Relentless Health Value

In November 2020, there was an Executive Order entitled “Lowering Prices for Patients by Eliminating Kickbacks to Middlemen.” And we had HHS (US Department of Health and Human Services) Secretary Alex Azar and the HHS Office of Inspector General finalizing a regulation to eliminate the current system of drug rebates in Med D (Medicare Part D). And what they were trying to do is create incentives to reduce out-of-pocket spending on prescription drugs by delivering discounts directly at the pharmacy counter to patients. Those discounts delivered at the pharmacy counter? Not insignificant. In 2019, Part D rebates totaled $39.8 billion. The new rule stipulates that federal spending can’t be increased as a result of this action. But in summary, it’s pretty much a reboot of the same ruling from earlier last year. Here’s a couple of points: The rule is only for Medicare (Med D)—Medicaid and commercial aren’t included—but … there’s a but, and we get into that in this episode. Also, the start date for this ruling is 1

I had a vision for this inbetweenisode. I wanted to highlight the wisdom of our amazing guests this year. I really wanted to find some theme that might be a key to our health care transformation. To achieve maximum suspense, here’s the very short story of how I got from “Is there a common thread of wisdom throughout all the RHV episodes this year?” to “Why, yes, there is … and it’s a good one!” So, let’s start our journey of discovery with this. Here’s a fact: If you talk to patients, they will often tell you that they receive poor care or their needs are not met—when they fall between different providers, or their payer and their provider and their PBM (pharmacy benefit manager) are singing off of different sheets of music. For more information, go to aventriahealth.com.   When not hosting the show, Stacey is co-president of Aventria Health Group, a marketing agency and consultancy. Aventria specializes in helping pharmaceutical, employer, pharmacy, and health system clients improve patient outcomes by creat

You know back in the olden days when a foot of measurement was actually the measure of your own foot? So, I might measure something and it’s, like, 19 feet. And then you measure the same exact thing and it’s 38 feet because you have tiny feet. This is the analogy that kept running through my mind as I was talking with Anna Kaltenboeck in this health care podcast about QALYs to measure the value of drugs. In this metaphor, QALYs are the ruler so that 1 foot of drug value is the same for everybody and all drugs. It’s very civilized as a concept if you think about it. QALY stands for quality-adjusted life year. The goal of a QALY is to figure out how much any given drug is worth to a society so that we, as a society, have a benchmark to evaluate the price of pharmaceutical products. QALYs are an apples to apples or a foot to foot way to compare the value of drugs for we the people. I mean, is this drug amazing and we should all pay a lot for it? Or is the drug more expensive than the current standard of treatmen

Sometimes when I overhear a conversation/argument about telehealth, it occurs to me that there’s a lot of fighting words about some things and very, very little about other things which I’d regard as equally, or maybe even more, important. Some of the sparring tends to jump immediately to tactics and UX (user experience), absent of strategy and CX (customer experience). In my experience, you can’t talk about a user interface until you talk about the overall customer experience and journey and what your goal is. So, here’s what I mean: Let’s take urgent care as an analog. Say a patient goes to urgent care with symptoms consistent of allergic asthma. The NP (nurse practitioner) gives the patient strict instructions to take an antihistamine and Flonase and Flovent. She tells the patient to be sure to make a follow-up with their PCP (primary care provider) to evaluate how it’s going. If the patient doesn’t make a follow-up visit, do we suggest it’s because the live in-person visit should have been telehealth? Or

There’s lots going on these days with transparency. Three cost transparency rules, as a matter of fact, just came out of CMS, for example. These rules demand that hospitals and payers make available cost information so patients can shop and employers can also shop. That last part there, about employers and/or payers being able to shop … that might wind up actually being the part of these transparency rules that has the most impact.   It all goes back to kind of a first-principle assumption that many made—including me, by the way—which is turning out to be arguable. It’s the great hope for consumerism through high-deductible health plans. The thought originally was that by pushing the burden onto patients/employees to find high-quality care at a fair price, we assumed that health care delivery would level up. We assumed that prices would come down, driven by the weight of consumer demands. But anybody seeking to validate this hypothesis would be pretty hard pressed to claim any sort of broad-stroke success bey

