If hospitals were run like startups, they would ship a 1.0 product as soon as possible, tolerating the embarrassment it causes and not worrying about the people they killed.

A better model is aviation, i.e. an industry where failure is often catastrophic. Look at the success of jet engine manufacturers in producing product that does not fail. Trans-oceanic flights on just two engines is something that would have been considered folly 30 years ago. It's all well and good for Southwest Airlines to have super-perky flight attendants that innovate by singing songs during post-landing announcements, but the real core of their business is safety, just like the real core of medicine is treatment outcomes.