Pivoting Around Healthcare’s Coming Regulatory Shift Means Taking A Hard Look at Innovation Strategy

By Mark Hughey & Kurt Schiller, Arcweb Technologies

The past few months have seen enormous shifts in the healthcare industry, and expectations are higher than ever. From the sudden widespread rollout of telehealth services to the dramatic increase in virtual visits and patient mobile app usage, the impacts of COVID-19 on the ways people use technology to engage with their health cannot be overstated.

But there’s another tectonic shift on the horizon, one that’s been largely overshadowed by the COVID-19 pandemic. That’s the 21st Century Cures Act, a piece of legislation passed in 2016 and officially put into effect on June 30, 2020, and it contains a series of dramatic regulatory changes that will totally reshape the way technology of all stripes uses, stores, and shares healthcare data.

This act is opening the door for patient data-driven companies and products from every conceivable industry—but effectively taking advantage of this opportunity will depend on a company’s ability to rapidly, measurably, and above all effectively innovate.

Why the 21st Century Cures Act matters

In the United States, while patient data is strictly regulated for privacy and other factors by regulations like HIPAA and HITECH, the data itself is generally acknowledged to be the property of the medical provider, not the patient. That means that with few exceptions it’s been the prerogative of doctors and hospitals (and ultimately, the technology vendors who manage the data) to decide who gets access to that data, and how.

“Data blocking” is one of the main problems being targeted by the Cures Act. Under the new regulations, providers, insurers, and software vendors (such as Epic and Cerner, developers of two of the most widely used electronic health record systems) will be required to share that data through standardized interfaces like FHIR and HL7.

In other words, vastly more healthcare data is about to become much more widely available to almost any business, app, or product (provided customers agree to share it, of course).

Finding opportunity in regulatory change

Regulatory changes like the Cures Act represent tidal shifts in the norms of industry, and they can spell opportunity or disaster depending on how your company and your products respond.

Could you tap into healthcare data to give customers better insight into their health? Or could your products tailor their experiences to a patient’s medical history? Might doctors find value in receiving critical insights about their patients—your customers?

If you haven’t previously thought of your business or products as existing in the healthcare industry, these may seem like totally alien concepts. Of course, the same could once have been said for now-ubiquitous tools like GPS, mobile internet, or high-definition video capture, which have made incredible impacts on industries as wide-ranging as retail, logistics, and events management. The availability of consumer-ready patient data tools like Apple Health have already spurred investment into healthcare use cases, and the Cures Act stands to drive adoption a step further.

Whether it’s GPS or healthcare interoperability, these major technological shifts are coming faster and faster, and it’s increasingly critical that companies are able to capably respond to them.

Unfortunately, when it comes to these sort of dramatic innovation initiatives, the track record is not great. In 2017, a survey of 450 CIOs found that 80% of all innovation projects fail to meet company expectations or goals, regardless of the industry — and in healthcare in particular, the American Hospital Association found that more than half of all healthcare leaders lack a standardized process for determining whether a digital project succeeded or failed.

While your business may not have literal lives on the line the way a doctor or hospital does, the cost of a failed innovation project can be significant, both in terms of sunk cost and missed opportunity.

The solution is to completely rethink the way that companies have traditionally handled innovation.

Upgrading your innovation strategy

Responding to a major change like the 21st Century Cures Act is a classic example of the need for a workable innovation strategy. In our work within the healthcare industry as well as the larger technology space, the team at Arcweb has found that the key to a successful innovation strategy is to adopt a standardized, measurable, repeatable innovation strategy.

One of the most common mistakes made by organizations beginning innovation initiatives is over-committing to a single idea. It’s easy to see why: given the difficulty of establishing buy-in, allocating resources, and getting an innovation project off the ground, a “one and done” mindset is an appealing idea.

But before deciding to double down on a single idea, remember the 20% success rate of innovation projects: there’s a very good chance that your initial attempt won’t pan out.

The solution, then, is to establish an “innovation pipeline”: multiple projects, features, and initiatives, each of which is given only enough resources to validate the basic idea and determine whether it has legs.

Looking to develop a patient data-driven feature? Rather than rushing to market with your best idea, launch several possible features as small pilots, each with a limited audience and minimal features – then measure the reaction, and see which opportunity moved the needle. If one of these limited projects is succeeding, double down on it. If it’s not panning out, reallocate the resources to one of the successes.

The other half of the equation, of course, is determining what “success” means for each project. More revenue? Better customer satisfaction? Press coverage? The desired outcome will be different for each company, or even each project—but if your innovation isn’t measurable, it will be impossible to determine if it succeeded.

Whether it’s COVID-19, a new regulatory regime, or other industry-redefining events, the worlds of business and technology have always changed rapidly, and there’s every indication that they will continue to do so. Learning how to innovate effectively, measurably, and within a standardized strategy represents the difference between successful adaptation and failure.

After all, innovation is a tool. And a tool is only as good as our ability to use it.