Interviewed Evan Falchuk, President of Best Doctors, on their product allowing consumers to get additional information and options regarding diagnosis and treatment options.
The interview took place at the World Health Care Congress and the podcast is below.
WHCC 2008 just wrapped up with a final keynote from Secretary Leavitt. Leavitt’s keynote was a progress report on the four cornerstones that have driven HHS under his leadership.
Cornerstone One: Standard Quality Measures
There has been a lot of quality metrics established, but agreement on the standards by which these will be measured is still a big challenge. Leavitt believes we are moving too slow. Currently, HHS is doing an inventory of the quality measurements they are currently using throughout HHS. They have identified 100 of them and will be going public with these measures this year.
Cornerstone Two: Standards for Cost of Care
Leavitt came down hard on healthcare costs and billing structure stating:
Our billing system in healthcare is insane.
He went on to draw an analogy between a consumer buying a car and a consumer buying knee replacement surgery going on to say we need to challenge the assumption that buying healthcare services is any different from other industries. Leavitt believes that current efforts striving for the perfect solution will never move us forward - he again stated we are moving to slow. We need to strive for good, not perfection. CMS is currently aggregating its cost for common procedures data and will make that publicly available to push the cost transparency issue forward. Getting back to that knee/car analogy, CMS covered the costs for 250.000 knee surgeries in 2007, the costs for those procedures will be made public this year.
Cornerstone Three: Interoperable EMR
Sees HHS steadily marching forward on interoperability. Quite proud of the establishment of CCHIT and the certification process used to insure EMR software is in compliance to interoperability standards. HHS, via it National Health Information Network (NHIN), will test flow of data among several systems by end of this year. Next year, he foresees this moving beyond test data to the flow of real data and scale-up.
While Leavitt recognizes the challenge of a broader NHIN and interoperability with fewer than 10% of small practices having an EMR system, he gave little concrete guidance on how to overcome this issue. They are looking to change the economic equation to promote adoption. What that equation will be remains to be seen, but I’d look to CMS as the prime leverage point.
One of his chief objectives this year is to see further adoption of eRx practices, which he will promote strongly. Currently looking to attach eRx requirements with physician reimbursement payment rule of he CMS bill before Congress.
Cornerstone Four: Incentives to Seek Value
He saved the fuzziest statements for this last cornerstone. Again, Leavitt promoted the need to establish standards for value metrics and incentives. Also emphasized the need for trust among all stakeholders to get this to work. The biggest challenge that HHS has uncovered here is that value and incentives are driven locally. Therefore, HHS’s role will be to establish the standards, and let the local community drive incentives. Chartered Value Exchanges, of which 14 have been awarded/funded to date, will be the mechanism to drive value and incentives at the local level. Goal is to have 50 opertational by 2010.
Leavitt closed his presentation by stating he sees the unbridled rise in healthcare costs as the biggest threat to our nation’s national economic security. Solving the healthcare puzzle is this generation’s challenge.
Analysis:
Yes, movement on Cornerstones One and Two has been glacial. Too many vested interests have very strong financial reasons to stall any progress on cost and quality transparency. While it appears that HHS will look to further leverage the clout of CMS, seems too little too late, unless of course the next administration picks up where Leavitt left off and pushes even harder to make this happen. In full agreement with Leavitt that we should strive for good enough and not perfection. Advocates for perfection are the ones truly stalling the process.
For Cornerstone Three, do believe that for all the complaining I have heard, all-in-all, CCHIT is moving the interoperability ball forward and EMR companies are structuring their solutions to comply. Now we just need to educate the physician. Here, HHS has fallen far short of the mark. For all the talk about wanting to drive adoption among physicians, adoption is still horribly low. Coupled with strong incentives to encourage adoption (CMS payment structure?) HHS could do more in educating physicians on what’s in it for them. The EMR market is still surprisingly fragmented, and even for me, an HIT analyst who covers this market for a living has a difficult time keeping up with all of them. Maybe CCHIT can provide some guidance here as well.
Corenerstone Four is my least favorite and was where Leavitt made the least clear statements. Defining value and structuring incentives around value is an extremely hard thing to do. The Chartered Value Exchange sounds like a re-branding of the failed RHIO concept and I don’t give these new exchanges any more chance of surviving than its predecessor. Secretary Leavitt, with all due respect, throw this one in the can and go with a three legged stool, afterall, a three legged stool is more stable anyway.
