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Healthcare Business Acumen: Remaining Relevant
By David B. Nash, Alexis Skoufalos and Robert Lytle
As full implementation of the Patient Protection and Affordable Care Act (ACA) unfolds, all the stake-holders in the healthcare ecosystem are struggling to adjust their strategies and system paradigms in a way that will position them for success in a rapidly changing environment. There is a significant amount of new information to process and quickly translate into practical actions. Those who hesitate, or make a misstep, are in danger of being left behind. Although the stakes are high, everyone is in the same boat, and the new paradigm is dependent on collaboration, transparency and accountability.
New reimbursement models and methods of financing, focused on value-based decision-making, are providing opportunities for collaboration between payers and provider systems to improve patient satisfaction and health outcomes. These changes will fundamentally alter the way pharmaceuticals and medical devices are developed, approved and evaluated. It is therefore more important than ever for those in the pharmaceutical and biotech industries to be well-versed in the nuances and complexities of the business aspects of health care.
As stakeholders begin to bear (and share) more financial risk for patient outcomes, they will seek more sophisticated information regarding the real-world effectiveness or therapies, and the relative value of one treatment over another. Under the ACA, a Pharmacy & Therapeutics committee would function differently, as it would not expand its formulary without favorable economic data. If they are to function successfully as full partners with their customers, pharmaceutical representatives must understand the context and impact of changes to clinical practice models triggered by the ACA, and the influence these changes will have on formulary decisions. They must be conversant in quality and process improvement strategies, especially as they relate to safe medication practices.
Interactions with Accountable Care Organizations (ACOs) may prove to be a singular challenge, since most entities are struggling to build the information infrastructure that will allow them to make informed decisions about the cost and quality of care delivered to the populations they serve. Since decisions made at the leadership level have downstream implications to multiple stakeholders within the organization (including patients), those doing business with ACOs must be able to operate from a systems-thinking perspective.
In this new world, business models focused on product selling will become less effective. New paradigms require innovative solutions tailored to address each customer’s specific business needs and must integrate well into a patient-centric care model. Moving forward, pharmaceutical representatives will be more likely to offer a service than a product and must be comfortable navigating in a complex, fluid sales environment. The rules for what an organization buys, how they buy it and what they are willing to pay for it have changed. Succeeding in this environment requires a higher level of sophistication, knowledge, and skill, including:
• A thorough understanding of the landscape accounting for the perspectives of payers, providers, intermediaries, policy makers and influencers.
• The ability to utilize analytics to identify business opportunities, levers and barriers.
• The ability to integrate customer and patient tools and programs into the approach.
• Advanced communication skills for developing and delivering tailored messaging to each stakeholder.
What does this mean in terms of workforce development and training? A coordinated brand, sales and training strategy is especially critical as you adapt to this new environment. A necessary first step is the assessment of the knowledge and competency levels of the frontline representatives and managers responsible for driving growth within these new paradigms. Do they recognize and understand these four factors?
Healthcare business acumen development needs to occur across a continuum of activities and experiences that help learners navigate within the various healthcare delivery channels and provide them with insights regarding the complex, and often competing, needs of stakeholders. This is particularly important now that new measures of quality and outcomes impact reimbursement levels and the overall bottom line.
Training should be designed to develop your employees’ skills in consultative selling, leading through influence, negotiation and conflict resolution. Train to the 3Cs: Comfortable in the C-suite, confident with committees and convincing with clinicians.
Finally, make sure your training efforts translate to behavioral changes in the field by creating a coaching culture that gives managers the tools to pull through the training, assess competencies and assign remediation.
The rules of engagement have shifted dramatically, and organizations unwilling to adapt their approach are unlikely to prosper. The skills required for success have changed as well. As trainers, we need to adjust and adapt to the new rules of the game.