Coming Together at the Payer/Provider Summit
The payer/provider relationship in healthcare is full of speed bumps and roadblocks, a fact unsurprising to even the patients. I was excited (and admittedly a little nervous) to see how both sides would work together on their challenges during the Payer/Provider Summit in Snowbird, Utah, in October.
During his keynote address, Shawn Stinson, Senior VP of healthcare innovation and improvement at BlueCross BlueShield of South Carolina, deftly introduced why payers and providers needed to come together at the summit:
“Many of us are in many different relationships across payer and provider organizations right now. But judging by current market forces and disruptors, external pressures are creating an urgency to change the unsustainable system we have today.”
With his experience in both the payer and provider worlds, Stinson then offered his unique perspective on the market forces and disruptors in the industry. Here are just some of his insights.
The Effects of Rising Costs
The percentage of dollars that goes toward healthcare in the US continues to rise. Stinson presented data from the Organization of Economic Cooperative Development (OECD) that shows that in 2019, we are on track to spend over $11,000 per person in the US. Stinson pointed out, “No longer is cost only a conversation between healthcare economists or politicians; healthcare costs are affecting most of the population. Average, everyday people are worried about not having access to the care that they need and being able to pay for it.”
Employers are telling payer organizations that they’re spending more on healthcare than almost everything else. Stinson gave an example: “In South Carolina, a medium-sized employer is now telling me that if we don’t do something, they will go out of business. It has gotten that dramatic. The amount that is projected that employers will continue to pick up is getting greater and greater.”
Of the over $3 trillion that is spent in the US on healthcare, the employer now pays a little over half. And while many employers ask for benefit plans that allow them to pass along those costs to their employees, that trend has leveled off as fewer employers feel like they can do that in this labor market.
Market Disruptors
Some larger employers are taking steps to try to improve the situation. One employer told BlueCross BlueShield that they will continue to work with them only if they can come up with a plan that cuts 20% of their healthcare costs. Another said that they will stay only if they are brought a plan that has providers at the table and that prioritizes value-based reimbursements.
Stinson dove into a few other examples of how employers are disrupting the market. “Employers right now, with or without payers, are going out and looking for direct relationships with telehealth vendors, or vendors that have apps that use AI to help manage their patients, and more. They are asking us more questions about what more we can do when we come in for our quarterly or annual reviews.”
The internet is allowing consumers to become their own diagnosticians to some degree. Stinson shared that his daughter had an allergic reaction when she ate certain fruits but that the symptoms would go away and come back. His wife told him it was oral allergy syndrome based on her internet research. Stinson was skeptical and sent his daughter to a friend who was an allergy immunologist. “The diagnosis?” he said. “Oral allergy syndrome. The last few years of my practice, it was very common for people to walk in with a well-reasoned, diagnostic workup and a terribly accurate differential diagnosis with a treatment plan for the top two or three problems on there that included drugs by name.”
Healthcare is also seeing more vertical integration. CVS and Aetna, Walmart and Humana, United Health Group with SCA are just a few disruptive examples.
Focusing on Fee-for-Value
Stinson asked attendees to focus on improving the payer/provider relationship with a focus on value-based reimbursements. “I suggest that if we come at this with metrics for success in a fee-for-service world, and we hold those up as the way to move forward, we're probably going to fail.”
He gave one example to illustrate his point: “We have a good relationship with one of our partners with a fee-for-service base. During a routine collaboration visit at one of their sites, they had a pizza party for hitting 100 admissions in a month. But we pay thousands of dollars a month for them to have fewer admissions.” Stinson remains hopeful despite the misalignment they see today. “I predict that this health system will be one of our very good partners in the future. But I just do not see a way to align ourselves in a fee-for-service world.”
He reiterated, “As we come together as payers and providers, costs and reimbursement better be on our minds because organizations are seeing an opportunity to make a difference. And if we're not part of that, if we hunker down in the old fee-for-service world, we have a long history of knowing what will happen with cost.”
Photo cred: Adobe Stock, calypso77