Rae Woods: From Advisory Board, we're bringing you a Radio Advisory. My name is Rachel Woods. You can call me Rae. I think it's safe to say that 2020 is a year we will never forget. It's a year that tested everyone around the world, all of us, and certainly all of you. So in this episode, I want to reflect on some of the key trends that have transformed our industry this year, and offer our take on what to watch for in 2021. To do that, I've brought two folks to the pod. There's Christopher Kerns, the Head of Executive Insights for Advisory Board, who you know and love. And I've also added Yulan Egan, one of our strategy experts. Hey, Christopher. Hey Yulan. Yulan Egan: Hi. Thanks for having us. Christopher Kerns: Howdie. Rae Woods: Yulan, this is your first time, Christopher, this is like your millionth. What advice do you have for Yulan, before she starts this podcast recording? Christopher Kerns: Don't think too much before you talk. It sounds weird. Yulan Egan: Yeah. I don't know if you'd given me that advice in any other context, but I'll take it. Christopher Kerns: I really wouldn't. Rae Woods: I want to start off by taking us back to our state of mind this time last year, so December 2019. I'm curious, what was maybe the one big thing you thought that we would be talking about in 2020? Christopher, let's start with you. Christopher Kerns: Well, I guess this time last year, I was thinking that this time this year, we would either be talking about a whole lot of more of the same, or we would be talking about Medicare for all, or a public option or some other vast expansion of the public health care financing state. And that's not really the conversation we're having right now. We still might, but we're not having it right now. Rae Woods: Yeah. Yulan, what would you have predicted we would have been talking about this time last year? Yulan Egan: I would have thought that we would be talking a lot more about the big disruptors within the healthcare industry. So we were thinking about doing research, for example, on artificial intelligence, maybe looking at some of the big tech firms. And obviously we've had a lot of conversation about virtual care, but it wasn't the conversation I thought we would be having. And I think big tech hasn't played quite as big a role in pandemic response as we maybe would have expected at the outset. Christopher Kerns: I also would say that at the beginning of the year, we were much more focused on those far reaching disruptions around artificial intelligence. I don't think that many of us would have predicted what a disruptive and important force tele-health and digital health has been across 2020. Rae Woods: And you're both circling around the most disruptive event that none of us would have predicted that would happen this year, which is obviously the pandemic. We did point out in an episode, we did with our colleague Dave Willis, that even though so much has changed this year, the good news is there's still a lot of trends that haven't gone away with the onset of COVID-19. I think the shakeup is more in how leaders need to prioritize and maybe even more importantly, what they need to deprioritize. So that's where I want to go next. Let's start by focusing on providers, health systems and physician groups. When it comes to 2021, what do you think is the first priority providers are going to have to get right? Yulan Egan: The big one that jumps out to me is workforce. I think that's the one that I hear about in every single conversation that I have these days. And there's both the immediate priority of dealing with shortages in the workforce, but then I also think longer term initiatives around burnout and how to retain staff in this environment. Rae Woods: I'm going to come back to workforce in a moment, but Christopher, what do you think are some of the big challenges that providers are going to need to tackle at the start of the year? Christopher Kerns: We know at the beginning of 2020, we had predicted that the physician market was going to be in serious flux, that there had been a number of different disruptors coming into the market. There had been some action among private equity, among non-traditional players, among the health plans to attract physicians to different in kind care models. And I think that the pandemic has only accelerated a lot of those trends. So going forward for hospitals and health systems, especially those that employ a lot of physicians, the nature of how they engage them, how they retain them is going to be extraordinarily important to their future. Rae Woods: This is really interesting because you're circling around the same type of topic, right? You're both talking about the workforce and physicians in particular, but I think Yulan, you're talking about a little bit more of protecting them in their moment of beyond burnout, right, their moment of trauma. And Christopher, you're saying that because there are winners and losers in the physician landscape, there might be a shakeup yet to come. Christopher Kerns: Yes. I would agree with that. Rae Woods: How should providers prepare for that? Yulan Egan: What it means to become, or to be, I should say, an employer of choice is probably shifting pretty quickly. There's some basic things probably to consider around flexibility, but I've been having some conversations with providers who are thinking about, for example, how do they offer physicians different paths in terms of what they're looking for from work-life balance? Should some physicians have an option to focus more on virtual care versus others who want to focus more on in-person care? So we're starting to hear some more creative solutions out there I think from at least some providers in the market. Christopher Kerns: And there's a lot of pressure not just to protect the compensation or increase the compensation of physicians, in particular primary care physicians. But I also think that there's a lot of pressure right now to improve the quality of the practice of medicine, make the practice of medicine more enjoyable. Take away a lot of the administrative tasks that take up so much of physician time, desktop medicine and whatnot. And I think a lot of the disruptors that would attract new physicians away are really focusing on those