Healthcare Incumbents: Watch Your Sides as Well As Your Back For Disruptions

By Clive Riddle, March 22, 2019 

Reuters reports that “United Parcel Service Inc wants to get beyond U.S. doorsteps with a new push into healthcare.” They tell us “the world’s largest package delivery firm is preparing to test a U.S. service that dispatches nurses to vaccinate adults in their homes, Reuters has learned, as the company and its healthcare clients work to fend off cost pressures and competitive threats from Amazon.com.” 

Deloitte, in a recent paper on the Health Plan of Tomorrow, that is the subject of an upcoming webinar, asks who will win the future of healthcare and health insurance: incumbents or disrupters> They tell us that “incumbents’ decisions will determine wither disrupters will be willing to partner with them in the transformation or compete and disrupt their business models.” 

Disrupters and Incumbents, it seems, are relative terms. We often think of disrupters as startups, and incumbents as established companies. But clearly the terms apply to lines of business, as opposed to the business as a whole. So UPS the incumbent in package delivery can become a disrupter in healthcare. Existing healthcare incumbents need to not just watch their backs for startup disrupters seeking to pass them by, but watch their sides as well, from established disrupters. 

UPS has touted healthcare supply chain management for some time. Then in May last year they announced “Chris Cassidy as vice president of global healthcare logistics strategy. He is charged with leading and advancing UPS’s commitment to the healthcare supply chain, which remains a top company priority….Cassidy possesses 18+ years of global logistics and business change experience, holding various supply chain operations, strategy and transformation roles at global healthcare company GlaxoSmithKline (GSK).”

Reuters states that “the world’s largest package delivery firm is preparing to test a U.S. service that dispatches nurses to vaccinate adults in their homes, Reuters has learned, as the company and its healthcare clients work to fend off cost pressures and competitive threats from Amazon.com UPS did not disclose which vaccines it would be using in the project, but drug and vaccine maker Merck & Co told Reuters it is looking at partnering with the company for the initiative.” 

How far and how disruptive this plays out to be remains to be seen, but the transformative potential is there for more healthcare to be transferred from provider settings to the home. And then of course, when patients with more complex needs have to set foot outside the home into provider settings and back again, there is now the disruption taking place with UberHealth and Lyft Healthcare, who have been around long enough to be incumbents in personal transportation but now disrupt in healthcare transportation. The Uber and Lyft disruption is being further fueled by SDOH (Social Determinants of Health), causing CRM incumbent Salesforce to recently roll “out new ‘social determinant’ tool for patients who need other kinds of help, like a ride to the doctor.” And now Uber and Lyft face startups like Veyo solely focusing on peer-to-peer healthcare transportation. 

So who is an incumbent and who is a disruptor? While answering be sure to watch your sides as well as your backs.