Jonathan Fanning, an author, entrepreneur and frequent speaker at HFMA Chapter and Region events, discusses how to overcome the barriers to creativity and innovation in healthcare.
Mentioned in this episode:
Erika Grotto: Overcoming barriers to innovation and creativity, today on HFMA’s Voices in Healthcare Finance podcast.
Hello, and welcome to the podcast. I’m your host, Erika Grotto. Today, we’re talking about something I think both excites and frustrates people: innovation and creativity. Jonathan Fanning is an author, entrepreneur and public speaker who talked with me about overcoming the barriers, which we all know are significant in healthcare. But before we get to that interview, let’s hear what’s happening in healthcare finance news. Here’s HFMA Senior Editor Nick Hut and HFMA Policy Director Shawn Stack.
Nick Hut: Hey, everybody. Periodically in this segment, we just take a look at the big picture in financial and operational trends that are manifesting in the hospital industry. For the most part these days it’s not a happy topic to discuss, but we’ll dive into it anyway. Health Affairs just recently published an essay by two leading health economists basically just looking at implications of ongoing trends for the industry. You can find that article in the show notes, but for the most part, they foresee a very difficult period ahead, especially for areas and markets that already have limited access to healthcare, such as rural regions. They could be looking at the loss of key service lines or even the closure of hospitals. So Shawn, we’ve talked several times about the underlying issues here—labor shortages, labor costs, supply costs, patient volumes that continue to be erratic and are vulnerable to economic trends such as a potential recession. But how much hope can we hold out, do you think, that the industry can emerge from the pandemic somewhat unscathed? Obviously, parts of it weren’t exactly thriving even before the pandemic.
Shawn Stack: Right, I think of community and rural hospitals were struggling of course before the pandemic. This is an environment that has extended almost to all healthcare facilities—not all, but I would say the vast majority of healthcare facilities we’re seeing and hearing from our executives are more stressed than ever, operating on razor-thin margins at best. Like you said, Nick, due to vastly increasing labor costs, not just in nursing but across the board lots of folks retiring during the public health emergency period and then having a hard time replacing those folks. And then keep in mind that just inflation, overall inflation in the U.S. period has really impacted interest rates, has really impacted real estate so a lot of hospitals and provider networks lease space for their hospital space, for their outpatient clinics and offices, and those contracts are up for renewal and they’re seeing really steep increases on leasing rates and rent. So it’s really forcing hospitals and hospital executives to sharpen their pencils and really take a closer look at what their strategic focus is going to be over the next two years, because we don’t see this going away, at least not for the next year as inflation continues to soar. There are some hard decisions to be made here, I agree.
Hut: Yeah, definitely, yeah, and thanks for that perspective. The thing is, you know, certain labor trends are moving slightly in the right direction. I know that Fitch reported that quit rates dropped by almost a percentage point to 2.3% during a nine-month period ending in August, but as far as the type of fundamental shift that is likely needed in order for more hospitals to attain the type of margins they envision for themselves, that doesn’t appear to be in the foreseeable future. There’s been a structural shift—and you touched on this—especially in the labor market, so hospitals may have to be prepared for significant shortages for a long time to come, and the required response in that scenario would be kind of a revamp of clinical operations and care delivery to require fewer human resources and similar changes to other aspects of an organization such as the revenue cycle. But there’s no set template for how to do any of that and how to pull it off without a hitch. You can look to other industries and maybe new entrants into the healthcare industry, but the hospital sector is a whole different ball of wax, to use a rather tired cliché. Shawn, is there anything you’d want to add either from your own observation or based on perspectives of HFMA members? I know you’re in touch with our membership base frequently.
Stack: Yeah, interesting that you bring up Fitch because we have Fitch coming in to speak with our executive councils later this week on Friday about the economic outlook on healthcare over the next six months to a year and talking to our executives, our CFOs in that group, about what’s going on in the market and what the expectations are there. So that is definitely something that our members are really wanting to focus on as we go to more virtual meetings to kind of control costs. Hospitals are even tightening the belt on their travel expenditures to just try to save money in any way they possibly can. And you know, you’re right. I think that many of these cutbacks and underpayments, if you will, for Medicare and Medicaid, as those rates tighten up as well—because keep in mind that the Medicare trust fund is also in trouble, so the feds are tightening appropriately wherever they feel they can tighten, and of course, that’s making our jobs even harder as healthcare providers, to operate under those even stricter payment structures, which aren’t even in many cases paying cost. But in those small, rural areas and those small community hospitals where they’ve been operating on a razor-thin margin for years, because most of their folks are older, sicker, and poorer than average, they’re even more dependent than ever on Medicare and Medicaid rates, and now that those are not keeping up with inflation, that’s a grim outlook for those community hospitals in those rural hospital settings, so we’re really focusing on getting them as much help as we possibly can.
