Something to Teach, Something to Learn. Dr Mark Britnell Chairman and Partner Global Health Practice KPMG
Mark Britnell – 54 countries, 160 occasions.
© 2013 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (‘KPMG International’), a Swiss entity. All rights reserved. This document is confidential and its circulation is restricted. KPMG and the KPMG logo are registered trademarks of KPMG International Cooperative, a Swiss entity.
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World Economic Forum, Davos 2012:
“The financing of health systems has increasingly burdened developed economies, which has been exacerbated by the fiscal crisis. Participants agreed on the drivers of the expenditure growth and, since many of these factors are unlikely to recede (e.g. ageing, lifestyles, public expectations), there is a clear need to develop a more sustainable way of managing health systems. The magnitude of health financing challenges suggests that incremental solutions may not be enough; however, a shared vision of new models for health systems does not yet exist.”
Source: The Great Transformation: Shaping New Models – World Economic Forum Annual Meeting Davos 2012
KPMG research: Transaction trumps transformation. 3,000 CEOs from all industries see the importance of transformational change but focus their attention on short term transactional efficiency. 43%
Changing business operations to realize cost efficiencies 32%
Improving cash and working capital management
30%
Exploiting growth opportunities through successful transactions
25%
Preparing your organization for major business model changes
24%
Managing and retaining the right people within the organization Addressing risk throughout the organization
21%
Looking for growth in emerging markets
21% 20%
Innovation through product development
18%
Adapting to take into account changing customer and stakeholder behavior
15%
Using information to forecast response to uncertain times
13%
Refinancing or seeking capital
12%
Using technology as a strategic enabler, not just an operational facilitator Embedding sustainability in the business model
10%
Responding to regulatory change
10%
Seizing opportunities offered by increasing public/private sector interaction
6%
Note: (a) Due to rounding up and down total figure may vary from 300% Source: KPMG ‘Succeeding in a Changing World’ 2012 © 2013 KPMG Advisory N.V., ingeschreven bij het handelsregister in Nederland onder nummer 33263682, is een dochtermaatschappij van KPMG Europe LLP en lid van het KPMG-netwerk van zelfstandige ondernemingen die verbonden zijn aan KPMG International Cooperative (‘KPMG International’), een Zwitserse entiteit. Alle rechten voorbehouden. Gedrukt in Nederland. De naam KPMG, het logo en ‘cutting through complexity’ zijn geregistreerde merken van KPMG International.
Total adds up to 300% all respondents had three votes(a)
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Healthcare leaders are even more focused on the urgent issues of today and less on the important ones of tomorrow. Healthcare 27% 32%
Improving cash and working capital management Changing business operations to realize cost efficiencies
43% 15% 21%
Addressing risk throughout the organization
33% 30%
Exploiting growth opportunities through successful transactions
Preparing your organization for major business model changes
15% 15% 18%
Seizing opportunities offered by increasing public/private sector interaction
18%
Using information to forecast response to uncertain times
4%
Adapting to take into account changing customer and stakeholder behavior
10% 12% 12% 10%
Using technology as a strategic enabler, not just an operational facilitator Embedding sustainability in the business model
27% 24%
Managing and retaining the right people within the organization
17% 13% 17% 20%
Refinancing or seeking capital Innovation through product development
Healthcare
25%
17% 21% 20% 18%
Looking for growth in emerging markets
Responding to regulatory change
50%
5%
10%
Total
Note: (a) Due to rounding up and down total figure may vary from 300% Source: KPMG ‘Succeeding in a Changing World’ 2012 © 2013 KPMG Advisory N.V., ingeschreven bij het handelsregister in Nederland onder nummer 33263682, is een dochtermaatschappij van KPMG Europe LLP en lid van het KPMG-netwerk van zelfstandige ondernemingen die verbonden zijn aan KPMG International Cooperative (‘KPMG International’), een Zwitserse entiteit. Alle rechten voorbehouden. Gedrukt in Nederland. De naam KPMG, het logo en ‘cutting through complexity’ zijn geregistreerde merken van KPMG International.
