Note To Reader – Today I’m publishing the last part of my blog series on digital health innovation.  I published Part 1Part 2 and Part 3 over the last few weeks and today I’m presenting a “bonus” piece with an idea for your consideration.  As always, I appreciate your thoughts, suggestions and feedback, so please feel free to comment below. Thanks for your time. JL


What Can We Do Beyond Pilot Health Tech NYC To Drive Adoption Of Digital Health Technologies?

As I argued in my last post, it’s clear that structured pilot programs are a highly effective way to drive adoption of new digital technologies in the health delivery system.  While programs like Pilot Health Tech NYC can clearly speed up the process of piloting new technologies, I believe that large, established health provider organizations are fundamentally limited in how quickly they can plan and execute any particular pilot project (for the many reasons detailed in blog post 2).  In fact, I believe programs like Pilot Health Tech NYC are operating at the limit of how quickly the typical established provider organization can innovate, and I don’t think we can go any faster using current approaches.  If we want to accelerate the pace of innovation we need to create an entirely new kind of entity to pilot digital health technologies.


The Living Lab Innovation Concept

I’ve spent a lot of time reviewing academic innovation research from authors such as Henry ChesbroughEric von Hippel, and Karim Lakhani for insight into the next generation of digital health innovation programs.  One of the most compelling innovation concepts currently in use is the “living lab”, initially developed by Mitchell, Larson and Pentland at MIT, which is best described as a:

“A system that brings together interdisciplinary experts to discover, develop, test, and deploy – in actual living environments – new technologies and strategies to solve real problems using open innovation principles”

The living lab concept is interesting because it combines a number of key elements from other innovation methodologies and directly addresses many of the issues that are currently constraining the advancement of digital health technologies in the field.  Utilizing the four main aspects of this model (exploration, co-creation, experimentation, and evaluation) a digital health-focused living lab would:

  • Exploration: Provide a platform that allows a broad range of stakeholders (patients, providers, researchers, innovators, etc.) to work together to discover problems and identify opportunities to utilize digital health tools.
  • Co-Creation: Allow these stakeholders to work together collaboratively to shape and create solutions to health care problems that are relevant and fit the needs of all involved.
  • Experimentation: Support a framework for testing new technologies to generate and collect meaningful data, test experimental hypotheses and quickly cycle through many different problems.
  • Evaluation: Facilitate the review of data from the experimentation process, support summarization and publication of key findings, and drive the application of that knowledge by all stakeholders.


A Living Lab For Digital Health

What I propose is the creation of a new entity – a “Living Lab for Digital Health” – whose primary mission will be to rapidly discover, develop, test, and deploy new digital health technologies.  This entity will be composed of two co-located components: a “Health Service” and an “Innovation Workshop”.  The “Health Service” will employ licensed providers (doctors, nurses and others) and provide direct care to patients who have consented to participate in the activities of the living lab.  The “Innovation Workshop” will employ technical staff (technologists, researchers, and others) who will interface with the innovator community, and manage the identification, creation, testing and evaluation of new digital health technologies.  The idea is to unite the “Health Service” and the “Innovation Workshop” under one umbrella, using open innovation principles, making it easier to run pilot programs and get new digital technologies into the hands of patients and providers.

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The “Health Service” will operate most effectively as an ambulatory/outpatient clinic, which will allow us to avoid the huge capital costs and the politically contentious “certificate of need” process required to create a hospital or free-standing health facility.  The “Health Service” will employ dedicated providers who exclusively serve patients, both in-person and virtually, participating in the Living Lab.  In addition to the dedicated provider staff, the “Health Service” may also support providers from more established host organizations interested in learning about health delivery innovation.  Another option would be to allow non-traditional provider organizations (such as concierge medical practices) to plug into the “Innovation Workshop” to work with the Living Lab’s technical staff and external innovators.

The “Innovation Workshop” will provide a physical laboratory environment for experimentation to take place, including computer workstations, software and hardware resources, and meeting areas.  “Innovation Workshop” staff will work directly in support of the “Health Service”, providing the many of the functions critical to advancing new digital health technologies including innovator vetting, technology evaluation, and pilot management.  The “Innovation Workshop” may directly develop its own proprietary technologies in partnership with the “Health Service” over time, in addition to sourcing technology from third-party innovators.


Aren’t There Similar Types Of Innovation Labs Already In Operation?

Given the tremendous interest in digital health it should come as no surprise that there are a number of different digital health innovation labs already operating.  University-affiliated academic medical centers were the earliest players in this space and there are well-developed digital health labs at UCSF and Harvard.  While these labs are able to harness the tremendous resources of their parent institutions I believe they are still constrained by the issues that define the academic medical center (organizational complexity, risk aversion, prioritization, etc.) and can’t move at startup speed.  I also believe that many of these academic medical center labs also face an innovator’s dilemma problem in which they may be reluctant to pursue truly disruptive technologies that might jeopardize the institutional status quo.

Accountable Care Organizations (ACOs) are also becoming a platform for digital health innovation as new payment models drive the adoption of technologies that make health delivery more efficient.  While ACOs will undoubtedly be a significant source of innovation in the future, creating an ACO is a major undertaking that requires the resources of a large entity like a hospital or large provider group.  Because of the many regulatory requirements and organizational details that need to be worked out, ACOs will be limited in how quickly they can innovate.  The Living Lab For Digital Health concept requires significantly less investment to run and maintain and will be able to generate results on a much shorter timeframe.


What Will The Living Lab For Digital Health Produce?

