Jess Roberts: I’ve found that empathy has been kind of unintentionally co-opted to make us not have to truly hear others’ experiences.
Erika Grotto: Design thinking for a better future in healthcare, today on HFMA’s Voices in Healthcare Finance podcast, sponsored by Red Dot.
Hello, and welcome to the podcast. I’m your host, Erika Grotto. Today, we’re talking about design thinking with Jess Roberts from the University of Minnesota. But first, let’s hear from our Beyond the News team. Here’s HFMA senior editor Nick Hut and HFMA policy director Shawn Stack with the latest.
Hut: Hey, folks. Shawn and I today are discussing a topic of great financial consequence to hospitals, and that’s the 340B drug pricing program. There’s increasing concern that circumstances of the pandemic are going to leave a fair number of hospitals suddenly ineligible for the program, and that could in some cases cost them millions of dollars in savings on drug costs. Of course, for anyone who doesn’t know, 340B offers eligible hospitals substantial savings on outpatient drug costs by requiring manufacturers to provide discounts on the price in order to participate in Medicaid. And Shawn, I know you’ve been having conversations with hospitals about this issue. What are you hearing?
Stack: Yeah, Nick, yeah, folks are very concerned as they’re preparing for their Medicare fiscal year cost reports that are due at the end of May this year. And they’re looking at, you know, the eligibility criteria challenges due to case mix shifts and longer hospital stays accompanied by Medicaid patients deferring care during the public health emergency. So they’re seeing the numbers and the formulas for the 340B program that HRSA monitors to be not coming in if they’re eligible. So the fear is there that a lot of hospitals are going to be stripped of that eligibility for that 340B program, which would be very detrimental to communities.
Hut: No doubt, and to that point, I attended a policy briefing held by the American Hospital Association, and one of the participating health system leaders was from Ascension. He described how a couple of their hospitals are going to be left ineligible for 340B because, like you said, of the pandemic’s effect on eligibility criteria. And in the case of one of those hospitals, it’s going to cost them more than $30 million relative to what they saved on drug costs in this past fiscal year through 340B and now won’t get to save in this coming fiscal year. So what’s going on with drug manufacturers? They’re also creating an issue for hospitals.
Stack: Yeah, so AHA and HFMA have been monitoring a lot of issues, or I should say some issues, with certain drug manufacturers not providing discounts to 340B entities under the healthcare umbrella, and this is, of course, cutting down on the savings these hospitals have been budgeting for years. And keep in mind that when we’re talking about savings under the 340B program, that’s where hospitals are able to roll out a lot of community benefits to the folks in their community surrounding the hospital, which is, you know, charitable pharmacies, medication programs, folks who need them, dental care clinics. The money goes in a lot of small towns and rural settings, the money goes to fund ambulance services in those rural communities. So this could be pretty impactful on communities if many of these hospitals fall out of that 340B eligibility this next year. And yeah, some of the drug manufacturers are not making it any easier on those entities.
Hut: Yeah, they’re really leaving hospitals in a jam in a lot of cases. So what can be done? The American Hospital Association says CMS could use waiver authority to freeze that formula, Shawn, that you were referring to, and lock it in for all hospitals at pre-pandemic levels. There’s pending legislation that would pretty much do the same thing. What are you seeing, and what do you anticipate might happen at the policy level?
Stack: I mean, I think that D.C. is hearing folks really explain what kind of impact this is going to have on communities in the dire times that we’re in. So I think that folks need to write into their legislators to echo the importance of 340B and the program and the impacts that it has on their communities. But we’ll wait and see. I’m hopeful that the feds will issue a waiver to lock in those pre-pandemic qualifiers for hospitals or for 340B entities. But we’ll have to wait and see where this goes.
Hut: Yes, indeed. And if something’s going to happen on the legislative front, that would probably be by mid-March when the appropriations bill for the remainder of FY22 is supposed to get passed. So maybe something can get done here, either on the regulatory side or in Congress in the not-too-distant future. So many thanks, Shawn, and as always, everybody, you can read our coverage of this and other healthcare finance topics at hfma.org/news.
Grotto: Design thinking is a process that’s gotten a lot of attention the last few years, and according to my guest today, it can be a useful tool in healthcare. Jess Roberts leads the Culture of Health by Design initiative at the University of Minnesota and teaches in the university’s school of public health. If you’re like me and are coming into this interview with a just a little knowledge or a passing familiarity with design thinking, Roberts has provided some additional resources that I’ve linked in the show notes for you to check out. For now, I hope you find this conversation intriguing. I know I did.
