Working Outside the System
Fred posted his talk from Le Web yesterday. It’s a good one in which he covers a lot of ground on how USV invests and specific sectors they’re interested in.
I’ll spare you a full transcript of the talk, but I want to highlight a single point he made while discussing a trend that they, and we, are very interested in: Health and Wellness.
Specifically, Fred says they’re looking for opportunities that keep people out of the healthcare system altogether as opposed to trying to fix it. And this is an important point.
A recent study on patient satisfaction lends some perspective on why avoiding the system is powerful opportunity. The study found, counter intuitively, that the most satisfied patients of the healthcare system have much higher healthcare costs and higher mortality rates than less satisfied patients.
Patient satisfaction is a widely emphasized indicator of health-care quality, but our study calls into question whether increased patient satisfaction, as currently measured and used, is a wise goal in and of itself,
Prior studies have shown that patient satisfaction strongly correlates with the extent to which physicians fulfill patient expectations.
Doctors may order requested tests or treatments to satisfy patients rather than out of medical necessity, which may expose patients to risks without benefits,
The system has incentives and protocols that are designed with the system, not the patient in mind. Continuing from the article:
The study found that patients who were most satisfied had greater chances of being admitted to the hospital and had about 9 percent higher total health-care costs as well as 9 percent higher prescription drug expenditures. Most strikingly, death rates also were higher: For every 100 people who died over an average period of nearly four years in the least satisfied group, about 126 people died in the most satisfied group.
Interestingly, more satisfied patients had better average physical and mental health status at baseline than less satisfied patients. The association between high patient satisfaction and an increased risk of dying was also stronger among healthier patients.
There are certainly chronic and emergency situations where the healthcare system is critical for saving and improving the lives of patients. But outside of those key functions, there is a new ecosystem of devices and services designed to improve overall health and decrease exposure to a deeply flawed care model.
The investments we have in this category to date have been made with this notion in mind. Fitnesskeeper and Misfit are efforts to collect and manage fitness data with an eye towards improving the performance and health of those participating in their networks. Sherpaa works with companies to ensure their employees receive the healthcare they need, without having to enter the healthcare system to receive it.
Over the last year Sherpaa has been able to resolve 70% of the health related issues for their customers outside of the traditional healthcare system. That’s a lot of savings for employers and a better overall experience for their employees.
This is an incredibly dynamic area to be investing. Wearable and mobile devices are changing the game for how we connect with our doctors, our personal data, and health care system. The more we can use and understand the former, the less we’ll connect with the latter.
There’s an entirely new system waiting to be built outside of the system and we’re actively investing in companies looking to make that a reality.
