trends

Health Care 2023: Three innovation trends worth watching

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Jan 3, 2023

It’s that time of year again. Many thought leaders put out their predictions of what will come to pass in the year ahead for health care. But what would theory predict? In this piece, I’ll highlight theory-based predictions around what 2023 will bring. Specifically, it will focus on what the theory of Jobs to Be Done may forecast. 

I’ve written extensively about Jobs Theory in the past, but a quick recap can be summarized as follows: 

  • A “job” is the progress someone seeks in a given situation or circumstance. We call this situation or circumstance an individual’s context. 
  • As a result, a job has two parts: the desired progress and the person’s context. Individuals “hire” products and services—that is, they pull them into their lives—in order to get a specific job done. 
  • When a new product or service comes along that someone perceives serves their job better than the old solution, they hire the new product or service and “fire” the old one. 

In health care, there are myriad examples of how existing offerings fail to meet consumers’ Jobs to Be Done. This presents an opportunity for new entrants—and incumbents—to serve currently unmet jobs. Here I’ll highlight how Jobs to Be Done will likely shape the year ahead in health care. 

Prediction 1: Companies that focus on the job will find growth where others struggle 

In his book, Competing Against Luck: The Story of Innovation and Customer Choice, late Harvard Business School professor Clay Christensen highlights that understanding and organizing around their customers’ jobs is what enables organizations to succeed in the long run. This is because doing so makes it significantly harder for new entrants or competitors to disrupt the organization. However, organizations that focus on their own products, services, and internally-focused priorities are effectively competing against luck. Despite historical approaches, organizations can set themselves apart when they flip this traditional “supply-side” mindset (focus on internal priorities) to one characterized by a “demand-side” mindset (focus on consumer and customer jobs). 

Organizations focused on the “demand-side” establish resources, processes, and priorities around identifying and serving consumer and customer Jobs to Be Done. As a result, they are able to help users achieve their goals by providing experiences that help consumers and customers complete their jobs uniquely well. While this is not the traditional approach of incumbent health care entities, many new entrants have taken this customer-first approach. You can read more about players executing this strategy in women’s health here

In 2023 and beyond, organizations like those highlighted in the article linked above will continue to attract consumers and customers whose jobs are not being met by traditional health care offerings. Even in a constrained economic environment, these organizations will see growth. Dispatch Health’s and Maven Clinic’s recent funding rounds ($330 million and $90 million, respectively) highlight how the market recognizes their ability to viably serve consumers’ and customers’ jobs better than incumbent solutions, and is rewarding them in alignment. 

This trend will occur to the detriment of incumbent organizations and other new entrants that take a supply-side approach. In the years ahead, we’ll watch the jobs-focused organizations grow, while others struggle to maintain market relevance and financial viability. 

Prediction 2: Women’s health will remain a priority, and those that respond are poised to win

As the November election highlighted, women’s health is a top priority—both on the national level and for the health care industry specifically. Women make the vast majority of health care decisions and spend about 70% more on health care during their childbearing years than their male counterparts. In 2022 we saw voters and health care consumers alike loudly voice their preference for access to women’s health services. 

In 2023, women will continue to demand access to life-saving health care. The entities that serve them will reap the benefits of market share growth and consumer loyalty over those who choose to deprioritize women’s desired progress. As a result, wise incumbents and startups alike will enhance their focus on women’s health services. This will include both existing services and new ones that aren’t yet in the limelight, despite research showing their benefit for health outcomes (i.e., doula care). 

Though not a prediction for 2023, in the years ahead, doulas should become a covered service for all. If covered, this health-enhancing care offering would be more available to all birthing people, and not just those who can afford to pay for it out-of-pocket. 

Prediction 3: Jobs-focused value-based care (VBC) models will continue to grow incrementally 

2021 and 2022 were characterized by a lot of discussion around whether VBC is the answer to improving health outcomes and lowering cost of care. Many argue the current trajectory of Medicare Advantage is not sustainable, and others have criticized its current risk-scoring approach as a “money machine.” 

Today’s VBC models might not be the ultimate pathway to better health and lower costs in their current forms, but that doesn’t mean we have to start from scratch. Until a solution enters the market that better serves the Jobs to Be Done that VBC has been hired to fulfill, VBC will continue to be hired by consumers and customers alike to achieve the “help me optimize my health so I can live my life” and “help me keep my costs as low as possible so I can maintain viability” jobs. 

In light of that, 2023 will see VBC organizations that are organized around their consumers’ and customers’ jobs achieve outsized success as compared to their peers who instead organize their businesses around either 1) what the competition is doing, or 2) a supply-side perspective focused on the products and services they already offer. While the growth won’t be near what we saw in 2019, 2020, or 2021 for health care startups, incremental growth will continue nonetheless.

Jobs-focused VBC entities currently seeing growth and that are likely to continue to do so into 2023 (and beyond) include Privia Health, Aledade, and more. 

Just as Christensen outlined in Competing Against Luck, organizing one’s company around consumers’ and customers’ jobs is a path towards long-term sustainability. Aligned with this thesis, Jeff Bezos, former CEO of Amazon, stated, “If we can keep our competitors focused on us while we stay focused on the customer, ultimately we’ll turn out all right.” If more health care entities took this stance, they too would see the outsized growth those who focus on jobs tend to realize. May 2023 be the year we see more health care entities take this approach.

Ann Somers Hogg is a senior research fellow at the Christensen Institute. She focuses on business model innovation and disruption in health care, including how to transform a sick care system to one that values and incentivizes total health.