Category: Health Policy

Where Health Care Value Can Lead


It seems inevitable that, in the near future, an innovative health care organization – Let’s call it The Platform – is going to seize the market opportunity of broader value. It will cobble together the pieces, and demonstrate to organizational purchasers that it consistently delivers better health outcomes at significantly lower cost than previously has been available.

To manage risk and drive performance, The Platform will embrace the best healthcare management lessons of the past decades: risk identification through data monitoring and analytics, driving the right care, quality management, care navigation and coordination, patient engagement, shared decision-making, and other mission-critical health care management approaches. It will practice care that is grounded in data and science, and is outcomes-accountable.

But The Platform will also appreciate that a few specialty vendors have developed deep expertise in dealing with clinical or financial risk in high value niches – where health care’s money is – like management of musculoskeletal care, chronic disease, maternity, surgeries, high performing providers, or specialty drugs. It will understand that it often makes sense to partner with experts who can prove and guarantee high performance rather than trying to learn to achieve high performance within each niche. The Platform also will realize that simplicity is a virtue, and that bundling specialized services under one organizational umbrella is easier for health plan sponsors to manage and for patients to negotiate than an array of individual arrangements.

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Reflections From the Ukraine


The English translator of Tolstoy’s epic Russian novel, “War and Peace”, Richard Pevear, writes in his introduction, “The book is set in the period of the Napoleonic wars (1805-1812) and tells the interweaving historical events of two very different families of the Russian nobility – the severe Bolonskys and the easygoing Rostovs – and of a singular man reminiscent of the author himself – Count Pierre Bezukhov. It embodies the national myth of ‘Russia’s glorious period’ as Tolstoy himself called it…”

On page 348, in a moment of intense introspection, the very same Pierre broodingly reflects, “What is bad? What is good? What should one love, what hate? Why live, and what am I? What is life and what is death? What power rules over everything?”

Pierre’s mind provides this very dark response, “You will die – and everything will end. You will die and learn everything – or stop asking.”

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Matthew’s health care tidbits: The Stupidity Vaccine

Each week I’ve been adding a brief tidbits section to the THCB Reader, our weekly newsletter that summarizes the best of THCB that week (Sign up here!). Then I had the brainwave to add them to the blog. They’re short and usually not too sweet! –Matthew Holt

For my health care tidbits this week, I think we need a new vaccine. We need one that prevents stupidity.

Look I get that some people don’t think the flu vaccine is effective and don’t think the effects are too bad, so they don’t get one every year. Many people don’t get a vaccine for shingles. But as someone who had shingles long before the recommended age for the vaccine, let me tell you, you’ll wish you had the vaccine should you get it. And even sensible liberal Maggie Mahar a long while back was pretty suspicious of Merck’s Gardasil vaccine for cervical cancer–although since then it’s been replaced both by a more effective updated version and by Cervarix and the long term results are really good.

But since COVID-19 appeared the cultural and ideological identification among most Republicans has been that only wussy liberals take the COVID vaccine. This is stupid and indefensible. Even Donald Trump thinks so! But when he told his cult members that, they booed him! And so the US is stuck on not enough people vaccinated to repel variants or stop ICUs filling up. There are now hundreds of thousands of unnecessary deaths among the unvaccinated with no end in sight.

But this isn’t stupid enough. Now we are seeing senior political leaders attacking vaccines for diseases we’ve had under control for ages. We’ve already seen outbreaks of measles in recent years, including one at Disneyland. Last month 17 Georgia state senators proposed banning school mandates for all vaccines including MMR, chickenpox, DtAP, Hep B, Polio and more. It’s amazing that these people don’t believe in science, yet they are probably happy to use a smartphone or get in an airplane.

Sadly there appears to be no vaccine for stupidity on the horizon

Medicare Advantage Poses Challenges to Health Care Cost-Effectiveness and Equity



Medicare Advantage (Advantage), originally conceived in 1997 during the Clinton Administration as ‘Medicare + Choice’, has progressively grown and become an established health insurance option for those 65 and older. According to data collected and aggregated by the Kaiser Family Foundation, Advantage has more than doubled in total enrollment between 2010 and 2021. In 2021 alone, 26 million people were enrolled in Medicare Advantage, which is over 40% of the total Medicare beneficiary population. In 2021, 85% of Medicare Advantage growth was concentrated among for-profit health plans, with UnitedHealthCare, Centene, and Humana leading the way.

Overall, the Medicare Advantage market is dominated by UnitedHealthCare, Humana, and CVS Health/Aetna, with this trio responsible for over half of all Advantage beneficiaries.As of October 2020, about 80% of Advantage enrollees directly purchased individual policies, while employer-sponsored Advantage enrollment has been steadily growing, comprising 18.1% of the Advantage market overall in 2020. Analysis from The Chartis Group indicates that half of all Medicare beneficiaries will be enrolled in Advantage plans by 2025, so the trio of existing leaders in providing Advantage plans may continue to innovate and profit immensely while new market entrants may grow their footprint rapidly, in response to growing demand.

