Bill Klaproth (Host): Welcome to the Healthcare Executive Podcast, providing you with insightful commentary and developments in the world of healthcare leadership. To learn more, visit ache.org. I'm your host, Bill Klaproth. In this episode, we'll be discussing what it will take to transform healthcare.

Our guests today, Dr. Marc Harrison, co-founder, CEO of Health Assurance Transformation Corporation, or HATCO; and Dr. Cheryl Pegus, Managing Director of Morgan Health Ventures. You can hear more from both of them at the 2024 Congress on Healthcare Leadership, March 25th through the 28th in Chicago. They're going to be doing a fabulous session, Hot Topic, Transcending Change: What Will It Take To Truly Transform Healthcare? To learn more and to register, visit ache.org/congress. Dr. Harrison and Dr. Pegus, welcome.

Dr. Cheryl Pegus: Bill, great to be here.

Dr. Marc Harrison: Thanks, Bill. We're really looking forward to this conversation.

Host: I am too. Well, thank you both so much for being here. I really appreciate this. Dr. Pegus, let me start with you. If you could please, tell us about your career journey and path to becoming a leader at the forefront of innovation and the evolution of healthcare.

Dr. Cheryl Pegus: Well, thank you for that question. I'd say my path started when I was really young. When I was 12, my grandfather got really ill and we couldn't afford healthcare and there weren't many places, frankly, willing to see him. And so, we cared for him at home and I was the wound dresser, which I did every day before school and on weekends. And it really made me want to do something to improve healthcare for people like my grandfather and I emigrated from Trinidad, came to the US, went to college at a very early age to become a doctor. And I've been working as a clinician for many years.

When I was in training, a study came out in the New England Journal that said that a man born in Harlem had less of a chance to making it to 66 than a man born in Bangladesh. And it really made me rethink my wanting to be a cardiologist, which is what I am. And that I wanted to do more in healthcare. And so, it really made me begin learning all aspects of healthcare, the business side, the care side, the social sides of healthcare. And today, my career has really, I hope, incorporated those learnings and I'm doing work that can make a difference in communities.

Full circle moment for me is, this past year, my own mom got really sick. And I moved her in with me and nursed her back to health and she's now doing great and really has made me grateful for this career journey in healthcare.

Host: Well, thank you for sharing that personal story of yours. It's always interesting to understand the why behind people like you do what you do. So, thank you again. We appreciate it. And Dr. Harrison, how about you? Can you tell us about your career journey and your path to becoming a leader at the forefront of innovation and the evolution of healthcare?

Dr. Marc Harrison: Well, thanks, Bill. And before I share a bit of my journey, I just want to thank Cheryl for the opportunity to participate with her both in this podcast as well as at the conference. It was a really gracious invitation and she's a person I admire greatly.

So, I'm a pediatric intensivist, Bill. And to be honest, I actually thought my wife and I were going to be in rural practice somewhere in the Rocky Mountain West, together in a small town. Now, she's a general pediatrician. And it turned out I didn't love general pediatrics, but I did love pediatric critical care. And I guess that I had a formative moment relatively early in my career, I was still in training actually, when I realized that this kid who I had intubated in the emergency department who was having status asthmaticus, that she actually didn't really need to be there at all. She had a dust mite allergy and we had sent her home after a previous admission with instructions to have her house professionally cleaned and dust mites abated and to take some prophylactic medication so she wouldn't get sick again. And the house cleaning nor the medication fulfillment was done because the family couldn't afford it.

So here, this kid almost died. She had an incredibly difficult and expensive hospitalization, and it was all unnecessary. And at that moment, I started looking at healthcare through a very different lens, and that continued through the course of my clinical career, which was well over 20 years. And I became deeply interested in how we transition from healthcare to health.

