There is no clear definition today for digital transformation in healthcare and what it means for an organization. We asked nearly 40 CIOs and senior health IT leaders who are members of the College of Health Information Management Executives (CHIME) to define digital transformation in healthcare and discussed a set of other themes based on our own research. 60 percent of respondents said digital transformation is about using digital technologies to reimagine business processes and customer experiences, while others stated that it means delivering healthcare when, where and how consumers want it; a small percentage stated that it is about using data, analytics and AI to improve outcomes.
Models of adoption
Today, health systems fall into four key models of digital adoption:
- Model 1 – Reliance on Electronic Health Record (EHR) capabilities to drive digital engagement
- Model 2 – Digital strategy singularly focused on virtualization of care
- Model 3 – Stand-alone digital initiatives driven by internal demand
- Model 4 – Strategic investments in long-term digital health platforms
Most health systems, especially smaller and mid-tier enterprises, operate in Models 1 and 2 and only the nation’s largest health systems are operating in Model 4. Most CIOs in the focus group, however, acknowledge that all enterprises need to shift to Model 4, especially during a time when health systems are embracing risk-based payment models.
What is driving digitalization?
Key factors driving digital transformation include Increasing competition and reduced reimbursements, along with the focus on patient experience and improving access to care for patients.
However, according to one CIO, “Any digital transformation strategy has to have an affordability component because reimbursement rates are going down and we have to work smarter.”
Health system CIOs in the focus group who are developing patient engagement applications expressed that they are also actively looking at monetizing the capabilities by offering them to peer systems that are yet to make the investments.
The CIO is also the Chief Digital Officer – For Now
Around a third of the CIOs in the focus group indicated that their organizations do not have a digital function, and by default, the digital function sits with the CIO.
According to one CIO, “We don’t really have that (digital) function here. But if our board was asked who it would fall under, I could see them all saying it would be part of the CIO’s role.”
According to Damo Consulting CEO Padmanabhan, “It also comes down to whether health systems can afford to have another senior executive in a CDO role, given the current state of digital maturity and the lack of interest in creating even more C-level roles. Our focus group of CIOs believe most health systems are not large enough for two separate roles. This is in sharp contrast to other sectors such as banking who have had full-time CDO roles for a while.”
No single vendor can address all aspects of digital transformation
Forty-six percent of the CIOs say that their enterprise digital strategy is their EHR system, closely followed by those that build or buy point solutions based on need (45 percent). Less than nine percent are implementing an enterprise platform in partnership with a major technology firm. “Based on these figures, it becomes clear that there is no single vendor platform that meets all needs and today, health systems must build their own stacks,” added Padmanabhan.
Healthcare’s digital transformation is still in the early stages of maturity relative to other sectors, yet CIOs understand the imperative to drive digitalization.
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