things. Rae Woods: And this makes me think about a question that I have for 2021, which is, are we actually going to see a shakeup in the workforce itself because there has been a spotlight on what physicians and nurses have had to do to combat this pandemic? I'm actually just curious to hear from you. Do you think that there are going to be more or fewer clinicians joining the workforce in the future? Christopher Kerns: Well, if the number of people applying to medical school is any indication, I think that we are going to be pretty okay. In terms of recruiting new physicians, will it be sufficient given the number of retirements? I don't know if I can make a prediction on that just yet, but the pandemic certainly hasn't discouraged young people from wanting to practice medicine, if anything, it has given them a renewed sense of purpose in that field. I would think. Yulan Egan: Well, and I think regardless there's going to be a little bit of a time gap that we have to grapple with, right? Because we're already seeing some of the early retirements come through. Obviously it's going to be a number of years before we start to feel the impact of the increase in med school applications. So I think dealing with that gap is something that we're going to have to figure out strategies for, for the foreseeable future at this point. Christopher Kerns: And let's remember that a lot of providers had to employ a lot of these strategies we've been talking about for a long time. Extending the physician workforce via advanced practitioners and using technology, telehealth, digital health, AI as necessary. All of those strategies got a shot in the arm this year. Rae Woods: To Yulan's point from the beginning. Yeah. Before we leave the provider landscape, I'm a little bit surprised that neither of you mentioned tracking what's going to be happening with volumes at the start of the year. This has been, I think one of the big shakeups of 2020, that to me is a little bit unclear where it's going next. What are your predictions when it comes to volumes? Christopher Kerns: A lot of our analysis suggests that we could see a new normal that is lower than the old normal, meaning that we could see volumes in certain specialties depressed by 5%, maybe even 10% as patients have learned new habits and new patterns of care. So it could take us quite a while to get back to our 2019 levels of volume, in particular specialties I think. Rae Woods: And that's on top of volumes being low already in 2020. So if we're talking about predictions is more money, more help, more support going to be coming to these providers whose volumes continue to be low? Yulan Egan: Yeah. So there are ongoing negotiations underway in Congress around just that issue right now. The most recent proposals we've seen, which have been bipartisan in nature have included some amount of additional funding for providers. So I think it's likely that we could see some additional funding early next year, but it's not something that we can bet on into perpetuity. At some point that funding will wind down. We're already seeing it become a contentious issue today. Christopher Kerns: And the amount of funding is obviously going to be highly dependent on who controls the Senate, full stop. Rae Woods: Which is another, maybe I'm not going to ask you to predict on the outcome of the Georgia election. Christopher Kerns: Please don't. Rae Woods: We'll just talk about it when we have an answer here on Radio Advisory. Christopher Kerns: That sounds wise. Rae Woods: So on the whole volumes are still going to be lower next year, but I can't imagine that that's going to be true for every specialty. Is there anyone that's actually pretty healthy, maybe even better off in 2020? Christopher Kerns: We think that outpatient surgeries are probably going to stay pretty healthy mostly because of the continued site of care shifts that we see coming from reimbursement. But also the simple fact that a lot of patients would prefer an outpatient setting given their fears around COVID-19. Yulan Egan: I do tend to agree though that overall I think volumes will continue to be depressed through next year. So the other thing that I'll be watching closely is whether this tips more hospitals and health systems toward consolidation, something that we were already watching this year, but I think has the potential to really accelerate next year. Rae Woods: And I'm guessing we're tracking that same potential for more consolidation on the physician group side as well? Yulan Egan: Definitely. I think one of the surprises this year has been that we haven't seen more consolidation in the physician space. There are a lot of really dire projections early on in the pandemic that we would see practices sell or shut their doors. Most of them have been able to scrape by okay but I would anticipate that we might be approaching a tipping point there. Rae Woods: Yeah. I think one of the big questions about these predictions in general is just how long the crisis continues. We know that vaccines are starting to be administered, but the big shakeup here is just knowing how long we are going to be dealing with COVID-19. Rae Woods: So let's turn to trends beyond just providers, outside of the physician health system landscape, do you have one big prediction that you're tracking for 2021? Yulan Egan: I mean, I think we're definitely watching what will happen in the technology space and with virtual care in particular. Rae Woods: What about virtual care? Because that's a pretty big area. What about virtual care do you think is going to be the hot topic in 2021? Yulan Egan: I think everyone is hoping for some answers on the reimbursement side, both in terms of what the federal government is going to do as well as what we might see from the private payers. I think that's the big open questions that a lot of our provider members have been asking. Rae Woods: I'm going to force you to make a prediction here because everybody is going to want me to, do we see telehealth reimbursement that we've seen through the crisis staying long-term? Yulan Egan: Yes and no. I think we will continue to see expanded coverage for telehealth services, I don't think we're going to have reimbursement parody. I don't think we will continue to see payment at