I've had a privilege of having lots of really great experiences. I was on the executive team at the Cleveland Clinic for a long time. I went to Abu Dhabi as the founding CEO of Cleveland Clinic Abu Dhabi. And then, I spent a really fulfilling six plus years as CEO of Intermountain, helping transform it towards value and scaling the company.

And here I am as the co-founder and CEO of HATCO, having left Intermountain specifically with the intent of driving innovation and evolution of how healthcare is delivered for all people, not just rich people, but for all people.

Host: Thank you, Dr. Harrison. Love hearing that. Great story. Here you thought you were going to be in rural healthcare, and you wind up traveling all over in different positions and spending time in Abu Dhabi. Very interesting. Thank you for sharing that.

So, let me ask you both this. I'd love to hear both of your thoughts on this. Dr. Pegus, let me start with you. Healthcare is at the precipice of significant change, but in many ways, hospitals and health systems are still operating under the same model they've been for decades. Why is that the case?

Dr. Cheryl Pegus: I think hospitals and health systems are changing. I'll start there. So, change is slow, but they're definitely changing. And I think we all have to remember that hospital revenues and expenses, they guide the decisions as in any other business. And in 2022, most hospitals were in the red. Hospital margins only started becoming positive again mid-year of this year. Just think about that. Being able to run a hospital business and the concerns just about being able to fund all of the services we need. And we know that that's been a real issue, you know, Marc just talked about rural health, but a recent study just showed that over 180 rural hospitals have closed with 20 of them occurring in the past year. And so, funding a hospital, I think, many leaders are trying to figure out what are the ways to do that going forward, particularly as you look at cost and as you look at how you utilize data and access points.

And so, some of the things that I think leaders at hospitals are doing and thinking about is medical education. I'm really passionate about this area personally and am working with a new medical school that's being formed, the Alice Walton School of Medicine. But how do you change education within institutions? How do you help people feel safe coming to work where we know there's just a high rate of violent acts at hospitals that is impacting burnout? And then, how do you ensure that people who want access to care feel as if they can get it in many satellite points? And so, a growth in ambulatory care is also occurring.

And my last, I would say, is how do you help as a hospital as we begin to get much more data? We have much more utilization of how people can access different points of care, where do you store that data? Do you build it all out yourself? Do you partner and work with the cloud? So, hospitals are changing. It may not be as rapid as other industries, but positive changes are happening and I'm excited about it, including how they're transforming as we look at payment reform.

Host: Well, as you say, over 180 rural hospitals have closed, so something has to change. And I'm glad you feel that we are moving in the right direction, albeit slowly. Dr. Harrison, how about you? Same question. Hospitals and health systems are still operating under the same models they have for decades. Why do you think that's the case?

Dr. Marc Harrison: Happy to share my point of view. So, I happen to agree with Cheryl as usual. I mean, I think she laid things out very well. And I actually share her optimism. The reason we're stuck in the model that we're stuck in is that every system is perfectly designed to get the results it gets. And American healthcare, by and large, until recently, has almost exclusively been about driving volume through medical facilities, because that's how people get paid. That is changing a bit and I would actually say that CMS has been probably our greatest champion in moving towards value-based care.

I think Managed Medicaid and, I believe, Medicare Advantage have been revolutions that have driven a lot of innovation. So, I am hopeful for a future that is more value-based. But currently, if you're paid to do lots of heart surgeries, you're going to do lots of heart surgeries. And I will reference the old Dartmouth Atlas data that suggests that your chances of getting spine surgery done are proportionate to the number of spine surgeries per capita in your community. So, I think that we're going to need to fundamentally change the economic model in order to see a change in the way healthcare is delivered for all people.

Host: And Dr. Harrison, if I could stick with you, you were president and CEO of Intermountain Healthcare. You left to join a venture capital firm and are now planning to buy a health system to test out some of the changes that you were just discussing. Why did you decide to go this route?

