A common misperception exists about monumental changes and how they come about. Most think that significant and permanent change occurs as a result of a large cataclysmic event that leaves the...
A common misperception exists about monumental changes and how they come about. Most think that significant and permanent change occurs as a result of a large cataclysmic event that leaves the world in a different state and renders the change necessary. However, long-lasting change is brought on by a series of small, seemingly minor trends that come together to force change. When this happens, it is referred to as “convergence.” Since the change is wrought by so many
converging factors, the effect is more long-lasting and powerful. For example, it was the convergence of a variety of factors that brought such a swift demise to the Soviet Union. It was not any individual factor, such as the civil discontent over food shortages. Were it not for a convergence of factors, communism may have returned to Russia as soon as the citizens realized that the end of the old regime did not coincide with the end of food shortages.
In the ‘90s, Wall Street faced such a convergence of trends that took the form of looming and severe problems. Among other issues, Wall Street recognized that any delay in settling trades introduced significant risk for financial firms. Obviously, there was risk of monetary loss, but it was also difficult to control information leaks and the concomitant risk of insider trading. Another important issue was financial data; clearly, this data needed to be shared by all stakeholders but couldn’t be unless data providers and financial firms adopted interoperability standards. While this was occurring, a few Wall Street firms began to realize dramatic competitive advantages through information technology. When one firm was able to recognize a pattern and act on the information before others, a “technology feeding frenzy” occurred that forced everyone to spend money on tech in order to remain viable. These and other trends forced Wall Street to make long-lasting changes in the way firms use information technology. The fantastic returns generated by hedge funds can be directly traced to the time when converging trends wrought major changes in Wall Street.
Healthcare faces a convergence of trends that threaten its livelihood and the viability of the enterprises that fund healthcare. Healthcare costs have increased three times faster than inflation during the past 10 years. Even if the results for this year show some slowing in the rate of growth, the system is still in so much trouble that change is inevitable. Couple the funding problems with an increased awareness that real-time information is the only way to define actionable interventions and the federal government’s unrelenting drive toward interoperability, and you have the same, or even greater, motivation for change that Wall Street faced. In a strange way, it may be that the rampant discouragement is actually encouraging. Perhaps the gravity of the situation will force not only a convergence but also a completely new direction in healthcare.
There is no doubt that Wall Street faced the problem, spent tremendous amounts of time and money to define solutions, and bravely pushed forward to implementation although there were many legitimate reasons to desist. The question today is: will healthcare as an industry respond as Wall Street responded, or will it use the same “yes, but we are different” excuse until it is too late? If the unresolved problems become so great that we are forced to adopt any sort of National Health Insurance, we will have waited too long.
Dr. Kennedy is the President and Chief Executive Officer of RemedyMD.