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The CEO of the largest health system in New York is betting healthcare will be disrupted from inside, rather than by Amazon or CVS

Jun 12, 2019, 21:07 IST

Northwell Health CEO Michael DowlingCourtesy Northwell Health

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  • Northwell Health CEO Michael Dowling is betting that health systems will be the ones to disrupt the way patients get care - not "disruptors" showing up from other industries.
  • Dowling, who runs the largest health system in New York, pointed to the changes the system's hospitals have been making, moving more and more care outside the four walls of the hospital, as well as a push to adopt new technology.
  • Ultimately, Dowling said, hospitals will still be the place you go to when you're really sick.
  • Click here for more BI Prime stories.

Michael Dowling is tired of hearing outsiders talked about disrupting healthcare.

Health systems, like Northwell Health, where he's CEO, are going to be the ones who lead the change, Dowling said. Because Northwell owns every piece of the care-delivery system - from academic medical centers to local doctors - it can be the one to drive change in healthcare.

"If you listen to the people on the outside they say 'Technology's going to change everything and then hospitals have to figure out how to get in the business,'" Dowling said. "We're in the business. We do more of it than all of the others put together."

Northwell is increasingly moving complex operations to local clinics, adding new technology, and changing up how it delivers mental healthcare.

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"When you have big systems like this over time, being able to integrate all the pieces, make them be able to work together, that will change healthcare," Dowling said.

Dowling pointed to groups like Haven, the joint healthcare venture from Amazon, Berkshire Hathaway, and JPMorgan; the newly combined CVS Health-Aetna; and partnerships between pharmacy giant Walgreens and health insurer Humana built on the premise of trying to make healthcare more convenient, less complicated to navigate, and less expensive than traditional hospitals and health systems.

Amazon CEO Jeff Bezos.Matt Winkelmeyer/Getty Images for WIRED25

Big-tech players for their part like Amazon and Google are getting interested in tackling healthcare. Amazon, for instance, in November announced it would offer a service called Amazon Comprehend Medical to hospitals, insurers, and pharmaceutical companies to help them analyze their health-records data. The company also bought pharmacy startup PillPack in 2018, marking its entrance into prescription-drug delivery.

Alphabet, Google's parent company, has a number of bets in healthcare, ranging from Verily, its life-sciences arm that's developing surgical robots, to Calico, its life-extension spin-off. Microsoft and Apple are also finding ways to embed themselves into the healthcare industry.

"They're all going to change the world as if nothing has been changing," Dowling said. "It's been changing dramatically for years."

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For instance, Northwell has closed some of its hospitals. Today it operates 23 hospitals and 750 care sites. It made $11.5 billion in revenue in 2018, making it the largest health system in New York by revenue. The organization's been moving a lot of care outside the hospital: A decade ago, it made 80% of its revenue from hospitals. Today, it's 50%.

Read more: The biggest health system in New York used to make 80% of its revenue from hospitals. A decade later, that's down to half.

The changing front doors of healthcare

There's lot of competition for patients. on being the place you go when you get sick. UnitedHealth Group is making a push to make its doctor practices a $100 billion business. CVS is rolling out 1,500 HealthHubs over the next two years in its pharmacies with the hope that you'll go there for help beyond flu symptoms.

Dowling said he worries that the new entrants only want to concern themselves with the healthiest, which could leave him with patients who are harder to care for, putting even more pressure on the hospital model.

But in cases of life-threatening emergencies, like what feels like heart attack symptoms, you're still going to want to go to the hospital, he said.

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"If you get pain down your left arm and you're sweating, you're not going to CVS or Walgreens or Humana. You're coming to one of us because you want your life saved."

And when it comes to technology, he's concerned it'll actually make healthcare more expensive. For instance, technology aimed at catching diseases early could lead to more costs for the tests themselves, as well as costs for monitoring. To be sure, new advancements in medicine often come with high price tags.

"All the tech companies that say they're going to save money, they're going to sell technology. I have yet to find tech that saves money in healthcare," Dowling said.

Which isn't to say that the pressure from new entrants isn't helpful.

"I appreciate all of these things that all of these other people are doing because quite frankly it'll make things better overall," Dowling said.

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Still, he doesn't want to be discounted. "What I don't like is when they exaggerate dramatically the role that they're going to play, changing everything, and also make the assumption that the rest of us who have been in the business a long time are not about change."

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