Three transparency rules have come out of CMS in the past months. My guest in this health care podcast, Jeff Leibach, calls these three rules three steps on a ladder. They build on each other. The first rule was announced last year, and it was for hospitals to post their chargemasters. You could consider this a baseline step. It’s not really all that useful in practice as many discovered. The next step on the ladder (which is coming out on 1/1/21): Providers (hospitals) for all services have to post a machine-readable file—all of their negotiated rates for all service categories. They also have to post a shoppable service file and/or some kind of patient estimator tool so patients can estimate the cost of the most shopped services. Then there’s the payer rule. This is more comprehensive than the provider rule, and the payers have some extra time—actually, they have an extra year (till 1/1/22). But basically, payers have to comply at a higher level. They have to allow price shopping across all sites of care. M

Wow! It’s episode 300. That’s a milestone. Because of you, we’ve grown to be one of the largest podcasts for health care executives—so, thank you to every one of you who has recommended the show to your friends and colleagues, which is really the highest compliment. Thanks also to all the listeners of this show who have written reviews, LinkedIn posts, and sent emails. The team over here at Relentless Health Value really appreciates your kind words. They’re super motivating. The emails we love to get are the ones where one of you talks about a success story, like an example where you’ve taken something you heard and made it actionable—how you helped patients get better care to lower cost or how you were able to collaborate with fellow stakeholders in a meaningful way. That’s really why we’re here and why it’s so motivating to hear stories like this, which brings me to a really important point. We’re in this together. All of you health care decision maker/stakeholder types out there, you who can directly effec

If you are a forward-thinking specialist right now, alarm bells may be going off, given COVID and/or the prospect of another COVID-style pandemic. Also, all of the capitated and advanced PCP (primary care provider) practices popping up. Also, virtual care models. FFS is a cushy status quo revenue model until it isn’t. One underappreciated point might be that FFS is not only a revenue/payment model. It’s also a business model. And as a business model, FFS very much drives how practices structure themselves to realize that FFS revenue. Consider that to earn a fee for a service, someone (a human person) has to physically do the service. So, all FFS-style businesses have an inherent incentive to add labor and not use technology in any way that actually reduces the amount of billable human hours involved in providing care to patients. But if that top-line revenue line goes down—wow!—you’ll find yourself as many did with way too many employees. An FFS business model has zero flexibility when it comes to revenue tha

I was really vexed the other day when I read on Twitter—First rule of thumb: Stay away from Twitter—but I read on Twitter someone bashing telehealth because, for many older Americans, going to the doctor is the only thing on their social calendar. Ummm, OK. So, we celebrate the idea of paying a cardiologist or a nephrologist or an orthopedic surgeon or some other specialist how much in FFS (fee-for-service) payments to be a paid friend for 7 minutes? So, we’re going to expect these expensive specialists to provide mental and behavioral health support when they have no particular mental health training, and, at the same time, we’re going to weirdly slam telehealth for not enabling this obviously failing and expensive model to continue. And I’ll tell you how I know it’s failing: We have an epidemic of loneliness in this country. So maybe, instead of this serpentine logic, we should instead actually directly address the epidemic of loneliness. Maybe we should directly address mental health and behavioral health.

Here’s something I never really understood: how physicians and nurses more often than not get to be responsible for the entire patient journey, including, start to finish, patient satisfaction. But if you just take one look at any random poorly rated physician’s reviews, they’re usually littered with complaints about the front desk in the practice. Negative reviews, of course, are not limited to front desk diatribes; but there’s often a lot of front desk commentary in them. It has always seemed to me to be a common and strange phenomenon in health care provider practices where the front desk is like a totally separate little fiefdom with a different mission statement and goals from the health care providers in the same exact office. Isn’t that odd when you think about it? I mean, first, the front desk is literally physically separated from everybody else. No matter which direction you approach from, there’s at a minimum a half-wall barrier surrounding them. Sometimes, in directions most likely to receive an a