Hut: These are trying times, and we’ll definitely be watching to see how it all shakes out. Thanks, everybody for listening. We’ll definitely be keeping you apprised of all of the latest happenings as these trends play out in upcoming months and beyond. Also, tomorrow is Election Day, and while there aren’t any huge repercussions, I wouldn’t think, based on the outcome of the House and Senate races for healthcare policy, it definitely bears watching, so we’ll be taking a close look at that and it might be fodder for discussion on a future segment. So thanks again, we’ll talk to you all soon.
Stack: Thanks, Nick.
Grotto: Jonathan Fanning is an author and public speaker whose name some of you might recognize. He’s delivered keynotes at several Chapter and Regional HFMA events. He talks a lot about how to overcome barriers to innovation and creativity. And in healthcare, especially right now, there are many, many barriers: finance issues, workforce issues, supply chain issues. Everyone listening could name others, I’m sure. But according to Fanning, some of the biggest barriers are the ones we impose upon ourselves.
We talk a lot about innovation and creativity in healthcare, and I think any of our members listening would say “Yes, we want to innovate. We want to move forward. We want to find better ways of doing things that we’re doing and find new things to do.” But there are barriers to that, and anybody listening is going to name a whole bunch of them. But tell me, in your view, what gets in the way of creativity and innovation in the workplace, and what fosters it?
Fanning: Those are two questions we could spend a couple weeks on right there. I love it though. Let me put it this way. My father-in-law retired. He retired a few years ago. And he told me he needed to retire because he needed to catch up on soccer because he’s a big soccer fan. He was born and raised in Europe, and he’s like, I’ve got to catch up on soccer. And I don’t encourage trying to do that because the soccer season never ends around the world. And you know, he starts getting me to watch some games, and I notice that a lot of the games end in a tie. So at the end of the game, they end up having to do penalty kicks to decide who wins. And in the world of soccer, here’s how it goes, and this is the creativity gap. This both fosters and gets in the way of. A soccer player, Cristiano Ronaldo. He lines up. He’s, I think, 12 yards, 36 feet away from the goalie when he lines up to kick the ball. Fifty-seven percent of the time, he kicks left, 41% of the time he kicks right. The goalie has less than a third of a second to get to where the ball will be. Less than a third. It’s about 3/10ths of a second because Ronaldo kicks it 80 miles an hour. Fifty-seven percent of the time, the goalie guesses left, 41% of the time they guess right. Now wait a minute, people say, Jonathan, you did the math wrong. No. No. Two percent of the time the goalie stays right in the middle because he knows that a lot of times these penalty kickers, they know he’s gonna guess, they know he’s gonna jump left or right so they kick it down the middle. Only 2 out of 100 does the goalie stay in the middle. Why? Why? See, Ronaldo could kick it down the middle and score 98% of the time because the goalie has evacuated. He doesn’t. He almost never kicks it down the middle. You know why? Because if he did and the goalie guessed correctly, the goalie would just stand there and it would be like slow motion. The goalie would just wait, smile, catch the ball, and roll it back onto the field and be thrilled that he just stopped the game-winning goal. Why doesn’t Ronaldo kick it down the middle? He doesn’t kick it down the middle for the same reason most of us have a massive gap between our creativity and our creative potential. If he went home after that, back to Portugal, and he lost the World Cup, he lost the European Cup, they wouldn’t let him back in the country. They’d be saying, “Ronaldo, what were you thinking? You’re one of the best in history, and you kicked it right at the goalie.” See, it would be a very creative approach to do that. Wouldn’t it? Look, the goalie’s abandoning the goal 98% of the time. Right down the middle will work, and almost all of us—I work with companies around the world, almost all of us have creative ideas all over the place. Creative ways to run meetings, to hire people, to hold people accountable, to engage people, to solve a financial problem or to solve a marketing or relationship problem. And a lot of us in the back of our head, we’re thinking, yeah, but if it doesn’t work out, the whole world is gonna be saying “What were you thinking?” What gets in the way almost always is us, either personally or culturally worried about “What were you thinking?” If I could start a person from one place, if they wanted to be more creative, if they wanted their world to be more creative, I would say start playing around with some of the questions that you pursue. Make them bigger or make them smaller. Shift them this way or shift them that way. With my entrepreneur camp, I ask the question—I started the camp 12 years ago, I’ve done it with about 1,000 kids around the country. And I ask the question, how can I in five days impact a kid’s life more than at least one year of their formal schooling does. And then eventually the question evolved. I played around with the question a lot. I said, every single little module that’s 30 minutes, 20 minutes, an hour. I want every single module to be something where it captivates them and it has the potential to just pick them up and give them a different view of the world, of what’s possible, helps them challenge some limit they’ve been making up for a long time. I work with a lot of big organizations that have some level of limitation. I spent some time in the military. My first TED talk was actually at a Navy base. The lieutenant that booked me to speak there, she had creative a pocket of excellence in her part of the military. The military, please, trust me, they have plenty of things they could point at to limitations and bureaucracies and all the rules and regs and financial limitations and staffing, and she stole from I think it’s Mike Abrashoff who wrote the book It’s Your Ship. She would tell her team all the time, and here’s a brilliant question to ask people. Pretend it’s your ship. What are some of the things that you would change, and how would you change them? And then she’d say, pretend it’s your ship, but you’ve got some serious financial challenges. You’ve got to make some changes and you have no money to do it. Alright, pretend it’s your ship, and you don’t have any resource. You don’t have people to do this change, so it’s gotta be a change that can be done without any additional resources. She would shift that question around constantly saying look, let’s assume there are limits, because there are, of course. But it’s your ship. If it’s your ship, what do you do? What gets in the way? Almost always, it’s me and you.
