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The 229 Podcast: Balancing Technology, Growth, and Innovation in Dynamic Times Sarah Hatchett

Sarah Hatchet: I think the word that we're using is described as magical. I don't think I ever, in my healthcare IT experience had a project that the users were just clamoring for, you know, like, please give us this technology.

Bill Russell: My name is Bill Russell. I'm a former health system, CIO, and creator of this Week Health, where our mission is to transform healthcare one connection at a time. Welcome to the 229 Podcast where we continue the conversations happening at our events with the leaders who are shaping healthcare.

Let's jump into today's conversation.

All right, it's the 229 podcast, and today I'm joined by Sarah Hatchett, CIO, for the Cleveland Clinic. Sarah, welcome back to the show.

Sarah Hatchet: Thanks so much, bill. It's just a pleasure to be here. Great to see you.

Sarah Hatchet: Yeah, that's right. So I technically, I've been doing the role for two years. I started in June of 23 and officially got the role in May of. So, I like to count the interim time because you're in the role, you're expected to do it. You're expected to make those decisions and own it.

And so it's been quite the journey. But very excited to continue on and be, you know, give you the update on where we've been over that last time.

Bill Russell: Yeah I'm looking forward to getting that update. You know, it's the Cleveland Clinic, so it's pretty small. You know, I actually, I was looking at my, I live in Naples, Florida, and my primary care doctor is from Northwestern Medicine in Chicago.

And as I was doing the research, it said that Cleveland Clinic is going to set up concierge medicine in Naples, Florida. But that gives a I mean you guys are pretty broad. I mean, it's Nevada, it's Florida, it's it's a Ohio. But you're also a destination plus you have global.

It's also daunting being the CIO in that context because. You're often presented with, you know, we wanna deliver here in this setting, or this setting, or this setting. Each one of those represent kind of a different set of technology needs whether that's through, you know, JVs or new affiliates or strategic partnerships and technology really needs to kind of enable that, that model.

So, we've definitely seen a change. It's. Less brick and mortar m and as than what we've done in the past. And it's, you know, evolving into kind of more of those strategic partnerships. And I'm really excited to be able to enable those.

Bill Russell: I think one of the the lies that we believe as CIOs is that we're gonna get in front of this.

Sarah Hatchet: Yeah, I think there's definitely two parts of it. You definitely have to stay ahead of the innovation curve. We've gotta be out there understanding what are the best capabilities in the market, in what we can build and what we can support, you know, to kind of enable those different care settings.

But then the second piece is also the platform. You've gotta have that highly reliable, stable, secure, always on platform. You know, I was actually in a meeting with our CEO just this last week preparing for a board presentation. We're talking a lot about AI and the innovation and the things that we're doing, and he paused and he said, you know what?

because it's so, you know, it'd be so encouraging for our teams to hear that there's a level of recognition and appreciation for the platform itself. Because that's just as essential.

Bill Russell: interesting you talk about the platform, we don't appreciate the platform \ until it breaks, right?

Yes. Or until there's cracks in it and we have to say things like, Hey, let's slow down a little bit. Or we have to. Put some things on hold while we, whatever or worse there's a breach or an outage that impacts care in a certain setting. How do you ensure that is constantly evolving to support these new demands?

And I think it's a super challenging spot to be in because to your point like that debt or that platform stability isn't. Isn't visible to the rest of the organization the way that it is to us. So we have to be able to understand how do we prioritize and allocate resources to kind of grooming that and maintaining that.

I think it shows up on the day-to-day of being able to just do really solid problem management. You know, when you do have issues, let's make sure we're fixing it completely and improving our resiliency when those things you know occur so that we're not. Having the same problems over and over again. And I think that's been a great opportunity for our teams and something we've built a lot of discipline on.

Bill Russell: The infrastructure challenges were really interesting. In fact, when I came in, it was a turnaround. So we essentially put most projects on hold for the better part of nine months while we established that platform. And that's one of the things that preached when I came in. It's like, look.

