Tag Archives: Pitching

Why the future of health lies in thinking small

General Practice in Australia is a private business. There are 7200 GP businesses in Australia, with a revenue of $10bn per annum. Each practitioner is estimated to earn $200,000 on average. 95% of the income for these businesses is derived from government rebates, mostly from 10 to 15 minute consultations. The concerns of the practitioners in this context are said to be:

1. Threat of litigation

2. Too much work to do in a limited time

3. Earning enough money

4. Patients who are difficult to manage

5. Paperwork

6. Intrusion of work on family life

7. The cost of practice overheads

8. Time pressure to see patients

9. Unrealistic community expectations

10. Negative media comments

Increases in the Medicare rebate have failed to keep pace with the rise in the costs of running a GP service with increased patient throughput often used to make up the shortfall. Where this and other barriers exist, it may not be feasible for patients to be offered additional advice or services beyond their original reason for presentation unless a strategy is negotiated and agreed between the relevant players.

We know that the healthcare needs of patients are set to change in three important ways:

1. The population is aging.

2. There are more effective, albeit ever more expensive treatments available.

3. Poor lifestyle choices, linked to obesity will generate greater demand for medical appointments.

We are therefore relying on private businesses to respond to growing need in the knowledge that they are already working to capacity.

Under the central set of assumptions used in this study, total health and residential aged care expenditure is projected to increase by 189% in the period 2003 to 2033 from $85 billion to $246 billion—an increase of $161 billion….This is an increase from 9.3% of gross domestic product (GDP) in 2002–03 to 12.4% in 2032–33. Increases in volume of services per treated case are projected to account for half of this increase (50%). Projection of Australian health care expenditure by disease, 2003 to 2033

Another unique aspect of the business of medicine is that despite its technical and scientific basis, medicine is most effective when the human interaction between practitioner and patient is at its heart. Efforts to interfere in the process through the revision of payment schedules are only partially successful if not actually harmful.

The commercial reality is that without innovation, primary care as a business will not keep up with demand. To date evidence in practice is that researchers in primary care often fail to engage with clinical partners and innovation is stymied. Government investment in innovation in primary care is on the one hand conservative and limited. Ninety percent of government funded healthcare is delivered by small businesses and yet over 90% of government investment in research and innovation is targeted elsewhere. What little is funded is usually awarded to competing tertiary institutions whose performance is measured on academic outputs rather than impact on practice.

These are the foundations for a lean, agile, creative, approach to innovation  based on commercial reality and factoring in three key elements:

1. The most expensive component of innovation is establishing the problem and creating a value proposition that  factors in the perspective of end users.

2. Innovation only ever works when it is driven by a champion willing and able to re-engineer multiple prototypes to solve the problem.

3. There are opportunities for commercial partnerships if the key performance is reframed in the metrics of sales.

The conditions already exist for this approach to innovation in the business of primary care. Primary care in many countries, like Australia, is led by highly creative, intuitive problem solvers, many invest their insights and energy on small projects that have the scope for substantial commercial returns but more importantly to deal with the coming tsunami of health related problems. The final word is to Paul Graham:

People are bad at looking at seeds and guessing what size tree will grow out of them. The way you’ll get big ideas in, say, health care is by starting out with small ideas. If you try to do some big thing, you don’t just need it to be big; you need it to be good. And it’s really hard to do big and good simultaneously. So, what that means is you can either do something small and good and then gradually make it bigger, or do something big and bad and gradually make it better. And you know what? Empirically, starting big just does not work. That’s the way the government does things. They do something really big that’s really bad, and they think, Well, we’ll make it better, and then it never gets better.

Why innovators should learn to embrace feedback

Lean innovators often work in isolation and not surprisingly the innovator is emotionally invested in her idea. She has conceived the idea, developed it, spent time and resources on bringing the idea to life. This makes criticism of her brain-child very hard to bear.

The temptation is to be defensive. To shout down the critic. To take the view that the person offering an opinion hasn’t understood the brilliance of what has been brought to the world. The cure for this sort of pain is to begin with the end in mind.
Consider who is this innovation is for? Who needs to cooperate to make it available to the end user? Who will pay for it, either with hard cash or with their time and effort?

Another way to get a better understanding of the real problem you’re trying to solve is to write a short letter to the person you want to solve the problem for. A crucial part of innovating is to tell the story of the invention effectively, to make the people who need to care in that moment, care. It’s worth investing the time to get your story right and to seek out people you trust to give you honest feedback before you have to tell the story for real.