The 

Disruptors
The Path to Better Health
Introduction
by Matt Zubiller, Vice President of Strategy and Corporate Development at McKesson

Who are the Disruptors

in Healthcare?
Healthcare Innovation. Much has been written about the role of innovation,
but its potential impact on healthcare couldn’t be more acute. Innovation
is vital to the long-term success and viability of the healthcare system – we
need better outcomes at lower costs and that means a key shift to put value
and patients at the center of care.

Today, healthcare innovation comes in many shapes and sizes. Whether it’s
the consumer who most recently bought a FitBit to measure their activity
or a completely new retail-based model of care, as embodied by companies
like ZoomCare, what each of these examples shares is this–a belief that in
order to drive true disruptive innovation in healthcare, we need to consider
systematic change of the way things have always been done. It can’t be just
incremental changes in how healthcare is provided and accessed. Instead,
we have to re-imagine current approaches to create a future where value,
connectivity, insight and accessibility are paramount and ingrained in all of
the touch points of our healthcare system.

This guide aims to showcase a few organizations–both emerging and

established–that are driving this type of innovation forward today. It’s these
start-ups and entrepreneurial large institutions and these ideas that embody
the future of healthcare beyond the next decade. They are the Davids –
traditional and comfortable Goliaths beware. They are your Disruptors.

In the spring of 2014, McKesson launched the Better Health Tour–a cross-
country tour aimed at bringing together stakeholders across the healthcare
industry to talk about fostering disruptive innovation. At each of the first
three tour stops to date–Portland, Boston and Minneapolis–we gathered
local Disruptors to share their insights on how to change the healthcare
system from the inside out. These are a few of their stories.
From Zero to Sixty:

Mayo Clinic’s innovation center dedicates 60 people to

transforming the healthcare experience
The Mayo Clinic, synonymous with world-class
patient care for nearly 150 years, decided there is
always room to improve the delivery and experience
of healthcare services. So six years ago, Mayo
launched its Center for Innovation with a mission to
incubate health and healthcare innovation aimed at
transforming the experience for patients.

“We’re bringing human-centered innovation and

design thinking to healthcare delivery,” says Barbara
Spurrier, administrative director of the center since
its inception in June 2008.

Spurrier and Mayo have brought 60 people to

the center, many with nontraditional and diverse
backgrounds, whose sole purpose is discovering
and implementing new ways to make healthcare
better for patients and to optimize health. The
center’s multidisciplinary team includes designers, And quite the table it is. Located on the 16th floor of
engineers, project managers, technologists and Mayo’s Gonda Building at the center of its Rochester
innovation coordinators in addition to doctors, medical campus, the center features an open office
nurses and other clinicians. Spurrier herself has design with walls that are not only movable but can
undergraduate degrees in economics and English, be written on when an idea strikes. Post-it notes are
which she later supplemented with a master’s degree the center’s wallpaper.
in healthcare administration.
“We think that the experimental kinds of
environments and places to prototype are really
“Innovation requires people to important as we’re getting our teams much
think differently,” says Spurrier. more comfortable with innovation and working
differently,” Spurrier says. “It feels like you’re
“One of the most effective ways stepping into a start-up environment or tech
to do that is by bringing different company in Silicon Valley.”

people to the table.”

Though located in a physical building, the center’s
four platforms know no bounds limited by bricks
and mortar and instead rest upon the philosophical
foundation of “always be there for me,” which guides
the direction of the center’s 60 thinkers:

• Always be there for me … when I need to come

to you (redesign of inpatient and outpatient care
models).
• Always be there for me … when you can come to
me (new models connected to patients/people in
their homes and communities).
• Always be there for me … when I didn’t even
know I needed you (new services to optimize
health and wellness).
• Always be there for me … (for employees) and
help me understand innovation and apply
it to my work (culture and competency of
innovation).

Spurrier notes that innovation

and a commitment to
transformation require robust
partnerships. To date, 23 organizations and
corporations from all sectors of the economy
are partnering with the center to share, test and
implement new ways of delivering and financing
“We have evolved significantly patient care and creating new health experiences.
since we opened our doors six Among the partners are Blue Cross and Blue Shield
years ago,” says Spurrier. “Now we have tools and of Minnesota, Ideo, Cisco, Destination Imagination,
offerings for our employees and staff to think about Good Samaritan Society and Yale University.
innovation as they do their work.”
“We try to understand user needs and then build out
The center, its 60 innovators, and the growing the services and products that meet those needs. It
culture of innovation throughout Mayo have led is about time for those of us in healthcare to deeply
to a number of new products and services that are understand the needs of people and recognize that
transforming the healthcare experience for patients. those needs cannot be understood from traditional
Among them are: an e-consult service linking methods like patient satisfaction surveys.”
remote patients and specialists; an international
symposium called TRANSFORM (held each
September); a bundled care and payment option for
dialysis services; and combination patient exam/
consultation rooms for physician offices.
All on the Same Team:

Iora Health engages patients in their care by improving

the primary care experience
“Our mission is to transform healthcare by
demonstrating that a better model of primary care
allows you to change everything that follows,” says
Zander Packard, chief operating officer of Iora Health.