Dr. Marc Harrison: Bill, I'm going to be mildly controversial here, and I'm going to say that as much as I loved delivering not-for-profit medicine, by and large, I'm not sure that not-for-profit systems are really designed for the kind of innovation that I believe that the industry needs, that the world needs.

And I've asked a number of audiences, and maybe Cheryl and I will talk about this at the conference, is there an industry that has gone through transformation purely based on the goodwill of the participants? And I can't think of one. And I think that our not-for-profit systems are led by great people who are trying to do the right thing, and they're leading companies that are not designed to drive change.

So, I had the privilege of joining General Catalyst and working in tandem with Hemant Taneja, who's the CEO, and Ken Chenault, who's the board chair, as we sought to imagine what a world might look like where we could create click-and-mortar medicine, so traditional medicine, but also digitally-enabled medicine that is done in a humane, inclusive, for-profit model that provides health and wellbeing for all people in the communities that it serves. And in order to do that, we've assembled a really amazing ecosystem of 20 health systems who are our thought partners and have shared their strategies with us. And we're beginning to take them through their digital transformation as collaborators. And we have the privilege of working with amazing digital health companies that are focused less on point solutions and more on systematic change. And we've begun the process of understanding how we can platformize these digital solutions so that they're easy to enable within a health system and that the companies can work together for the best interest of that health system's patients.

And finally, we actually think it's really important that we own our own health system so that we actually can help move them through a transformation very thoroughly and they can serve as a model for other systems around the country and around the world for what healthcare might look like if we fully take advantage of our human potential as well as digitally enabled healthcare.

Host: Yeah, I like how you say you're going to platformize these health solutions. That sounds very interesting and we certainly will be watching, Dr. Harrison.

Dr. Marc Harrison: Me too, Bill.

Host: So, Yeah, this is really going new.

Dr. Marc Harrison: It's not going to be easy, but it's going to be important, I think.

Host: Yeah, for sure. Well, let me ask you both this question too. Can you share some examples of how hospitals and health systems can start embracing creativity and innovation right now? Dr. Pegus, can I start with you?

Dr. Cheryl Pegus: Absolutely. And really, really like Marc's approach to how do we innovate faster. Because I do think change in healthcare is happening maybe slower than we want. So, I am so appreciative of someone jumping in all with head under the water and going after it. So, thank you, Marc, for the work that you, Hemant, Ken are doing.

One of the things that I think hospitals can do more of is expand digital access. This requirement of in-person care for a lot of care has to do somewhat with billing as opposed to ease of access for people seeking care as well as when they need it. And so, I think that digitization really is important as we go forward, studies have shown that when people of color, people in rural areas have access to specialists, particularly if they don't live in those areas, and it's done digitally, we can increase the quality of care and decrease the length of time that someone may be ill. And so, really looking at the outcome of, if I am a health system in a community, how am I helping that community with their overall health, needs to become kind of a guiding light as opposed to all the pieces that you build towards it.

I think one of the other ways that they can embrace creativity, we've heard a lot just about cybersecurity and hacking. I think how we do the cloudification of healthcare and how you partner to do that as a hospital is really, really important. So, why are we building a lot of these IT internal teams when there are market industry leaders who can probably help and really help with that access of being able to find care in many different parts.

And one of the big pieces that I think hospitals have to look at, you know, the U.S. has the highest maternal mortality rate for a country of our stature and of our healthcare expertise. How we change that and how we partner for earlier care, how we may look at birthing centers, how we may look at how high risk care is determined, there's a lot of great opportunity, a lot of great technology being developed. Team-based care, including doulas, are happening.

One of my passion areas is how we utilize community health workers, they are a part of the team. If the payment model is on value-based care, you're able to utilize them more, and we know about 40% of what doctors and nurses are doing, where they're trying to get medications for patients, they're trying to make sure that they can get to travel appropriately for their care, they need help with someone helping you to understand just the health literacy of what's going on. We do not need doctors and nurses to do that. Community health workers can do it. And if we continue to transform our payment model, we can increase the number of community health workers. So, lots of innovation, not all of it tech-related, that we still need to do. Some of it is bread and butter healthcare, but I'm excited that I think we're getting there because payment models are changing.