We wanna run fast, but we have to, you know, we have to really set this foundation and then we can run faster. But one of the challenges I always had, and I'm curious how you're approaching this is my team, right? So I had 800 staff and I, I love it when people say, well, you know, we don't have the money that Cleveland Clinic has.

Sarah Hatchet: The first. Piece is you need to have a shared understanding and a culture around that demand and capacity equation. You know, if you put on your business hat, what is the right equation? Dynamic? Should we have more capacity than demand?

Should we have equal capacity versus demand, or should we have, you know, less capacity than demand? And if you're sitting in the CEO's seat. Simply wouldn't make more, it wouldn't make sense to have excess capacity sitting around. Right? That's waste, that's cost, that's all of these things. If you can hit a sweet spot, that's certainly perfect.

Happy times, but it's not the reality, right? So, right. And to some extent, recognizing that we've made an intentional business decision that there's always gonna be more demand than capacity. And it's up to us to be able to prioritize our portfolio, to making sure that we're working on the right things that continue to support that business decision.

When in fact we are indeed winning by being strategic and being intentional about the way we allocate resources. I think the piece to that for us to understand that deeply, we've been through a journey in kind of deepening our maturity in resource planning. We had to get time tracking in place.

Bill Russell: a significant leadership move. I can't tell you the number of CIOs I ask, or do you do any time tracking? And the answer is no. No, we can't do it. And I'm not sure how you do effective governance without, without knowing your resources and what they're currently working on.

Sarah Hatchet: Yeah. Yeah. And actually I think the buy-in from the teams has been good because one, they know we're looking at it, right?

Like they're, it's not just data that goes off into the ether. Right. They know that we're looking at it

Bill Russell: Well, and it's it should help them.

Sarah Hatchet: Yes. Yes. And they know that we're using it data to make operational decisions. Like who gets to backfill a position? Where do we need to supplement teams?

Like that data actually becomes. What we surface when we're trying to make those decisions. So, you know, it's one thing to say, oh, my team is just over capacity. It's another thing to say, well, let's look at the data. Let's see where that time is going. Let's make sure it's right. You know? I think we've built a lot of trust with the teams and the process by making it real.

But I would imagine the larger governance is saying, no, this is more important than this. Those meetings are always fun, by the way. It's like this just a Yeah. The one, I mean, because I don't think, I think what people don't appreciate is in healthcare you're talking, well, you know, should we do a new cancer center or should we do a new labor and delivery, or should we do, you know, and you're sitting there going, yes, of course we should do all these things.

And you have to lead at some point. You have to make decisions.

Sarah Hatchet: What we're trying to do is take a page outta that playbook, which is when the clinical side of the business is making those decisions, they're looking at what's the highest amount of value that's gonna be delivered.

So what we're trying to do is in it completely internalized and, and pivot towards a model that's more value-based. So what we were doing previously is meeting with each of the business areas and saying, what's your stacking priority? And everybody had their number one. Well, what do you do with a hundred number ones, right?

Like, it's not easy to make that decision. So now what we're trying to do is actually shift to more of a value scoring model. These things are not always revenue driving. Sometimes it's patient safety, quality outcomes experience, these sorts of things as well. But being able to codify that into a score so that you could say, well, this may be number one, but it only scores a 30 on the scale.

Being able to stack rank with both the priority of the business and the proposed value that it's gonna be driving, we hope will be the unlock of being able to make those decisions in a much more facile way.

Bill Russell: I feel like I just interviewed you for a job. I wanna make this a little more fun.

We just got, we are building a new building. And their whole problem or challenge is, okay, other CIOs who are in the room, what should a new building look like? What's the technology you're looking at right now that you're like, this is gonna be interesting. This might have a significant impact on the way we think about delivering care or shift the way we're doing something today?

Sarah Hatchet: Yeah. I actually have one of those projects right now. We're building a. billion dollar neurological hospital right at the heart of our main campus. And there was a great desire to have a very innovative technology first approach there. I think some of the things that they're doing are definitely clinical in nature.

There's definitely a lot of talk about wayfinding our main campus is quite complex and we still have not cracked into like how to help patients find the right place to park and then kind of the turn by turn to where they need to go for their appointment if they have multiple appointments.

