Technology is the key to starting up a new health care company

A Health Care Startup Realizes That They Need CIO Help

Technology is the key to starting up a new health care company
Technology is the key to starting up a new health care company
Image Credit: Jose Banks

Just exactly how important is a CIO? A startup health care company tried to accomplish the creation of a new way for patients to purchase prescriptions online; however, they quickly ran into problems and failed. This time around they understand that things have to be different. This time around they’re hiring a CIO to help them do it correctly.

The Challenge Of Ordering Drugs Online

So what went wrong for this startup the first time? The company understands the importance of information technology and is trying to turn the filling of prescriptions into an e-commerce business. The company signs up patients to shop for prescription drugs online and then pick them up at a local pharmacy. In order to pull this off, the company worked with a pharmacy benefits manager firm that already had their IT systems in place. However, over time disagreements between the two firms started to cause problems and eventually the relationship fell apart.

The company has decided to try this again. This time they are building their own systems to process patient’s claims instead of having to rely on other company’s systems. They have also taken the extra step of creating their own network of pharmacies where patients will be able to pick up their prescriptions. This second attempt has required the firm to hire a person for the CIO position and agree to play well with their health industry counterparts.

The challenge that the company still faces is that they are going to have to be able to find and hire the right mix of technology and health care professionals to help them out. The company is in the process of entering the health care market that has a lot of need for their product, but at the same time a lot of other health care companies are in the process of increasing their digital efforts. The company hopes to be able to hire people who have an in-depth knowledge of the health care industry as well as people who have in-depth knowledge of technology.

Why The Second Time Will Be Different

Initially the company started business by launching a website that was designed for patients who were uninsured or who had health care plans that came with high deductibles. The company initially depended heavily on their pharmacy benefits partner to fill drug orders and to connect with the pharmacy where the patient would pick up the drugs. The company also had nobody in the CIO position. The company’s plan was to make money off of the difference between what it paid the pharmacy benefits manager and what they paid the pharmacy.

However, disagreements over prices soon arose and the two companies ended up parting ways. The result of this is that pharmacy chains started exiting the company’s network and it became harder for patients to pick up the drugs that they had ordered. The problem turned out to be the fact that the startup thought that they could change the industry by working with established firms and using their existing systems.

In the brave new world that the company is creating for their second attempt, the company is in the process of hiring e-commerce experts. The company has also had to create their own prescription-claims processing system. This time around the company is still hoping to be able to make money based on the difference between what it will pay for drugs and what it will end up reimbursing pharmacies. However, this time around since they will be handling both the claims and the pharmacy relationships they hope to be able to control both sides of the finance equation.

What All Of This Means For You

Let’s face it, having a CIO onboard is important. A startup firm in the health care space tried to roll out a new way for patients to purchase prescription drugs online. However, they didn’t have a CIO onboard and eventually the whole thing just fell apart. However, they are now going to be making a second pass at it and they hope to be successful because they now have a CIO.

The first time around the company partnered with a pharmacy benefits manager firm. The company signed up patents, they shopped for prescription drugs online, and then could pick them up at their local pharmacy. However, the companies got into a disagreement and the relationship fell apart. The second time around the company has hired a CIO and other technical professionals. Their plan is to create their own IT systems so that they can own both the claims and the pharmacy relationships.

Starting a new company is a difficult thing to do. When technology is at the heart of what you are doing, you need to have a CIO onboard who can help guide the company as you roll out new systems and develop new software. This startup firm learned the hard way that trying to create a technical product without a CIO can only lead to disaster. This time around they’ve learned their lesson and they now have a CIO onboard. There is still a lot of risk to what they are trying to do, but the chances of them being successful are now much greater.

– Dr. Jim Anderson Blue Elephant Consulting –
Your Source For Real World IT Department Leadership Skills™

Question For You: How involved in the relationship with the pharmacy benefits manager firm do you think the CIO should be?

Click here to get automatic updates when The Accidental Successful CIO Blog is updated. P.S.: Free subscriptions to The Accidental Successful CIO Newsletter are now available. Learn what you need to know to do the job. Subscribe now: Click Here!

What We’ll Be Talking About Next Time

That pesky e-commerce thing has changed everything for businesses everywhere. What this means for the person with the CIO job is that they need to help the company find ways to use the importance of information technology to do things quicker and better. One way that the person with the CIO job is trying to help out is by taking the robots that have become an indispensable part of almost every warehouse and move them into retail settings. Will robots be the way that CIOs make retail better?

Leave a Comment