the same level as it is for in-person care. Rae Woods: Yeah, I totally agree. I'm pretty bullish on that to say don't get used to the payments that you've gotten right now. Christopher Kerns: I think there's going to be a big push for home health. We're going to see more reimbursement options probably through Medicare advantage for reimbursing a number of different home health services as more and more families want to keep their loved ones at home, to the extent that it is possible. Will it be possible to the extent that a lot of families would like? Probably not, but I think that home health has a huge opportunity for major expansion in 2021. Rae Woods: Yeah. I think one of the things I did not expect us to be having this big of a conversation about in 2020 was the conversation around post-acute care, was the conversation around nursing homes, which I think we can all agree. It was probably one of the biggest tragedies of living through this pandemic. But if we're going to be able to push care into the home, that's also going to require technology, right? Christopher Kerns: Absolutely. It will require a great deal of remote monitoring. It will require a great deal of artificial intelligence, frankly, to be able to alert providers when an emergency is likely to happen. Rae Woods: Let's unpack the artificial intelligence piece of this. Yulan, this was something you thought you would be talking about this year anyways. But AI is a pretty significant part of digital disruption part of the technological landscape. Are there individual pieces of AI that you see being prioritized at the start of 2021? Help me understand what is futuristic versus what is reality for the new year? Yulan Egan: I think a lot of the past focus on AI has been more around administrative functions. And so I guess what I'd be keeping an eye out for at least in 2021 are AI solutions that are more clinical in nature. And that actually help, for example, maybe extend a physician's panel size so that they can see more patients. Something like that could be a game changer, if we're looking at even a temporary shortage on the physician side. Christopher Kerns: I think we'll also want to look at where are the applications focused in terms of patients. So are these going to be focused on relatively low acuity patients so that we can actually have patients processed a lot faster, for colds and flues and things like that? Or are we going to see it deployed more for chronic care management and more acute, more severely ill patients? I think we're likely to see it go in both directions, but by focusing on the more acutely ill patients, we're likely to see a much bigger bang for our buck on that, in my opinion. Rae Woods: Yeah. One of the big silver linings of this year has been just how much collaboration we saw across different parts of the healthcare industry. So it's not just trends among providers or everyone else, it's really these different parts of the industry coming together to face a common enemy. As we start to get a better handle on COVID-19, as the crisis eventually goes away, are you expecting to see this level of collaboration continue into the future? Yulan Egan: I hope we continue to see collaboration. I think before we can even begin to think about collaboration and partnership between different segments of the industry, we also have to look internally at our own organizations. A lot of health systems really use this as an opportunity to accelerate a lot of the integration and systemness ambitions that they have held for a long time. I think there's a real risk though of backsliding. Rae Woods: I agree that we need to get better at working together within organizations, but I do want to push us to thinking across industries. Maybe it's not another pandemic, but what's the next thing that you think is going to happen in the healthcare industry that would push us to really work together for a common name? Christopher Kerns: Well, collaboration and cooperation are at the heart of value based care. When it really comes down to it, we saw a lot of providers work together, share information, move patients to appropriate sites of care because it was absolutely necessary. What we got in 2020 was a real proof of concept for a lot of organizations that might have been on the fence on adopting risk-based payment or value based care or incentives that create a greater opportunity for providers to work together, to improve the quality and reduce the costs for all patients. I think that we have a real opportunity to be able to expand that in 2021 for organizations that really did see that proof of concept. Yulan Egan: Yeah, Christopher, I agree with that. I think value based care is going to be one of the big issues to watch next year. I am very curious to see how the Biden administration might evolve the value-based care landscape. That's something that we saw under the Trump administration. It's something you can do without congressional action. So one of the things that could be top of the health policy priority list for the incoming administration. Rae Woods: A value based care could be the next moment for collaboration across the industry. How do you actually suggest different players go about that? Christopher Kerns: I think there are three pillars and yes, there are always three pillars, but in this case, there really are three. The first is making sure that the physicians in your market, especially PCPs have the right incentives to direct patients toward lower cost, higher value site of care, that's number one. Number two, is making sure you have the right ambulatory footprint to handle all of the demand that you're going to see. So effectively embracing the site of care shifts in your marketplace. And third is right-sizing your inpatient footprint just because you're doing a lot more care in an ambulatory setting does not mean you won't need inpatient hospitals. It just means you need the right number of beds in any given marketplace. Those are the three things that have to be embraced by leaders. Rae Woods: And those all sound very provider focused. How about the rest of the industry? What do they need to focus on? Yulan Egan: Yeah, I was going to say from a collaboration perspective, I think tighter coordination between providers