Embracing Disruption for Growth

As we approach the October deadline for ICD10, you can sense the tension in the industry as the unknown consequences of using this code set move closer to the present as each day passes, or as Snoopy would begin the story, it was a dark and stormy night.

Even the most prepared organizations can only guess what the impact of switching to ICD10 will have on their transaction processing, cash flow, and procedures.  Every organization is linked to others and the disruption caused by this will be felt by everyone.  It can’t be avoided, only mitigated through planning, preparation, and then making adjustments quickly.

Charles M. Schulz, Snoopy
Charles M. Schulz, Snoopy

One common theme I have noticed throughout preparation for this transition is the attitude that switching to ICD10 is negative event.  That the disruption associated with switching to this code set is not worth the headaches it will create.  Many of these same individuals and organizations that share this opinion would agree that the ICD10 code set provides more detail and is more descriptive than ICD9.  It then stands to reason that once this code set is adopted, the quality of data collected in the industry will improve as well as the ability to analyze this information such as relating clinical and financial information to outcomes.

This paradox of associating negativity with positive change is very common in individuals and organizations of every kind.  We desire to always improve and move forward, regardless of how small or incremental the growth might be.  Any disruption that negatively impacts these process improvements in the short run is normally avoided, regardless of any potential long term benefits.  Normally, people are often punished for failure instead of rewarded for attempting something new.  

The reality is that we live in a rapidly changing world.  Incremental change will only get you so far.  The organizations that excel, not just survive, are the ones that embrace disruption and failure.  They learn from it and have the courage to intentionally create short term losses for the chance of long term gains.  These organizations move forward knowing that they will sometimes fail, accepting large risk/reward propositions over and over again.  Learning from their mistakes until they gain a foothold at a higher level of productivity or efficiency.  Then, like a rock climber on the face of a cliff, they reinforce this new position and refine their processes once again.

Back around Y2K, it became clear that the new HIPAA regulations for standardized transactions were going to become requirements for the industry.  At the time, we had Windows-based applications that supported the existing electronic standards for claims and remittance processing.  The easiest approach for our organization would have been to modify these applications to export the data in the new format.  It would have only taken a few months and we could have possibly been first to market in accommodating these new formats.

However, we had other fundamental issues that held back the growth of these software products.  They had to be updated frequently to accommodate the ever changing business rules of payers.  These updates had to be applied to hundreds of different servers by our customers.  This process was unreliable since it meant that the customer had to apply these updates correctly and promptly before they took effect.  Since this did not occur at the same time for everyone, we had to continually deal with the support issues associated with different versions of the product throughout our customer base.  Other issues were associated with this deployment model like everyone had to do their own backups.  Each customer had to purchase high end servers and the associated software needed to maintain these systems.  No one was complaining about these issues, they were associated with all software at that time and were not really considered to be obstacles.

About this time, some industries had begun to use the internet to link customers to remote databases using a web browser as the front end of the application.  Through this model, everyone could share the same copy of the software and no local installation was required.  Backups could be done for everyone at the same time and client systems only had to have an internet connection and a browser.

Since we had to make a major change to our applications anyway to accommodate the new data formats, we decided to also accommodate this new technology to deal with the support and productivity issues associated with the Windows based environment.

 Instead of a few months, the new applications took over two years to develop and test.  We started from scratch, our programmers had to learn new languages. We used a new database platform and shared servers.  Everything we did was new and different from our previous system and experience.  The only thing the new and old systems shared was the general business process they supported.

During this time, other vendors provided solutions ahead of us by making small changes to their Windows products, we operated at a loss as other development and business opportunities were bypassed while these new products were developed.  The risk was difficult to deal with as our customers saw other vendors accommodate the changes quickly not knowing if we could deliver or when.  We lost some of them as they decided that they could not accept this risk or delay.

When our current product line was released in 2002, we were one of the first to deploy the Software as a Service (SAAS) model in the healthcare industry.  Suddenly, we could finally assume that everyone was running the same version of the software.  Deployment, setup, training and software maintenance was now easy, scalable and profitable.  As the years have gone by, one by one, our competitors have had to make the same changes to keep up or they have ceased to exist.   While they began spinning their wheels, we made rapid improvements to these products and grew our market share.  Looking back, this decision seems obvious.  At the time it, was not.

I can also point to several other development projects that did not end as well.  We developed a secure messaging system for providers and patients.  It took over two years and I thought it would revolutionize the industry.  It was sold to five small customers over the last five years.  Other development projects were completed or nearly completed, but never saw the light of day for one reason or another.  Still, I don’t regret any of them.  We learned from all of them and in many ways the failures have been more profitable to our organization through what they have taught us.  Pieces of these rejected systems still exist and have been incorporated into other solutions or our experience developing these failed systems has allowed us to make related systems better and faster.

As healthcare organizations that depend on information technology to grow, each of you are going to have to learn to embrace disruption to excel.  Like in nature, evolution is not the process of small changes in organisms that allow them to adapt to their environment, it is unique mutations that create opportunities for essentially new organisms to grow and replace existing organisms that do not have their advantage.  Like in nature, mutations usually fail, they create a defect instead of an improvement.  However, without mutations, life could not adapt to environmental changes that are sure to occur.  Eventually, without adaptation, nothing would survive in a changing environment.

We can all learn from nature by understanding that growth is not a straight line process always moving up and forward, but a disruptive process of dealing with change, taking risks, and looking beyond the short term.  If your organization can adopt the attitude of seeing change as an opportunity rather than an obstacle, and back it up through policy and action, you will achieve the benefits of change and when the dust clears, you will be looking back at what used to be the competition.


By Kalon Mitchell, President – MEDTranDirect