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Becker’s Healthcare Podcast
Reimagining Consumer Experience and Technology at CVS Health with Tilak Mandadi
00:22:56
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- [00:02]
A
This is where health insurance leadership comes together. Becker's fourth annual Spring Payer Issues Roundtable brings together over 400 payer and health plan executives and more than 100 speakers to Chicago April 13th and 14th. This year's event includes keynote conversations with the industry's top leaders and former President George W. Bush. For the full agenda and event details, visit Beckershospitalreview.com and click on the Events tab in the upper right. We're looking forward to hosting you here in Chicago.
- [00:34]
B
Hello everyone, this is Jacob Emerson with the Becker's Healthcare Podcast. Thrilled today to be joined by Talok Mandadi, who is the Executive Vice President of Ventures and the Chief Experience and Technology Officer at CVS Health. Talak, thank you so much for taking the time to be with me on the podcast today.
- [00:51]
C
Thanks for having me. Jacob, how are you?
- [00:54]
B
I'm doing great, Talok. I'm better now that I get to sit down with you and chat a little bit about everything going on at CVS Health. But before we dive into all that, can you, can you first tell our audience a little bit about yourself, your career background, and then give everybody an overview of your current role and what you do at cvs?
- [01:12]
C
I look after CVS Health Ventures, which is our corporate ventures group. We have 40 plus companies, 2 billion assets under management. I also am the Chief Experience and Technology Officer part of the company. So my teams look after all things technology. So that's core IT functions, core technology platforms, digital AI, data analytics. Anything that's connected to all of that is looked after by my team and I look out for the creating and measuring customer experiences, both physical and digital across the company as well. I was in other industries before I was with Disney, prior to coming to CVS Health and before that I was at American Express. So I have seen other industries before coming to healthcare.
- [02:19]
B
Absolutely. And let's talk a little bit about that because it's always so interesting when we have senior healthcare executives coming from other industries. Like you mentioned, you led digital transformation at Disney and then at American Express before CVS Health. So I wonder, is there a lesson from hospitality or from the entertainment industry that you would share with all the healthcare executives listening in they might miss or not be as as aware about when it comes to customer experience.
- [02:51]
C
I think coming from Disney to CVS Health and learning healthcare experience, I was humbled by the complexity of the healthcare industry, Jacob, and I was also humbled by the dedication of the people that work in healthcare industry to do the right things. And what surprised me though is in all this complexity of healthcare industry, how the patient and the provider experience became an afterthought, especially the customer experience. And even worse, the customer engagement in their own health is very, very low. And it's clear that the bad experience or the complexity of the experience is the issue in getting to better consumer engagement. And without getting to better consumer engagement, you are not going to get to better healthcare outcomes. And all of that requires the healthcare industry complexity to go down. So that's the revelation to me on we gotta improve experience materially and get to much better engagement for the consumer in their own health.
- [04:20]
B
Absolutely. And I know those things have been a major focus for CVS over these last few years. It's certainly something that we've been covering a lot of here at Beckers. And obviously, as you know, Tolox, the company operates at massive scale. You have over 9,000 pharmacies, but you also oversee a venture arm that invests in startups all over the country. So I wonder, how do you think about balancing building as a company versus buying innovation, especially when you're trying to move fast in what is such a highly regulated industry.
- [04:55]
C
On the venture side, we are not a passive investor, Jacob. We take a very active role as an investor. What I mean by that is we invest in companies, by and large the companies that we want to use within the CVS health ecosystem. So 70, I think 70, 75% of all CVS ventures companies have commercial agreements with CVS health entities. And we also participate very actively into the companies that we invested in in terms of roadmap development, prioritization and exploring jointly what the art of the possible. So when you ask me, how do we decide when to build internally, when to go to an external company, the approach we've been taking is we build internally anything that's highly value added, differentiating and unique to us and helps us get to our customer experience goals and our operational efficiency goals. That's things that are unique to us, differentiating to us. We build internally. If we see things that are gaps that we need to fill and a startup can fill that gap quickly, we go there, we go invest with them and we integrate with them and we actually help them get better in their product roadmap. So it's kind of a spectrum of things on things we build internally and things we build with the startups we invest in. We are also, we talked about this at the investor day. We are well underway into becoming a technology products and services provider to the rest of the healthcare industry. So now we are not only Building technology products for internal use. We are also building them and productizing them that the rest of the industry can adopt as well.