CIGNA & WellPoint to Make PHRs Portable in 2008
You heard it here first folks, CIGNA and WellPoint will make member data portable by end of 2008, following the lead of Aetna and UnitedHealth.
Sat in on the session, Critical Health IT, which had representatives of WellPoint and CIGNA talk about their consumer and broader health IT initiatives. During Q&A got a chance to ask both why have they not come forward with a public statement that they support the portability of a member’s PHR. (Note, during their own prepared remarks they gave somewhat dismal views of PHRs stating adoption has been a challenge). Both stated that they have every intent of making a member’s data portable. WellPoint and CIGNA are currently deploying the CCR standard internally to insure that the data will be portable and enable a member to populate a PHR of their choosing outside of their health plan. They also went on to state that this will be completed in 2008.
Towards the end of our exchange on this question, the WellPoint representative went on to state that they still have issues regarding privacy and releasing such data to a non-covered entity. GIGNA nodded in agreement. What a load of bull, particularly after WellPoint has had a few privacy/security breaches of their own.
Hey WellPoint, its my data, let me choose whether or not I wish to take the risk and stop being so damn paternal. Or is it, you just don’t want anyone between you and me? Watch out, you are about to be dis-intermediated.
And finally, thank you to the WHCC 2008 team for inviting me to attend what has been an excellent event. Your ability to bring together many of the leaders in the healthcare industry is to be commended. I have learned much in these two and a half days, so thanks again for the opportunity to participate.
John Moore is Managing Director of Industry Analyst firm, Chilmark Research
Contrary to popular belief, I don’t believe that the internet is isolating. The internet actually connects people more and better both online and offline. Despite the scare that air travel was going to be harmed by internet communication, air travel is at an all time high. The so-called Web 2.0 movement has made purchasing and connecting with others easier and almost idiot proof. Instead of technology holing us up in closets staring blankly at LCD screens, our society has found that humans still need the physical presence of other humans — and now we have even more means of communication to connect with others. We text our friends to meet up at a bar. We send out “spam” email to our parents with daily photos of our new kiddo and their new grandchild. We video chat with our wives as we’re out on the road traveling. We meet our future wife on the internet and meet up for coffee because technology has allowed us to find other singles in our neighborhood.
Technology connects us and makes our lives more meaningful.
The healthcare industry does not yet understand this. They don’t understand that humans want to connect with other humans — preferably humans they know and like. They don’t want to connect with corporations, especially corporations that have a cringe factor to their brand — notice there isn’t a single healthcare brand in the Top 100 brands. They don’t want to connect with websites. They want to connect in meaningful, advantageous ways with people they value.
It’s trying to. I think. But doctors are too busy to care and they aren’t paid for accessibility and communication. Therefore, patients haven’t even been given the option.
There should be two main players in healthcare — doctors and their clients. Technology should be used to enhance the old-time, personal doctor-patient relationship — not cheapen it by using technology to connect you with some random doctor who doesn’t know you and vice versa. It’s unsafe and cheapens our profession.
Convenient Care Clinics and online video and IM visits with random doctors have arisen as a response to the deficiencies of our current policies that do not pay for intelligent care and instead pay for volume and more intensive care. They are excellent business opportunities to meet demand for patients who will take anything because their doctors are not accessible or available.
But they fracture our healthcare system even more.
If our policies and, therefore, our doctors do not respond to healthcare user demand, our healthcare is going to get more and more impersonal with less and less qualified caregivers. In effect, our safety is being threatened by cheapening the once coveted doctor patient relationship.
People get sick and need care when they need care. Giovanni Colella, former founder and CEO of Relay Health, said “People do not care if they communicate with their doctor, they just want to talk to a doctor.”
Of course Giovanni. When people are desperate and in need, they’ll take the best thing available. And when people aren’t given the option to communicate with their doctor, they’ll search for the next best thing. Since their own doctor isn’t available, they’ll take anything. When you’re starving and only rice is available, you’ll eat a lot of rice.
Technology has revolutionized every other industry except healthcare. I could develop the Killer App of healthcare and NOBODY WOULD USE IT.