Total adds up to 300% all respondents had three votes(a)
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KPMG in Rome, 2012. Over 40 senior executives and clinicians from 22 countries debated major global challenges of today. Prof. Dr. Bastiaan Bloem
Martin Gerber
Anne McElvoy
Paolo Rolleri
Medical Director, Radboud University Nijmegen Medical Center
CFO, Universitätsspital Basel
Public Policy Editor, The Economist
Director General IRCCS San Raffaele Pisana – Istituto di Ricovero e Cura a Carattere Scientifico
Christian Boel
Tim Harford
Valerie Michie
Dr. Giancarlo Ruscitti
Vice Healthcare President in Region Midtjylland
Senior Columnist at the FT and Author of Adapt: Why Success Always Starts with Failure
Global Head of Health, SERCO
CEO Fondazione "Opera San Camillo"
Prof. Dr. Hans Büller
Dr. Pieter Hasekamp
Dr. Terry McWade
Dr Brian Ruff
CEO, Erasmus Medical Centre
CEO, Dutch Health Insurers Association (ZN)
Deputy CEO, Royal College of Surgeons in Ireland
Head of Risk Intelligence and Access Innovating Divisions, Discovery health
Sir Ian Carruthers
Unni Hembre
Sir Jonathan Michael
Dr. Masami Sakoi
CEO, NHS South of England
President, European Federation of Nurses Associations (EFN)
CEO, Oxford University Hospitals NHS trust
Planning Policy Director, Ministry of Health, Labour and Welfare
Lord Nigel Crisp Independent Crossbench Member of the House of Lords
Prof. Dr. Udo Janssen
Filippo Monteleone
Prof. Anupam Sibal
Chairman, German Hospital Institute
Managing Director, General de Santé
Medical Director, Apollo Hospital
Paul Cummings
Gary Kaplan
Sir Robert Naylor
Dr. Kevin Smith
Director of Finance, Northern Ireland Health and Social Care Board
CEO, Virginia Mason Medical Center
CEO, University College London Hospitals NHS Foundation Trust
President and CEO, St. Joseph's Health System
Frances Diver
Sir Bruce Keogh
Prof. Benjamin Ong
Dr. Arthur Southam
Executive Director, Victorian Department of Health
Medical Director of the NHS and NHS Commissioning Board
CEO, National University Health System
Executive Vice President, Kaiser Permanente
Dr. Jennifer Dixon
Bala Krishnan
Carlo Perucci
Isabel Vaz
Director, Nuffield Trust
Director of Development Office of Chairman, Aspetar Scientific Advisory Board
Head of the National Outcomes Programme, National Healthcare Agency
CEO, Espírito Santo Saúde
Prof. Axel Ekkernkamp
Dr. Chul Lee
Glenna Raymond
Prof. Shan Wang
CEO, Unfallkrankenhaus, Berlin
CEO, Yonsei University Health System
President and CEO Ontario Shores Centre for Mental Health Sciences
CEO, Peking University Peoples Hospital
Orsida Gjebrea
Dr. Claudio Luiz Lottenberg
Chris Rex
Ron Williams
Senior Policy Advisor, Supreme Council of Health
Chairman & President, Hospital Israelita Albert Einstein
CEO, Ramsay Health Care
Former Chair & CEO of Aetna Inc. and member of President Obama’s Management Advisory Board
© 2013 KPMG Advisory N.V., ingeschreven bij het handelsregister in Nederland onder nummer 33263682, is een dochtermaatschappij van KPMG Europe LLP en lid van het KPMG-netwerk van zelfstandige ondernemingen die verbonden zijn aan KPMG International Cooperative (‘KPMG International’), een Zwitserse entiteit. Alle rechten voorbehouden. Gedrukt in Nederland. De naam KPMG, het logo en ‘cutting through complexity’ zijn geregistreerde merken van KPMG International.
