Why AI Alone Won’t Fix Health Care Staffing: Covista CEO Steve Beard

Steve Beard: Necessity is the mother of invention, many consumers and many Americans wait far too long for care we view the technology as being able to actually deliver hyper-personalization at scale, whatever You think the pace of play is, it's probably faster than that.

David Young: So Steve, we've actually spoken about this before, but I want to revisit kind of the scale of the problem that we're facing. When we look across the health care system today, how would you describe the workforce challenge the country is facing?

Steve Beard: We think it's massive and we think it's growing. Couple different frames you might use to look at it. So in any given month, there are over 700,000 posted openings for health care-related positions in the US, with only about 350,000 available workers to apply for them.

Another way to think about it is just the sheer number of folks that we talk to in the course of our work that tell us that the workforce constraints are actually a barrier to delivering high-quality care. We've had some proprietary research around this that really makes clear that chronic workforce shortages are not only a barrier to those institutions' ability to fulfill their mission. But it really does impact how long we wait to see a specialist or a generalist and the quality of the care once we receive it. It's a big problem in America.

David Young: It seems that there are challenges and problems across the entire value chain.

Steve Beard: Yes. It's not a single problem. It's a family of problems that come together to create real fragility and real bottlenecks in the system.

David Young: To this point, is this primarily a shortage? You mentioned here the over 700,000 openings. It's a massive growing problem. And you kind of say it's a family of problems. So I'm assuming here it's yes, there's a shortage of workers, but it's also a problem involving where people are trained, where they practice, and actually how long they're able to stay in the profession?

Steve Beard: Absolutely. You've got a shortage of available seats in schools that train clinicians. That's medical schools, nursing schools, veterinary medical schools, allied health programs. There are more people who are seeking spots in those programs than there are seats available, so that's an academic seat supply issue.

In addition to that, there's a real shortage of folks to actually train those folks. Clinical faculty in particular is in short supply. And then there's a shortage of clinical capacity, actually the environments in which aspiring clinicians go to actually learn the hands-on part of their academic journey. And so those shortages across those three categories contribute to the bottleneck in creating the kinds of clinicians at the scale we need to deliver health care that Americans deserve.

David Young: I want to ask you a question about the workforce challenge and the fact it begins before people apply for jobs.

 Just given what you've said, I've got a hard knock to ask this question. Do you think, it seems there's a myriad of problems here across the entire, let's just say value chain. Do you think there is recognition of the severity of the problem at the general public level and also at the policymaker level in DC?

Steve Beard: I think there's a recognition of the scale of the problem. I do also think there's a fair amount of rationalizing that challenge. Some folks believe technology will be the solution. Other folks look at the data trends much shorter term time horizons. For instance, in the last jobs report that the federal government released, you actually saw a decline in the number of folks seeking employment in health care.

That's a quarterly number that doesn't really bear on the broader trend. All the data that we focus on would suggest that these workforce shortages are large, they're growing, and that they are durable. And the irony of that is that there's no shortage of demand amongst folks who would love to have a career in health care, nor is there any shortage in the demand by employers who need this workforce to meet the needs of their patients.

David Young: We're going to get to AI and tech in a moment because it's hard these days to talk about anything without evaluating the impact of emerging tech. But before we do, the workforce challenge begins, as we said, before someone applies for a job. It's shaped by whether students can access education, complete their programs, obtain clinical experience, pass licensing requirements, and successfully enter the workforce.

When you look at some of those problems right at the beginning, what are some of the most significant bottlenecks in the education-to-employment pipeline?

Steve Beard: Sure. Let's start with academic institutions. We'll use nursing by way of example. Last year the data would suggest that there were 96,000 applicants to nursing schools in the US that did not get a seat in those programs.

It's a staggering number. These are folks that would like to be a nurse that have applied to a program, and for one reason or another weren't admitted. And the primary reason for that is just the sheer lack of seats in nursing school. Along the same lines in medicine, 26,000 qualified medical students who apply for a seat in medical schools in the US do not find that seat, and as a result, they're either waiting to apply another year or they're rethinking that as a career choice.

There's a huge demand for these professions, but unfortunately, the academy and educational institutions don't really have a strong incentive to grow the number of seats to meet that demand.

David Young: Now I'm somewhat perplexed. At the front end of the pipeline there are more people wanting to go into the industry than there are seats. But at the other end, let's say, of this pipeline, we've got more openings.

