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January 23, 2019

Not Grandma’s Phone

There is a video going around that shows two 17 year-old boys trying to figure out how to use a rotary phone.  Fellas, what do you think the word ‘dial’ means?

Is this what Grandma look like when she is trying to tell Siri, through Bluetooth as she drives down the freeway, that she can see the delivery man at her door through the webcam app on her phone, and that Siri should flash her automated porch lights three times to activate Grandma’s  automated signature on his hand-held device so that he can leave her case of prune juice there by the flower pot?

It is timely to think about what happens when one generation encounters the technology of another because Apple is in discussions with at least three Medicare Advantage plans about subsidizing their watch as a health tracker for the seniors on these plans.  Actually, to call it a ‘health tracker’ is a bit insulting; the Cupertino company’s positioning of their product is as an ‘intelligent health guardian.’

The use case for the watches, which range from $279-399, is pretty straightforward.  MA plans are capitated and on the hook for all costs for their members.  The Apple watch functions – fall detection, an electrocardiogram, who knows that else is in the works – don’t have to eliminate many trips to the ER to pay for themselves.  Last week, Apple CEO Tim Cook retweeted (isn’t this like the old telephone ‘party line’?) a post from a woman saying her husband’s Apple watch detected his a-fib and the subsequent trip to the ER found four major blockages, saving his life. Not a bad marketing story.

Apple already has various watch deals in place with Aetna and United around general wellness, and just announced a partnership with Zimmer Biomet, the orthopedic device manufacturer, to study the recovery of joint replacement patients.

These stories are specific examples of one of our big themes for 2019 – the rise of the platform players.

When I say ‘platform players,’ it is natural to think of Ascension and HCA and Sutter and Partners – the big integrated delivery systems.  You have one or two of five behemoths in your market.  And you have to figure out how to deal with them.

But Apple and Google and Optum (the UnitedHealth subsidiary) and others are platform players of a different ilk.  Their strategies – the assets they are building, the disruption they look to cause, the business models they are pursuing, the way they will approach the market – are not based on facilities or the accumulation of providers in a region, but instead rest on the value of information. 

Obvious Coan, they are tech companies.  But it is not about the watch…it is about the data.

The issue for independent physicians, and our industry in general, is that you can never compete head to head with these folks.

But, can you use what they are doing to advance your mini-platform? 

Better yet, can you be their partner?

Tim Coan
Tim Coan

CEO and founder

Tim Coan, ALN’s CEO, writes an insightful and witty blog weekly about a variety of topics relevant to independent physician practices.