Grotto: You’ve talked about some of the barriers and the challenges being mental and within ourselves, and some of them are cultural, which maybe means we’re subject to the barriers that are within somebody else that they’re telling us, “No, we can’t do it that way,” or the classic, “No, this is how we’ve always done it and we need to keep on doing that,” which is the worst. What’s the best way, if you are self-imposing limits and barriers, some of it is just a mental game, right? Overcoming them. But what about when you have these things imposed on you? How do you get past those? How do you creatively get past those? Is it the same kind of thing?
Fanning: I would say yes to a degree, but not completely. If you want to make progress in any area of your life, there’s always a momentum game that has to be won. Let’s say you want to run a marathon and you’re not ready to run a marathon yet. That’s probably true for everyone. I have a friend, he wants to climb Mount Shasta out on the West Coast, and it’s one of those, you leave at 2 in the morning and you reach the top at noon. Can you imagine starting at 2 in the morning first of all, and then you’re hiking every single step uphill for the next 10 hours?
Grotto: That does not sound like something I would enjoy.
Fanning: Yeah. Exactly. He says the other option is you don’t make it in one day and you sleep on the mountain, so you end up carrying food and shelter for an overnight. So my thought is, I’m not doing it, or if I do it, I’m doing it on one day. We’re not doing that tomorrow. There’s no chance we’re doing that tomorrow, so we’d have to do some sort of a training process, right? And the training process, you have to win the momentum game. And the momentum game starts with, go outside and do a walk. And do that every day for a week. And then go outside and do a walk and incorporate some hills into your walk, and do that every day for a few days or a few weeks or longer. And in the creative world, it’s exactly the same thing. Most of the time, the momentum game in your head, it’s, I need to get through not just thinking creatively but doing something that takes some creativity.
Grotto: There are a couple of things that you mentioned that I hear over and over in different ways. One is this idea that you’re not going to solve your problem today. It takes time and asking more questions and more questions and more questions. That comes up over and over, and what I hear a lot of when I talk with members and the organizations that we work with is, what people want to do is sit down and say, “OK, this software isn’t working” or whatever. “It’s not doing what we want it to do. We need to buy new software. Here’s one.” Without thinking about, is this going to fix what we need to be fixed, is it a wise expenditure of the funds that we do have to solve this problem, or is there something else that we can do? You can’t fix things right away. You have to ask more questions. You have to figure out what the problem really is before you try to solve the problem that you think you have.
Fanning: Yeah, and I constantly challenge people and myself to ask some questions that are small progress but sometimes ask a question that’s massive progress. You know like, to go back to a sports analogy, every now and then in football, you throw it deep. You’re just like, you know what, we’re not trying to get three yards this down. We’re trying to get the whole length of the field. You know, like, I have my kids in my entrepreneur camp ask the question of, who’s one contact that, wow, if you made that contact, your business idea goes through the roof? Who’s one person like that? And we do an exercise with them. I call it kind of a building courage bootcamp where I’m like, think of five things like that that would wow, they would change your world if you were able to do them, but they take some guts to do them. And then, you know, we’re going to pick one and we’re going to do it. And it’s funny because they don’t have a problem coming up with the things. If I were able to get this connection or if I were able to do this, like, OK, go on LinkedIn and let’s send a message to that person, and they look at me like, oh, well, yeah, mmm, I don’t know. I don’t know. So sometimes it’s one, sometimes it’s the other.
Grotto: I can’t help thinking about a cheerleading coach that I know who, his program is community service first, cheerleading second, and I spent not to long ago, I spent about two hours talking to him, and he talked about cheerleading for about 30 seconds. But they go all over the country doing community service things, and the girls in this cheerleading group are the ones who drive everything they do. He’s just kind of the adult who makes the calls and gets the bus and all of the things that they need to do. And a number of years ago, the girls came to him. They’re in New Jersey. And they said, “We want to visit all of the 9/11 sites in a day on September 11.” And he said, “Do you know how far away those things are? That’s impossible.” But they have a saying in their cheerleading group, when we hear that it’s impossible, we do it. So for 10 years in a row, they got a bus, they left New Jersey at midnight, they went to New York, they went around to Pennsylvania, they went to D.C., and they went home.