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The paradox.
Most people believe that their health sectors need substantial change but think their own organisational plans are robust.
They can’t all be right. Transformational changes requires the majority to have a new vision. That's why change is hard.
Focus remains on transactional change not transformational reforms.
© 2013 KPMG Advisory N.V., ingeschreven bij het handelsregister in Nederland onder nummer 33263682, is een dochtermaatschappij van KPMG Europe LLP en lid van het KPMG-netwerk van zelfstandige ondernemingen die verbonden zijn aan KPMG International Cooperative (‘KPMG International’), een Zwitserse entiteit. Alle rechten voorbehouden. Gedrukt in Nederland. De naam KPMG, het logo en ‘cutting through complexity’ zijn geregistreerde merken van KPMG International.
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Leading hospitals, health plans and life sciences executives believe their business models are ‘somewhat sustainable’
From volume to value (USA):
Sustainability of current business models over next 5 years: 9%
2%
2% 18%
20%
53%
43%
18%
40%
19%
25%
20%
8%
8%
HC Systems (104)
Health Plans (51)
17% Pharma (54)
Not at all sustainable Not very sustainable Somewhat sustainable Very sustainable Extremely sustainable Source: Transforming Healthcare: From Volume to Value – New Research on Emerging Business Models KPMG 2012
But they don’t feel their industries will stay the same…
…with moderate to major change coming in their sectors
Extent of changes to your industry over next 5 years: 2%
4%
13%
33% 53% 63%
65% 41% 24% HC Systems (104)
Health Plans (51)
Pharma (54)
Minor changes Moderate changes Major changes
Source: Transforming Healthcare: From Volume to Value – New Research on Emerging Business Models KPMG 2012
Healthcare leaders in Rome also demonstrate the paradox.
Question – The current business models operated by hospitals are:
Somewhat sustainable
‘Most (75%) think that current business models are somewhat sustainable but almost all (95%) expect moderate (30%) or major (65%) business model change in the sector’
Question – How much change do you expect to see in the shape of the provider system and in their business models in the next 5 years?
Major changes
© 2013 KPMG Advisory N.V., ingeschreven bij het handelsregister in Nederland onder nummer 33263682, is een dochtermaatschappij van KPMG Europe LLP en lid van het KPMG-netwerk 9 van zelfstandige ondernemingen die verbonden zijn aan KPMG International Cooperative (‘KPMG International’), een Zwitserse entiteit. Alle rechten voorbehouden. Gedrukt in Nederland. De naam KPMG, het logo en ‘cutting through complexity’ zijn geregistreerde merken van KPMG International. Source: Pre-conference survey Something to teach, Something to learn, KPMG Rome 2012
Active strategies to manage are transactional.
85%
81%
82%
78% Question – Which strategies are providers likely to adopt to respond to these changes?
74%
44%
Major cost reduction
Lean and improvement methods
More focus and specialisation
Investment in Health IT
New workforce models
Extra income from existing payers
© 2013 KPMG Advisory N.V., ingeschreven bij het handelsregister in Nederland onder nummer 33263682, is een dochtermaatschappij van KPMG Europe LLP en lid van het KPMG-netwerk 10 van zelfstandige ondernemingen die verbonden zijn aan KPMG International Cooperative (‘KPMG International’), een Zwitserse entiteit. Alle rechten voorbehouden. Gedrukt in Nederland. De naam KPMG, het logo en ‘cutting through complexity’ zijn geregistreerde merken van KPMG International. Source: Pre-conference survey Something to teach, Something to learn, KPMG Rome 2012
…..but they expect payment systems to focus more on quality, value and risk. 78%
78%
74%
74%
Question – I expect payment systems to:
55%
11%
Become more integrated
Contain more quality incentives
Focus more on patient value
Share more risk with providers
Reduce prices & cap volumes
Remain largely the same
© 2013 KPMG Advisory N.V., ingeschreven bij het handelsregister in Nederland onder nummer 33263682, is een dochtermaatschappij van KPMG Europe LLP en lid van het KPMG-netwerk 11 van zelfstandige ondernemingen die verbonden zijn aan KPMG International Cooperative (‘KPMG International’), een Zwitserse entiteit. Alle rechten voorbehouden. Gedrukt in Nederland. De naam KPMG, het logo en ‘cutting through complexity’ zijn geregistreerde merken van KPMG International. Source: Pre-conference survey Something to teach, Something to learn, KPMG Rome 2012
They do believe integrated care will..
