitoring bundle Notified by Virtual Sepsis Unit and  Immediately implement  Sepsis bundle treatment

Sepsis  Teams Incremental Innovation Process change

EWIS Virtual  Sepsis Unit

E‐ICU Central  Monitoring

Radical Innovation

Radical Innovation


Radical Innovation

Patients needed  to be monitored  24/7

Incremental Innovation

Tele‐Sepsis Impact • DATA – Analytics

• Process Change • Tele‐Health  Infrastructure – EHR – Central Monitoring

• Leadership

Tele‐Sepsis Impact

New products and Processes What was the impact? All Hospitalized Patients will be monitored 24/7 Patients with chronic disease will be monitored 24/7

A new product to allow for easier monitoring Disc Data will be analyzed To pick up early warnings

Cost Utilization Quality Value


The CIC along with  Booze Allen  Analyzed our  Sepsis Data Incremental Innovation

HR Resp. Rt.

Added known Risk factors To monitoring bundle Notified by Virtual Sepsis Unit and  Immediately implement  Sepsis bundle treatment


Sepsis  Teams

Virtual  Sepsis Unit

E‐ICU Central  Monitoring

Incremental Innovation

Radical Innovation

Radical Innovation


Radical Innovation

Patients needed  to be monitored  24/7

Incremental Innovation

What does it take to successfully  innovate? • Leadership – It all starts at the top – Leaders must constantly evaluate their  organization to determine if it remains viable, on  target with the mission & the strategic direction  and is continuing to incrementally improve. – Pick a team that can act autonomously but in  synch with the values and direction of the  organization.

All that is old is not necessarily bad.  Leaders will need to keep Creativity from causing anarchy in thinking and chaos in care models as they are built

Leaders live and manage within the interface !!

Innovation should not be suppressed by the status quo.  Change is not only healthy but required for value to be created

Standardization Established Norms Proven Processes “Lockins”

Leadership Creativity Innovation Change

What does it take to successfully  innovate? • Leadership • Team members/coworker characteristics – Creativity – be able to see beyond the obvious – Knowledge of the organization and the business – a knowledge of the whole – Atmosphere of collaboration – Courage and strength of personality to be able to  fail

What does it take to successfully  innovate? • Leadership • Team members/coworker characteristics • Culture – – – – – –

Be clear about the strategic direction Encourages incremental innovations Protective environment for radical innovators Use pilots – don’t eat the elephant all at one sitting Networking with like organizations Looking outside the space to different successful  organizations. (fertilize the field and rotate the crops)

What are the ingredients for successful  Innovation • Mission, vision and strategic direction • Identify that there is a problem – What is the value proposition – target audience, innovation (product)  and compensation

• Assess if the organization has the operating model to be able to  deliver the innovation, manage the costs and do you have the right  people • Innovation is not an accident • Leaders create the culture of innovation – Systems – Policies  – Actions

• Innovation is similar but not the same as continuous improvement  and creativity

Hardwire innovation in an organization 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12.

Create it as a strategy within the organization Create opportunities for networking Remove the fear of failure Provide time and a License to Innovate Decentralize Decision Making and Innovation Provide seed money for innovations/make a little‐sell a little  Develop a method for screening innovations Work with customers (patients) to develop innovations Create opportunities for innovators to grow with their Innovation Recognize Innovation and Innovators Measure  and track innovations Develop trust and lead with integrity

Innovation Killers • Perfect gets in the way of good enough • Failure is not an option – Create a portfolio approach

• “We have always done it this way” • Lack of critical understanding of organizational  operations • Over thinking the problem ‐Innovations don’t have to  be complex – don’t miss out on the simplicity of a  solution • Don’t fall in love with the innovation • The leader feels the need to be the innovator

Is the culture innovation ready • Has the current success made the organization  self‐satisfied and complacent • Is the organization inwardly focused • Do you punish risk takers who fail • Are creative people and new ideas unwelcome  in the company • Is there an excessive bureaucracy • Do we reward creativity

Create an ambidextrous organization Tomorrow


Ambidextrous Organization

Successful Operations Innovation

Mercy’s Ambidextrous World Fee For Service Feed the Beast

Population Management Grow the Village Tomorrow


Ambidextrous Organization

Successful Operations Innovation

Volume More Patients


How does it grow and Drive strategy?


24/7  physician on  demand call  centers

Solidify network of  hospitals

Family  Conferences

e‐Hospitalist Radical Modular





centralized  monitoring


Incremental Radical Change in  Process Monitoring Procedures

24/7  central  monitoring

Required new technology

Home  monitoring

Sepsis Teams  Radical

Tele‐ consultations

Internet e‐ messages Asynchronous care


Remote Care  Management Architectural Incremental Modular

Disease Specific Teams  Incremental Radical Modular Architectural

Hospital in  the Home

"If we keep doing what we have been doing, we'll keep getting what we've always gotten"— an expensive, high‐tech, inefficient health‐care system. “ The health‐care system needs to be redesigned.“ Paul Batalden, MD Institute for Healthcare Improvement

There are three kinds of groups those who make things happen,  those who wait for things to happen, and those who wonder what happened.