- [07:26]
B
And that's a really fascinating business strategy to lock that you're pivoting towards becoming, like you said, a provider of tech to other healthcare companies, tech services and you know, CVS overall as an organization, of course you sit at such a unique intersection of an insurer, a pbm, retail pharmacy, primary care. And we've been hearing for decades now about the promise of interoperability. And I think that goes along with this conversation of what you were just talking about. So I wonder why do you think that patients or providers on the ground should believe that interoperability is finally working now?
- [08:05]
C
I think so, Jacob. I share some of the pessimism from the past on interoperability, having learned that in the last three years, some of the challenges, but I'm actually very optimistic. I think this is the time for that interoperability challenges to be resolved. The reason I feel quite optimistic is the following. One, I think the administration CMS is very focused on addressing interoperability challenges. Second, the AI transformation. Look, AI has incredible potential and I think it's a leapfrog technology that healthcare has been waiting for. But AI on its own would not be able to reimagine or transform healthcare AI. For us to realize, for this industry to realize the full potential of AI, it needs to be AI plus interoperability. And I think that understanding is now clear across the industry. So I think there's momentum behind that. The another reason I'm optimistic about interoperability is technology advanced quite well. Right? So not just the AI part of the technology, the communications technology, the digital technology advances now make electronic transfer of records, API based access, tokenization, all of those things are now a lot easier to do. So the hurdles that used to remain in the path of interoperability from a technology perspective are a lot less so. I am bullish about interoperability. I do think there are certain decisions need to be made. I think there is a lot of push towards interoperability on the provider side. So the providers getting the data they need. There is a lot of push on the side of the consumer. Consumers having access to the data that they need and they desire to have. I think similar push needs to happen on the payer side. I think payers having access to the full healthcare record would be incredibly helpful for payers to support their members in a much more consumer centric way than has been possible in the past.
- [11:01]
B
Sure. No, that makes a lot of sense. And I think that's a good counter to maybe some of the pessimism that you mentioned around interoperability that we've seen over decades now. But interesting to hear you say that this, this intersection of government focus on it, on the emergence of better AI tools and then some of the barriers that are coming down as tech advances all working together to make this finally possible. And I want to stay on the AI conversation talak, because as you know, we've seen a lot of big announcements already this year with some of the largest companies in this space rolling out new healthcare features for consumers. And so as somebody who's leading CVS's AI strategy across across pharmacy PBM care delivery, how do you think that more consumer AI entering health care is changing your technology roadmap? And any, any broad thoughts on these announcements?
- [11:57]
C
Yeah, so I AI can do a lot of things really well, Jacob. There is no doubt about it. And I think as an augmentative technology, AI is already really transforming healthcare and the clinical AI is progressing quite well. There is still a lot of ground to cover in terms of triage accuracy and the ability to guide care, et cetera, and augmenting the human physician. I think that's the direction things are going to go and things are progressing well. But there is room to run still on the services AI side, whether it's in the call center experiences or care management experiences, AI is really, really helping consumers navigate care and becoming a concierge for consumers. And that's the underlying premise behind the open engagement platform we announced at our investor day in December. But I want to come to the very important question. You look, AI is a technology and it could do a lot of things, but really a company's ability to reimagine healthcare doesn't depend on AI. It depends on trust. The companies that have the consumer trust and consumer engagement with trust, those are the companies that will be able to reimagine healthcare. You asked what impact does it have on our CVS health technology roadmap? The good thing is we had a head start. We were actively developing with AI well before ChatGPT made AI a mainstream topic. So we feel very confident with where we are with the with using AI in improving both on the services side as well as on the clinical side. But we also started out with extremely well defined principles of we will never compromise on human touch. We will never allow AI to get in the in the middle of providing care to our consumers and allowing consumers to have access to care. The principles are very important to Us and we structured our AI program around those principles. But we have a great advantage. We have the consumer trust that people trust CVS. People come to CVS. 185 million folks engage with CVS every year. And I think that's what gives us the leg up amongst all these announcements you hear. We have the same type, the same or even more advanced technologies. But in addition we have the consumer trust.
