AHIP17: New vision for healthcare calls for bold, forceful changes
“In respect to the challenges that were up against, I can’t think of a more challenging time,” Anthem President and CEO Joseph Swedish said at AHIP Institute & Expo 2017.
AUSTIN — Sectors across the U.S. healthcare industry as well as the presidential administration have been “reinventing healthcare,” Anthem President and CEO Joseph Swedish said last week at the America's Health Insurance Plans (AHIP) Institute & Expo 2017. There is consensus that three main issues should be tackled with healthcare’s transformation — affordability, access and care quality.
Research has shown that providing better care at a lower cost is “truly an achievable goal,” Swedish said. Exactly how that goal can be achieved through transforming the several areas within healthcare that are currently undergoing major changes remains unclear.
Swedish outlined the strategy his company, the second largest payer in the country, is using to make its vision of a transformed health system a reality. He kicked off his keynote speech by discussing the seven characteristics Anthem is focusing on during the transition. These characteristics were adopted from AHIP, as payers across the country rely on the national association to represent them as a unified voice during this time of uncertainty and change, he said. “In respect to the challenges that were up against, I can’t think of a more challenging time,” Swedish said.
Anthem’s board is challenged in trying to meet the expectations set by these new characteristics, Swedish said. Yet, he added, “We can’t react to change. We have to get way ahead of it.”
The characteristics are:
1. A desire to promote consumer choice and market competition
What’s interesting about this being the first on the list is the fact that Anthem had been battling in several courts for months over its proposed $54 billion merger with Cigna challenged by the Department of Justice (DOJ) due to concerns with increased prices to consumers and reduced market competition. A federal judge ruled in favor of the DOJ in February and the Court of Appeals upheld the conclusion last month that the merger would have led to reduced completion for national accounts.
In addition, an increasing number of payers have been dropping out of the Affordable Care Act (ACA) exchanges so competition has substantially decreased in the individual market. These companies have argued that the exchanges they left were not profitable and changes are needed to improve their stability.
There is one trend that could potentially improve competition. More hospitals have begun taking on the role of payer, Swedish noted. Hospitals becoming payers is a trend emanating from value-based care, he added.
2. Simplify the healthcare experience
The connectedness of healthcare made possible through mHealth technology has allowed consumers to more easily gain access to their own health data, as Eric Topol, director of the Scripps Translational Science Institute, noted during his discussion on the potential of precision medicine at the AHIP event. Patients can now get high resolution X-ray images through their cellphones, Topol said as he demonstrated a full-body medical selfie of his own on stage.
Currently, it can take a new patient about 24 days on average to see a primary care doctor in 15 different metropolitan areas, a recent Merritt Hawkins report concluded. But telemedicine services give patients who need to see a doctor access to care from the comfort of their home. “Telemedicine today is just a video chat,” Topol said. "But tomorrow, it will be exchanging data.” In 2015, Anthem partnered with Castlight Health to allow customers to access physicians 24/7.
3. Support partnerships in all levels of government
Everyone has their area of expertise in healthcare. But during the major transformation the system is experiencing, partnerships will be key to deciding the strengths that different companies and organizations have to offer to tackle the challenges they're facing. According to Swedish, Anthem has expanded “very aggressively” in the government sector after purchasing Medicaid provider Amerigroup.
4. The conversion of volume to value
Payers and the federal government has been tying more clinician payments to the quality of services provided. The CMS already met its goal of having 30% of Medicare payments tied to quality and is on track to hit 50% of payments by 2018.
Anthem is now “paying 59% of reimbursement to the provider community through value-based care models,” Swedish said. “We are a market leader with respects to advancing value based contract for the benefit of our members,” he added.
5. Address the impact of chronic disease in our society
Anthem’s partnership with Harken Health, which shut down in May because of financial losses, was aimed at providing enhanced care for chronically ill patients, Swedish said. Patients received an individualized care plan, and their needs are addressed based on their chronic disease pathway.
6. Support clinical innovations
Anthem recently created an innovation studio to better understand the needs of costumers, how to model innovations that are applicable to their needs and how to bring them to the market rapidly, Swedish said.
The studio recently generated several initiatives including one called “What's My Status?" This sends updates to members about the status of their claims and provides summaries of their care plans and data on their healthcare spending.
7. Leverage data and technology
The AHIP audience gasped at one data point Swedish presented — the large amount of consumer data Anthem has from processed claims. The company processed 730 million claims just last year. And this created 17 petabytes of health data about its members, which can now be put to good use, according to Swedish. “The world of opportunity is growing,” he said.
Topol argued that most data don’t get analyzed in a truly meaningful way. However, instead of everything being big (e.g. Big Data), everything is going deep (e.g. deep learning), Topol said. "This will reset the playing field between patient and doctors,” he added. “It’ll make them [doctors] a whole lot more capable.”
Anthem's 4 pillars
From the skyrocketing costs to the uncertainty around the fate of the Affordable Care Act and the shift toward value-based care, insurance companies are facing numerous challenges and Swedish argues that the way to overcome them is through innovation.
“We have to make bold changes,” Swedish said. “Our industry must continue to forcefully drive change.” With the aforementioned seven characteristics in mind, Anthem has implemented four pillars for innovation:
The first pillar is about blurring the lines between payers and providers to better promote payer-provider collaboration. A new Quest Diagnostics study showed that surveyed payers and providers said they believe co-investing in value-based tools is the best way to effectively prepare for the shift. Dr. Patrick James, chief clinical officer for health plans and policy, medical affairs for Quest Diagnostics, expects more collaboration of this sort.
The second pillar is cost of care. Swedish argued that “cost is the biggest and most pressing challenge that we face.” Health costs have been skyrocketing in recent years and this has led to highly detrimental amounts of uncompensated care at many hospitals across the U.S. At Mayo Clinic, for example, uncompensated care with Medicaid patients increased last year compared to 2015. This led to the infamous comment from Mayo Clinic CEO John Noseworthy that Mayo would give preferential treatment to privately insured patients.
The last two pillars are about wellness and quality. “Quality is an enterprise-wide priority that encompasses service wellness, it's truly tied to value,” Swedish said. More than half of Anthem’s Medicare Advantage enrollees now have four-star plans compared to just 22% in 2016. This growth creates the kind of value that members are trying to align with, Swedish added.
Consolidating Anthem’s four pillars for innovation to transform healthcare creates an imperative to perform in a way that truly understands the needs of the industry, according to Swedish.
Payers are uniquely positioned in the care continuum as they have close relationships with consumers as well as those in the hospital and tech industries. The insurance industry also has the capital needed for powering the change Americans are hoping to see.
There is one thing that James hopes that more payers will do to better understand the daily challenges that care delivery providers are struggling to overcome. James suggests that payers go to hospitals and actually see what a clinician workflow looks like today.
Payers are already interested in being the ones to bridge the gaps between all healthcare sectors and allow for a connected system to deliver higher quality care that is more affordable and accessible. “I think the health plans now . . . need to reestablish their value proposition to help the consumer navigate and become the navigator,” David Biel, U.S. leader of Deloitte’s health plan consulting practice, told Healthcare Dive. Biel argues that's why more payers are reaching out to providers and tech companies to collaborate in an innovate way in the journey toward patient-centric care.
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