The COVID-19 pandemic was an accelerator of shifting consumer preferences and care-delivery innovation. See how, by embracing a digital mindset, health systems can transform their relationship with consumers.
The COVID-19 pandemic accelerated the convergence of several trends in the health care industry, particularly consumers prioritizing convenience and access to care. Leading health systems view digital transformation as a way to become more consumer-friendly while simultaneously changing their operations, culture, and use of technology.
The Deloitte Center for Health Solutions collaborated with the Scottsdale Institute to better understand how health systems are using digital to transform health care. To understand the digital transformation journey of health systems, we engaged Scottsdale Institute members in multipronged research: We conducted a survey of technology executives of 25 health systems, interviewed five health system technology leaders, and facilitated a moderated panel discussion of technology leaders from three health systems. We found that:
Our recent health care consumer survey findings show that consumers are increasingly exercising agency, engagement, and control over most decisions about their health and well-being.1 To meet consumers where they are, health systems should consider accelerating their digital transformation efforts by establishing a governance model, creating a digital culture, recruiting and retaining the right talent, and measuring the success of their initiatives.
Over the past two decades, many hospitals and health systems adopted digital technologies in their various functional areas. In many cases, however, they took a piecemeal approach to numerous initiatives—from installing electronic health record (EHR) systems to building apps to trying disruptive technologies such as artificial intelligence (AI)—while remaining largely focused on the same business and customer models.2
The COVID-19 pandemic significantly altered this status quo for the health care industry. Virtual health and care delivered in the home became the model of not only necessity but also preference. But this change was not as sudden as it might look. The pandemic was an accelerator of several trends, including shifting consumer preferences, rapidly evolving technologies, newer talent models, and clinical innovation. In the face of these trends, as hospitals and health systems work toward adapting their businesses, a well-defined approach toward digital technologies will likely be at the core of this transformation strategy.
The Deloitte Center for Health Solutions collaborated with the Scottsdale Institute to better understand how health systems are using digital transformation to help future-proof their organisations. We conducted a multipronged research project, engaging with large- and mid-sized health system members of the Scottsdale Institute between May and July 2021 that included:
Health systems acknowledge the acceleration in consumer agency and activation in the last few years.3 As consumers increasingly take charge of their health decisions, health systems are aligning digital investments to their overall business strategy—a strategy focused on consumers, according to roundtable panelists and interviewees. Almost all our survey respondents (92%) noted that better consumer satisfaction and engagement are the top outcomes their organisations want to achieve from digital transformation, followed by improved care quality (56%). Closely aligned to the top outcomes, functions receiving most digital investments today are patient experience (88%), IT/cyber (80%), and clinical care delivery (68%) (figure 1).
Health system interviewees likewise discussed taking a “consumer-centric” approach, focusing their digital investments on improving patient experiences and newer forms of care delivery, especially since the onset of the pandemic. This is consistent with our recent research on opportunities for consumer-facing technologies in health systems to build a better health care experience. As one of the interviewees said, “With COVID-19, it became necessary to accelerate consumer-facing technologies, and now there’s no looking back.”
Threats to cybersecurity are one of the biggest challenges health systems have faced amid rapid digitalisation in the last few years. Since the onset of the pandemic, health care facilities have been among the top targets for ransomware attacks and will likely continue due to the large amount of personal-sensitive data.4
As consumers become the center of digital transformation efforts, privacy and security of patient information are among the top digital priorities for health systems. In our survey, cybersecurity was among the top three investment priorities today and also in the next 3 years. Interviewees also discussed how their cybersecurity units worked hand in hand with digital transformation teams to ensure greater transparency and ownership. Without a matched focus on cyber, health systems open themselves to additional risks as they increase digital activities.