Iora Health runs primary care clinics for specific

clientele, namely self-insured employers, unions,
and insurers seeking an improved experience for
employees or members and better value per dollar
spent on healthcare. Partners include Dartmouth
College; the New England Carpenters Benefits Fund;
the Freelancers Union in Brooklyn, New York; and the
Culinary Health Fund in Las Vegas.
You won’t see any white doctors’ coats when you walk
into an Iora Health clinic. The model jettisons traditional billing and coding
(fee-for-service medicine) in favor of a flat per-
That doesn’t mean board-certified physicians don’t person, per-month fee. There are no co-payments for
work there. Iora Health chooses to underscore its patient visits. This frees up providers to spend the
team-based approach to care by doing away with this appropriate amount of time with patients under their
visual cue of traditional medical hierarchy. care–whether in person, over the phone or via email.
Same-day access is a priority. One Iora Health clinic
Patient-centered, team-based care is receiving a great has seen a 12% year-over-year reduction in total net
deal of attention throughout the healthcare industry, health costs with this model.
and Iora Health is joining the fray, if not leading the
way in that movement. The Massachusetts-based
company couples that innovative approach to care
delivery with an innovative payment mechanism
that properly aligns the financial incentives between
providers, payers and patients.
“We want to inspire other people to explore a more
Iora Health has defined its job as engaging patients holistic, proactive, value-based way of delivering
in their own care by improving the primary care primary care,” says Packard.
experience. The results are better experience and
health for patients, lower costs for payers, and better Iora Health applies a patient-centered model of team-
business health for Iora Health’s six clinics. based care with physicians, nurses, social workers and
health coaches all working together. Like many other
patient-centered clinics, Iora Health providers conduct Iora Health has a patient advisory group, where
team “huddles” each morning. Iora dedicates 45 each practice invites patients to give their input on a
minutes to this critical conversation and expects every quarterly basis. Inclusiveness and attentiveness build
member of the team to participate equally. During the trust, Packard says.
huddle, the team reviews the appointment schedule
and identifies patients who missed their appointments, “Once patients know that we’re all on their team, it
who are in crisis, or who require follow-up after a creates this incredible opportunity to serve them,” he
hospital discharge or for chronic illnesses or other says. “Patients start referring to ‘our practice’ and feel
conditions. a real sense of ownership in how well it serves them
and their community.”
Involving Patients at All Levels
Technology is an important component to meeting
Iora Health employs four non-physician caregivers for patient needs, and Iora Health has developed
every one physician. Health coaches work with patients a proprietary platform that combines claims,
to help set goals, identify barriers, navigate the system administrative and clinical data to better serve
and get the right care when they need it. patients. It includes disease registries and other
identifiers to follow up with and proactively manage
“What patients really need is someone who is a relationships with patients who have chronic care
compadre, a health coach, someone who actually cares needs. This system is also available to patients online
about them, who teaches them to care about themselves to encourage their participation in care and treatment
and helps them navigate the system,” Packard says. “The plans.
only way you can do that is by flipping the model around,
putting patients at the center, getting paid differently and “Trying new things in healthcare is necessary to drive
building a team that is good at that stuff.” improvement in an ever more costly system,” Packard
adds.
Iora Health is inclusive with its provider teams and
patients, and Packard says this approach keeps “The catalyst is the status quo,” he says. “It’s about
leadership open to new ideas. time we try things, because staying with the current
model of care delivery isn’t going to get us where we
“We view innovation as something that happens all the need to go.”
time—not just by people who have innovation in their
title,” Packard explains.
“A good idea will only go as far
For example, a health coach in Las Vegas suggested as your team will take you. You
starting a diabetes club, an idea that has since been
implemented.
need to hire the right people
who believe in your vision of
“Our definition of innovation is that people across the
organization are learning and sensing what patients how to improve the healthcare
need, and are empowered,” he says. experience for patients. Each
person on your team needs to
bring that attitude of changing
things for the better to work with
them each and every day.”
Pills, Customer Service and Nothing More:

