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Implementing and Financing Innovation at Houston Methodist

Analysis  |  By Jack O'Brien  
   October 27, 2020

The eight-hospital health system in Texas has navigated challenges presented by the pandemic and doubled down on effective strategies for innovation.

Houston Methodist, an eight-hospital health system in Texas, was prompted into doubling down on innovative processes to improve the patient experience due to the ongoing COVID-19 pandemic.

Nicholas (Shetal) Desai, DPM, chief medical innovation officer at Houston Methodist, tells HealthLeaders that the system adjusted to the circumstances created by the virus and outlines the three-step process of implementing digital health strategies for patients. 

Additionally, Houston Methodist Hospital's CFO shares insights on how certain technology investments have already delivered savings.

Three phases of pandemic-fueled innovation:

1. Get a handle on your operations

Before the pandemic began, telemedicine was "nice to have," according to Desai, but now "digital virtual care is no longer an option, it is a standard core benefit."

He says that telemedicine visits at Houston Methodist rose from a couple thousand visits per month pre-COVID to 240,000 visits between March and August, including around 140,000 virtual urgent care visits.

"People are leveraging virtual [care,] even in the walls of the hospital, to minimize exposure and risk," Desai says. "I think that has changed the entire landscape of how we view digital continuous monitoring and then how you access patients so you can protect them, minimize exposure, and keep medicine moving."

2. Improve patient throughput and minimize burnout

Desai says the next step in his organization's pandemic-fueled embrace of innovation was twofold: how could Houston Methodist improve patient throughput and minimize burnout.

He says provider organizations like Houston Methodist had to manage supply and demand as it related to PPE usage, drug cost management, and how to implement algorithms to help understand substitutions better.

Desai adds that most organizations also grow in areas of innovation as they started to "look at alerts differently" than they once did.

"As a physician, I'll call myself out and say alerts kind of annoyed me," he says. "But alerts became my friend in this situation where we could provide insight into what [doctors] can and can't do, or what [they] could do that is more empowering, not just at the patient level but also the physician level."

3. Doubling down on lessons learned  

The third phase was a "confluence of lessons learned from the two" focused primarily on doubling down on the organization's efforts to improve the patient experience, according to Desai. 

As an example, he details the system's pharmacy verification processes, which enabled electronic prescriptions as a core capability for the system rather than acting as a "nice to have" function.

"When you think of [patient] portals at hospital systems, it no longer was a 'nice to have,' it became critical in delivering messages back and forth to patients," Desai says.

Since the start of the pandemic, Houston Methodist has also attached patient coupons to discharge medications, which Desai says is a simple way to empower patients.

These approaches may seem varied but all focus on maintaining a quality experience for the patient through care delivery, communication, and discharge.

Additionally, he says that by conducting a real-time benefits capture of pharmacy benefits, the system selects the right type of medications, minimizes a lower cost alternative, and considers what options may be available based on formulary options.

"Those are some of the things, if you go from access to managing throughput to the [patient] experience, where innovation has spent a lot of time in the last couple of months," Desai says.

He continues: "Key lessons learned are to look for maximum efficiency opportunities and it's not just about identifying the traditional savings opportunities, it's looking at what planning for utilization looks like."

The role of a CFO in innovation

Innovation within a hospital or health system requires ambition from the clinical staff but also relies on financial leadership and investment.

Last month, Linda Kulhanek, CFO at Houston Methodist Hospital, spoke at a virtual roundtable about the facility's acceleration and investment in digital transformation initiatives.

"Innovation has always been part of the lifeblood of our institution," Kulhanek said. "Our focus is keeping our patients at the center of everything we do, so the end goal of all of our decisions are to benefit our patients."

Kulhanek said that the hospital didn't decrease its investment in technology as a result of the pandemic and shifted its priorities around digital health. She said that in her more than 30 years in healthcare, this marked the first time in her career that the organization could "basically start over" in the middle of the year.

Kulhanek added that the hospital has utilized robotic process automation (RPA) to improve productivity and free employees having to do repetitive tasks and rededicate them to more important tasks focused on patients. 

Every day, according to Kulhanek, personnel were manually inputting Medicare numbers into a federal database. However, that process is now automated, and those employees can spend their time on more important tasks, according to Kulhanek, which has made their jobs "easier and more efficient."

"Intelligent automation allowed us to cut costs, and [during] the two years that we've had it running, it's only 10 live bots but they are bringing us about $2 million in savings per year," Kulhanek said. "What we found is that we can implement significant improvements in quality while at the same time minimizing our labor costs. RPA has meant to complement our employees work, and it's meant our employees are getting digital capabilities that they didn't have before."

Correction: An earlier version of this story identified Linda Kulhanek as CFO of Houston Methodist. Kulhanek is CFO of Houston Methodist Hospital, the organization's flagship facility. This story has been updated to reflect that.

Jack O'Brien is the Content Team Lead and Finance Editor at HealthLeaders, an HCPro brand.

Photo credit: Houston, USA - September 22, 2018: Sign of Houston Methodist on the building, a leading academic medical center in the Texas Medical Center and six community hospitals serving the Greater Houston area / Editorial credit: JHVEPhoto /


Houston Methodist provided around 240,000 virtual care visits between March and August, according to Nicholas (Shetal) Desai, DPM, chief medical innovation officer at the organization.

He adds that "digital virtual care is no longer an option, it is a standard core benefit."

Linda Kulhanek, chief financial officer at Houston Methodist Hospital, said during a roundtable that the facility's use of robotic process automation has delivered savings of $2 million per year.

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