Steve Beard: We've got an incredibly strong demand trend on the part of folks who want to join these professions. On the back end, we've got an incredibly strong demand trend among employers who want to hire them, and in the middle, to your point, we have this classroom to workplace pipeline where the supply is dramatically limited, and that's our challenge.

How do we first and foremost create more seats for students who want to pursue these programs? Secondly, how do we ensure we have enough faculty to train these students? And thirdly, how do we ensure that we bring sufficient clinical capacity on line to allow folks to complete one of the more important parts of their journey, which is the hands-on clinical training that they get in these clinical locations?

And we have to think about solving that problem across all three of those dimensions.

David Young: So seats, faculty, and clinical capacity, and it leads into my next question for you. From where you sit, how do we actually start solving this? What do academic and educational institutions need to do differently across each of those three?

Steve Beard: Yeah. So I think on the academic side, unfortunately, many academic institutions in the US go to market on a value proposition that's rooted in selectivity and prestige. And if you take a selective value proposition to market, you are implicitly suggesting that scale and quality are mutually exclusive, and so many of those programs are small by design.

We take a somewhat different approach. We actually believe that not only are scale and quality not mutually exclusive, they can be mutually reinforcing, and we're in the business of student success at scale. The idea that we can support, in our case, 100,000 students across a host of programs delivering more nurses, physicians, social workers, and veterinarians to the US market than anyone else in the country.

There needs to be a shift on the part of academic institutions to be willing to take on more students, as well as the commitments necessary to support them successfully on those platforms.

David Young: Let's talk a little bit about supporting them successfully and moving forward, because I think it's obviously important to understand that producing more graduates is obviously essential but in and of itself won't solve the problem if health care professionals leave. And if they're leaving because of burnout, poor working conditions, or even limited opportunities for advancement.

How closely aligned do you think health care educators and health care employers are today around understanding that if we don't push up retention rates of employees and give them career tracks and make sure they're fulfilled and somewhat happy in their role, it almost doesn't matter how good the front end of the pipeline is.

I'd be curious as to your thoughts in terms of where the disconnect is there, and is there a realization that once they get into this profession, organizations and institutions have to put their best foot forward in retaining the staff that obviously they spent years training.

Steve Beard: Yeah, this is something we pay quite a bit of attention to.

As you can imagine, we are focused on anything that diminishes the attractiveness of these professions on the part of students, right? A couple of things come to mind. First, you have to think about where the sources of burnout and frustration come from, and based on much of the survey data we take a look at, a lot of that is driven by, first and foremost, the shortage of workforce supply.

So clinicians are being asked to do more to address the supply shortage of other clinicians, and that's a burden to them. The second place we focus on is the extent to which the administrative burdens of health care drive a ton of the burnout. If you went to school to be a doctor, you went to school to be a nurse, the fact that you spend an inordinate amount of time on coding and electronic medical records and other administrative tasks obviously brings down overall satisfaction.

And then there's a broader question about the way care delivery institutions think of their employees, thinking of them as labor or cost as opposed to a strategic advantage or resource to be invested in to differentiate them from their competitors. We think there are opportunities to think differently across all of those dimensions.

We also think that technology can and will play a role. We're actively involved in a number of partnerships with technology companies that are on the bleeding edge of AI development. We've got a partnership with Google Cloud. We have one with Hippocratic AI in Silicon Valley, as well as GE Health Care.

And we think that while there's lots of exciting use cases for this technology in care delivery, eliminating the administrative burden is a no-brainer, to the extent that we can automate coding, automate some of the health record stuff-- scribes, for example, ambient listening technologies. We give time back to a clinician, which then allows them to practice at the top of their license.

And when you can practice in the areas that you went to school to practice in, it drives up employee satisfaction.

David Young: Yeah, I heard something recently, and this relates to what you just said. They go to school to practice in these areas not to do administrative work.

We'll get to tech and AI in a minute, but I think one of the encouraging areas here is hopefully emerging technology and AI enables physicians and doctors to do the jobs that they wanted to do, not sort paperwork. Just one final point and question around effective partnerships and the relationships between educational institutions and hospitals and health care systems.

From your perspective, what does an effective partnership between all of those kind of institutions look like between educational institutions, hospitals, and the health care system look like, because you have a unique perspective in terms of how they could work more effectively and efficiently together.

