Phoning it in

Apple’s iPhone was disruptive technology and a game changer. Google, hungry for new markets, released its own operating system, known as Android, and has begun taking market share from Apple. Apple, undaunted, will soon release an updated iPhone which is rumored to have a new “killer app”: video conferencing. The companies are playing a giant worldwide game of leapfrog and consumers are the winners.

Why doesn’t this happen in health care? Clayton Christensen is a leading authority on disruptive innovation. In the September-October 2000 issue of Harvard Business Review, Christensen asks you to imagine a small, portable x-ray machine, capable of producing stunning images. Using night vision technology and a patented “nanocrystal” process, the device can be used in a doctor’s office – not a hospital. At just 10% the cost of a traditional x-ray machine you might think this would be an “Android” level example of innovative technology.

The good news is that this technology exists. The bad news is that the entrepreneur who developed the machine got nowhere when he tried to sell it. According to Christensen, this was because it threatened the existing business model. Yet most agree that the “existing business model” gets it wrong.

Wellness is another example. According to Dr. David M. Lawrence, former chief executive at Kaiser Permanente, nearly half the money in what he calls the “sick care” system is misspent, and much of that spending should move to wellness. That conversation goes back further than HMOs and capitation and yet the existing business model remains unchanged.