A customer-centric approach has kept 111-year-old

Central Drugs relevant
By Elizabeth Hayes The answer: focusing on value, service and scale.
Bailey said she doesn’t look to compete with the
At a time of stagnant or declining reimbursement chains head on, but rather seeks to distinguish the
rates from insurers and price hikes from drug store with more of a customer-focused model.
manufacturers, independent pharmacies like
Central Drugs are feeling squeezed from both sides. “Her approach is patient-focused, and that makes
a lot of sense,” says John Norton, director of public
“It’s been very difficult,” says Shelley Bailey, co- relations for the National Community Pharmacists
owner of the 111-year-old drug store, located at Association. “The basic independent pharmacy
Southwest Fourth Avenue and Southwest Alder model is about patient care, (not) volume and the
Street in downtown Portland. front-end stuff.”

Central Drug’s customer mix is about 80% on the

Oregon Health Plan, 10% on Medicare and 10% on
commercial plans. Customers often suffer from
multiple, complex conditions, such as HIV and
hepatitis C.

About 10% of generic prescriptions are covered

below the unit cost of the medication. At the same
time, some big-selling drugs, such as doxycycline,
have skyrocketed in price.
While most chain drug stores subsidize themselves
It’s little wonder that family-owned pharmacies, with a plethora of non-pharmacy items (Valentine’s
which used to be anchors in American downtowns, Day candy being a huge profit center), that’s not
have become something of an endangered species, the case at Central. When the store remodeled in
while nationwide chains like Walgreens and Rite Aid 2011, shelf space was reduced and a conference
and big-box-based pharmacies have proliferated. Of room added for patient-oriented programs such as
Oregon’s 614 pharmacies, 23% are independent. nutrition classes.

“When people walk by, they probably think, ‘How “We can improve outcomes, but how do you pay bills in
cute, a mom-and-pop business,’” says Bailey. “We the meantime?” Bailey asks. “For us, it’s not the dollars
don’t have the challenges of a startup, but we live per square foot at the front end. If we focus on that,
in a world of healthcare Goliaths, so how do we we’re stepping away from our core services, connection
participate?” and community. I would hate to put those at risk. The
more we can focus on knowledge, the better we’ll be.”
Bailey and her staff emphasize educating customers, “Our message is always, ‘Refer
connecting them with social services and insurance
coverage if they don’t have it, and providing tools to to us individuals who have
help them adhere to medication regimens.
challenges and let us serve them
and impact their lives,’” Bailey
says. “Good will is a lot stronger
than marketing.”

And if Central can show that its pill packs are

increasing adherence rates, insurers might be
convinced to pay extra for the service. Central might
look to partner with a health plan to invest in a
machine, which runs about $150,000, to efficiently
create the pill packs. Norton, of the pharmacists
association, said a 2009 study showed $290
billion is wasted each year on the improper use of
medications, so adherence services are a key way
that independents can distinguish themselves.

“That’s why a pharmacist like Shelley is going to

help not only patients,” he says, “but the overall
“It’s beyond putting pills in bottles and ‘Have a nice
expenditures of the healthcare system.”
day,’” says Bailey, 30, who has co-owned the store
with Gary Lundgren since 2006, though she has
worked there since she was 16 years old.

Central uses an appointment-based model to

spend extra time with customers to make sure they
understand their medications and to synchronize
refills. This means a patient may stop in once a week
or once a month and pick up all their meds at once.

“We feel strongly that to be part of the system, you

have to connect face to face,” Bailey says. Central
creates so-called blister packs that group various
daily meds together, an especially helpful tool for
patients who don’t read well. Some patients are given
boxes with compartments containing each day’s pills.

These services are provided free of charge, but

Bailey hopes the investment will pay off. These
practices bolster both medicine adherence and
customer loyalty, which is key since the store doesn’t
do any marketing.
Zooming In on Neighborhood Healthcare:

Pairing technology with neighborhood clinics connects 

patients to primary care
ZoomCare’s tagline is “Healthcare on Demand.”
Patient services include primary care, mental
health, pediatrics, physical therapy, chronic care
management, and specialists such as orthopedics,
dermatology, podiatry and natural medicine.
ZoomCare has a flat fee model, and most illness and
injury visits cost $140 for self-paying patients.