How to get there. So we're definitely looking at that. I think the other piece is this video AI is definitely compelling. The idea of having a multimodal experience in the patient room, potentially in the OR as well that can help us with delivering certain care workflows like virtual nursing, but then also use ai.

Bill Russell: It's worse when they give you a billion dollars and like two years from now you're saying, Hey, we need to upgrade some things in the building. And they're like, what?

Sarah Hatchet: Yes, that is failure mode. Or that we would have to come back in and do construction to retrofit a building where now patient rooms are inaccessible because we're in their installing stuff.

So for sure. I think that's a, it's an important consideration.

Bill Russell: I'm not sure if people appreciate how. Challenging of a job. It is to build a new building. It's I had CTOs in a room last week, so we had a, one of our 229 meetings with CTOs and , we talked about new rooms and specifically like how many drops would you pull into a new room.

And it ra it still ranged from like 50 down to five. And I was like, wow that's really interesting. And it depended on how they were viewing the technology and the use of wireless and the use of 5G

and then they were saying to me, you know, that will dictate how we build the building. because that will dictate the wiring closets and the power and all this other stuff. It's a, there's a lot of variables that go into building a new building.

Sarah Hatchet: Yeah, for sure. And you know, just using that example of the neurological gospel, that budget had to be finalized two years ago in the business plan when the technology that we're talking about today wasn't even thought of at that time.

Bill Russell: You were out at UGM. Oh yeah, I was. You were out at UGM I've talked to some CIOs who walked outta UGM and they were like. You know, every year we come up here and they roll out like 150, 160 new things across, you know, 50 modules and whatnot. And that represents a significant challenge for you in that chair.

Do you just, well clearly you take more than just yourself and your team. You take clinicians and whatnot up there. Does that become a big prioritization project as well when you get back?

Sarah Hatchet: You know, I wish it did in more tangible ways than what it does today. Actually while I was at Epic, I shared some feedback with them of like what that experience is like as a CIO to kind of take their roadmap back and try and decode it because even though they say it's available today, you may or may not be on that version.

So I've asked for them for some help and helping our. us figure that out. And actually I've found them to be quite receptive to that feedback, so hopefully it'll get better. It is a little tricky, especially when you're looking at third party solutions that provide similar, you know, functionality.

Getting back to the value statement, right? If I can go buy something today that's gonna provide me value today, while I'm kind of like waiting for that epic roadmap to evolve. We're going for it, right? Because whether you're talking about, you know, or utilization or staffing optimization or these sorts of things, these are actual real value drivers for us and our important priorities.

Bill Russell: the best example of that. We're gonna talk about ambient listening at this point. You know, when that announcement came out, you would, if you were on social media, which you don't have time to be, so I was, and I can tell you there was a huge, like, outcry, like, oh my gosh, epic's gonna take this over and whatnot.

But I'd love for you to talk about it because you guys were already down the path with a tool. Your clinicians are using it. They're getting used to it. You're not walking out of there going, oh, epic's doing it. Let's swap this out and let's move this in. I mean, how, talk about that journey to your solution and then talk about when you hear that kind of announcement, how that calculus, how that logic sort of works in your head as you hear that.

Deeply understanding what we think the value drivers are for those things. And it turns out that it's the quality of the note, it's the quality of the note. That's the differentiator. And that's how we ended up selecting the product that we did. The project now is live with over 3,500 physicians.

We're seeing great outcomes in terms of their, you know, adoption of the tool and experience with the tool, but also some revenue improvements as well. So that's been fantastic. I think the word that we're using is described as magical. I don't think I ever, in my healthcare IT experience had a project that the users were just clamoring for, you know, like, please give us this technology.

You know, it's this idea of maybe you're discussing growth charts. Well, it could pull up in real time. Here's your growth chart. Like I actually think. That's super interesting and compelling, and it's gonna be a challenge for the vendors that aren't embedded in Epic, to be able to reproduce that kind of experience and where it's heading.

Now that being said, I think it's gonna take time, you know, as we just talked about, for Epic draw roadmap for them to de to develop the same product. When you think about how many vendors have spent collective time of, you know, hundreds of engineers in developing these products over the last few years, it's gonna take some time for there to be sort of parody.

