Top 10 things I heard at Federation 2017

I attended the recent Federation of American Hospitals Public Policy Conference and Business Exposition, in Washington DC. It was a great meeting and had record attendance. Kerry Price from the Federation has put an indelible stamp on the meeting and organization. If you didn’t attend this year, you really should consider it next year – it is a must-attend meeting!

I wanted to share a few takeaways from the meeting. By no means a comprehensive list of items, but certainly some interesting discussions. I did my best to capture these thoughts accurately, but I don’t think they are verbatim, so I am paraphrasing at times.
I’d be interested in hearing what you think of these. Comment here or drop me a note at

  1. Cost cutting is not going away. (Newt Gingrich)
    Newt Gingrich, former Speaker of the House, made the point that cost cutting is not a fad, but a worldwide phenomenon. He made it clear that he believes faster, better, and cheaper are attributes that are here to stay.
  2. The smartphone is the most important medical device ever invented. (Newt Gingrich)
    As diagnostic and monitoring apps develop, and vital statistics can be delivered right to your smartphone, this will facilitate better health for people all over the world. I certainly have thought about smartphones being helpful in wellness initiatives, but as a gateway to primary and interactive care – that really opened my mind.
  3. Suppliers, can you align your goals with your customers (as opposed to shareholders)? Business success will follow the success of your customer. (Pete Allen of Novation)
    Sage advice from Pete Allen, who has been on both the supplier and GPO side of the desk. If publicly owned suppliers would focus on patients and their needs, the company would prosper. The converse to that is that the company focused on shareholder return, and that focus of putting energy into products, is not necessarily needed by the market.
  4. 56 percent of patients look for cost of healthcare before getting care. (Matt Stevens of the Advisory Board)
    Consumerism in healthcare was a huge re-occurring theme of the meeting. But the statistics Matt provided floored me. I knew more people were shopping their healthcare – especially Millennials – but I had no idea it was as high as 56 percent!
  5. Give me convenience or give me death! (Julius Heil of Intalere).
    Another patient demand for a better consumer experience. A better experience is coming to permeate all facets of healthcare as the marketplace continues to transform. Look for increasingly convenient, virtual, friendlier, closer care sights with expanded hours for Americans everywhere.
  6. If you or a family member were sick, what country would you go to for care? The problem isn’t where the best care is, it’s how we pay for care for all Americans. (Senator Marco Rubio, R-FL)
    This is a great way to frame the need to restate that we don’t have a healthcare problem, rather a healthcare financing problem. Senator Rubio did a great job imploring the audience to keep providing great care for patients, and that Washington would find a way to make a sustainable finance model for those that need help.
  7. We will see the expansion of the definition of the word “commodity”. (Richard Yonker of Tenet)
    We have been seeing this the last few years. Any product that can be cross referenced and substituted to a product with comparable attributes is at risk of being converted. It is clear that Suppliers who don’t have a highly-differentiated value proposition should be nervous!
  8. We are happy to pay more for a better clinical outcome. We do it all the time. (Raymond Davis of Banner Health)
    This is clearly good news for Suppliers that have products or services that can move the needle on outcomes. Spending more on products for better outcomes is not sweeping the country by storm, but I do sense a changing tide that value and the intersection of cost, quality and outcomes is being mobilized.
  9. Amazon knows what you want. They have 800,000 medical items …. I don’t think you’ll see mass adoption. (Julius Heil of Intalere).
    Amazon has many people nervous in the US Healthcare Supply Chain, especially distribution companies. I think the emerging Amazon healthcare play isn’t going to be one to just replace one stakeholder or another. I think it is going to be a model none of us can imagine, one that is truly different than anything we have seen. Maybe one that has two-hour product delivery or overnight replenishment? Check out this upcoming meeting that will answer some of these questions. IDN Insights West 2017 Meeting Details
  10. We have 3,300 employees, and only 15 percent are related to contracting. (Pete Allen of Vizient)
    This reminds of the only tag line “This isn’t your father’s Oldsmobile.” We live in a time where there is no such thing as a standard old GPO. They truly are margin improvement companies. Just doing contracts these days is clearly not enough.

About the Author

John Pritchard
John Pritchard is the publisher of The Journal of Healthcare Contracting.

1 Comment on "Top 10 things I heard at Federation 2017"

  1. John, my first pass at some of the comments, is that the obvious is stated. I have been in healthcare for over 30 years and even when hospital profit margins were good, we were always looking for ways to cut costs, but never, at the expense of patient outcomes and for some of us, we were able to generate better outcomes, better patient satisfaction, etc. without having to pay more for it. The issue becomes, can industry develop Value/ROI/RWE models that fit how we treat patients and measure outcomes and now that we have more “Integrated” Delivery Networks, will we make the best clinical decision for the patients, to prevent admissions or treat patients, whether it is a drug, device, procedure, etc. I have been speaking to some health systems that are/have implemented Value Based Insurance and Population Health. The question is, how will the GPOs contribute in these models and as one IDN told me, there maybe an amendment to a contract they write for their IDN, which may include their GPO. If preventative care works, like some IDNs are focused on, there will be less use of products/commodities on the inpatient side and more expenses, in particular drugs, in the non-acute/outpatient setting. I am not sure if people realize how the shift in inpatient care has been affected by newer treatments over the years, to the outpatient setting?

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