Free Enterprise Staff  | October 20, 2015

Does Dell Medical School Know How to Fix U.S. Health Care?

This post originally appeared on Above the Fold the U.S. Chamber of Commerce’s digital platform featuring analysis, commentary, and real stories about the intersection of government and business.

For the last several years, Washington has been the epicenter of a fierce debate over how to fix U.S. health care. But what if the road to real reform was through Texas and not the nation’s capital?

In Austin, health care experts attached to the Dell Medical School at the University of Texas, which is slated to open in 2016, are looking for a fresh approach to creating a health-care system that offers higher quality and more responsive care at a lower cost. That process starts with asking questions.

“Physicians of the future need to be able to look around at the system and say, ‘What’s wrong? What’s broken in our system?’” Clay Johnston, dean of the Dell Medical School, recently explained. “How can we restructure it to better meet the health needs of patients?”

The school’s leadership is betting that one way forward is to nurture constructive partnerships between health care providers, researchers and entrepreneurs to develop and test new solutions that benefit patients. That model for innovation has served to improve quality and lower costs in a wide range of industries.

It’s an approach that dovetails with the findings of a recent report on civic innovation published in May by 1776, a business incubator based in Washington D.C., and the U.S. Chamber of Commerce Foundation.

That report, titled “Innovation That Matters: How City Networks Drive Civic Entrepreneurship,” offers a roadmap for how pressing public challenges can be addressed by bringing together civic and business leaders, entrepreneurs, and corporate partners to focus on fresh solutions.

With a focus on health care and three other core “civic sector industries” — education, energy, and city government — the report explores how these key areas could be transformed through an infusion of entrepreneurial values and start-up-style management.

Austin was one of eight cities on the leading edge of innovation profiled in the report — and the approach that leaders of the Dell Medical School are taking to address health care challenges offers a prime illustration of innovation in action.

‘Future Facing Health Care System’

Mini Kahlon came to the Dell Medical School last year to serve as the new institution’s vice dean of strategy and partnerships, after serving in a similar capacity for the Clinical & Translational Science Institute at the University of California, San Francisco. The goal of the new school, as an innovation center, is to develop what she calls a “future facing health care system” that better serves the public’s needs.

“In some ways we’re actually very regionally focused because we want to demonstrate some very big changes,” she said during a recent telephone interview. “But the only way we’re going to achieve the scale is that we have to beg, borrow or steal every good idea from everywhere else and then leverage it here.”

Austin turned out to be an ideal location for testing that approach, thanks to a powerful local commitment from voters. In addition to funding from the Michael & Susan Dell Foundation and the University of Texas System, the medical school will benefit from a local revenue stream in the form of a property tax increase approved by 55 percent of Travis County voters in 2012.

The fact that voters would approve a tax increase in the middle of a sluggish economic recovery, Kahlon added, was perhaps surprising but also a reflection of their belief in the concept.

“It blew my mind,” she said. “That’s one indicator of the commitment this community has to make this shared vision a success.”

Kahlon’s role is focused on building partnerships – being a connector. As a neuroscientist with a background in academia as well as managerial experience in Silicon Valley, she wants to identify the cutting edge research that’s happening on the UT campus, and then help researchers connect with entrepreneurs and industry to create new health care products, technologies and therapies to bring to market.

That’s not as straightforward as it may sound. Many academic researchers may not grasp the full commercial or medical potential of their work. Meanwhile, many entrepreneurs who are poised to fund product development and marketing may not recognize how what’s happening in the research lab can carry over to a product.

Kahlon’s job sits at the intersection of the two, helping to connect them and build a road to bring new health care treatments, therapies and products to practitioners and patients.

Another component of that strategy is the launch of the Texas Health Catalyst program, which offers researchers in the medical sciences incentives of up to $100,000 for bringing new discoveries to market

The goal of these undertakings is to create a new ecosystem of care, “where the smarter way to deal with it is to redefine some goals, plug in technology — right now we have enough evidence that that will improve outcomes and reduce costs,” she said, “and, by the way, create this amazing system for entrepreneurial activity.”

What might that look like? As an example, Kahlon pointed to hypertension as a particularly pernicious health care problem — one that affects nearly a third of U.S. adults, according to the Centers for Disease Control, and leads to more than 30,000 deaths per year.

That means millions of Americans trudge to a doctor’s office on a regular basis for a blood pressure reading and to have their medications adjusted. As Kahlon describes it, it’s a poor use of the physician’s expertise and time, a burden on patients and a wasteful way to deal with what in most cases is a manageable condition.

“The right way to manage it is not to have to go to a doctor,” she argued. “That’s not rocket science; you don’t need a physician to do it. It’s not rewarding for the physician, and it’s a complete waste of time for the patient.”

A more effective and efficient system, she suggested, might allow a patient’s blood pressure to be monitored via a wireless device that would signal when a change in medication or additional care was needed. That would also free up time for physicians to focus on more serious cases.

That entrepreneurial approach to innovation isn’t limited to the research track. It’s also found in the school’s educational curriculum, as medical school Dean Clay Johnston explained.

“There’s a lack of entrepreneurial leadership in health care — not necessarily people going out and starting companies, but people who are very creative and providing solutions to system problems on a large scale,” Johnston said in a recent interview. “Those are the people who we think we need to train. Our graduates may spend 80 percent of their time in the direct care of patients, but we hope that they will spend the other 20 percent working directly to improve health at scale.”

Making Health Care Innovation Matter

What’s happening in health care in Austin is a case study in the type of civic innovation the Chamber and 1776 explored in the “Innovation That Matters Report,” which serves as a roadmap for cities looking to develop a “civic entrepreneurship” ethos to drive growth and progress.

The areas of health care, education, energy and city government were selected because they reflect public sector industries that are highly regulated with entrenched institutional players. As a result, they’re areas that tend to grow more expensive and resistant to change, leading to a cascade of poor outcomes and squandered public trust.

1776 and Chamber researchers examined Austin and seven other cities (Boston; Detroit; Chicago; New Orleans; New York City; San Francisco; and Washington, D.C.) and conducted interviews and roundtable discussions with local leaders and entrepreneurs. The goal was to find points of commonality to identify a set of best practices for civic entrepreneurship, which could be adapted and adopted by other cities.

Researchers tagged network connectivity as the “secret sauce” that drives growth in the civic innovation ecosystem — the stronger the network effect binding entrepreneurs, civic leaders and the business community, the more advanced the ecosystem.

The Texas capital scored well on the connectivity measure, perhaps because the city has “a comparatively small base of corporate and civic institutions,” which allows for greater familiarity among players. Leaders at the Dell Medical School are certainly leveraging that network effect for their ambitious goal of rethinking health care.

And that rethinking is overdue. For years, the policy debate around health care has centered on instrumental questions about who should be paying.

But as the leaders in Austin emphasize, there is an entirely different conversation to be had about how to make health care better and more affordable. The solution to those challenges is more likely to be found through entrepreneurial exploration and innovation.

“The big picture is that this is an area of innovation, which means that we’re going to try some things, and some of it is going to fail and some of it is going to succeed,” Kahlon said. “But we have to because otherwise we’re just going to be doing the same things in the same old ways.”