…offer new possibilities for quality and cost
Reduce costs (75%)
Improve outcomes (90%)
Source: Pre-conference survey Something to teach, something to learn, KPMG Rome 2012
Consensus on major trends.
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2
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Payers are becoming ‘activist’.
Some hospitals are transforming into health systems. Patients becoming active partners. High growth health systems, providing new perspectives on health reform. Innovative integration and partnership.
© 2013 KPMG Advisory N.V., ingeschreven bij het handelsregister in Nederland onder nummer 33263682, is een dochtermaatschappij van KPMG Europe LLP en lid van het KPMG-netwerk van zelfstandige ondernemingen die verbonden zijn aan KPMG International Cooperative (‘KPMG International’), een Zwitserse entiteit. Alle rechten voorbehouden. Gedrukt in Nederland. De naam KPMG, het logo en ‘cutting through complexity’ zijn geregistreerde merken van KPMG International.
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Passive funder to activist payer. Make the organisation capable of contracting for outcomes and value. Find new ways to connect with – and empower – patients. Increase focus on the management of overall population health, ‘moving care upstream’. Information, segmentation and stratification.
Delivery must be integrated and coordinated.
Payment reform is key; from volume to value. © 2013 KPMG Advisory N.V., ingeschreven bij het handelsregister in Nederland onder nummer 33263682, is een dochtermaatschappij van KPMG Europe LLP en lid van het KPMG-netwerk van zelfstandige ondernemingen die verbonden zijn aan KPMG International Cooperative (‘KPMG International’), een Zwitserse entiteit. Alle rechten voorbehouden. Gedrukt in Nederland. De naam KPMG, het logo en ‘cutting through complexity’ zijn geregistreerde merken van KPMG International.
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Providers: Transact or transform? In spite of fiscal crisis, many providers are still healthy and solvent. Uneven momentum for change. All face big strategic question – ‘do things better or do better things?’ For some M&A and new international markets offer growth e.g. Ramsay, Fortis, SECOM, Netcare. Much to be done operationally: Lean, workforce, care system re-design, clinical informatics and quality improvement at scale e.g. Intermountain, Virginia Mason, Buurtzorg, Salford. Some hospitals are transforming into ‘health systems’ through integration or acquisition e.g. Geisinger, Apollo, Saskatchewan (Canada), Albert Einstein, Brazil. Some become narrow and focus using Lean, e.g. Aravind, Narayana Hrudayalaya, Fortis and Coxa in Finland. © 2013 KPMG Advisory N.V., ingeschreven bij het handelsregister in Nederland onder nummer 33263682, is een dochtermaatschappij van KPMG Europe LLP en lid van het KPMG-netwerk van zelfstandige ondernemingen die verbonden zijn aan KPMG International Cooperative (‘KPMG International’), een Zwitserse entiteit. Alle rechten voorbehouden. Gedrukt in Nederland. De naam KPMG, het logo en ‘cutting through complexity’ zijn geregistreerde merken van KPMG International.