But we'll be watching it for sure and just making sure that we're continuing to head down the right path, getting the best experience for our providers, best experience for our patients as well.

Sarah Hatchet: I definitely have a three to five year strategy, but whether it is tied to specific technology capabilities is not something I track. It feels like we have just a much more of a dynamic environment and especially just the way that capital and operating allocations have been given. It doesn't allow me time to kind of like.

Forecast where that's happening to be able to kinda lock that in in a way.

Bill Russell: Let's talk through a couple of 'em. So, data and analytics, if you're looking out three years it feels to me like there's some dramatic movement. I mean, when I watched. What they were doing with cosmos.

And I thought, wow that, that's really interesting to have that AIelement that is able to look at the note, listen to the conversation, and then provide another set of. I don't know what we say, another set of eyes to, to the diagnosis or whatever's happening in the care setting. I assume at the clinic, you guys are looking at the same thing.

Sarah Hatchet: Yeah, for sure. And I think it's totally healthy too. Define a vision and an ambition, right? Like I could just as well say, revenue cycle, is there a three to five year horizon where Rev cycle becomes completely automated and autonomous?

Oh

Bill Russell: From your lips to God's ears would be, that would be amazing.

Sarah Hatchet: Right. And, and, and, And to your, you know, to, to my point is that kind of vision casting helps you identify which capabilities you wanna lean into in the near term. Like, the way I always think about it is similar to autonomous vehicles, right?

But there was nothing wrong with cast net vision because it allowed the innovation to happen in real time.

Bill Russell: Three to five years. Infrastructure again, I was with the CTOs and the amount of work that's being done on the cloud is pretty dramatic. We were having a conversation about the perimeter anymore, and the, one of the CTOs from a academic institution essentially said, there's no perimeter anymore.

It's like the perimeter's almost. It is like it, it's constantly morphing. because you know, we're going out to workday and then we're going out to the EHR, which happens to be in the cloud. We're going over here. And he's like, I'm not even sure I can define the perimeter of this thing anymore. So our security models and technology models have all shifted.

And just pay for what you need, which is something that they appreciate. Are you seeing that same thing three to five years mostly, you know, scale up, scale down as you need resources?

Sarah Hatchet: Yeah, it's actually, it's a hot topic for us at the moment. We invested in a pretty major data center build about 10, 12 years ago.

And so to some extent it's been a no-brainer for us to remain largely on-prem because we made that investment and there's still, you know, depreciation on that asset and all these sorts of things. But in the next five years, there will need to be major capital investments on the actual infrastructure, the data center itself.

What is the data center availability gonna look like? Where are these GPUs gonna come from and how are we gonna continue to do that? You know, if we were to lean more deeply into cloud, what would that would look like? You know, as I'm talking with my peers, people are still a little bit all over the map on this.

I've heard everything from. You know, folks similar to me. I've heard everything from the app. We went all in on cloud and now we're kind of pulling it back just because of rampant topics, costs. People are really just trying to figure it out and it doesn't seem to be any one rhymer rule, best practice that's out there that everyone's adopting, which I think makes it even more complicated to be able to talk about it with the board and talk about it with key stakeholders.

because It's just evolving so, so quickly. I think it's tri, it's tricky to, to kinda get a finger on it.

I mean, we could talk about AIin healthcare and go on for the next three hours, but I wanna talk about AIin it. Let's start with. Your team. I was recently with again, a group of leaders and one of the leaders told the story that in one of their town halls, he asked how many of them had experience with chat GPT or Claude or that kind of stuff.

And he said the number of people, and this was the IT department, he said the number of people in it was like 55%. And he goes, that's not even as good as the general average of. People in society. And he was kind of, kind of just taken aback and surprised at that. how are you thinking about ai?

Sarah Hatchet: Yeah. It's interesting. I was. Trying to get ahead of a lot of this when some of the first AIrelated projects showed up in our portfolio by making sure everybody knew, like AIis gonna be part of our jobs going forward, whether it's.