The founders worked closely with IT specialists

to develop a patient portal, analytics tools and
financial software systems to enhance the patient
experience–all based on ZoomCare’s own custom
operating system. For instance, ZoomCare
What happens when you combine the smartphone embedded evidence-based practices into its clinical
with a neighborhood health clinic? In Portland, support system to ensure that its practitioners follow
Oregon the result is called ZoomCare — an best practices in their care treatment plans. Today,
innovative approach to primary care services that ZoomCare serves about 250,000 patients.
seeks to optimize access, quality and affordability
through technology. Now in 24 locations in the
greater Portland area–as well as Seattle and Boise,
Idaho–ZoomCare makes primary and specialty
healthcare accessible in key locations. It also
leverages mobile technology to make everything
from appointment scheduling, to lab results, to
pricing attractive to consumers.

David Sanders, M.D., co-founder and CEO of

ZoomCare, says its goal is to reinvent the “bricks”
of healthcare rather than just rearranging them to
make the same wall.

“I want to define disruption of care as twice the

health at half the cost and 10 times the delight,” Dr.
Sanders says. “We need different people practicing
in different places, different processes, different
methods of payment.”
Keeping “Sarah” in Mind  consumer-centric approach has been key to
A
ZoomCare’s success. For instance, a patient can go to
ZoomCare had humble beginnings but big ZoomCare’s website, schedule an appointment with
aspirations. The company started in a small space on a provider, and be guaranteed to see that provider at
the second floor of a mall more than seven years ago. the scheduled time. Additionally, ZoomCare makes
In the first few weeks of operation, not one customer laboratory, pharmacy and imaging available in the
came into the clinic. same location to enable one-stop shopping for all
primary healthcare needs.
“We were thinking, ‘Oh my gosh, are we just totally
off base here?’” says Dr. Sanders. “Many of my Maximizing provider skill sets is also a focus to
colleagues in the industry–though well-meaning– help keep ZoomCare running as lean as possible
said, ‘You guys have made a giant mistake here.’ But without sacrificing the quality or safety of patient
brick by brick we began working at it and perfecting care. ZoomCare has worked closely with Oregon
our model.” lawmakers to clearly define clinicians’ scope of
practice to make sure that all providers–physicians,
Sanders and his partners and staff keep their physician assistants, nurses and pharmacists–work
patients in mind with all decisions they make. at the top of their license, meaning they’re doing
They call their typical patient “Sarah.” She doesn’t everything the law allows them to do.
want to travel far for care, wants convenient hours,
wants to know the price of a service ahead of time, Sanders and his colleagues at ZoomCare are now
and wants on-site access to ancillary services. The leading an effort to expand telemedicine in Oregon.
job to be done is improving the health status of the A pending bill supported by ZoomCare would allow
neighborhood by making it easy for patients, the providers and patients to connect one-on-one using
Sarahs, to receive the primary care services they video technology.
and their families need.

“Everyone in the company knows who she is, knows

“It’s very difficult for folks to
her needs and is very, very focused on serving her,” break through and say, ‘What is
Dr. Sanders explains.
most important in healthcare?’”
Sanders says. “It’s not me. It’s
not my business. It’s not my
company. It’s the patient.”
McKesson On Tour:
Local Health In Every City

Providing quality health care begins at the local Innovation Framework

level, with individuals and communities evaluating
how people want, need and really access care. As the health sector shifts from a fee-for-service
One company believes that its ability to bridge the payment structure to a value-based care and
conversation between payers, providers, innovators payment structure, overall outcomes and the
and manufacturers can improve health technology continuum of care are more important than
and outcomes. Through its Better Health Tour, San individual treatment steps. Therefore, the
Francisco-based McKesson’s simple goal is to create partnerships that must be forged to connect the
conversations between local health innovators fragments of the continuum begin with conversations
and experts that serve as a catalyst for change. that align our understanding of individuals and
Throughout 2014, McKesson has carried out various communities. Those conversations occur at the
legs of a nation-wide “tour” to introduce and foster intersections of health, not within the silos.
exchanges between different experts in the health
sector. While conversation alone is not a solution, Additionally, the right conditions must exist within
alignment in vision could be the catalyst for a region, for an area to see progress. McKesson
connecting pieces of a very broken system. That is, outlines three business catalysts that must co-exist
focus on the ecosystem as a whole, not the individual to drive cost-effective care and transformative
firms. innovation within a particular region — Alignment
(collaboration among local stakeholders), Value
(achieving better results at a lower cost) and Venue
(delivering care in a variety of settings by an
array of caregivers). Alignment is the foundation,
or as Matthew Zubiller, vice president, decision
management for McKesson said on behalf of
McKesson, “Step one is locally addressing the same
questions, but with conversations varying based on
cities culture.”

