Convergence: Consumer and Patient-Centered Business Designs

What will be the distinguishing feature of the healthcare marketplace over the next decade? We would argue that it will be convergence – a blurring of the traditional lines that separate healthcare from health insurance, medicine from health and wellness, employer-sponsored benefits from retail-based healthcare, and the physical from the virtual.

In this Oliver Wyman Health Innovation Center (OWHIC) ideation session, 75 leaders from healthcare and such adjacent industries as retail, venture capital, social media, and IT discussed how new customer expectations and new forms of competition create risks and opportunities. We identified major opportunities both for incumbents and for companies just entering the healthcare market. And we developed a set of high-potential business models for a fast-approaching future. Read and share our Executive Summary here and related infographics and reports here.

Report From the Ideation Session

When senior leaders convened in Chicago, they discussed and debated convergence across three fronts:

The drivers of convergence between the consumer and patient-centered markets – and the new rules they imply for a reshaped healthcare market
The next-generation consumer- and patient-centered business models most likely to win the post-reform race to value
The business model implications for competing in the converged, value-based market – and the risks of staying the same

As part of this, we shared our view of the future converged market landscape that builds on our Roadmap to 2025 and our three previous ideation sessions. Throughout the two days, participants engaged with one another around the implications of the converged marketplace, and worked together to create a new playbook for competing in the future market (see full agenda here.) Download and share our Executive Summary and related infographics and reports through the link below:

1What do you mean by convergence in healthcare?

A couple of things. First, we expect to see payer and provider organizations work together in new combinations, as providers move to take on financial risk and insurers get more involved in care delivery. Then there’s the drive to create new integrated marketplaces that connect traditional care providers and insurance to personalized health and wellness offerings. Finally, we expect to see non-traditional players – retailers, technology companies, and so forth – entering healthcare and partnering with the traditional players to create new, lifestyle-based models.
2What is causing convergence in healthcare?

Many people credit the Affordable Care Act, but really the challenges of an aging population and exploding medical costs were moving us in this direction even before ACA. Healthcare has simply become too expensive for the average employer or individual. And even if it were affordable, the system is frustrating and difficult to navigate. In other words, demand is growing for more streamlined, affordable, prevention-focused healthcare experiences – and we’re already seeing the emergence of organizations prepared to deliver it.
3What worries are there with convergence?

Convergence creates tremendously exciting opportunities – and promises a dramatically better experience for consumers. But it also comes with real risks for today’s incumbents. Our concern is that today’s leading healthcare organizations, dependent as they are on outmoded fee-for-service models, won’t be able to make the transformation to value-based models fast enough to compete in the future landscape. That’s a major part of what we discussed at the ideation session.
4What are you most optimistic about with convergence?

Ultimately, we’re most excited about what convergence potentially offers healthcare consumers – which we all are. Convergence promises a more seamless, holistic, affordable healthcare experience that delivers dramatically better care for less cost. It promises new ways to manage one’s health throughout one’s lifetime and new ways to build profitable organizations that make this possible. Convergence is at the heart of the new value-based healthcare world – and it’s going to be an incredibly exciting ride.