That’s fine. You’ll be left behind as we create The New Digital Divide of Healthcare using technology to enhance a personal doctor-client partnership with your own personal neighborhood doctor. The age of using the internet to provide only simple text and impersonal, “jack-of all trades, master of none” information died on September 24, 2007.
Healthcare is personal. Healthcare is private. Healthcare is about a close doctor-client partnership to optimize the physical and mental health of both doctors and their patients. Doctors…we deserve it. Every day, we face life and death decisions. Our minds and our professional environment need to enhance our ability. Patients…you deserve it. Everyday, you should be happy and healthy so you can go about your business in this lovely world.
Doctors and patients — healthcare will continue to slip away from both of us and into the hands of a decreasing number of oligopolies.
We need to take it back. We need to partner with one another. We need to use technology to organize our needs. It’s not going to be cheap, it’s not going to be easy, but it’s going to be the best thing we’ve ever done to make our nation and our world a happier and healthier place.
If I got a nickel for every time I heard the word consumers here at the WHCC, I’d be a bajillionaire.
If I got a nickel for every time I heard someone use the word consumer appropriately, I’d be broke as a bad joke.
consumer |kənˈsoōmər|
noun
a person who purchases goods and services for personal use : [as adj. ] consumer demand.
• a person or thing that eats or uses something : Scandinavians are the largest consumers of rye.
The first definition is appropriate to someone who is buying a new laptop. They go online, search “PriceGrabber” for the best price, find the store with the best rating and/or the one they’ve had a previously good experience with, enter their credit card information, and a few days later that shiny new laptop shows up on their doorstep. It’s a lovely, painless experience. It’s actually enjoyable because you absolutely know you’ve spent your hard-earned money on something you value. This is the true consumer experience mastered by the retail industry.
It’s non-existent in healthcare.
The second definition is appropriate to someone or something that consumes a resource — we consume oxygen, we consume rye, bacteria consumes glucose, etc.. This definition often has little to no direct personal monetary expenditure. This definition seems almost synonymous with intake or consumption of a resource we need to survive.
The second definition seems more in line with healthcare.
We consume antibiotics and doctor visits to prolong life.
Please stop calling them consumers. Call them healthcare users.
Until you can offer healthcare users consumer benefits on par with actual retail stores in America, you cannot call them consumers. They are users.
This is a perfect example of an entire industry slowly changing the true meaning of a word without anyone noticing to advance an agenda.
Let’s talk about the characteristics of people who use healthcare in the US:
1. They spend someone else’s money on routine and specialized goods and services. “The United States has the best healthcare someone else can buy.”
2. They have no easy way to gain knowledge when they need it (like Pricegrabber) about how much they will “spend” on a given service and, often times, product.
3. If they do have knowledge about the amount they’ll spend, it’s often in the form of the amount of the co-pay (a heavily discounted price that cheapens the value of a doctor’s visit to a near meaningless ten dollar bill).
4. There is no way to shop for value.
5. There is no way to have the consumer experience similar to a visit to the Apple Store because doctors are paid for volume rather than the retail consumer experience.
6. Online rating systems are terribly flawed. Only people with an agenda (either a great experience or negative experience) go out of their way to rate their doctors. Therefore, “consumers” have no ability to measure value.
7. Value, in the mind of the consumer, is how long they waited for an appointment, how long they waited in the doctor’s office, how much they had to pay for the medication they were prescribed by a physician, and how much of the transaction their insurance covered.
8. All of these “values” are worsening in the minds of consumers in the current healthcare climate due to the trends showing an ever-increasing cost-shifting to employees and decreasing physician reimbursements causing an increased volume of patients in the doctor’s offices.
9. Value, to consumers, is increasingly becoming “Did I actually see my doctor?”
There are three “consumers” of healthcare — doctors, patients, and insurance companies. Doctors write the grocery list, patients go the grocery store to pick up the items on the list, and insurance companies pick up the tab at the end of the month.
Doctors are absolutely clueless about how much things cost but they nearly always order the juiciest filet mignon — they believe their perceived quality is associated with the taste. Patients are absolutely clueless about what things cost but they almost always want the filet mignon — they believe quality of care is associated with cost. And Insurance companies are near omniscient about healthcare costs and only want to pay for Spam.