By making sure the conversations bring together

diverse voices, new ideas can be fostered and
curated, leading to potentially actionable results.
John Hammergren, McKesson CEO From those actions, new processes and standards
can be produced. And, it is not until those processes
have become efficient that the care can be delivered
in a wide variety of venues. Scaling too soon or
without a complete system could lead to even greater
trouble in our system. Instead, to truly focus on
cost-effective care for patients, providers – and
payers – need to be aligned in their mission.
Conversations On Tour However, after the partnerships forged during the
Better Health Tour, Retrace Health now believes its
During the Minneapolis-St. Paul leg of the tour, primary care clinics’ modified business model could
McKesson reached out to area experts and scale across the country – an ideal outcome for
entrepreneurs such as Thompson Aderinkomi, McKesson, given that Mr. Aderinkomi’s estimates
Founder and CEO of Retrace Health, in addition to show up to A $65 Million savings for MN DHS
the Mayo Clinic’s Center for Innovation, Twin Cities in 2012 alone by sending primary care medical
Orthopedics and Transfuse Solutions. providers to where the patients are in low income
neighborhoods.

The Show Goes On

So long as McKesson maintains the importance

of connecting individuals and organizations, and
refrains from dictating the conversations and ideas
shared, the Better Health Tour could be a unique
and important foundation for driving change for
local health and care providers, and further drive
new groundbreaking companies. As Mr. Kelly
describes the events, “to date, these are well-crafted
and highly localized events that are simply about
bringing people together for a good conversation.”
John Hammergren, McKesson CEO
For potential future events, Mr. Aderinkomi noted
The Portland event featured participants like Bill the importance of maintaining a rotating and
Kelly, Co-Founder and CEO of ReelDx. Mr. Kelly, exclusive conversation space for thought leaders,
who also co-founded the companies that became experts and innovators. He says keeping the
WebMD and Learning.com, was able to discuss the conversations limited and in various locations are
importance of his new company, ReelDx, adding keys. For example, “In Minnesota, we can bring our
HIPAA-compliant, personal clinical video to the safety net hospitals together and improve our health
health care continuum. Secure, shareable videos can insurance exchange concept by introducing leaders
help patients convey their symptoms and get triaged to one another who can work together.”
to the right care more quickly; can create a vivid
record of critical conversations, such as hospital To date, McKesson’s Better Health Tour has been
discharge instructions; and can enhance traditional to Portland, Boston and Minneapolis (Twin Cities).
medical school learning with real patient video case Before 2015, the tour will continue through Toronto,
studies. Using their platform to capture, store and with future events in the works.
share video, ReelDx could jump start conversations
about telehealth, as well as cross-device and
provider real-time sharing with other organizations.

In the case of Retrace Health, Mr. Aderinkomi

claims that his company has one goal, “To lower Nicole Fisher Contributor
health care costs by bridging online and offline Nicole Fisher is the President and CEO
care.” Using this underlying theme, his company at HHR Strategies, a health care and
human rights focused advising firm.
aims to make primary care available to all Twin
City residents and keep up to 39% of avoidable
Emergency Department visits out of the ED.
Conclusion
by Matt Zubiller, Vice President of Strategy and Corporate Development at McKesson

Does True Healthcare Innovation

Depend on the Disruptors?
As we strive for a healthcare system value that delivers better outcomes at
lower costs, the role of innovation has grown increasingly important for all
of the stakeholders involved–from patient, to payer, to provider, and beyond.
In order to achieve true transformative innovation, we need people–like
these Disruptors and the companies they could potentially disrupt–to come
together to collaborate and share cross-industry insights that will allow our
healthcare system to rethink, reshape, and evolve.

All of the Disruptors featured share a few things in common:

• Refusing to accept the status quo

• Bringing people with diverse backgrounds and experience to the table to
solve problems
• Offering streamlined, user-friendly technologies and approaches to
engagement
• Taking a consumer-centric approach to care

What they also have in common is a shared belief that the most complex
problems in healthcare can’t be solved by asking emerging, entrepreneurial
companies to bear the burden fully on their own. They also realize that
established companies have their own lessons to be shared through years of
experience and broad-based workforces that have pushed the envelope for
years. While there are undoubtedly upsides and downsides for both, when
large and small organizations come together, they both depend on each
other to drive transformative innovation. As such, the traditional Davids and
Goliath model can be turned on its head.

Given the unprecedented level of change gripping the healthcare industry,

large and small healthcare organizations will need to depend on innovation,
creative thinking, and more than ever–each other–to successfully navigate
the evolving marketplace. More so, the future success of a “healthy”
healthcare system will rest on the ability to arm these Disruptors–
regardless of size–with the resources, support and guidance to bring their
transformative ideas from paper to patient.
McKesson Corporation
One Post Street
San Francisco, CA 94104
415-983-8300

betterhealthtour@mckesson.com