Host: Yeah, it sounds like innovation is out there, but like you said, how do we innovate faster? How do we get there quicker? But thank you so much for the details that you just shared with us on how we can get to where we need to go faster and some examples. So, thank you for that, Dr. Pegus. How about you, Dr. Harrison? Any ideas, or I should say examples, of how health systems can start embracing creativity and innovation right now?

Dr. Marc Harrison: Absolutely, Bill. My colleague, Hemant Taneja, talks about radical collaboration, and we really believe in that as opposed to talking about disruption, because collaboration is positive and it builds things. Disruption scares people and it breaks things, and we prefer to build rather than break. And I think when you look at the people who are delivering healthcare in the moment right now, as Cheryl said earlier, they're really strapped. They're understaffed in many cases. They have all this burden of documentation that much of it is unnecessary, and it's just clunky. And the teams don't have a lot of bandwidth to make change, and I think bringing in colleagues and partners from the outside, maybe from partner companies that really is a force multiplier, and it allows people to go quickly.

Probably the thing I'm most excited about right now is the power of large language models, particularly medically specific large language models. And I'll just give you a specific example of something that I really think is important and could address some of the issues that Cheryl raised. I, like many, if not most, Americans have a complex chronic medical problem. So, I'm a cancer survivor and I still need regular interaction with the medical establishment for labs, for imaging, for doctor visits, for infusions, to fill prescriptions, et cetera. And I'm a doctor, and I'm pretty sophisticated. And I find it onerous to keep up with my own healthcare. And imagine if you didn't have all those advantages and how hard it would be to take good care of yourself.

I think a large language model that trains digital chronic care nurses to help each and every one of us who have chronic care to make sure that we make our appointments, that we get our prescriptions filled, that we follow up on our lab tests, that we see our doctors and nurses on a regular basis could be enormously successful and serve many of the functions including listening to people like community health workers do. So, I think certainly there will always be a place for people. But I think, as Cheryl was alluding to, the people should really be reserved for their highest and best purposes. And I think we can use technology to accelerate, catalyze a move into the future.

Host: I love that term, radical collaboration.

Dr. Marc Harrison: Yes, Hemant coined that, and I love it. I absolutely love it.

Host: Yeah, that really says a lot. And you talked about large language models helping out as well. I mean, that makes a lot of sense as well. So, thank you both. Those are great answers for how we can start to move the change in the right direction more quickly. So, that was really great. And I know you're going to be talking a lot more about these things at your session at Congress.

You are both presenting the Hot Topic, Transcending Change: What Will It Take To Truly Transform Healthcare at Congress this March. Can you both give us a sneak preview of your session? What will attendees expect? Dr. Pegus, can we start with you?

Dr. Cheryl Pegus: First, I would say attendees should expect that we're pretty engaged in this. This isn't a side thing. This is for, I believe, both of us, what we're doing for the rest of our career. We want to see change occur. I've mentioned this, but I'll just highlight it. What should change in medical education as we get ready for the world of AI? That's a really big deal. So, I really want to talk about that. I mentioned that I'm part of a new medical school that's forming. I'll bring some of that forward.

I think the second thing that for me is really important is we know that healthcare is local. We sometimes say ZIP code more important than genetic code. So, how do we get healthcare to the places where we need it the most? We talked a little bit about how payment models can do that. So, I'll be talking about how payment models can improve care in rural and in underserved communities. And then, half of my time I spend just on science. I sit on the board of the American Heart Association. I invest in a lot of companies that are focused on science and how is the science of longevity going to impact what we do? I think everyone has looked at GLP-1s and talked about around obesity. There's a lot more to that since obesity underpins almost 300 billion of our spend in healthcare. So, I want to talk about that a little bit.