Wouldn’t it be in everyone’s best interest (especially insurance companies) to arm both patients and doctors with cost information and cost-effectiveness data at the point of decision making? Wouldn’t it be appropriate to let the public know that cost of care is not associated with quality of care?
It would be appropriate, but it would affect your business models.
The bottom line is…patients are paying more for less, the consumer experience in healthcare is non-existent, and the morale of primary care doctors on the frontline is at an all-time low. Meanwhile, our “solutions” are just talk because there are too many golden geese laying too many golden eggs in a healthcare pond increasingly becoming an oligopoly.
But this is the beginning of a national crisis that will threaten our ability as a nation to compete in the global market and thus threaten the very existence of our nation as our healthcare spending rises to over 25% of our GDP in the next decade.
Bill Gates has said the only thing he’s afraid of is “some guy in a garage.”
He’s out there. But he’s not taking any hints from the Healthcare Industry about how to do things.
This next session is with James (Jim) Roosevelt (President and CEO of Tufts Health Plan) and Phyllis Anderson (VP of Marketing from Humana). It should include real-life discussions on what works.
Interestingly, Jim is making a point that he made earlier which is about how to differentiate when all the providers are in each plan. I talk about this a lot. My opinion based on what JD Power showed in their study is that communications is the differentiator. How? What? When? Personalization? Rules? Preference based? Integrated?
Jim said that 3-years ago they were in touch with 1.5% of their members on a regular basis…that number is now 22%. I am not sure there is a benchmark to know if that’s too much or too little…but it seems good. Some of the words he uses which I think are important are - cost management, quality improvement, evidence-based, self-care, comprehensive and integrated, effective, and positive ROI.
He laid out a good continuum of programs moving from low cost, healthy programs (wellness) to more expensive programs for at-risk people (disease mgmt) to high cost programs for the chronic patients. Tufts is moving to a consumer empowerment plan called My Wellness Plan which will focus on engaging 100% of their members and still get an ROI of greater than or equal to 1.5:1. He showed a chart that 50% of health costs are driven by health behaviors (good news in that it is an addressable challenge).
He talked about an example around bariatric surgery which I thought was a good case study. Rather than simply not covering it, they cover it after certain steps including a six-month lifestyle modification program. The key point he made is that surgery without behavior modification is dangerous.
They have 3 categories for engaging members:
Lead a Healthly Lifestyle
Manage Care and Treatment
Effectively Navigate Health Care System
He made the point that it could be copied, but the question is do you act first. I think the question really is how well do you implement the vision. It’s easy to envision and know what to do. It’s very difficult to execute it well and make a difference.
Phyllis started with some patient messages which were interesting.
Take a deep breath. We dare you.
The food groups are your friends.
Make you next smoke break a clean break from smoking.
Where do you see yourself in 5 pounds?
Lower back under attack?
“Healthiness is a nuance.”
As the quote indicates, health information and engagement varies dramatically, and it will take a while and some trial and error.
“Incremental change will ulimately result in significant impact.”
She talked about a pilot they did and what they learned:
Create real-life goals (relevant to where they are and where they live)
Want to fit a dress by reunion versus lose 100 pounds in the next 6 months
Community is key
Coach
Peers (the participants blogged and got feedback via the blog)
Rewards and incentives are necessary
Personalized to individual
Not just monetary
Include recognition
“It costs less to support well people.” Phyllis went on to make the point that it’s worth spending the money now rather than waiting until people get sick.
There was a good question from the audience on whether ROI mattered. Apparently, some of the employers here at the conference had said that they were willing to invest in programs that promoted health without any ROI. I think the key is that there are limited resources…I would spend money first where I got a return. I am willing to bet that I don’t have much money (or time) to address the other programs.
Only 2% of consumers are currently using a PHR, according to Revolution Health CMO, Jeff Gruen at the World Health Care Congress on a panel with Graham Pallett (Carol) and Jeff Rideout (Health Evolution Partners).
So why are these tools not being used?
Some initial thoughts:
Awareness
Concerns around security and privacy
Data needs to be “easy” and ubiquitous
Compelling or “killer” apps
Interest in the PHR is clearly renewed, with consumer oriented development occurring due to efforts by tech titans Microsoft (HealthVault) and Google (GoogleHealth). The real question is whether this is technology leading the wagon or if there are real unmet user needs creating opportunities that the technology can begin to address.