My guest in this health care podcast is Vincent Rajkumar, MD. Dr. Rajkumar is a professor of medicine at Mayo Clinic, Rochester. He’s also a practicing hematologist at the Mayo Clinic with a focus on multiple myeloma. Dr. Rajkumar does research and conducts clinical trials. He’s a well-known thought leader in questions about the cost of drugs in this country versus other countries. So, let me tell you what happened with this episode: I mentioned to a few people I would be speaking with Dr. Rajkumar, and every single person I mentioned it to sent me questions to ask him. So, that happened. I wound up with way too many questions; thus, I spent my Thursday evening organizing said questions into some semblance of a logical order. In this health care podcast, we talk about telehealth in oncology. We talk about standardizing treatment pathways in oncology amidst the growing complexity of said treatments and how this could potentially help community oncologists and generalists. We wrap things up with Dr. Rajkumar’s

PCPs (primary care providers) are really important to population health. Primary care is the foundation of any well-functioning health system, I am sure many listening to this podcast know well. For the Triple Aim to happen, patients really need access to robust primary care. This has been affirmed by almost anyone who looks into it. And yet, in this country, our system sort of anemically supports our primary care colleagues. As a general statement, poking and prodding and procedures are compensated at a far higher rate than anything requiring cognitive services. What a PCP or a pediatrician mainly does all day is really cognitive. It’s listening and thinking and counseling and coordinating. But here is maybe an underappreciated point: If we’re going to measure PCP performance, then we need the right measures to measure that performance. You might be doing this measurement as a basis for incentives or maybe for continuous improvement programs. Either way, if you don’t have the right measures, then maybe great

Lately, several of the Relentless Health Value episodes have focused on digital health companies and their disruptive potential on referral flows of traditional provider organizations. We also talked about other goings-on with the potential to encroach on hospital systems and independent docs alike. For example, we’ve got Walmart getting, in a big way, into the health clinic business. We’ve got VillageMD and Walgreens teaming up. We’ve got mergers in the on-site clinic space. There’s just a lot of action. But let’s talk about what Dan O’Neill called “physician entrepreneurship” in EP287. Dan said that now is a fantastic time for entrepreneurial physicians to reinvent the practice model. This is true because many, including Dr. Matt Anderson in EP292, have said that it’s not an entirely safe bet if you’re a doc right now to hope that all the practice changes initiated by COVID (like telehealth, etc) go away like a bad hangover the second this pandemic gets stuffed back into Pandora’s box.   So, there’s risk mi

Let’s cut to the chase here for our conversation about co-pay cards offered by pharma companies versus co-pay accumulators and co-pay maximizers deployed by health plans. This whole war of the co-pays started back in the day when PBMs (pharmacy benefit managers) began to shake down Pharma for higher discounts. The prize that PBMs offered Pharma was lower co-pays for patients. It’s a well-known fact that the higher the patient out of pocket, the lower the market share of the drug—the old supply-and-demand curve at work. So, the PBMs and health plans kind of had an ace up their sleeve because they control how much the patient pays out of pocket. And so, they use that ace to pull in higher discounts from Pharma. “You’ll make it up in volume,” they told Pharma. “We’ll make sure you get lots of patients by putting your drug on a lower formulary tier and giving patients who take your drug the lowest possible co-pays.” At a certain point, pharma companies started to get mad about their dwindling net prices. And they

Welcome to Episode 292, Part 2. This is the second part of a two-part episode, but, in a way, you can listen to whichever part you want first. So, if you wound up here first, no worries. Just go back when you have a sec and listen to Part 1. There’s some good stuff there you don’t want to miss, including some background information that might be good to have.  This episode, as well as the last one, is about Teladoc buying Livongo. I am going to call the combined organization T&L because I heart acronyms as much as you do. Here’s the thing with T&L: They are not alone in their quest to disrupt the traditional health care delivery market. You also have Aetna making a plan design that advantages CVS clinics. You got Humana doing the home health thing. You got Walmart and Oak Street hooking up in Texas and risk contracting with managed Medicaid and Medicare Advantage. You have employers across the country direct contracting with Centers of Excellence and buy in perspective bundles. Also, speaking of emplo