And lastly, really, really important, I think, is how do we continue to afford technology? We just saw that CRISPR technology has come up with a treatment for sickle cell disease. Think about all of those other opportunities that are ahead of us and how do we continue to do that? And I'll talk a little bit about how we at Morgan Health are investing in these types of innovation in a collaborative manner to really allow them to be utilized by communities everywhere so everyone has access.

Host: Dr. Harrison, how about you? Your thoughts on your session?

Dr. Marc Harrison: I guess what I'd really like people to expect is a frank but optimistic conversation around the future of health and healthcare. One of the things that makes me the saddest right now is when I hear people who are doctors and nurses and other healthcare professionals who are not recommending for their children to go into healthcare.

I happen to think it's still the greatest profession around the greatest industry around, the opportunity to be intimately involved with another human being at both the happiest and saddest times of their lives. I mean, it's very powerful stuff. And I think that if we organize healthcare in the right way, and if we deploy solutions in a thoughtful manner, our kids should have even better careers in healthcare than any of their forebearers had. And so, I want us to have a conversation that provides people with hope that there's a future out there that can provide better health for their neighbors and a better experience for them as providers and leaders.

Host: Providing hope, always a good thing. We like that. So, that's going to be great. This is going to be a great session. So, I know we're all looking forward to it. And as we wrap up, I want to thank you both for your time. If I could just get some final thoughts from each of you. Dr. Pegus, let me start with you. Any additional thoughts as we wrap up talking about what it's going to take to transform healthcare?

Dr. Cheryl Pegus: I'd say that healthcare is transforming, so I wanted to keep that positive note. I think that we are all seeing that payment whether an institution is able to be able to stay open, whether clinicians feel valued for their work, whether we can truly do team-based care that include managing people's, what we call, social determinants, really impact what we're doing in healthcare.

I think that transparency to physicians, nurses, we're just seeing how the sausage is made, feeling that they're a part of it. We've sometimes put people in separate silos. As physician leaders, I think our role is to show people that it all needs to work together, and that we are doing this work, one, because it feels mission-driven. But it is absolutely necessary. And if we don't do it, I always say, who are we waiting for to do this work, to transform and make all of us, our families and people we serve get the best healthcare.

Host: Very well said. If we don't do it, who are we waiting for? Very well said. Thank you so much, Dr. Pegus. And Dr. Harrison, any final thoughts from you as we wrap up talking about what will it take to transform healthcare?

Dr. Marc Harrison: Yes. So, we know that about a third of American healthcare is either unnecessary or frankly harmful, and we need to stop doing that. If we do, there's plenty of money to go around for all the fancy therapies. Just yesterday, end of last week, the FDA approved the first CRISPR therapy, this one for sickle cell disease. And it's going to be really expensive. But if we actually are smart about how we digitally transform and how we organize to provide more effective, efficient, and humane care, we're going to be able to provide better health for all people, and I'm really excited about that future. But we're going to have to change in order to do it.

Host: Yeah, absolutely. And we're excited for that future as well, especially with people like you at the forefront. So, Dr. Pegus and Dr. Harrison, thank you so much for your time today. We appreciate it.

Dr. Cheryl Pegus: Thank you, Bill.

Dr. Marc Harrison: Absolute pleasure, Bill. Thank you. And thanks, Cheryl.

Host: Absolutely. Well, thank you both. Once again, this is Dr. Marc Harrison and Dr. Cheryl Pegus. Hear more from them at the 2024 Congress on Healthcare Leadership. It's March 25th through 28th in Chicago at their session. It's called Hot Topic: Transcending Change, What It Will Take to Truly Transform Healthcare.

To learn more, and more importantly, please register, visit ache.org/congress. That's ache.org/congress. And if you found this podcast helpful, please share it on your social channels and check out the full podcast library for topics of interest to you. This is the Healthcare Executive Podcast. Thanks for listening.