There are clearly different (and competing) objectives for PHRs from the consumer, provider, and payor perspectives.
Consumers have a number of different needs that could be addressed by a PHR:
ER in coma
Questions/ clarification from doctors and care providers
Followup information
Appointment reminders
Coaching
Storage of data/ condition over time to give to provider
Peace of mind
Access to information (e.g., history, vaccine records, end of life instructions)
Pharmaceutical safety/ coordination
Ability of care providers to take care of loved one/ relative
Given the number of needs and potential user needs, it appears that we don’t have clarity around the initial consumer “beachhead” and the minimum functionality required to create real value. How much of the clinical record needs to be captured and even autopopulated? What degree of certainty needs to exist around the data? How transportable does it need to be? Do clinical or claims records even capture the information relevant to consumer needs?
For now, we have a platform looking for an application– it will be interesting to see in what direction (if any) the development of the PHR unfolds. Which company will create the Visicalc or “Facebook” style apps that create value on top of the platforms is the question for the entrepreneurs and Venture Capitalists…
Imagine a Health Care system that functioned like the consumer credit industry. Scott Kornhauser has. The CEO of Healthation thinks the system ultimately delivers a personal health care score (like a credit FICO score) that drives what consumers pay for healthcare, complete with the ability to improve rtheir rating over time with the right behaviors/performance.
That tidbit was part of the vision Kornhauser delivered in “Processing the New Business of Health Care in a Retail Marketplace”. Kornhauser’s bigger vision is that the retail transformation of the U.S. health care delivery system is going to demand real time claims adjudication. To make real time claims adjudication a reality, Kornhauser sees a combination of indexes and other data points coming together to make the real time claims process work.
In Kornhauser’s vision, consumers will have the ability to opt in or out of sharing their data with various types of providers. However, to get the best health care credit score possible, they would have to share a great deal of data and then have their overall health judged - via a numerical score that looks a lot like the FICO score that drives your personal access to credit.
Ready to tell Danny in Accounts Payable he has a health care credit score of 500 and will have to pay double what others do for healthcare?
Great!
Have a bad health care FICO score like Danny? In Kornhauser’s world, you’d probably pay more for medical premiums. But like the credit FICO score, you could improve your health care credit score by demonstrating desired behaviors - like paying your bills on time (easy for Danny, right?) or losing weight to get your BMI score within an acceptable range (harder for Danny…).
As part of my opportunity to be part of the press at the World Healthcare Congress, I opted to interview some of the participants and speakers. This is my first of several that I have scheduled.
I had a chance to sit down with Phyllis Anderson who is the VP of Corporate Marketing for Humana. She has an interesting background from Pillsbury, Nabisco, and Bank of America as I discovered when I asked her what they were doing to bring in non-healthcare people to help them address consumerism within healthcare. Her story about working on healthier snack foods where they wanted to protect the quality of taste while addressing the healthy trends in the US seems very applicable.
How do we manage our history of healthcare while addressing the sea of change?
We talked a little about the paradigm shift that they are addressing in moving towards an individualized healthcare sell. Phyllis talked about focusing on the benefit to the consumer. Sticking on that same concept, when I asked her about how they were addressing preference-based marketing, she talked about creating “viable consumer experiences”. She talked about looking at 3 factors: message x channel x frequency. She mostly spoke about the differences in needs / interests around messaging by health status. I asked about using different models like Prizm versus Pro-Change, and she said they were still exploring the right model.
Given what she said plus what one of her colleagues had said on the main stage, I asked her about how they captured feedback (i.e., indirect on direct) about satisfaction. She said that they ask for feedback on a lot of their outreach programs today.
Listening and Leading
She talked about their CEO’s term of listening and leading and trying to balance those two things. Sometimes you have to listen. Other times you have to lead the consumer. We also talked about the fact that if the patient isn’t engaged then it’s pretty hard for them to give feedback.
I then asked about how they’re using JD Power and Forrester’s healthy studies. I was glad to hear that they had embraced the JD Power study and were working on an expanded relationship with Forrester.
