05 Mar Health 2.0: The Long Tail of Health Care
Long Tail (lông tāl)
- New business phenomenon in which low distribution and storage cost enable significant profits to be realized by selling small volumes of niche items instead of large numbers of popular items.
- The potential for online retailers to make more money than their bricks and mortar counterparts because there is virtually unlimited “shelf space” to offer products.
Chris Anderson of Wired magazine editorial fame, coined the term and described the phenomenon in a 2004 article called The Long Tail. For the unfamiliar, the Long Tail is best described as the ongoing niche interest in something once the large pulse of public interest has died off. Essentially, so the theory goes, when distribution and storage costs of a business are very low, they can realize significant profit by selling small volumes of hard to find items to many customers instead of selling large volumes of a few popular items. Given the length, or the area of the curve under the “tail”, it turns out there is actually a greater opportunity for profits pursuing this niche strategy if the right distribution and cost elements exists.
The Long Tail Explained. As demonstrated by the above example, while Walmart sells the bulk of popular music at their stores, the distribution and storage costs elements of online retailers like Rhapsody are such that they can actually mine a very large, underserved niche market that proves to be just as, if not more, profitable.
In my closing remarks yesterday on the final reactor panel at the Health 2.0 conference (totally off the cuff by the way as I was unaware I was going to have an opportunity to make a statement), I had mentioned this concept. However, given my uncharacteristic lack of preparation and desire to offer a coherent closing statement. I have including the following:
First, I wanted to thank everyone for participating in the conference. Health 2.0 remains a very unique type of conference, where the energy, the mojo, and the level of attendees is extraordinary. While the novelty has somewhat worn off for those in the space for the last 18 months, the organizing influence of the Health 2.0 banner continues to grow in strength, magnetism, and centripetal force. I likened this growing movement to the appearance of an oncoming swell, and those paying attention can position themselves appropriately to catch the choicest part of the wave and subsequently ride the fastest, furthest, and with the most style (some will even get in the “green room“). Others, with their backs facing the wave (whether in denial, dismay, or disarray), will get rolled under the force of change wrought by Health 2.0.
Second, I wanted to highlighted the concept of “Aggregate, Analyze, Advise” (halfway down page) and briefly outlined how most Health 2.0 companies are openly demonstrating the value of this paradigm. Others, have extolled versions of this vision as well. I believe this creates a nice framework to think about how the various companies, in their various niches can help solve unique consumer problems by addressing unique needs. In fact, the very reason these companies exists is that there is some real or perceived need that is not being met and they are attempting to use the enabling web 2.0 tools to engage people who have not been engaged in the past.
This allowed me to make my third point in rebutting the notion of technology as a disintermediary force – the cold steel of the computer inserting itself between the warm and engaging relationships enjoyed by humans. I shared how I was initially very critical of the new Dr. IM model, going so far as to call out Jay Parkinson when he announced his new practice model. I had failed to realize, based on how the initial press portrayed (downside of virtual medicine) things, that Jay was using enabling technology to engage an entirely new generation of patients on their terms, in ways in which they were familiar, in language they understood, and consistent with how they lived their life. In fact, the enabling technology was allowing him to practice in a more intimate, personal way. Jay is not trying to serve the mass institutionalized health care system, he is trying to service a niche group of young, urban professionals who for whatever (or for obvious) reasons have opted out of the medico-industrial complex. And, his 7 million hits the first three months his website was live should help people understand that this new style of health care delivery was meeting some previously unrecognized need.
Which led me to my final point: I am struck by how this explosion of personalized technology, and how much opportunity there appears to be to service the “Long Tail of Health Care” – the vast majority of underaggregated, underanalyzed, and underadvised niche patients who are looking for niche services. These niche services, as demonstrated at both Health 2.0 conferences, are the first attempts to use technology to personalize the health care consumer experience, to meet them where they are, in the way they want to be reached, in a language they understand, and with means that meet their unique values. This perhaps, becomes an even better definition of Health 2.0.