Fanning: I love that.
Grotto: Ten years in a row.
Fanning: I love that. I absolutely love that. It reminds me of, there’s a question I spend a lot of time with that’s very related to this, and it’s, how can I make this more meaningful? I was in a car accident 20 years ago when I was four years, old, right? But it was western Pennsylvania, Interstate 80, warm day, cold night, black ice, and the car started sliding and two tractor trailers obliterated my car. And my older brother, his skull was shattered in the accident, and they had to helicopter him to Pittsburgh to work on his brain. It’s one of those thing that, we get wakeup calls, don’t we? We all get wakeup calls. I call them frying pan moments where the world hits you with a frying pan and you go ow! And then sometimes you go back for more or the same frying pan hits you two years later. But one of the wakeup calls I got from that is that we thanked two surgeons and two nurses for saving my brother’s life. And it took me, I don’t know how long before I realized that it was more than two surgeons and two nurses. You know, it was the helicopter crew that airlifted him. Oh, it was the maintenance team that made sure that helicopter crew was ready to go. It was the software people and the logistics people behind the hospital in Clarion, Pennsylvania and the hospital in Pittsburgh. And it was the admin, and it was the finance. And I forgot to thank them. So one thing I would absolutely say to the people that do what you do, I could be better at saying thank you and maybe so could you. You know. You want a game changer? Every Friday morning, write down one person you could thank for the impact they had on your life. Game changer, and it’s a ripple effect you can’t measure.
Grotto: Well, this is definitely, I think, a good note to end on. Jonathan Fanning, thank you so much for joining me today. This has been great, and I hope that everybody listening, if they’re listening when we first come out on a Monday morning, you’re inspired for your week or if you’re listening later, you’re inspired for whatever is to come. But thank you so much for joining me.
Fanning: Sounds good. Thank you so much, Erika, and thanks to all of you for serving and leading. I appreciate it.
Grotto: Voices in Healthcare Finance is a production of the Healthcare Financial Management Association and written and hosted by me, Erika Grotto. Sound editing is by Linda Chandler. Brad Dennison is the director of content strategy. Our president and CEO is Joe Fifer. If you like content like today’s podcast and want more of it, consider subscribing to our Leadership newsletter. It comes out on the third Tuesday of the month, and it’s full of great insights for current and future leaders in healthcare. You can sign up for it by signing in at hfma.org and clicking My Communication Preferences. And if you want to communicate with our team, reach out. Our email address is [email protected]
If you want to climb Mount Shasta, see how a short walk goes first
The concept of innovation is one that gets a great deal of attention in healthcare, but barriers are cited frequently by organizations plagued with financial challenges, workforce shortages, supply chain issues and other obstacles. According to Jonathan Fanning, an author and frequent speaker at HFMA Chapter and Region events, some of the biggest barriers are the ones people place upon themselves.
“What were you thinking?”
On a recent episode of HFMA’s “Voices in Healthcare Finance” podcast, he gave the example of Portuguese soccer player Cristiano Ronaldo. When making a penalty kick, Ronaldo almost always kicks left or right, even though the goalie will almost always guess he will kick left or right.
“Ronaldo could kick it down the middle and score 98% of the time because the goalie has evacuated. He doesn’t,” Fanning said. “If he [kicked it down the middle] and the goalie guessed correctly, the goalie would just stand there, and it would be like slow motion.”
The idea of losing a match in that way is enough to stop a player from taking the chance, Fanning said. The idea of a misstep also can discourage people in healthcare to take risks.
“If [Ronaldo] went home after that, back to Portugal, and he lost the World Cup, he lost the European Cup, they wouldn’t let him back in the country. They’d be saying, ‘Ronaldo, what were you thinking?’” he said. “And a lot of us in the back of our head, we’re thinking, yeah, but if [this idea] doesn’t work out, the whole world is [going to] be saying: “What were you thinking?”
Fanning also said people tend to focus on the difficulty of a big goal without thinking about small ones.
“I have a friend who wants to climb Mount Shasta on the West Coast,” he said. “You leave at two in the morning and you reach the top at noon. We’re not doing that tomorrow. There’s no chance we’re doing that tomorrow, so we’d have to do some sort of a training process. You have to win the momentum game.”
It also can be worthwhile to know when to go for the big goal, Fanning said.
“Every now and then in football, you throw it deep,” he said. “So sometimes, it’s one, sometimes it’s the other.”