Since last fall’s election, the uncertainty in healthcare has grown tremendously. At first, it seemed definite that the Affordable Care Act would be repealed. But after numerous attempts in Congress, still to no avail, the “new normal” appears to be this: wake up, check Twitter to see if anything exploded, and then plan your day.
But how can we do this, day after day, without losing our sanity? Is there any “signal” we can extract from all of this noise? A path we can follow?
Fortunately, there is. There are tried and true methods to manage through turbulent times, both at the business and personal level. We can apply these methods as healthcare leaders. Below are some tips that you can use, depending on your role in the company.
Role: Responsible for business strategy
If you responsible for developing or contributing to your company’s overall business strategy, but feel overwhelmed by the uncertainty in the marketplace/political environment, you must “keep calm and carry on.” Remember that it is always possible to take a systematic approach, even if uncertainty levels are high. Here are some tips from a classic Harvard Business Review article, “Strategy Under Uncertainty.”
First, identify the level of uncertainty you are facing. Level 1 means that the potential outcome of the situation is “clear enough.” Levels 2 and 3 means that there are alternate or a range of futures. And Level 4 means there is “true ambiguity” regarding the potential outcome. About half of all strategy problems are Level 1; very few are Level 4. This means most strategy problems have a range of potential outcomes you can assess.
Second, identify the range of potential outcomes and their probabilities of happening. Try to simplify the possibilities and narrow things down.
Third, do scenario planning on how to respond to the most likely outcomes. Specifically, identify where and how to compete. You have three options for action, according to the Harvard Business Review article:
1. Make big bets (“shape the future”)
2. Hedge your bets (“adapt to the future”)
3. Wait and see (“reserve the right to play”)
For any scenario, identify the “no regrets moves,” i.e., the things that are worth doing no matter which outcome. Those could be building skills of employees, gathering competitive intelligence, and finding ways to reduce costs and run more efficiently.
For example, take the ACA repeal and replace proposals. It may feel like a lot of uncertainty, but if we analyze what’s really at stake, we can see that the potential effects fall into two main categories: the individual insurance marketplace and Medicaid. The proposals’ impacts have boundaries and are distinct. Specifically, the individual insurance market is a very small percentage of the insured population. And while Medicaid covers more people, a block grant would limit, not eliminate funding. So, for all of the “noise” around these proposals, it’s still possible to work systematically through a discrete set of options of how to respond.