For somebody who’s listening who’s never heard of design thinking, doesn’t know anything about it, what is it, and what does it have to do with healthcare?
Roberts: Sure, so design thinking, or human-centered design, as it’s often referred to as well—they’re oftentimes used interchangeably—is really about placing human experience at the center of the design process. And the design of services, tools, technology, etc. Products. And it’s about following a design rigor so the process learned by those such as myself that are trained in the design fields to approach some of these problems in a bit more iterative and hopefully more creative fashion. I would say the key ways that it’s distinctive from other approaches is, again, that sort of focus on humanizing the issues, so the issues that are facing patients and the staff. It’s about grounding the work in that end user’s lived experiences as well as their hopes, values, fears. Oftentimes, it will be referred to as sort of that outside-in approach, so instead of coming up with some really great—or what you feel to be great—ideas and then going to sort of test those things, this is about uncovering opportunities for innovation based on the realities of your end users. The second piece that I also mentioned in the design process is that it’s an iterative way of working, so it allows you to safely and efficiently learn your way forward by taking really small, safe steps forward without overinvesting in inaccurate or incomplete assumptions. So this is a—there’s a key distinction here. In design, we’ll often talk about prototyping, and that’s different from—I think a lot of health systems are used to things like piloting, where prototyping is really about starting something really small. It might be just testing something or trying something with two patients, for example, rather than launching a full-on pilot for several months to learn something. And it’s different in that in the prototyping process, the outcome that you’re looking for is to learn something, something you can incorporate into that next iteration, whereas piloting can be a bit more about, was our previous assumptions right or wrong, so let’s test whether or not this works. And then finally, I think another key distinction is, design is really about asking fundamentally different questions to help really reframe some of those persistent challenges. In fact, I argue that design done well is probably as much, if not more, about the cautions or the problem as it is about the solution because we tend to sort of default to the same problems and get frustrated when we don’t come to a successful solution. And a lot of times, that’s just because we’re not framing the right problem or the right aspect of a particular challenge, and almost always we’re failing to fully understand it from our end users’ perspectives.
Grotto: I like that you brought up the human experience. This definitely feels like a good time for that in healthcare. When you think about the struggles of patients, the struggles of our workforce right now, and workforce shortages, some of the things like we’re dealing with. And it feels like this is something that we have to do. It’s not just “let’s try this.” It’s something that is an imperative at this point. So you had sent me a paper to read that you had co-authored in preparation for this recording, and one of the things that jumped out at me, speaking of the human experience, was that empathy is a really important concept in design thinking. And it feels like that is already an important concept in healthcare in general. It’s a way that we’re maybe accustomed to thinking about things. But how can hospital and health system leaders make empathy a part of their organizational culture in a way that leads to progress, rather than sort of those one-on-one type of interactions?
Roberts: Yeah, I think this is the fundamental challenge, right? It’s, how do you take what can oftentimes be really powerful individual stories and experiences and actually turn it into some structural change? I’ve found that empathy has been kind of unintentionally co-opted to make us not have to truly hear others’ experiences. Instead, we will think—I hear it all the time in leadership circles that, well, we’re all patients. And while that’s technically true, it probably isn’t very reflective of the broader audience you’re looking to design for or you’re in service to, because you are in a different, oftentimes, financial circumstance. You obviously have a very different understanding of how the healthcare system works than the general public. So it occurred to me several years ago that really what we need is a level of humility. So instead of projecting our own experiences or perspectives on an abstract individual or population, we really need to recognize that we can’t really know what we don’t know. So those things that are outside of our own experiences. And no matter how passionate or invested we get in those things, if we can just leave it at work, if it’s part of our work life, we can’t understand it in—or the urgency around it in—the same way that someone that goes to bed every night living it. And so being really focused on, when we’re talking about empathy and humility, of really starting to understand experiences that, you know, maybe you haven’t captured in the past. So an example of this might be, if you’re going about looking at more effective ways to increase colorectal screening or some other cancer screening, it is important to talk to people who might be cancer survivors, but we tend to stop there. And the real value is actually going to come from people who are not thinking about cancer, whose lives haven’t been altered by cancer drastically at that point of diagnosis, for the rest of their life. We want to actually engage folks where getting a colonoscopy is number 126 on their list of to-dos, right, because they’re the folks that you really need to try to connect with, and by focusing on the middle of the bell curve we can kind of miss those voices or those perspectives that might offer insight. So we really want to be intentional about diversity when we’re talking about empathy and engaging a set of perspectives and values. Not just, again, because it’s a good idea, but because that’s actually foundational to creativity and innovation, differences of foundation to those things.