and plans will be really critical if we're going to see value based care take off more than it has already. I think historically, that's been a little bit of a sticking point, lack of agreement or lack of alignment between those two segments of the industry. Rae Woods: We started off our conversation talking about the things that we did not expect to be talking about this year. And I don't think I will be the first person to admit that I didn't expect this much of our industry to focus on things like racism or health equity. I am glad for the record that it has been such a big part of the healthcare conversation. So when it comes to 2021, do you expect this to continue? Christopher Kerns: I do. To this industry's credit, health equity and minimizing disparities and outcomes has actually been a priority for a few years now. It has been brought to light over the last several years. And I think this past year has really just shown a spotlight on it. So if there's one thing that really gives me a lot of hope on this issue, it is that it is likely to be maintained as an executive level priority into 2021 and beyond. Yulan Egan: I think we'll continue to see focus on the social determinants of health, but I also think that this becomes even more critical part of what it means to become an employer of choice. I know that a lot of our provider members and really members across all segments of the industry have been thinking very critically about their own workforces and how to address some of these issues internally, as well as externally. Rae Woods: And perhaps this is another example of a moment where the healthcare industry could come together to fight a big challenge. Right? I think about the role of technology and AI in reducing bias at the point of care. I think there's a lot that can be done here. Christopher Kerns: I also think that given the impact that focusing on a lot of these issues around social determinants of health can have in various communities, the health care industry has a real opportunity to lead on these issues and not just be an example of another organization or another industry that is following the trend. Rae Woods: Yulan, Christopher, I want to thank you so much for coming on our final Radio Advisory episode of 2020. I usually use this time to give our listeners a bit of an action item, right. Something that they should be focusing on right now. But since it's the end of the year and almost the start of a new one, I want to do something a little bit different. I'm going to ask you two questions this time. The first is a very classic advisory board question. As you're thinking about the new year, what is keeping you up at night? Yulan Egan: I'm happy to start. I think for me and this ties a little bit back to the volume conversation we were having early on, that's something that we didn't actually bring up was how all of the deferred care is going to impact health status down the line. I'm concerned for example, that people have been skipping their cancer diagnostics, and we might see a wave of new cancer cases in the future, whether that hits this year or further down the line, I don't know, but that's something that has me worried. Rae Woods: What about you, Christopher? Christopher Kerns: My big concerns are the financial sustainability of the industry right now. It's not just about the relief that we might be getting from Congress. It is, do they have the cash and the financial resources to make it through to the end of this pandemic? Because the reality is the vaccination regimen is going to take a long time. It's going to take quite a few months before we get to anything resembling herd immunity and maybe even longer than a few months. So making sure that the industry has the wherewithal and the resources to sustain itself is a big concern. I think they do, but it worries me. Rae Woods: I don't want to end on to sad or sour of a note. And I think that the holiday season, for many, even in these weird times is all about hope and joy. So when it comes to the future of healthcare in 2021 and beyond, what's giving you hope? Yulan Egan: The health care industry, I think often has a reputation for being very slow to change, very slow to embrace innovation. And I think one of the things we've learned this year is that when it's necessary, this industry can actually do very remarkable things, very quickly. So I'm hopeful that we can maintain some of that mentality heading into 2021, and that we continue to see innovation. Christopher Kerns: So many positive developments that we had been looking at over the last several years, got such an accelerant this year for terrible reasons, but I'm hopeful that we have made great leaps forward. Whether it comes to digital health, whether it comes to health equity, whether it comes to innovation around vaccine development, there have been huge amounts of innovation this year. And I'm hopeful that we'll be able to push those forward into 2021 and beyond. I think this industry has a pretty bright future, despite the worries that I just expressed. Rae Woods: Well, Yulan, Christopher, thanks for coming on Radio Advisory. And I will talk to you next year. Christopher Kerns: See you in 2021. Yulan Egan: Thank you. Happy holidays. Rae Woods: If you want to hear more of what our research team is hopeful about for 2021 and beyond, we've put together a couple of videos for the things we're tracking across innovation and partnership, and even just what it means to work from home in this new world. We've added a link to that in our show notes. Think of this as our holiday card from Advisory Board to all of you. Before we close out the show, I want to take a moment and thank everyone who makes this podcast possible. When I start off every recording, I say that we're bringing you a Radio Advisory. That's more than just me. We've got Joe Shrum who does all of our sound engineering and editing. Chris Phelps, our fearless leader and producer. Alice Lee, who does all of our marketing and make sure that our messages get out to you, our listeners. And there are so many more Ben Palmer, Andrea Hendrickson, Sarah Rindone, Dan Tayag. Thank you for all you do for Radio Advisory. We'll be back with more in the new year, but in the meantime, remember, we are here to help.