Clinician Economics, Part 3
In Clinician Economics, Part 1 I briefly covered the concept of unit economics and entertained the idea of applying that to a clinical setting in the context of new products entering the market. In Part 2 I illustrated why the in-patient clinician may not be particularly inclined to adopt new solutions. Is the out-patient setting any different?
The CEO of our imaginary Z-app (an AI app that helps clinicians save time in documentation and patient processing) is at the office of our out-patient physician. She’s a gynaecologist who co-owns a practice with two other clinicians and sees on average 40 patients per day. She’s the owner of the practice, so she doesn’t track her time the way an employed physician at a hospital does, because she doesn’t have a salary. Instead, her income is fully based on how well her business practice is doing. If she’s interested in growing her income, she has to increase the amount of patients coming through the door (let’s for now ignore the scenario with extracting more revenue per patient). As treating patients is a human-to-human interaction, she has a natural limit to how many people she can serve herself, and she likely is already there. So her only other option is to hire another physician (on a salary) to serve the excess of patients.
This is starting to sound a lot like what hospital management does, but that’s not the point I’m trying to make. Making in-patient clinicians more productive and enabling them to see more patients is not a financially appealing argument for them personally. They get paid either way. Sure, having to work over hours to complete administrative tasks is annoying, but perhaps this is a result of accumulation and not the fault of a single broken process. Taking a piece of the chain and replacing it with a newer, stronger piece doesn’t change the strength of the whole chain.
The people who actually have the financial and business incentive to adopt productivity tools are the ones who can take advantage of the excess and that’s the owners and managers of hospitals, medical centres and private practices. And given the complexity of the system, their first priority isn’t replacing slow processes one by one. Instead it’s preserving the smoothness of how healthcare is delivered. Not speeding up individual wheels, but making sure that the wheels move in sync. This is, of course, a difficult proposition for any company, but especially for startups, who by the virtue of being small don’t have a choice but to focus in getting their foot in the door.