Grotto: You answered this a little bit, but I’m curious what you’re going to say about this. You talked at the beginning about prototyping versus piloting and not focusing on the faceless patient who is an amalgam of market data, but on a real person. But I’m curious, first of all, if you’re prototyping with just a couple of people, what can that actually tell you? And how do you identify who it is you want to talk to, because if you’re talking to the wrong people, you might not be getting the right answers that you need.
Roberts: Yeah, this is a—this relates back to the need for that iterative process, because again, the idea isn’t that you’re testing whether or not you have a good idea or the right solution to a problem. It’s to learn something. And if your objective is to learn something, you can learn something pretty quickly. So an example of this is, with a health system, we were looking at a different way to reframe the intake process. So instead of just asking the standard questions of, why are you here, what would you like to be addressed today, we asked two questions: What brings you joy, and what are you most fearful of. And in that process, we prototyped it with one clinician and about four different patients that they had in the morning. And through that process, we learned, number one, people are willing to share some of those things to different degrees. Number two, the system doesn’t know what to do with that information. So we sat down with patients after they saw their clinician and would ask them, well, why does this bring you joy. And one individual, it was being home with my dogs. And the dogs were important because they were there when her husband passed away a couple of years ago, but recently, one of her pets, one of her dogs, passed away, and she’s been really struggling. And then at the end of that conversation actually said, actually, can you ask my clinician to come back in because I meant to talk to him about my depression medication. So she was willing to share something really insightful with perfect strangers that she didn’t in the traditional clinic visit with the clinician she had a relationship with for 20 years. So that insight—we didn’t design a whole system around that, but it was an insight to really think about, well, how do we ensure that we can actually take this information and directly tie it to some care plan itself.
Grotto: So it sounds like—the way I asked the original question is, how do you make it a part of your culture rather than one-on-one interactions, but we are talking about the one-on-one interactions. This is where we’re starting and developing from there. That’s a really interesting way to think about it, and I think it’s something that might not feel natural to a lot of people who are working in healthcare and are kind of used to doing things the way they’ve been doing them.
There’s so much more that I would love to discuss with you, but we are, sadly, out of time. But I really appreciate you joining me today. I hope that this conversation will get some people thinking about things in a little bit different way. So Jess Roberts, thank you so much for joining me today.
Roberts: Thanks for having me.
Grotto: We’re going to take a moment now to welcome our sponsor. Hello again, Red Dot CEO Michael Bumann.
Michael Bumann: Hello, Erika.
Grotto: So, I’ve been looking forward to doing this particular segment. I know you really like talking about doing good, and you’ve said to me on more than one occasion that you can do the right thing and make money. And today we’re going to talk about doing good with the money you make, which is a very cool thing. So tell me about your experiences there.
Bumann: Yeah, this is actually the follow-on to it. So yes, we can do good, yes, we can make money, but then what do you do with that money that you’ve made? And to help kind of frame that, you know, for a larger system working with our platform, they can see somewhere between $10 and $25 million in bottom-line revenue that first year, a smaller system between $5 and $10 million. So it’s enough to create—and this is what we’ve seen—they take that and they create a budget for new programs. A couple that jump out is, one system had a high number of what we call “frequent flyers” on their EMS ground transport system. So they went ahead and took the money that we provided and created a paramedic house call program, where a paramedic would go out in a vehicle and deal with these people in their home and alleviate a high number of really unnecessary 911 transports. Another one—and this was a larger system—they took the funds and they created a budget to create what they referred to as a “startup incubator” within their own system to partner with both entrepreneurs that they grew sort of in house and partners that are entrepreneurs they partnered within their community. And so, you know, again, the capital or revenue is significant enough that you can do really some meaningful things with it, and we always enjoy seeing what our funding will do and where they get used in the community. So yeah, that’s a super exciting part of what our platform can provide.
Grotto: I love hearing about stories like that, because it really illustrates how what you do can create a ripple effect of good things, which is really cool. So thank you once again for joining me today.
Bumann: Always a pleasure.
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Voices in Healthcare Finance is produced by the Healthcare Financial Management Association and written and hosted by me, Erika Grotto. Sound editing is by Linda Chandler. Brad Dennison is our director of content strategy. Our president and CEO is Joe Fifer. Don’t forget to sign up for our Beyond the News webinar. You can sign up at hfma.org. And if you want to get in touch with our team directly, please reach out. You can email us at email@example.com.