In addition, taking a nonconventional approach toward user experience, akin to consumer technology companies, was a recurring theme for interviewees and roundtable panelists. For example, one of the interviewees mentioned how digital technology is aiding more real-time feedback from patients, and they do not have to wait for months to get results from regulatory reporting (e.g., HCAHPS survey). This quick feedback obviously helps resolve consumer issues much more rapidly than previous nondigital solutions. Similarly, one of the panelists discussed how their organisation is taking a “design-thinking approach to reimagine all their processes—both clinical and nonclinical.” Using this approach, they initiate planning with the starting points for different consumers and how they might access their health care services.
“A patient’s journey is not just in the hospital. There is a “before” and an “after” (or a “not at all”) and what we need to do is be able to stitch that together, making sure we are caring and understanding the context and then where we can leverage those digital tools to be there for them.”
—Chief digital officer, large regional health system
We also asked our survey respondents how they planned to achieve the transformation—what technologies they were investing in now and what they planned for the next few years to transform their business and customer models. Respondents reported investments in insights and analytics (76%), virtual health services (68%), and cloud (56%) as top priorities today. Health system interviewees corroborated these are top investment priorities. They said their focus is on building unified data and business intelligence (BI) capabilities. This forms a strong base for real-time business analytics, predictive analytics, and AI. One interviewee noted they need to focus on the entire technology spectrum, not just on next-in-class technologies. For them, better communication technologies for their call centers are just as important an investment as AI pilots.
For Atrium Health, a North Carolina-based integrated health system, the pandemic acted as a catalyst for their digital transformation efforts. As our roundtable panelist Omer Awan, chief data and digital officer at Atrium Health, put it, “We have been working on digital efforts for a while, but it wasn't until the beginning of last year that we really embarked upon a multiyear digital acceleration.”
Atrium Health, like many health systems, ramped up its virtual health capabilities last year owing to the pandemic. Mr. Awan said that as the impact of the pandemic tapers off, one of the priorities for Atrium would be to not lose momentum toward virtual health and improve focus on better patient and caregiver experiences. He discussed how Atrium looks at virtual health holistically, with well-being, remote monitoring, and care management being as important as virtual visits. To ensure a better patient and caregiver experience, Atrium is deploying technologies such as chatbots to better understand consumer expectations.
Atrium is layering predictive analytics and AI at several patient touchpoints to understand and preempt consumer needs. As Mr. Awan notes, “We still haven't seen the best of AI and there's so much potential” to transform user experience and care delivery.
Digital transformation means something different to every health system, every stakeholder. However, most survey respondents and interviewees agree that it is more than just transferring paper processes to a digital environment. Digital transformation is a new way to deliver care, improve processes, and meet the well-being needs of consumers. Deloitte defines digital transformation as the use of digital technologies to radically improve the performance or reach of an organisation. In a digitally transformed business, digital technologies enable improved processes, engaged talent, and new business models. This can take significant time and can expect scrutiny of efforts. It therefore requires a thoughtful approach to ensure alignment with end goals while also demonstrating value along the way.
“Four years ago, digital transformation made it onto our health system strategy map. Then, I would have said, [we would be completely integrated] 5 years from where we started. But today, realising the challenge of the work, I don’t know the way we will look 5 years from now. Lots of work to do, so can’t say [how long digital transformation will take].”
—Senior vice president, a large integrated health system
While survey respondents were at different stages in the digital transformation journey, none of them said they were close to an ideal digital state. Most survey respondents (60%) said their organisations were no more than midway through their digital transformation journey. Slightly more than half of respondents said they have 3 or more years left until completing their digital transformation. In addition, 20% are still in planning stages and another 40% may not have a well-defined strategy (figure 2).
Expansion of opportunities for digital transformation has made the journey longer than they had initially expected, according to some health system interviewees. As these health systems progress further into their longer-term strategies, they are realising that they are still at the beginning of their digital transformation journey, and that this journey is not just about digital technologies but about transforming health care as a whole. They also discussed a need to create frequent checkpoints to measure the value of the initiatives—rather than waiting until the completion of the initiatives to measure ROI—because it is such a lengthy journey. Organisations should consider setting goals for specific milestones at different stages to ensure value at various stages and check whether they are on course for end objectives.
