Q: It's clear why a hospital C-suite would pay close attention to analytics and business and clinical intelligence – they want to reduce readmissions, avoid penalties, increase patient satisfaction scores and improve their bottom lines. Why should physicians, with so many sick patients and so much else on their plates, care about big data?

A: A quick story: I was speaking to the medical students at my school about a year ago. I said to them, “You people are entering this field where you're going to be under intense pressure your entire career – that was very different than what I was under – to deliver high-quality, safe, satisfying care at the lowest possible cost.”

I was trying to shake them up. One of them raised his hand, and he said, "What exactly were you people trying to do?"

I wake up in the morning and say, as my defining mantra, that the system has every right to say to us as a profession, "You are here to serve us." You think you've been doing it your whole career, but that's not the game here.

The game here is to deliver incredibly terrific, evidence-based safe care – and to do it at a cost that's survivable. I think physicians believed for a long time that we're not part of that. That we sort of operated above, or independent of those imperatives that somehow our ethical duty was to focus like a laser on what the patient needed, and damn the costs.

I think we're waking up now and realizing that that's not right. In a no-money, no-mission way. As in: If it's damn the costs, we're going to go out of business and not be able to do the things we need to do.

And it's right for our individual patients as well. When we are profligate in our spending we don't take advantage of the data we have to figure out the best way to treat patients, the best way to prevent bad things from happening, the cheapest way – we often use mealy-mouthed words, but the correct word is cheap – the cheapest way to safely and effectively take care of a patient. Should that be in the hospital, should that be at home, should that be in a clinic?

When we're not doing that, I think we're not following our Hippocratic Oath.

Now, does every doctor need to be an expert on analytics and big data? I don't think so. In the same way that not every doctor needs to be an expert in surgery or radiology.

We all need to know how to use it; we all need to know what to make of it; we all need to be good consumers of it. That’s a new set of competencies that's extraordinarily important. And bring the doctors and the systems they work in closer together. Good systems that survive and thrive in the future are going to be ones where that way of thinking – that the C-suite thinks this way, but I'm a doctor and I think this other way, and somehow I'm on a little higher horse, a little bit more morally pure.

That's all going to go away. We're all going to think the same way. The job here is to produce the best care at the lowest cost. And there's a set of structures and culture and data and analytics that allows us to do that. A good doctor will say, "Terrific. I need to be a part of that. I need at the very least to understand how to do that."

And some of us need to be experts in that because if it's just non-clinicians that do that they won't be asking the right questions, and they won't be able to communicate as effectively with their brethren as some people who are physicians.

It's quite parallel to the emergence of CMIOs. I spent the other day at Epic. You could argue: “Do IT vendors need to have physicians and nurses on staff?” You could argue: “Why, this is all about technology, this is all about code.” But they've all come to realize, not really!

You need to understand the workflow; you need to understand how these people think. And you're going to have to have other people who cross over between these two worlds. I think the same is true with analytics and data.

Q: Talk a bit about your equation for determining "value" in healthcare: quality plus safety plus patient satisfaction, divided by cost.

A: It's not rocket science. Every industry in a capitalist economy is driven toward producing the best product at the lowest cost. The code word for that is value.

What's funky about medicine, as that medical student asked me, is that we have really not been. There are multiple reasons. One is that the insurance system insulates everyone, to a large extent, from cost. The costs get hidden and moved around in funny ways that make them not obvious.

This morning I had to run out and get my large mocha because otherwise I would not be functioning at 9 a.m. I have to decide whether it is worth $3.65 to give to Starbucks every morning for this cup of coffee. And I do that based on my consideration of value: quality, satisfaction, whatever pleasure it gives me, divided by the cost. I decide whether it's worth it. That cost comes completely out of my pocket, and if I decide one day that it's not worth it, and the $1.80 I can get from Dunkin' Donuts down the street is good enough, and I'm gonna save that money and do it another way, that's what I'll do.

We have an abiding belief in America, and I think it's been largely borne out, that that sort of pressure – producing the best thing, however you define the best, divided by the lowest cost, or the survivable, acceptable cost, is how we ended up with Google and how we ended up with Apple and how we ended up with Amazon. These companies that seem to work and seem to thrive.

Medicine has been insulated from that. And I believe that the abiding philosophy of modern American health policy is that insulation has led us down a dark alley – to care that is too expensive, that is unsatisfying for patients, to access that's not good enough, to quality that's spotty and care that is often unsafe.

The question that health policy gurus grapple with is how do you create an ecosystem that drives doctors, hospitals, vendors and new entrants to the field to come in and deliver the best product at the lowest cost.

That's very tricky because the insurance is there, and needs to be there – if we take insurance away and treat it like Starbucks, a lot of people are going to go broke very quickly.

And it's difficult because when I judge whether my tall mocha is worth $3.65, I'm a pretty good judge of does it taste good and make me feel better in the morning – whereas patients have a very hard time judging whether their doctor or hospital is any good.

So you have all these nuances that make healthcare purchasing a little different. But the push to deliver value is, I think, the defining moment of where we are in health policy. We're trying to figure out how to create a system that delivers appropriate incentives to everyone, including patients, to increase the numerator – the good stuff: better-quality, safer, more reliable – and does that at, if possible, a lower cost.