Helping us to implement kind of a point solution or whether it's becoming increasingly integrated into kind of our enterprise applications like Epic. Everyone needs to be able to identify as being AIas part of my new level of responsibilities in terms of education, understanding, and being able to operationalize these tools.

Now we certainly do have an AIdata science team that does, you know, some of the deep build and the deep algorithmic and forecasting, those sorts of things, but. As, as far as the things that we buy or the things that come with the platform, everybody's gonna need to be able to understand and work with it because it's coming as embedded within the workflows, right?

I do think there's gaps. I do think there's an opportunity for us to provide more education and training for our team members to really encourage that as a growth opportunity. You were asking me a little bit earlier about how do you prioritize the time, like how do we actually carve out time in the resource planning for learning and development, cross training and growth?

Like how do we actually. Put our money where our mouth is and say, I'm not just expecting you guys to be able to learn these things, but to actually I'm creating space for you to do so, in the resource plan. So I think that's, I think that's super important to let people know that you actually really mean it.

Otherwise it can just feel like, yeah, another expectation where it's really hard to meet.

Events that we're supposed to read couldn't be read by the number of people we have allocated for. And AI is a great tool to sort of go through those things. But there's, there were others in the room that their teams had to utilize some of the tools that are out there to actually. Create workflows and embed agents into things and to actually free up additional time within their organization.

And it led to an interesting conversation on, utilize what's given to you by the vendor or potentially build, not build, like we're gonna build our own model, but more build, like, we're gonna use a model, we're gonna use the agents that are available, and we're going to, it's almost like a low code, no code kind of approach.

And I'm curious where you would fall down on that, you know, use what's given to you or, or build.

We had our own bespoke tools. We had pretty strong software engineering capabilities, and I think we learned that we need to change our posture. We need to be more dependent on the vendors. They're out there building killer products, killer apps, and here we are kind of struggling along with just what we can come up with.

And so the pendulum swung from, you know, being we're not just a healthcare company. We developed software all the way to like, now, you know, currently we don't have hardly any software engineering in house. We're always, you know, kind of buying best of breed software or relying on our enterprise platforms to show up with this functionality.

Like, yeah, I could go to market and buy a great HR tool but if I can develop one in house and it actually works and meets 80% of their requirements maybe we need to start looking at that. Software costs just continue to rise. As I'm sitting in my seat trying to figure out where can I squeeze things?

We're becoming more facile with kind of building our own things. But it'll take some time, it'll take a learning curve and being able to adopt some of those tools.

Bill Russell: So how did you get so comfortable in the chair? I mean, you know, I mean, you went from interim to you seem like a seasoned pro at this point.

And I'm not just blowing smoke. I mean, these. I was looking at my podcast the other day. I've done over a thousand interviews since we started nine years ago. You seem really comfortable in the work that you're doing.

Sarah Hatchet: Well, I appreciate that Bill, and coming from you, having, knowing that you speak with so many people, hearing your vote of confidence is a huge boost and a huge encouragement to me.

So thank you so much. It truly, truly means a lot to hear you say that. I mean, I think for me, my secret sauce is my team. I'm here, I'm talking to you, but all of these things that we've been covering are conversations that I've had with my CTO, with my ops leads, with my enterprise architects.

I just couldn't be more thrilled and more grateful um, for their support.

Bill Russell: this is a great conversation. I look forward to our next conversation and a year from now when you're telling me about that, that billion dollar building and what you've been able to do and the team have been able to do together with the great clinicians up there at the Cleveland Clinic.

So,

Sarah Hatchet: yeah, hopefully you can come to Cleveland and get a tour. I'd love to show you that. And the quantum computer and. Whatever else we got going on. There's always something going on here, so it'd be great to, to host you here.

Bill Russell: Well, I'm looking forward to it, coming up for a Cleveland City tour dinner, I think next month, so

Sarah Hatchet: Right.

Bill Russell: Should be fun.

Sarah Hatchet: Absolutely.

Bill Russell: Sarah, thanks for your time. Really appreciate it.

Sarah Hatchet: Thank you so much, bill.

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