The primary mission of the Living Lab is to pilot new digital health technologies in a real-world clinical setting and generate research in the form of pilot studies.  Pilot studies will generally be developed in partnership with innovator entities testing a specific technology.  In general, these pilot studies will provide innovators with proof-of-concept data to demonstrate the validity of an application or product.  The research agenda of the Living Lab may be organized around specific disease states (i.e. “Diabetes Month”) or horizontal applications (i.e. “secure messaging”).  In support of pilot studies, the Living Lab will organize the following:

  • In-Person Meetings –
    • Public Forums will bring together a broad range of stakeholders to discuss a particular topic or issue
    • Focus Groups will allow smaller groups of patients and providers to work directly with technologists and innovators on specific problems
  • Online Meetings –
    • Webinars will be used to help scale interactions between patients, providers and innovators, broadening the discussion
    • Surveys will be used to collect information from all stakeholders to inform R&D and product development
  • Competitions
    • Challenges will be organized over long periods to develop solutions to problems of interest to the Health Service or Innovation Workshop
    • Hackathons will be organized to allow all stakeholders to brainstorm and build solutions collaboratively on a shorter time frame
  • Residencies –
    • Patient/Provider – Patients and providers will have an opportunity to volunteer to work with multiple innovators to collaboratively design products over a specified period of time (i.e. days to weeks)
    • Innovator – Innovators will also have the opportunity to embed themselves in the Health Service for a customer immersion experience


Are There Collaboration Partners With Whom The Living Lab Can Work?

There are many organizations working on exciting innovation efforts, many of which have participated in Health 2.0 Developer Challenge projects, that could partner with the Living Lab For Digital Health: 


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  • SHIN-NY/New York eHealth Collaborative (NYeC) – NYeC created the Statewide Health Information Network (SHIN-NY) to connect providers across New York State.  The Living Lab could utilize the SHIN-NY as a central component to deliver better care to patients in the Health Service.
  • Blue Button/Office of the National Coordinator (ONC) – The ONC has been at the forefront of our national health IT adoption drive.  The Living Lab could collaborate with ONC on initiatives like Blue Button to give patients better access to their health data.
  • SMART (Substitutable Medical Apps, Reusable Technologies)/ONC – Is a project funded through the Strategic Health IT Advanced Research Projects (SHARP) program to create more modular and flexible health IT systems.  The Living Lab could be an early adopter of the SMART system and develop applications for it.
  • Health Data NY/New York State Department of Health (NYSDoH) – The New York State Department of Health has been very active in making a broad spectrum of health related data available to the digital health community.  The Living Lab could use data sets from the NYSDoH to improve health care delivery.


How Will The Living Lab for Digital Health Be Funded?

There are a number of different potential sources of funding that can help launch the Living Lab For Digital Health and eventually make it self-sustaining, including:

  • Direct Patient Care
    • The outpatient clinic business model is well-established.  The “Health Service” will recruit patients with health insurance and seek payment for reimbursable services from third-party payors.
  • Pilot Consulting Fees
    • Innovator companies seeking validation of a new technology will likely value access to patients in the “Health Service” and may partner with the Living Lab on a project basis to generate white papers and research studies.
  • Sponsorships
    • Organizations that currently support digital health innovation efforts, such as technology vendors, payors, pharma, etc. may be able to provide significant sponsorship support to cover the costs of the “Innovation Workshop”.
  • Grants
    • Organizations that seek to promote innovation in health delivery, such as major foundations and governmental agencies may be able to fund both the “Innovation Workshop” as well as subsidize the cost of care in the “Health Service”.
  • Training Fees
    • Health providers seeking to learn more about digital health technologies will likely find value in accessing the “Innovation Workshop” and may partner with the Living Lab to receive training.


What Will It Take To Get Started? 

The Living Lab for Digital Health requires a modest capital investment and a relatively short planing period, facilitating the launch of the project on a short timeline.  Specific considerations include:

  • Organization
    • In the state of New York one must establish a professional service corporation (or PC) to deliver care in an ambulatory or outpatient setting.  Establishing a PC can be accomplished in a short period of time and I have already submitted the relevant paperwork.
    • In addition to establishing an organizational entity for the “Health Service”, the Living Lab will also require basic operating elements such as malpractice insurance and third party payor registration, all of which can be completed in less than a quarter.
    • I have already established the LLC needed to operate the “Innovation Workshop”.
  • Facilities
    • As mentioned above the “Health Service” and the “Innovation Workshop” will be co-located to facilitate interaction between providers, patients, and innovators.
    • I project that that each component requires anywhere from 1,000 – 2,000 square feet of space, for a total of 2,000 to 4,000 square feet.
    • The location will be based in New York City, likely in one of many densely populated neighborhoods to simplify patient recruitment.
    • I have been working with a design team to create the facilities needed for this project and can complete the initial design process on a short timeline.
  • Team
    • Health Service
      • The Health Service will be initially staffed with a health delivery team that is similar to what would be found at a typical medical practice with a census in the range of 3,000 – 5,000 patients: 1-2 Physicians, 1-2 Nurses/Nurse Practitioners/Physicians Assistants, and 1 Support Staff.
    • Innovation Workshop
      • The Innovation Workshop will require a small team of individuals who can interface effectively with the Health Service and the innovator community.  Worskshop staff will require background in health, business, innovation and technology.  Staffing would likely be: 1 MBA-level Lead, 1 to 2 BA-level associates.
    • Through my personal network of providers and digital health professionals I have the connections needed to pull together a great team for this project.
  • Timeline
    • Entity Formation (PC) – <3 months
    • Fundraising – 3 to 6 months
    • Team Recruitment – 3 to 6 months
    • Establishing Facilities – up to 6 months
    • Time To First Patient Visit – 6 months from project initiation


Next Steps? 

I am ready to pursue this opportunity in the immediate term.  As noted above I have most of the resources already in place and have the ability to execute along the timeline described.

If you’re interested in funding this project, partnering with me, volunteering, or just getting involved in some other way please feel free to give me a call at 646-734-2320 or email me at