DealFlow Events had an opportunity to discuss healthcare service industry trends, leadership, risk and more with Scott Ferguson, CEO of Aesto Health, and Paul Wiley, VP of Provider Sales of Veradigm.
Both thought leaders are speaking at the upcoming Healthcare Services Investment Conference 2023 on Nov. 15 and 16 in NYC, delivering more useful information about succeeding in this evolving industry.
How do you foster innovation and how does technology fit into that process?
Paul Wiley:
Well, I guess from an innovation perspective and how technology fits, Veradigm is a technology company, so it’s at the core of what we do and how we operate. And, so there are a few different ways we focus on that within Veradigm. One is leveraging things like data to be able to understand where the market is now, where are customers now, and where are they going? So leveraging is a key piece. In addition, leveraging input and feedback from partners such as Scott with Aesto to be able to drive forward not just in our own siloed minds but also leveraging partners to be able to push this forward as well. So in doing so, it allows us to take a more holistic approach from a technology perspective and an innovation aspect across the business as a whole.
Scott Ferguson:
At Aesto, we’ve got three ways that we foster innovation, and all three are related to our organizational values and how we behave as individuals within our respective teams. So one of our permission-to-play values, which for people that aren’t familiar is a minimum standard that we expect from each other, is to always ask why. And if we are always asking each other why are we working on this, what problem are we solving, why are we still doing it this way, et cetera, then that will tend to help us challenge and look for new ways to do things.
The two other values that dovetail into aspirational values are to be courageous and speak the unspoken and to seek simplicity, whether it’s simplicity in the process, simplicity in the solution, maybe simplicity or pricing, simplicity in how we make the coffee in the morning, just to always seek simplicity. And so, with those three values guiding our behavior and our subconscious, that tends to foster innovation. And so when you think about how we use technology versus the innovation and the technology that we create, how do we use technology to, I guess, support that process? We use a third-party product called Officevibe.com and that engages every individual in the company on a weekly basis. It’s a survey tool.
It’s a SaaS survey tool that helps us solicit insights and suggestions about specific areas for improvement across our products, our processes, and organizational health. Hey, how’s everybody feeling about what we’re doing? What do we need to do to make it better? So that’s the way we use technology in our own healthcare technology business to support the innovation process.
What do you think the three biggest trends to watch in 2024 will be in the healthcare services industry?
Scott Ferguson:
In my opinion, number one would be data-driven modeling and business intelligence tools for healthcare M& A because it will accelerate the speed of ROI. It will add certainty to valuations and enable people to get deals done with more confidence and potentially more speed in times that are somewhat uncertain due to a slower economy. So that’s number one. Number two, the same data and tools that will be used in the pre-acquisition process will help to create benchmarks for accountability of asset performance post-acquisition. So I think that bullet point to elaborate on it a little bit. The last few years have been incredibly active with acquisitions and M&A for healthcare. And now, it’s time to make sure those assets are performing right.
So that relates to the data-driven modeling, pre-acquisition, and post-acquisition. And then the third piece is analyzing the data related to operational performance areas, which I know is near and dear to Paul’s heart, to reveal hidden opportunities for incremental margin improvements that are ready and waiting to be realized. And, these assets have been acquired over the past few years. The question is now, how do we apply technology? How do we identify that hidden yardage, and then how do we execute on it? That’s my three for 2024 to watch.
Paul Wiley:
That’s great. I totally agree with Scott on those. I would maybe consolidate a few of them. In regards to this idea of, in general, consolidation taking place across the industry, whether you think of a provider network and the consolidation happening from multiple organizations on the provider side coming together, or from a payer aspect, multiple payers consolidating as well. But the ability to use this data, to use the analytics, to use the M&A type of activities and insights, to be able to understand and deliver those in a more effective manner, that’s able to be done now better than ever before. I think that’s part one. And then secondarily, these organizations have to run these practices, in particular, are having to be run in a more efficient manner than ever before.
They are truly being run as a business and not necessarily just as a healthcare practice as before. So doctors today need to be businessmen, not just doctors. And in that respect, using the data to be able to do that is critical. That way, you’re able to understand how your business is performing, but at the same time, how you are providing care in an optimal way as well, which I think is the third one in my mind is around consumerization of health care. It’s not new. We’ve been talking about consumerization of health care for years. But the fact is, I don’t believe that healthcare has delivered on it yet. And I think there’s still a way to go, and patients are expecting it. Patients are expecting this technology, this ease of use in their health, just like they are on their Amazon checkout page.
And in that respect, leveraging the data, driving the businesses, focusing on the patients, help us to be able to do that, not only in 2024, but I believe, beyond as well.
Over the next five years, what do you see as the greatest challenge(s) your business will face?
Paul Wiley:
I think the biggest challenge that we’ve seen over the past and moving into the future, there’s a lot of noise in the market associated with technology and what’s being delivered. And to be honest, does it work, and does it add value? I think there are a lot of questions around the new capabilities, the new solutions, the new vendors who are coming into the market and saying, we have this brand new widget, but is the widget actually delivering value to patients and to providers? And from a Veradigm perspective, we’ve been obviously around for a very long time, for 20 plus years, and consistently delivered value in this.
And, I believe us continuing to work with partners like Aesto and with proven value, to be able to say, here’s what we’re doing for you, and here’s the demonstrable results, is critical to drive success in the future. And so, in summary, I think plowing through the noise is a key thing for us and for partners like Aesto to be able to show the results to customers who are looking for it and trying to understand it.