So whether you believe using American Well or Live Wisdom fundamentally changes the delivery system or not, it is going to address some need for someone who is interested to pay $50 for 10 minutes or $1.99/min for glorified telemedicine services. Whether you personally would ever go to a doctor like Jordan Schlain or Jay Parkinson, they are on the cutting edge of a new era of personalized services – including those delivered by caring, effective, and high quality professionals. In addition, folks like Phreesia with their electronic clipboards, Eliza and Silverlink with their Voice Recognition Software, or patient centric applications like Emmi Solutions, ReliefInSite, or even PharmaSurveyor are attempting to deliver to products to service niche needs that have traditionally fallen outside the mainstream medicine but squarely within the context of the Long Tail of healthcare.
A word of caution about this Long Tail notion, however. As pointed out by David Sobel (“The Elder” as became known during the conference) in his exit speech during my panel, for all the enabling technologies we are developing to addresses the Long Tail of health care, we need to also be concerned about addressing the fundamental and structural flaws within our current system:
The assembled talent, brain power and passion in the room was truly remarkable. Thanks for giving me the opportunity to participate. I do hope that my brief, hastily constructed remarks before my departure were not offensive to people, but hopefully provocative and constructive. I was truly impressed with the efforts I saw of people trying to empower patients and professionals as partners, but at the same time somewhat distressed by the reality. Namely, for the most part our healthcare system is broken and handicapped with perverse incentives. Many of the fee-for-service models and concierge practices are not going to be able to provide care for many who most need it and can’t afford it. And many of the tools have the potential to further fragment care if not used wisely. While Kaiser Permanente itself is limited in reach with only 8 million members nationwide and unfortunately unaffordable to many, this aligned system offers so much promise for integration of these Health 2.0 tools as well as primary care and specialty care. Again, my intent was to urge people to work towards a more rational health care system, while respecting that they have business plans and models to execute. – David Sobel, MD MPH (used with permission)
I have long argued for a broader and more inclusive definition of Health 2.0 for this reason (although Dr. Sobel appropriately cautioned me to not even attempt to constrain my thinking by defineing something so fluid and dynamic). I have always maintained that the enabling technologies were only part of the story – and the thing they should be enabling is the transition to next generation healthcare (which is going to involve some very painful reform – ie, “this is going to sting a little”). For this reason, I have focused on the concepts of value driven health care (outcomes/price), transparency, openness within healthcare (and open source!), and collective intelligence via networked collaboration (social or otherwise). These reform concepts are critical if we are to begin to correct the fundamental and foundational problems that plague our health care “system”.
But these conceptual platitudes are empty if there are not real dollars attached. We have to have finance reform to fundamentally change the twisted and perverse incentives that currently exist. This will include financing mechanisms that align interests, incent appropriate behavior, that reward for results (see what MedEncentive and even consumer oriented Virgin HealthMiles are doing), and that bring market principles to bear on price, quality, and choice. As we pay for care in this way, the hope is that it will be delivered in the most efficiently and effectively way possible. So while “vertically integrated” health care systems appear to deliver the best results to date, perhaps the next generation of Health 2.0 companies will be able to use technology to pay for care from technology enabled virtually integrated delivery systems (more later) that achieve comparable results. I believe this software enabled coordination of care, and the financing mechanisms that enable its creation, can be likened to some of the new delivery models we are seeing as we slide down the Long Tail of Health Care:
Sliding down the Long Tail of Healthcare: So, you like the comprehensive care model of Kaiser? May I introduce you to a Carol.com care package, or perhaps you would like to schedule an online visit with Dr. Enoch Choi, or could I interest you in a $50 online visit with an American Well physician, or perhaps you have a quick question that can be addressed in a $1.99 LiveWisdom e-visit? You get the drill.
I have great hope for the future of Health Care in the United States. Perhaps the call to create a more rational health care system will begin in the grass roots of the Long Tail, “shifting left” up the curve as Health 2.0 companies can demonstrate objective increases in value, and push on further still as catalyst for the foundational reform efforts that will enable us to create next generation, high performance healthcare.
In the vernacular of the day, the 7 word challenge to describe this next generation health system:
Effective, Efficient, Equitable. Technology Enabled Reform. Thrive.