The guys in the black hats always come out when times are hard, this time, to pontificate on why Obamacare and Population Health initiatives are nothing more than myths invented by an army of pseudo-intellectuals who profit from promulgating this sort of nonsense. The irony is that, despite the near zero growth economy we all now live in, the healthcare industry and the dynamics of its labor markets have both changed permanently and irrevocably and, in my opinion, for the better.
The much-publicized chasm between the old industrial economy and the new knowledge-based economy is not only real, but will continue to grow in importance, and in dramatic fashion, for the foreseeable future. This time, it is healthcare’s FFS model that will be permanently disrupted. Knowledge workers with interdisciplinary skill sets will be in high demand and, for the most part, cannot be outsourced. Bending the cost curve of an industry that consumes 17% of GDP will become a national security initiative. We are a single Black Swan event away from a catalyst of massive disruption.
The Internet and the New Economy, while not one and the same, are certainly part of the same positive feedback loop that, along with globalization in its myriad manifestations, are pushing world economies into increasingly unchartered waters. In the next five years, healthcare’s Talent Wars are likely to increase in ferocity and winners will acquire the assets necessary to dominate their respective markets for the next hundred years.
We are at an inflection point of immense proportions. This is the kind of discontinuous change that occurs once every thousand years or so. Of the three factors of production (land, labor, and capital), labor, in all its incarnations, is about to emerge in a manner that will permanently establish its dominant position in healthcare. Over time you will see smart labor transforming healthcare in ways previously unimagined, all to the upside of both the top and bottom lines.
Just as smart medical devices with embedded software have invaded every nook and cranny of healthcare, from the operating room to the intensive care unit, smart labor will begin to make its presence felt as the key differentiator in emerging pillars of the industry such as business intelligence and patient engagement. The opportunities in healthcare are massive in scope, as the industry struggles with the creative imperative that permeates all aspects of its value chains. As Manuel Castells notes in The Rise of The Network Society:
Toward the end of the second millennium of the Christian Era several events of historical significance have transformed the social landscape of human life. A technological revolution, centered around information technologies, is reshaping, at accelerated pace, the material basis of society. Economies throughout the world have become globally interdependent, introducing a new form of relationship between, state, and society, in a system of variable geometry.[i]
Although Castells certainly does not share my views on the importance of labor, he does an eloquent job of describing, in vivid detail; the general social and economic conditions that place smart labor in a position of prominence in my worldview, especially in healthcare. Why healthcare in particular? Because there is widespread consensus, notwithstanding the political partisanship that surrounds Obamacare, that 17% of GDP is unstainable. Further, there is likely not a single adult over fifty that has not had one or more near financially catastrophic encounters with the perversity of FFS, especially if you have had the misfortune of becoming ill between jobs and without insurance.
The fight for talent will focus on individuals with healthcare experience that also possess strong skillsets in information technology and project management. These resources are scarce today and will become scarcer over time as population health initiatives, out of the “innovate or die” imperative, begin to gather momentum.
[i] Manuel Castells, The Rise Of The Network Society (Blackwell Publishers: 1998), 1