FOX: This is a delicate matter because health care providers don’t intentionally practice inefficacious medicine. It is important to note that it’s not just providers tackling this issue. Employers are directing their employees through the growth of defined contribution health plans. Employers offer a set amount and allow employees to shop for coverage from a menu of plans. In the future, perhaps, they’ll select plans from the exchange. One of the effects of this is that more patients are questioning the costs of our services. There’s also a big market for nontraditional health care companies. Walmart is now one of the largest providers of durable medical equipment in the United States. There are many things that are going push us to be more price-sensitive. Consumers are going to get a better deal. Regardless of what happens with the Affordable Care Act, the employer community no longer will continue to pay what it's paying and will channel people to be more cost-effective with their care.
BUZACHERO: That’s right. One of the things we are seeing is that many of the larger- and mid-sized employers are opening on-site clinics, and they’re going past the point of just having a physician extender. They are adding imaging capability, for example. And there are organizations emerging to help large employers do that. I think this shift is going to be for the better, actually. Employers can help influence their employees to make better decisions. But what does this mean for hospitals? Hospitals have so much more knowledge about how to care for the total population versus just a single incident of care. We are beginning to deploy care navigation teams to follow patients through an entire episode of care. It has reduced length of stay and improved quality.
MODERATOR: What kind of partnering is going to be needed with the payer community to get some of the data you need to reach the performance measures that payers want to see these days?
MANAS: Payers have a wealth of data. They know what their members are doing across the continuum. We have a snapshot of what’s going on in our hospital and health system. The ability to partner with payers and share data is important.
BUZACHERO: Their approach in contracting heretofore has been to hold data close to the vest and use it to tier us as an industry and drive patients where they feel they can get the best value. That has to change to move to a different model.
NAAS: Some of our members have provider-owned health plans and it is interesting to see how they have been able to leverage that double vision. It provides clarity around the continuum of care, how they are controlling the flow of care and cost comparisons, as well as outcome comparisons per unit of payment and where care is being received. Some members now are leveraging that capability to provide those services to other provider organizations that do not have health plans.
FOX: Our partnership with Blue Cross for our ACO model is rather new, and it’s an evolving model. We’re now nearing the end of the third year. We’ve developed a close partnership but it’s been difficult to get data translated into information. Blue Cross has struggled but made great strides, and we’ve struggled and made great strides. An advantage that we have at Advocate is having such good coverage in the Chicago market, so it makes sense for Blue Cross to work with us.
NAAS: In deference to the employers who are providing coverage, many would ask who’s paying for this? Many health care organizations are following the premium dollar and working directly with employers.
FOX: Well, it’s one of our benefit offerings in Advocate. We now have an Advocate-only health plan for our employees. It’s a cheaper plan than our HMO and our PPO products. We’ve had such success with the Advocate-only plan that employers have come to us to ask if we could create something similar for them.
LINDEN: That’s clearly our plan as well. That’s why we’re using our own health plan as a model; we then can share our experience with other self-insured employers in our community. We can highlight our partnerships with other organizations that provide services that we do not. It makes sense for employers and providers to work together, and it makes sense for payers to be at the table if they are willing to open their books and bring the value. I am biased, but it doesn’t make sense to me that in my small community, the prices of benefits go up for the employers every year, and the payment to us goes down every year. Where’s that money going? As we work to improve the delivery system and bring down costs, it’s the payers that will benefit. Hospitals and health systems need to either find people willing to partner with us to change the system in a way that benefits patients, or we need to do it ourselves.
MODERATOR: And you’re comfortable with the risk side of this equation?
FOX: We view accountable care as a transition vehicle to full risk. And it does frighten us, because to take full risk, particularly for a Medicare population, is huge. We’ve spent the last three years working to build the infrastructure that gives us a chance to be successful in a full risk environment. And we still have a ways to go.
BUZACHERO: There are relationships that have emerged in which some payers have worked with providers to help. That type of relationship can be advantageous to both parties.