Healthcare providers know the industry is ripe for disruption, and despite efforts by many health systems to provide more convenient, patient-friendly care, many in the industry recognize disruptive innovation is more likely to come from outside the industry than from within.
We've seen this type of disruption by CVS and Walgreens, both of which have expanded drop-in clinic locations in recent years. Retail clinics provide day-of care with transparent pricing, without appointments or long wait times, and they are a growing threat to traditional providers
While hospital-owned physician groups have responded by trying to make appointment scheduling more convenient and opening their own urgent care centers, retail clinics have secured a small, but growing, outpatient market share. According to a 2013 study be the Center for Studying Health System Change, 4.1 million American families reported using retail clinics in the previous 12 months, and higher-income families were nearly twice as likely as lower-income families to use retail clinics.
Another disruptive innovation worth attention is the retail-based infusion center. Over the weekend I was reading athenahealth CEO Jonathan Bush's new book "Where Does It Hurt?" and he mentioned the recent launch of an infusion center by a St. Louis grocery store. It caught my eye, so I did a bit of research.
Launched last September by Schnucks, a grocery chain with a large Midwest presence, Schnucks Infusion Solutions' first Ambulatory Infusion Center offers infusion therapy to treat a number of conditions including cancer, Crohn's, Multiple Sclerosis and Cystic Fibrosis.
The freestanding infusion center offers evening and weekend hours, free Internet, cable TV and snacks, according to an Advisory Board briefing. It's staffed by registered nurses with certification from the Infusion Nurses Certification Corp., pharmacists and technicians.
While the grocery store doesn't seem the most natural business to provide infusion therapy, there's no doubt it knows a thing or two about convenience and can provide a lower-site cost of care than hospital-based centers — an attribute that is increasingly beneficial as patients and payers look to rein in costs.
Health system leaders do and should worry about disruptive innovation, and Schnucks has provided a prime example of it. Anyone who thinks otherwise should review the definition of 'disruptive innovation,' a term coined by Clayton Christensen, a Harvard Business School professor (who also provided the foreword for Jonathan Bush's book):
"Disruptive innovation …describes a process by which a product or service takes root initially in simple applications at the bottom of a market and then relentlessly moves up market, eventually displacing established competitors."
As established competitors, hospitals must take note.