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and more than 100 speakers to Chicago April.
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visit beckershospitalreview.com
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here in Chicago.
Hello, everyone. This is Jacob Emerson with the
Becker's Healthcare Podcast.
Thrilled today to be joined by Talak Mandati,
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. Thanks for having me, Jacob.
How are you?
I'm doing great, Tlaloc. 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 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.
I look after,
CVS Health Ventures,
which is our
corporate ventures group. We have
40 plus companies,
2,000,000,000 assets under management.
I also am the chief experience
and technology officer
for the company.
So I 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 after 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 health care.
Absolutely. And let's talk a little bit about
that because it's always so interesting when we
have senior health care executives coming from other
industries.
Like you mentioned, you 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 health care executives
listening in, that they might miss or,
not be as as aware about when it
comes to customer experience?
I think,
the coming from Disney to serious health and
learning
health care experience,
I was humbled by
the complexity
of the health care industry, Jacob,
and I was also humbled by
the dedication
of the people that work in health care
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
is the issue
in getting to better consumer engagement. And without
getting to better consumer engagement,
you are not gonna get to better health
care outcomes.
And all of that requires
the health care industry complexity to go down.
So, that that's a that that's
revelation to me on we gotta improve experience
materially
and get to much better engagement
for the consumer in their own health.
Absolutely. And I know those things have been
a major focus for CVS over these last
few years. That's certainly something that we've been
covering a lot of here at Becker's.
And and, obviously, as you know, Deluxe, the
the company operates at massive scale. You have
over 9,000 pharmacies,
but you also oversee a venture arm that
invests in start ups all over the country.
So I wonder
how how do you think about balancing,
building as a company versus
buying innovation,
especially when you're trying to move fast in
in what is such a highly regulated industry?
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
we invest in companies,
by and large,
the companies that we want to use
within the CVS health ecosystem.
So,
70
so I think 75%
of all CVS ventures companies
have commercial agreements
with, with serious 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 what the art of the possible.
So
when you ask me, what how do we
decide
when to
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,
that there 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
in in their product road map.
So it's a it's it's kind of a
spectrum of things
on on things we build internally
and things we build with
the, startups we invest in. We are also
I we 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 health care industry.
So
now we are not only building technology products
for internal use,
we are also building them and productizing them,
that that the rest of the industry can
adopt as well.
And that's a really fascinating business strategy, Tilak,
that you're you're pivoting towards becoming,
like you said, a provider of tech to
other health care companies, tech services. And, you
know, CVS overall as as an organization, of
course, you sit at such a unique intersection
of 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.
I think
so. Hey, Jacob.
I I 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 health care has
been waiting for.
But
AI on its own
would not be able to reimagine or transform
health care.
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,
the the 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'm I am, I am bullish about
interoperability.
I do think,
there are certain,
certain decisions need to be made. I think
there is a lot of push towards
interoperability
on the
provider side.
So the provider's
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 health care 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.
Sure. No. That makes a lot of sense,
and I 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 its on the emergence of
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 I wanna stay on the I
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 health care 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 road map. And any any broad
thoughts on these announcements?
Yeah. So
I
AI
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, etcetera,
and augmenting the human physician.
I think I think that's that's the direction
things are gonna go and and things are
progressing well.
But there is there is room to 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 for consumers. And that's the underlying premise
behind
our,
the open engagement platform we announced at our
investor day in December.
But I wanna I wanna come come to
the the very important question you asked.
Look. AI is a technology,
and it could do a lot of things.
But, really,
a company's ability
to reimagine health care
doesn't depend on AI.
It depends on trust.
The companies
that held a consumer trust
and consumer engagement
with trust,
those are the companies
that will be able to,
reimagine health care.
And
you asked what impact does it have on
my on our CVS Health technology road map.
The good thing is we had a head
start.
We were
actively developing with AI
well before ChargeGPT
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 in in
the middle of
providing care to to our consumers and allowing
consumers to have access to care.
The the 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,
185,000,000
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.
Absolutely. I think what you just said overall
is such an important point, Tala, for for
all of our listeners. And and and you're
right. CBS is such a trusted brand,
for for people. And as you continue to
double down on that customer experience overall,
that that trust in AI is going to
be so critical. And I like I said,
I think that's such an important message,
for all of the organizations listening in
as
you 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?
Yeah. I'll,
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 health care is the
holy grail.
If we get consumers to engage in their
health care
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.
So we got into this wanting to how
do we
how do we inspire
much stronger engagement in health care by the
consumers?
And
we offer as part of the and 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 health care 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 and needs. So So it's for the
consumer's health
end to
end, and, hence, it's completely open. So whichever,
health care,
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 health care 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
the,
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 wanna 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 and,
and and,
taking out the stress that is prevalent
in health care today for the consumer.
And and now 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 the, as we go through the year.
Understood. It's exciting times clearly to lock into
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, Tlac, what else are we
missing for everybody listening in right now? You've
got the ears of a lot of other
health care leaders from all over the country
as we speak.
What do you wanna share with them? Any
wrap up thoughts or or final bits of
advice?
I'll, I'll you know, coming from our set
of health care,
Jacob,
I I do wanna make one pitch to
the entire health care industry.
And I say this as me,
a consumer of healthcare,
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, PBMs,
pharmacies,
payers,
providers.
You all every one of you
play an incredibly important role
in an incredibly important function, health care, in
this country.
I would
like to see a world where each of
the health care stakeholders
actually work together,
together in combination with the administration.
Start up companies
and
incumbents, large incumbents that are willing to transform
and wanting to transform health care like CUS
Health,
working together.
All of us working together
to make the consumer's
health care
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 a
consumer of health care.
The wise message, and I appreciate you sharing
that with us, Talak. And and, overall, appreciate
you being here,
with us, giving us your insights, and and
telling us a little bit about all the
important work happening under your leadership and with
your teams at CVS Health. We we really
appreciate you taking the time.
Thank you, Jacob. Thanks for having me. Absolutely.
And to our listeners, if you'd like to
listen to more podcasts from Becker's Healthcare, you
can visit beckershospitalreview.com.