One of the panelists today at ACT-IAC’s Health Innovation Day was Verily’s Vivian Lee, MD, Ph.D. Asked for her thoughts on what will drive innovation in health care forward, Vivian offered a new mental model, organized around the idea of co-production.
Industrial engineers look at co-production as a problem and solution when an organization’s pursuit of its mission depends on the behavior of actors outside of its control. As Vivian observed, co-production occurs in our system of producing elementary and secondary education. While teachers and schools deliver curriculum, parents support the production of education in their homes and through their contributions to the school community. Another example is trash removal. Municipal trash services take our trash away for processing, but they depend on residents putting their trash in bins and taking their bins to the curb.
Co-production is a problem in need of solutions throughout healthcare. Clinical outcomes depend on the actions of patients and their healthcare providers. Payors and providers are not aligned in their pursuit of the quadruple aim, yet they offer differentiated capabilities to improve quality and cost of care. There are some co-production issues that are event harder to tackle, stemming from social determinants and implicating public policy Many of the problems of co-production can seem overwhelming and unsolvable, but if innovators across the health system could agree on how to view the problem and iterate on solutions together, that could provide a path forward. As we look for ways to innovate in healthcare, co-production could serve as that lens.
Peter Drucker once described innovation as the act that endows resources with a new capacity to create value. Vivian observed that administrative costs still comprise 25% of healthcare costs. It’s not that we lack resources; instead, we need to endow them with new capacities to create value. Technology and data will help with that, but innovation begins with organizations making the space to identify the shortcomings in their workflows, and developing ways to align with their co-producers along common goals.