Steve Beard: Academic partnerships with health care delivery networks, not a new idea. They've been around forever. In fact, most of your academic medical centers have their own medical schools and nursing schools, and they're part and parcel of their model. But they've largely delivered talent to those systems at a relatively small scale.

We believe there's an opportunity to think about the pipeline from the classroom to the delivery institution at a much larger scale, and we've embarked on a couple of proof point partnerships that we think are very encouraging in this regard. We have a partnership with SSM, which is a large Catholic health system that operates in four states in the central US: Oklahoma, Missouri, Illinois, and Wisconsin.

And starting in St. Louis, we're committed to delivering to them 400 or more nurses a year, which is a bigger proprietary pipeline than they've ever had into their system. We pair tuition assistance with the ability to do one's clinical work at SSM, along with a service commitment on the part of the graduate that brings down the churn in the new nurse population and creates a stickier relationship between employer and employee.

It has a lot of virtuous benefits, including growing the interest in the nursing program to begin with, but also providing SSM an ability to acquire talent in a way that's less frictional, less expensive, and more reliable than the spot market for talent. We think that's a model that can be replicated elsewhere, and we recently announced a partnership with Advocate, which is the third-largest not-for-profit provider in the US, to start a similar program in Wisconsin, and then expanding to other markets going forward.

We think that academic partnerships can actually be a large-scale solution for talent acquisition that is much more attractive to these employers than what they're commonly accustomed to leveraging, which is basically the spot market for talent in the labor market.

David Young: You mentioned, Steve, you mentioned states. When we look at this problem, is it, and I'm assuming here it's a nationwide problem. But are there certain states and policies at the state level that you think are helping and being more proactive and productive in solving the problem than other states?

Steve Beard: Yeah. Policymakers Have an important and potentially critical role to play in addressing workforce shortages.

For example, in medicine many residency slots across the US are actually funded in part by the federal government, and I think there's more the government can do to fund an increase in the number of residency slots available for physicians to accommodate a larger number of students working their way through the system.

At the state level, most nursing programs are governed by a state board of nursing, and there are certain qualifications and rules around who can actually even deliver instruction. I believe it's in Wisconsin, for example, where they've actually brought down the number of years a clinician needs to have practice before they can actually be an adjunct faculty member, which then increases the supply of faculty to programs in ways that allow those programs to grow.

There's all sorts of things at the state level, at the federal level we can do to incentivize growing the population of clinicians to meeting the growing need that we have as a society. With an aging population, the expansion of insurance programs, we're going to need this talent and I think policymakers have an important role to play.

David Young: Let's turn the topic of conversation to emerging tech and AI. Much of what you mentioned is related to it. In terms of some of the partnerships that you've developed, GE Health Care and Google Cloud being two of them you also mentioned earlier.

How do you reinforce scale and quality? You're absolutely right. A lot of people think, "Hey, if we're going to scale it, then quality is just going to decrease," and ideally that's not what you want and not what you believe as well. They can be mutually reinforcing. Technology now is also changing both how health care professionals are educated and actually how the care is delivered.

When you look at this and you look at what lies ahead in the conversations you have, where can technology and AI have the greatest positive effect on health care education?

Steve Beard: On the educational side of the journey, we actually believe that unlike prior technologies that were promising to revolutionize education, AI has real potential.

We are experimenting with AI-powered tutors, student advisors. We're using AI for test prep and adaptive learning tools. We're using AI to help us with predictive models around the pace of mastery of concepts and other progressive issues across an academic journey, and we're really excited about some of the early results.

I think longer term, we view the technology as being able to actually deliver hyper-personalization at scale, where every student's academic journey reflects the unique needs and preparations and preferences of that student. And if you can personalize the academic journey at scale, you can accommodate many more students successfully in a model.

We're eager to begin to invest behind that and prove out that thesis. When you move to delivery, lots of promising developments there, some of which go to the administrative burdens we talked about earlier. You've got AI scribes now that sort of keep track of physician notes in meetings with patients.

You've got ambient listening technologies that are actually recording the conversations between providers and patients and leveraging that data for purposes of record keeping. You've got automated monitoring devices that can actually take the vitals and measurements of a large number of patients much faster and much more reliably than an individual nurse walking around a hospital floor.