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Patients as partners: Patients are no longer passive recipients and new systems and ways of working are required to manage this change. It has taken a decade for us to realize that better care is usually less expensive care. It will take another decade for us to realize that patients are partners – either creating or compromising value. Techniques that allow patients to create more value include: shared decision making; Al Mulley’s ‘preference misdiagnosis’; amplified patient voice; informed care and (internet) coaching. End of life care and chronic care are the most important immediate areas to create better value. Tools that patients need to control and secure better value include: pathways, records, decision aids, social networks and technology e.g. PatientsLikeMe. © 2013 KPMG Advisory N.V., ingeschreven bij het handelsregister in Nederland onder nummer 33263682, is een dochtermaatschappij van KPMG Europe LLP en lid van het KPMG-netwerk van zelfstandige ondernemingen die verbonden zijn aan KPMG International Cooperative (‘KPMG International’), een Zwitserse entiteit. Alle rechten voorbehouden. Gedrukt in Nederland. De naam KPMG, het logo en ‘cutting through complexity’ zijn geregistreerde merken van KPMG International.
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From God to Guide – ParkinsonNet:
5 design criteria:
Helping to create an active patient able to manage their care and take key decisions
Bas Bloem created ParkinsonNet: a revolutionary partnership approach involving Parkinson’s patients in the Netherlands, has led to a 50% reduction in associated hip fractures and €20 million worth of savings.
Defining what value based care would look like from the perspective of the patient Changing the way that doctors and other clinicians work with patients by shifting to a partnership approach with patients Creating a network of experts
Linking all of these together with information technology tools
© 2013 KPMG Advisory N.V., ingeschreven bij het handelsregister in Nederland onder nummer 33263682, is een dochtermaatschappij van KPMG Europe LLP en lid van het KPMG-netwerk van zelfstandige ondernemingen die verbonden zijn aan KPMG International Cooperative (‘KPMG International’), een Zwitserse entiteit. Alle rechten voorbehouden. Gedrukt in Nederland. De naam KPMG, het logo en ‘cutting through complexity’ zijn geregistreerde merken van KPMG International.
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High growth countries.
‘Something to teach, something to learn’’ isn’t a new form of Western Imperialism. High growth countries and emerging markets can be characterised by 3 words: speed, buzz and leapfrog. Many still have under-developed primary care platforms but entrepreneurs see this as ‘white space’. Much greater reliance on technology, smart operational processes and public-private partnerships. Growing middle class with increase in NCDs demands leap-frog over 20th century care models. Asia, Africa and South-America all developing low-cost delivery models and point-of-care diagnostics. Reverse innovation. © 2013 KPMG Advisory N.V., ingeschreven bij het handelsregister in Nederland onder nummer 33263682, is een dochtermaatschappij van KPMG Europe LLP en lid van het KPMG-netwerk van zelfstandige ondernemingen die verbonden zijn aan KPMG International Cooperative (‘KPMG International’), een Zwitserse entiteit. Alle rechten voorbehouden. Gedrukt in Nederland. De naam KPMG, het logo en ‘cutting through complexity’ zijn geregistreerde merken van KPMG International.
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Leaders in Rome identified 10 characteristics:
1 2 3 4 5 6 7 8 9 10
Enduring Values Shared purpose Consistent and stable leadership Deep engagement with clinical staff Strong focus on front-line Set culture, hold professionals to account
Align individual, team and organisational objectives Information transparency – internal and external Curiosity about high performance Authentic partnership
© 2013 KPMG Advisory N.V., ingeschreven bij het handelsregister in Nederland onder nummer 33263682, is een dochtermaatschappij van KPMG Europe LLP en lid van het KPMG-netwerk van zelfstandige ondernemingen die verbonden zijn aan KPMG International Cooperative (‘KPMG International’), een Zwitserse entiteit. Alle rechten voorbehouden. Gedrukt in Nederland. De naam KPMG, het logo en ‘cutting through complexity’ zijn geregistreerde merken van KPMG International.
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Coming soon... Global perspectives on clinical governance
This document is CONFIDENTIAL and its circulation and use are RESTRICTED. © 2013 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Printed in the United Kingdom. The KPMG name, logo and ‘cutting through complexity’ are registered trademarks or trademarks of KPMG International Cooperative (KPMG International).