Scott Ferguson:
My belief is it parallels nicely what Paul said because immediately now, as far as our company is concerned, the biggest challenge is displacing the status quo in operations in a slow or slowing economy. Health tech companies don’t compete against each other’s solutions. They compete against the enterprise customers’ disposition of I’m not buying right now, or I’ll buy it later. And working operators, the operators that are working in the enterprises and the investment groups that are sponsoring and funding the enterprises, waking them up to the possibility of finding some stored potential in those existing assets and some overlooked opportunities for incremental improvements, I think is the key to the next five years.
And now anybody in the consolidated space for healthcare enterprise that has been highly acquisitive since the pandemic is coming down the backside of the slope of the biggest healthcare M&A spending spree in history, bar none. And that’s colliding with a slower economy. And the natural inclination is to push back from the Thanksgiving table, rub your belly, and say, hey, I feel full. Maybe I need to take a nap. And healthcare groups that will be thriving five years from now and realizing outsized returns will shift their investment focus to more resilient tactics with incremental improvements that support those operational efficiencies that Paul was talking about earlier. Putting marginal improvements into motion now will accrete significant value over the next half-decade. And I think that is what we face as health tech companies supporting those groups for the next five years.
I think that’s what they’re facing for the next five years. And how do we outperform expectations from the past two years of the most roll-ups in history?
With that in mind, what do you think makes for a successful leader? How do you keep cultivating those qualities in yourself to keep delivering what’s needed?
Paul Wiley:
I think, first off, leaders should always be learning and growing. If you’re not, then the rest of the team’s not either because the team will follow the leader. And in that respect, making sure you’re growing, you’re learning is critical. I think, too, is driving that and fostering that growth with those on your team. One of our goals is to promote every single one of my leaders. That’s one of my goals in the organization, and to do so, they have to be growing. The last one is I firmly believe high-performing teams rest well. So it’s not just to perform well, but also to rest well. And so, in that respect, ensuring that takes place is critical across the organization so that people are performing at their optimal capabilities.
Scott Ferguson:
I agree with all of those. What sets leaders apart from others? I think, first and foremost, it’s a healthy dose of self-awareness, a high degree of transparency, adaptability, initiative, and all that wrapped up in optimism. I think those are some key ingredients. There probably are others to cultivate those qualities in myself, I feel like it’s important to seek unvarnished feedback, to speak the unspoken, to be open to input, and to take whatever the next step is. It’s the very next step needed. And to embrace change is pretty much the only constant in life, and recognize no matter how good or bad something seems at the moment, it’s going to change and just understand that.
What is your approach to it? And how do you balance potential rewards versus potential risks?
Scott Ferguson:
I think to achieve more than others think it’s possible, you have to take a little more risk than others think is safe, and you have to dream a little bit more than others think is practical. How do you balance that? I’d say very carefully. I actually, and I’m not being a wise guy, I thought long and hard about the answer to that question, and I just kept coming up with those two words very carefully. No other formula than that.
Paul Wiley:
Yeah, that’s funny. Well, I think at least my opinion is that you might be speaking with a couple people who are both optimists and willing to take risks because we’re both founders and entrepreneurs. So in that respect, we might be a little bit on the other side of the curve on this one, a little bit, but it is one where the fact is that I don’t think there’s a blanket statement on risk and willingness to take risk. I think it’s on an engagement-by-engagement basis. I think it’s on a strategy-by-strategy basis. I think it’s on a customer-by-customer basis because each engagement, each customer, and each strategy is slightly different. And so, in that respect, having a single broad-brushed approach, I believe, is dangerous. Instead, having a strong board and a strong team allows us to understand which ones are worth taking and which ones are not.
Last one: Just a brief overview of the history of your company and what makes it so special.
Paul Wiley:
All right, well, from a Veradigm perspective, and it’s interesting, I’m 11 months in, and I was the founder and CEO of Opargo, which was acquired by Veradigm 11 months ago. But in this regard, Veradigm has been around for 20-plus years delivering EHR practice management revenue cycle capabilities to providers for, as I mentioned, many years. But the reality is, what we’re seeing and what we’re doing is different. It’s different from before. We’re leveraging analytics and data and relationships to be able to understand what’s not only important to the providers but also what’s important to the payers, as well as what’s important to the life science companies. By ensuring that we are working through that network, as we call it, the Verdigm network, we’re able to deliver better outcomes, better care, and greater efficiency for all three pieces of that network.
And so it’s a very fundamental change and shift in the organization. Instead of just delivering technology, we focused on delivering solutions that help practices be more efficient from a data consolidation, analytics, payer, and relationship perspective, but then at the same time, too, leveraging those insights to be able to help insurance companies and life science companies be able to close that loop and provide better care for patients as well. So we’re excited about where we came from. We’re also really excited about where we’re going because we believe it gives us an opportunity to deliver value to each of the different pieces of the healthcare ecosystem.
Scott Ferguson:
At Aesto, our vision is to simplify healthcare data exchange. Why do we want to do that? So that we can accelerate clinical and business decisions for our customers and all the folks that are involved in healthcare. What do we do? What’s our mission? We develop solutions that enable data access, data analysis, and data storage. Who do we do that for? Mostly key stakeholders are involved in healthcare mergers and acquisitions through the continuum of that process. Whether it’s the buyer, the seller, the M&A team, the integrations team onboarding the platform, and it could be the operations team, or certainly the C-suite that’s responsible for the performance of those assets.
So our solutions are designed to automate and eliminate some of the most difficult, most time-consuming, most error-prone parts of the healthcare acquisition process and then give management the tools to be accountable for post-transaction performance.
DealFlow Events’ Healthcare Services Investment Conference 2023 is next week, Nov. 15-16 in NYC at The Edison Ballroom, a luxurious and historic venue in Mid-Town Manhattan. Register now while tickets are still available.