- [15:16]
B
Absolutely. I think what you just said overall is such an important point to lock for all of our listeners. And you're right, CBS is such a trusted brand for people and as you continue to double down on that customer experience overall, that trust AI is going to be so critical. And like I said, I think that's such an important message for all of the organizations listening in as, as they pursue this journey as well. You mentioned the consumer engagement platform that you announced at your, at your last investor day. Can you fill our listeners in a little bit about that, what that is and, and why is it important overall for the company and then of course for, for your customers?
- [16:00]
C
Yeah, I'll go through that in a quick detail and happy to answer any questions you have on that. Jacob. We believe consumer engagement in healthcare is the holy grail. If we get consumers to engage in their healthcare frequently, consistently, constantly, that will lead to trust. Trust leads to behavior change and behavior change by far has been shown to be the best predictor of healthcare outcomes. We got into this wanting to how do we inspire much stronger engagement in healthcare by the consumers we offer as part of the, and we also were very clear right at the beginning this needs to be an open platform. So the platform needs to be able to connect to any payer, any provider, any PBM and any pharmacy because those are all the healthcare stakeholders that a consumer touches. So we wanted to create a consumer centric platform. It's for the consumer. It's driven by the consumer preferences and needs. So it's for the consumer's health end to end and hence it's completely open. So whichever healthcare stakeholder the consumer is interacting with, that stakeholder can integrate into this platform to provide a consumer oriented, end to end, completely connected experience for healthcare to that consumer in the platform. And the platform offers three services. I think that's, that's why for the, for, for potential stakeholders, the way to think about it is it offers three services. One is pharmacy as a service. So we are packaging the pharmacy technologies that we have developed which we believe are world class. And any pharmacy in the country can use these pharmacy technologies and be a much better Pharmacy, quite frankly. Second service is called engagement as service. This is where we allow the stakeholders to have direct relationship with the consumers to help consumers to get the most out of their healthcare. And third is insights as a service. So based on the consumer engagement, are there things that our consumers want that we can learn from them and make our products better? And many other types of insights. So that's why we think the stakeholders would be very interested in joining this platform. In addition to wanting to provide a great consumer experience on the consumer side, the value proposition is incredibly compelling. We basically want to do all the homework, the healthcare homework, which is incredibly frustrating to consumers. We want to do it for them so they can focus on their health. We want a essentially a health concierge in the pocket of our consumers, helping them, informing them, supporting them and taking out the stress that is prevalent in health care today for the consumer. And we want consumers to own their health and their health care. They want to, we want them to own their own decisions on health care by being better informed. And so the consumer value proposition is incredibly powerful, especially because it's an open platform and it integrates all stakeholders that the consumer touches well outside of the CVS health ecosystem itself. So we are very bullish about it. We are well underway and more and more details would come as we go through the year.
- [20:14]
B
Understood. It's exciting times clearly to lock and to your point earlier, now is the time from a variety of factors for interoperability to become tangible and, and CVS is clearly leading the forefront there. So appreciate you sharing details around that new platform with us and with our listeners. In that vein, Talak, what else are we missing for everybody listening in right now? You've got the ears of a lot of other healthcare leaders from all over the country as we speak. What do you want to share with them? Any wrap up thoughts or final bits of advice?
- [20:48]
C
I'll, I'll, you know, coming from outside of healthcare, Jacob, I do want to make one pitch to the entire healthcare industry and I say this as me a consumer of health care, not as a CVS health executive. So it's just me saying stop fighting with each other and help me. It's not, it's pointless for the different stakeholders, pharmaceutical companies, PVMs, pharmacies, payers, providers, you all, every one of you play an incredibly important role in an incredibly important function healthcare in this country. I would like to see a world where each of the healthcare stakeholders actually work together together in combination with the administration, startup companies and incumbents, large incumbents that are willing to transform and wanting to transform healthcare like Serious Health. Working together, all of us working together to make the consumer, healthcare and health outcomes better. That's what American people want, and that's what, as an industry, we need to deliver. And the only way to deliver is for us to collaborate, not fight. That's, that's the, that's my thoughts as.
- [22:24]
B
A consumer of health care, the wise message. And I appreciate you sharing that with us to lock and overall appreciate you being here with us, giving us your insights and telling us a little bit about all the important work happening under your leadership and with your teams at CVS Health. We really appreciate you taking the time.
- [22:44]
C
Thank you, Jacob. Thanks for having me.
- [22:46]
B
Absolutely. And to our listeners, if you'd like to listen to more podcasts from Becker's Healthcare, you can visit Beckershospitalreview.com.