This is episode 1 of a two-part show about the potential impact of the Teladoc acquisition of Livongo. To get started here, in deference to the fact that we’re all in the health care industry, let’s agree on an acronym, shall we—because I can’t keep saying Teladoc-Livongo. So, I’m going to go with T&L heretofore that will refer to the Teladoc acquisition of Livongo. What is the general merged T&L pitch? Here it is (I looked at their investor deck): T&L is going to use technology to transform the experience of living with a chronic condition and provide a differentiated consumer experience. The merger will also create a consumer-first, data-driven digital health experience that puts the consumer in charge. T&L will also translate deep consumer data to improve member outcomes and cost savings. Here’s why I think that whole slide is the tip of a disruptive iceberg. First of all, we’re in the middle of a land grab for patients. For my full land grab observational analysis, you can read the show no

Medicare Advantage (MA) enrollment has nearly doubled over the past decade. It grew 37% from 2016 to 2020. Right now, MA comprises nearly 40% of the Medicare population—and that number is only expected to grow. So, in case you’ve been out of the loop, at the beginning of 2020, CMS (Centers for Medicare & Medicaid Services) rolled out a third category of these “chronic supplemental benefits.” And these chronic supplemental benefits allow plans to offer basically services to attenuate social determinants of health to offer stuff like nonemergency transportation, meals, home modifications … that whole list. This is all, really, part of a broader bipartisan effort to move Medicare from an acute care to a chronic care program. Then … corona. So, the question I’m kind of wondering about at this juncture is, Were/Are MA beneficiaries able to maintain their health status better than, say, other plan designs, especially given some of these chronic supplemental benefits, which you’d think would be super helpful in

There is a land grab going on right now, the likes of which the health care industry hasn’t seen before—at least in our generation. Spoiler alert: There’s a whole episode of Relentless Health Value coming up on the impact of the Teladoc-Livongo hookup. And that is totally relevant to the point I’m about to make. But let me just start with a little bit of background: American patients—let’s get real here—have no more money to spend on health care every year. Really. I mean, you look to employers. The government? Who knows? But let’s just say for the purposes of this discussion that what’s going on right now is a zero-sum game—that the dollars in the system every year are the dollars in the system, and if you want to increase your revenue as any given health care stakeholder, you’ve got to take those dollars from somebody else. Alright … now consider this: Previously, if a health system, say, were going to make a list of their competitors, they’d probably list the health system down the street, maybe the one in

Here’s a couple of sentences ripped from the headlines recently: It is free to be tested for COVID-19 in the US, but the cost of treatment can be shocking. Even if you’re insured, the deductible and co-pay can add up to several thousand dollars. And if you’re uninsured, the financial toll is even uglier. That’s what Boston resident Danni Askini learned when she got a $34,927 bill after receiving treatment in a local emergency room for COVID. That’s from Time magazine. Episode 260 of the show was about the Shkreli Awards and the worst profiteering in health care. The judges of the Shkreli Awards bucketed the winners into a few categories. One of the categories of “winners” was called Schizophrenic Compartmentalization, and this schizophrenic behavior seemed super applicable to hospitals this past year. This schizophrenic compartmentalization happens when the person who wrote the mission statement and probably doctors and nurses are on a totally different planet than the billing department. So, I wanted to take

You may or may not know (I don’t know why you would, honestly), but I speak Swedish. I mention this because there’s this famous and really culturally emblematic Swedish word which is this: lagom. It means “the exact right amount.” In Swedish culture, the exact right amount deserves its own word. For example, “Did you have enough watermelon?” “Why, yes, I had half a slice. It was lagom.” Lagom has no direct translation in US English because, in the United States, we don’t need a word for “the exact right amount.” Why? Because the exact right amount already has a word: the most. More. More is always better. I think this shows up in health care in this country, and it definitely showed up in my conversation with Dr. Bishal Gyawali in this health care podcast. There’s this cultural bias in this country that more is better. The point I’m making is that there’s a sort of fundamental belief that aggressive therapy—the most aggressive therapy—is the best therapy and conservative therapy, or following the treatment pa