All of this gives time back to the clinician that clinician can then use to do the high-value interpersonal care that they trained to deliver in the first place.

David Young: In those conversations with clinicians, are you seeing a real willingness to lean into this and say, "Hey, I can see the benefits of emerging tech and AI"? Or is there somewhat a level of hesitancy around leaning in and embracing some of these new emerging tech opportunities?

Steve Beard: Yeah. It's the latter. What we're hearing from our employer partners is that the biggest barrier to AI adoption and care delivery isn't the technology itself. It isn't even the cost of the technology.

It really is the willingness of the care workforce to adopt the technology. So workforce adoption is the real bottleneck. One of the ways we try to get close to that issue is, for example, with Hippocratic and with e-health care, actually developing the curricula to train clinicians to use those tools.

Beyond that, I think every employer-- and this is not unique to health care-- really needs to think about how the technology is positioned culturally. It helps to position the technology as an augmentation of a professional, not a replacement of a professional. That certainly drives adoption. And to the extent you can appeal to a professional's desire to heighten their own relevance and their own effectiveness, that goes a long way toward getting them to take a leap on the technology, as opposed to something that only makes them more productive or otherwise drives down the cost of their employer.

So I think positioning is a big part of driving workforce adoption.

David Young: And it's quite interesting, we spoke about the importance of education at the beginning of the pipeline, but now with emerging technologies, you almost need education to be a constant for the workforce moving forward if they're going to take advantage of it. The health care workforce challenge crosses, we mentioned this earlier, traditional policy boundaries, including health care, education, immigration, licensing, and workforce development. All major issues in and of themselves.

What federal state policy changes would have the greatest effect on expanding the health care workforce, from your perspective?

Steve Beard: I think programs that, first and foremost, subsidize the cost of attendance for folks to actually pursue these programs. I think incentives to academic institutions to actually grow and expand their programs, it would be a great help.

I think funding for clinical capacity, whether that's in residency or preceptors for nurses, would go a long way. Revisiting the requirements for clinical faculty would also allow institutions to capture more of a very important bottleneck resource in the academic context. There's so many ways that I think the federal government, with its outsized role in care delivery, can support this effort to grow the workforce and incentivize the kinds of things that invite more folks into these clinical careers so that they can serve a growing patient need across the US.

David Young: Do you think there needs to be more attention focused on, you mentioned this just now, the requirements of clinical capacity? I feel like it is an industry that's just somewhat set in its ways, and this is what's been required for decades and decades. From your perspective, is there a need to revisit what requirements and education truly are required to take people from being educated and putting them into the workforce?

Steve Beard: I think that's a challenge for education broadly defined, right? The 120 credit hour bachelor's degree in the US is a turn-of-the-century artifact that's been around forever, and one has to ask, why is that even still relevant today given the way students learn and progress?

The four-year degree, does it need to be four years? Could it be three years? And you have several states actually experimenting with three-year bachelor's degrees. How do we innovate around the student journey in a way that brings folks through these programs faster, well trained, and fully competent to deliver care, but gets them to the place they're needed most more quickly?

There's lots of innovation to be done around the academic model in this regard. Obviously, core faculty that do research need to be highly qualified and highly trained, but an adjunct professor working with a student on an important task in day-to-day care delivery, I don't think that person necessarily needs to be rigorously trained because they do this for a living every single day, and they're bringing real-world experience to the classroom.

How do we think about removing those barriers to the critical resource in training clinicians in a scaled way that will provide more workforce to US health care?

David Young: I'm assuming you guys also look at different industries and how they're leveraging-- you know, and whether it's emerging tech and AI, but just trying to be more innovative in and more adaptive in streamlining that educational process.

Steve Beard: Every industry and every profession obviously values scarcity. If I'm a physician, I think my general bias is that I want to make the barrier to entry for medicine pretty high because it preserves the value of my position in that market. I do think, however, folks are warming up to the idea that these shortages in the face of the nation's demand for additional care just are not sustainable.

So our hope is that even the professional associations, the guilds, the other folks that represent the interests of practicing clinicians are supportive of the idea to expand the pipeline to invite more into practice.

David Young: Steve, let's Look at the future and what lies ahead.

I'm really curious here. When you look at what's going on-- you know these problems better than most-- you also are very hopeful and optimistic about what lies ahead. Are you optimistic that the US can start working toward closing the health care workforce gap? And if so, what gives you confidence in that thinking?

