Last month we were invited by our friends at Seramount, a research and consulting firm specializing in workforce inclusivity, to host a conversation with Chief Diversity Officers from for-profit and not-for-profit healthcare organizations. We met with those DEI (diversity, equity, and inclusion) leaders and had an eye-opening discussion about the top challenges healthcare organizations face today, how they relate to equity, and what they can do to build support from their C-suite. We’ll be sharing an in-depth look at the framework we created for DEI teams in a future post. But we wanted to start our conversation with perhaps the most important single takeaway from that conversation—the need to connect equity initiatives to existing organizational priorities outside of DEI. We’ll talk you through why that is, how to do it, and an example of some organizations putting theory into practice.
Healthcare leaders focused on marquee priorities tied to existential challenges
When we spoke to Chief Diversity Officers last month about the challenges providers are facing, we were impressed with the savviness with which they approached those issues. They were under no illusions about the onslaught of competing priorities leadership must manage. And it’s not just providers—life sciences companies are also struggling with workforce shortages, and players from across the industry are trying to build out new revenue streams while stanching the outflow from previously reliable income sources. Especially given current resource constraints, strategic buyers have a set list of named priorities they are willing to invest in, and high expectations for ROI. Health equity is just one goal on that list, and rarely at the top of it.
The diversity officers we spoke with understood that they were competing for attention and resources with some very high-stakes initiatives. What was less clear to them was what they could do to make sure their efforts didn’t get lost in the fray.
Linkage to strategic business priorities generates more buy-in for comprehensive reforms
We started by asking what specifically their DEI priorities were for their own organizations. Answers varied from person to person, but there were three general themes we noticed:
Organizational culture (creating a “culture of inclusion,” building a “shared identity based in DEI principles”)
Career trajectory (increasing hiring and promotion transparency, succession planning for more diverse leadership)
Data enhancement (building a stronger data infrastructure to collect equity data; systematically analyzing data based on race, ethnicity, gender, sexual orientation, etc.)
As they were stated, most of these aspirations don’t fit neatly under top business priorities, meaning that forward momentum relies entirely on commitment to the organization’s mission imperative. And when margins are tight, such endeavors often see cuts (we see a similar situation playing out among Chief Innovation Officers: it’s very hard for them to get dedicated resources for innovation projects, and when cuts need to be made, they are first on the chopping block). Leaning heavily on mission doesn’t mean nothing will get done—but it does impact which projects get funded, how much, and the extent to which DEI filters into other aspects of operations.
Alternatively, we counsel the DEI leaders we speak with to find opportunities to weave diversity initiatives into existing organizational priorities. Starting with the strategic agenda and working backward into DEI takes a bit more creativity, and certainty requires a deep understanding of the dynamics within a given organization. But building connections to essential departments and speaking the language of the executive team will likely generate more sustainable and comprehensive reforms.
Let’s take some of the examples given above:
Hiring and promotion transparency: Staff members took issue with the seemingly capricious nature of promotions, concerned that decisions were being made for reasons outside of a person’s performance. Implementing more transparent HR systems could reduce disparate outcomes, but a thoughtfully designed process would likely also increase staff retention by creating clearer guidelines for advancement, and the perception of fairness may boost the organization’s reputation as an employer of choice. Both outcomes would be highly desirable as providers and life sciences companies compete for a relatively small pool of talent.
Better infrastructure to capture and analyze data: Many of the Chief Diversity Officers lamented insufficient data systems; as the adage goes, if you can’t measure it, you can’t fix it. Investing IT resources, already in exceedingly high demand, into collecting SDOH data just for community benefit purposes can be a tough sell. But if the DEI team works with the quality or population health team to create tools that could also benefit quality improvement efforts or even risk contracts, suddenly the argument for resourcing becomes much stronger.