UWH, one of the top academic medical centers in the country, has been at the forefront of integrating digital into their organisational strategy over the last few years. “Digital strategy is not and should not be separate from the organisational strategy,” declared Cherodeep Goswami, system vice president and chief information officer at UWH, kicking off the roundtable. As a colead of the digital program, one of his biggest priorities is to convert his organisation from “doing digital” to “being digital.” In that vein, he identified key areas where digital is enabling a broader organisational transformation:
Digital is helping UWH transform itself organizationally, and as Mr. Goswami puts it, “Digital should be the building DNA of every organisation’s broader transformation efforts.”
Health care leaders face several challenges on their transformation journey. Data quality and access and talent were major barriers to digital transformation for survey respondents (figure 3). Budget is also important. Survey respondents, interviewees, and panelists shared how they are addressing these challenges.
“When you are tracking everything, you are tracking nothing. We are trying to reduce that. The first question we have is, ‘How does this attach to the KPIs we have in the organization?’ The decision is made by the highest level of the organization.”
—Senior vice president, integrated experience, a large faith-based health system
According to survey respondents, leadership (80%) and management of implementation (68%) are accelerators of digital transformation (figure 4). Interviewees underscored the importance that organisational leadership understands and supports digital transformation efforts and follows through with appropriate resources, staffing, and decision-making authority. This allows digital transformation leaders to think outside the box, speed up product development cycles, and change organisational culture around digital.
“C-level support is really important. We have to be partners with other teams but having a separate entity (specific governance for digital transformation) was a key to success.”
—Senior vice president, a large integrated health system
Similarly, interviewees stressed how important change management is in the process of digital transformation. Without coordination and communication across teams, implementation becomes much more difficult. This parallels survey findings where respondents stated that organisation culture (60%) and lack of ownership/communication (48%) are barriers to digital transformation. Because multiple teams, including digital transformation, IT, cybersecurity, innovation, clinical, and front office, can be involved in consumer-facing initiatives, a governance process should be in place to prioritise projects and give all stakeholders a shared understanding of goals.
Faith-based SCL Health has been providing health care services to communities in Colorado, Montana, and Kansas for several decades now. Amid trends such as consumerism and newer competition from other industries, “it is time to reimagine the services we provide, and also reposition our organisation … and digital transformation is the biggest enabler in achieving this,” according to roundtable panelist Craig Richardville, SVP and chief information and digital officer, SCL Health.
When Mr. Richardville joined SCL Health 2 years ago, one of his first priorities was to align the IT and digital services (DS) units into one—ITDS. He created an ITDS leadership team that owns all ITDS initiatives across the organisation and partners with functional leaders such as the chief medical officer and chief marketing officer on the governance committee. This has helped accelerate planning and implementation of diverse ITDS efforts.
Leadership and governance are crucial to all digital transformation initiatives and, as Mr. Richardville said, “We have the right people sitting in the right (ITDS) seats and this really helped transform the whole organisation.”
Health systems recognize that digital transformation is essential to improving health care and strengthening customer relationships. It is more than just investments in technology—it results in changes in organisational culture and employee engagement; it is an enterprise investment that requires enterprisewide participation. To move forward digitally, many leading health systems are embracing six key principles:
The impact of digital transformation will be felt across all aspects of health care, helping enable easier access to care, improving quality, and decreasing the cost of care. Consumers can connect quickly and conveniently with their preferred provider. In addition to stronger consumer relationships, digital transformation can also help improve operational and financial efficiencies and bring health systems’ long-term strategies into reality.
Amid uncertainty and change, health care stakeholders are looking for new ways to transform the journey of care. By focusing on the differentiated needs of plans and providers, our US Health Care practice helps clients transform uncertainty into possibility, and rapid change into lasting progress.