On the other side of that same problem, what is more or most alarming to you that kind of would keep you up at night saying, "My goodness, that we've got this major problem, but we're not solving it with the quality and speed that we need to?"

Steve Beard: On the optimistic side, I think necessity is the mother of invention, and the fact of the matter is that the demographic trends in US health care are such that we will absolutely, as a nation, have to bring more supply to that demand. Technology is a part of it, academic pathways is a part of it, clinical capacity is a part of it, policy is a part of it, particularly as it relates to incentives.

But the fact of the matter is that we are facing a growing demand on the US health care infrastructure that will demand a thoughtful, comprehensive response. So I'm optimistic that we as a country and as an industry will rise to that challenge.

On the what keeps me up at night side of it is the knowledge that today, you know, many consumers and many Americans wait far too long for care, and the care that they get isn't always what they deserve.

David Young: Before I close with a question around your leadership, because you've led the organization through a pretty amazing transformation over the last few years.

But I'm just curious as to your thoughts, when we look at lessons learned and what gives us inspiration moving forward, and we look at the problems that we've discussed that happen here in the US and we put it in a global context, are there countries around the world that you guys are studying, saying, "Hey, here's a system that's somewhat different but more effective and more efficient than ours," or not?

Steve Beard: The workforce challenge, broadly defined, is a global challenge. Obviously the health care delivery systems vary dramatically around the world. One of the things we are paying quite a bit of attention to is are there ways we can free up a more robust import and export of talent into US health care?

It's very difficult for a trained physician from outside the US to come and be licensed to practice here. Same thing with a licensed nurse who's practiced in Asia or in Europe who wants to come practice in the US. The barriers are relatively high. So if we wanted to think about talent as a global resource, how can we bring down the barriers to entry that would allow the US market, which is a growing one, to get access to more of that talent, to speed the path to licensure in the US, and get those folks at the bedside where they can help Americans all over the country?

David Young: Yeah, interesting. Final topic of conversation here, Steve, with you. You've been the CEO of Covista for five years or so. You've led the organization through a wide transformation. When you look back on the last five years or so, I'd be really curious for you to share some leadership lessons that have stuck with you over the course of this tenure.

I often think of CEOs looking at their stakeholders-- and you have a lot of stakeholders, I think, from your customers, your employees, your owners, and also the communities within which you work. So super curious for you to close just in terms of a moment of kind of self-reflection in terms of your leadership and what's been critical in moving Covista forward.

Steve Beard: It'll be five years in September. The days have been long, but the years have been short. It has gone quickly. But it's been a real privilege to lead the organization, particularly through so much change. From a leadership lesson perspective, you know, one of the things I've learned is that the clock moves faster than you think it does.

Whatever you think the pace of play is, it's probably faster than that. The other thing that I've learned is just the value of storytelling, particularly in service of the vision that you and your leadership team have for the business. There's no substitute for a compelling vision of the future, and there's really no substitute for being able to effectively tell that story repeatedly to a multiplicity of audiences over and over again.

Developing both the appetite for storytelling and the stamina to do it on a rolling basis is really a critical piece of leadership success in my view. And then finally, just conditioning organizations in today's world that change is a constant. You've got lots of organizations that may believe that change is a one-time or episodic dynamic.

I think we at Covista have come to learn that change is part of our DNA, and we've created a culture that sort of embraces continuous improvement and continuous change in service of what we think is a really compelling vision and mission.

David Young: And Steve, just related to that, you mentioned change is a constant pace of play.

Does that focus on the execution of what you guys are trying to achieve and say, let's increase the pace of play by which we execute? If change is a constant and we're waiting for things in the environment to be perfect, it's never going to be perfect.

Steve Beard: That's right. But it's also recognizing that your audience is evolving.

Employee expectations for their employers have evolved dramatically since COVID. Customer expectations have evolved dramatically. What people expect by way of customer service, particularly in a tech-enabled world where you can refinance your mortgage and buy a car on your phone or get a package delivered same day from Amazon, what is the consumer's expectation on what a friction-free experience looks like? And how do we continue to evolve our model to be able to meet those evolving demands so that we don't lose any of the customers that we think would be well served by our programs?

David Young: Steve, thank you so much. Thank you. Really appreciated this insightful and reflective conversation. It means a great deal.