Identifying a common goal to advance a non-equity priority is vital, but so too is the process of quantifying and measuring outcomes. This includes both the DEI outcomes (e.g. percent of underrepresented groups achieving promotions) as well as the enterprise-wide benefits (e.g. change in overall attrition rate). These wins help generate momentum so the initiatives can eventually run on their own, rather than need constant support and justification from the DEI team.
What does this look like in practice?
To explore what this principle can mean in the real world, we’ll take an example from a subsector getting a lot of attention right now—personalized medicine. Many organizations are capitalizing on this space, but different investments create very different impacts on healthcare disparities.
Over the past few years, we have seen major advancements in precision medicine, and genomics in particular. One innovation expert we spoke with envisaged a genomic revolution fueled by developments in commercially available DNA sequencing, genetic testing, and gene therapy. These groundbreaking innovations can save lives by catching diseases early and improving treatment protocols. And yet studies have found that many validated genomic tools are less accessible to women, racial and ethnic minorities, low-income individuals, and people living in rural areas. The reasons for these discrepancies are numerous and rooted in longstanding and multigenerational inequality; today we see them manifest as fewer women of color asking their doctors about genetic testing, fewer providers who primarily serve minorities referring to genetic counselors, and higher rates of coverage denials for non-White patients. Moreover, these same groups are often under-represented in genomic research, and we see less investment in technologies to diagnose and treat genetic conditions more common among people of color.
Given well-documented disparities in healthcare outcomes across the U.S., these finding are perhaps not surprising. They are also not immutable. The goal is of course to move toward a system where everyone has equal access to valuable genomic applications. While there are some researchers and policies makers pushing the industry in that direction, that change isn’t going to happen overnight. In the near-term, we are seeing some entities jump at a different opportunity in the healthcare personalization space that is perhaps more likely to improve equitable treatment and outcomes in the next couple of years.
There are a growing number of provider organizations and health plans testing patient segmentation strategies, creating products for groups that have traditionally been left out by our current healthcare infrastructure.
This version of care personalization could improve disparities in access and outcomes by offering services tailored to the diverse needs and preferences of historically marginalized groups. But of course, organizations are also making a bet that there is a path to profitability by targeting previously untapped market segments. There are a few different forms that could take, but we’ll just highlight two here:
Attracting patients: The first value proposition involves attracting new members by offering them something different and specialized. Part of why we’re seeing this uptick in demographically specific care offerings now is the increasingly crowded Medicare Advantage (MA) market. We have a lot more to say about MA profitability, which you can read about in both our public blog and members only content, but here’s a very brief refresher on the top-level info relevant to this discussion: Medicare Advantage is the most profitable line of business for insurers, resulting in more plans being offered year over year. Word of mouth and significant marketing have meant that, as of this year, more than half of Medicare beneficiaries are enrolled in an MA plan. Once enrolled, most beneficiaries do not switch plans, meaning a growing number of plans is competing for a shrinking number of eligible enrollees. These efforts at differentiation give the insurers who offer demographic specific plans or partner with demographic specific providers a competitive advantage.
Experimenting with risk: The second reason has to do with risk, which is another term that gets thrown around a lot. At its core though, the basic principle of risk is that if an organization can reduce total or episodic cost of care for a payer, it will be rewarded with either a bonus or savings depending on the risk model. By targeting specific populations, providers and plans can dip their toe into risk arrangements in a more focused way. Some of these groups are no doubt banking on the idea that by simply designing programs with more specialized needs in mind, they can unlock almost guaranteed savings.
The conversation continues
The pressures our industry faces today are not going to go away in 2024—in fact, many of them will only become greater. C-suites and boards are preoccupied with workforce, revenue, and costs, but that doesn’t mean DEI has to fall to the wayside. Our message to equity leaders is that with volatility comes opportunity, if you’re able to seize it.
Subscribe to our blog if you’d like to get the next installment in our health equity series, where we’ll share a step-by-step process for advancing DEI initiatives in your own organization, and reach out to us if you’d like us to bring the conversation to your team.