George Halverson, Kaiser Permanente’s CEO gave a keynote earlier today at the World Health Care Congress in Washington DC. The statistics he gave were compelling. The opportunities, also, really interesting. From a consumer perspective, the prescription he wrote was not– heavy on centralized best practice reminiscent of the socialistic command & control approach rather than incentives for innovative practice.
The issues today are pretty clear– we are focusing our resources heavily on the sickest individuals.
1% of the sickest consume 35% of the health spend
10% of the population consumes 80% of the health spend
But these innovations, although they lowered costs and seemingly were good for patients, hurt Virginia Mason’s bottom line. For example, “the big employers saved $100,000 in the first year. But Virginia Mason fell into the red on the average migraine case, instead of breaking even as before.”
The diagnosis was clear– hospitals and hospital systems make such a large sum off of “excess” care, that they can’t afford to get off the gravy train by doing the right thing.
In my mind, this is where the solution laid out was exceedingly non-consumer friendly.
Halverson suggested that universal mandates are required to make health affordable– taking spend for the sickest 1% from $12K/month down to a more manageable $300/month. This makes sense if one looks at the purpose of insurance as a mechanism for wealth redistribution/ wealth transfer. Thus, universal healthcare has an individual mandate– the healthiest are subsidizing the sick at a level that they can’t reasonably expect to recoup.
From the viewpoint of the healthy consumer, spending $300/month for no benefit is a poor economic choice. The business model for insurance in fact rests on a different trade-off, the payment of an underwritten premium that matches actuarial risk against level of insured protection (e.g., amount of potential claim payment one could attain if the risk in fact occurs). The healthy consumer then faces one of two choices– pay premiums to insure against future risk or opt out of insurance altogether. As insurance costs go up, and are focused on highly technical solutions with marginal benefit, we would expect to see the largely healthy opt out, as we are starting to see in the employer health insurance market, via CDHP plans or dropping the benefit completely, as the job. Employers are increasingly showing that they believe health insurance’s cost is not a good value for the job(s) it was hired to perform.
The solution is unlikely to come from the hospital system that is disincented to cut its own throat by reducing the cost/ delivery of high tech care. Instead, how can we create incentives that increase reimbursement/ wealth for those that reduce the shift of the “healthy” 80% into the “sick” 20%? How can we also create better value for those currently seeing minimal value for their contributions, and limit the spigot being poured, without accountability, into the sickest 1%?
I did have a chance to read his book before coming to the conference and look forward to see what he has to say about health care reform. For Shultz the story of reforming health care and social security begins with the stability and growth of the US economy. In order to respond effectively to the coming cost catastrophe the economic pie has to growth. Any reforms have to be designed to pass Shultz’s “pie test.” Simply put, proposals that weaken the the GDP fail the test. So making use of the competitive market to discipline costs, raising labor force participation, recognizing labor mobility, growing personal savings, forcing government to confront the cost of over-promised entitlements, increasing taxes only as a last resort — these are some of the dynamics that should be examined when looking at the impact of healthcare reform measures.
Thus the “Shultz-Shoven health care initiative” includes, but is not limited to, the following:
Encouraging national rather than state health insurance markets
Making health insurance benefits portable
Enhancing consumer access to healthcare price and quality information
Risk-adjusted vouchers for Medicare and Medicaid
Offer Medicare and Medicaid beneficiaries choice of private health plans
Fund government programs dedicated taxes rather than general fund to promote cost effectiveness
Replace Medicaid’s eligibility “notch” with phased reduction in the value of vouchers as income increases
Shultz’s ideas are not new but they do enjoy an economic logic that cannot be denied or ignored.
He sums up his proposals in the following way:
. . . we seek to modernize and significantly reform Medicare and Medicaid, improve employer-sponsored health plans, and ensure that those who do not have access to such plans will still be able to obtain affordable major health insurance. We advocate that all Americans have access to strengthened Health Savings Accounts and a more competitive health insurance environment.
The question will be whether in today’s healthcare debate these conservative, market-oriented ideas will seem somewhat tepid in the face of corporate conspiracies and single payer fantasies.
Matthew Holt interviews Jonathan Cohn, a senior editor with The New Republic whose book - "Sick: The Untold Story of America’s Health Care Crisis — and the People Who Pay the Price” - was recently published.
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Listening and Leading