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Raspberry Pi Health Care


Like many of you, I have been intently following the war in Ukraine, cheering for President Zelensky and the Ukrainian people, while hoping it doesn’t end up in WW3.  I thought about trying to write about it, then I saw that Raspberry Pi just turned ten, and I thought, yeah, that’s more my speed.

And, of course, easier to relate to healthcare.

For most of us, a computer is our smartphone, tablet, or laptop.  We buy them already designed and built, complete with an operating system and other useful software.  There’s an almost unlimited range of other software that can easily be downloaded to run on them.  Ease of use is paramount.  

This was not always so.  If you are of a certain age or have studied the history of computers, you’ll know that in the 1970s and early 1980s, (home) computers came in a kit.  You assembled them and figured out what you might want to use them for.  Then came Apple and the PC revolution. Our expectations about what computers could do grew as our expectations about what we had to do diminished.  Between 2006 and 2011, Eben Upton and his collaborators sought to change this.

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Get Ready for (Healthcare) Microgrids


We depend on it.  Indeed, our daily lives are unimaginable without it.  The trouble is, it’s become unreliable.  Lives have been lost because it wasn’t performing when it needed to be.  It’s built around large facilities that are often decades old.  Parts of it don’t communicate/coordinate well with others.  Its workforce is aging and burnt out.  There is no person or agency charged with ensuring its resiliency. It badly needs to be rethought for the 21st century. 

Oh, you thought I was talking about our nation’s power grid?  I was talking about our healthcare system.  

The parallels are striking, and concerning.  They’re huge industries, based on early 20th century approaches, and beset by 21st-century challenges to which they may not be easily adaptable.  If we don’t manage their evolution to the 21st century right, we’re dead.  Literally.  

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What Would Newt Do? Making Value-Based Care Victorious


Health care’s much-trumpeted transition “from volume to value” care remains more tepid than transformational, according to a new study. Looking at 22 health systems nationwide, RAND researchers found that compensation continues to be “dominated by volume-based incentives designed to maximize health systems revenue.”

Although confusing payment schemes bear part of the blame, there are deeper problems that appeared in sharp relief when I chanced upon a long-ago PowerPoint from a prominent political strategist and early advocate of “data-driven reimbursement.” 

I refer, of course, to Newt Gingrich. His recommendations from 2007 about designing transformational change in health care provide a perspective that remains useful today in addressing what is ultimately a political problem. Frankly, value-based care (VBC) advocates perform dismally.

Going Along the Gingrich Roadmap

Back in 2004, Gingrich and I both served on a commission seeking to improve the quality of long-term care. This was during a period when a neutered Newt, out of power, was undergoing a political makeover by championing bipartisan health reform ideas such as electronic health records (EHRs) and evidence-based care. He even shared an award from NCQA with then-New York Sen. Hillary Clinton. 

What Gingrich also shared, often, were his thoughts about what was necessary to drive the kind of sweeping alteration of the status quo represented by his leading Republicans to their first House majority in decades. Reviewing that roadmap, it’s not surprising that VBC advocates remain far from their destination.

The journey starts off in the right direction, with VBC advocates following Gingrich’s advice to “focus on large changes.” Trying to upend the way physicians have been paid since Hippocrates made his first house call certainly qualifies. But ambition has to be articulated as part of an organizing and attractive vision.

In 1997, in a book called Demanding Medical Excellence, I summarized the urgency of what we now call value-based care this way: 

Tens of thousands of patients have died or been injured years after year because readily available information was not used – and is not being used today – to guide their care….(The health care delivery system) must be restructured according to evidence-based medical practice, regular assessment of the quality of care, and accountability.

In a similar vein, Gingrich in 2007 emphasized “a clear and compelling vision for quality” that would appeal to patients and medical professionals by promising safe care (no preventable deaths or injuries); consistent clinical excellence (appropriate and effective evidence-based care); and clinicians and staff partnering with patients.

Language That’s Bureaucratic, Not Bold

In contrast, the coalition sponsoring last month’s Health Care Value Week positioned transformation as a series of “models” addressing a bureaucratic checklist of health care “challenges.” The same type of language is used by the Centers for Medicare & Medicaid Services.

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What the Pandemic Taught Us About Value-based Care


You’ll recall that we ran a long piece (pt 1, pt 2) about Medicare Advantage from former Kaiser Permanente CEO George Halvorson earlier this year. Here’s a somewhat related piece from the current head of The Permanente Medical Group about what actually happened there and elsewhere during the pandemic–Matthew Holt

The COVID-19 pandemic has provided important lessons regarding the structure and delivery of health care in the United States, and one of the most significant takeaways has been the need to shift to value-based models of care.

The urgency for this transformation was clear from the pandemic’s earliest days, as shelter-in-place orders caused patient visits to brick-and-mortar facilities to plummet. That decline dealt a financial blow to many fee-for-service health care providers, who are paid per patient visit, treatment or test performed — regardless of the patient’s health outcome.

Prepaid, value-based health care systems, on the other hand, have demonstrated that they are better equipped to respond to a continually evolving health care landscape. Because they are integrated, with a focus on seamless care coordination, and they are accountable for both the quality of care and cost, these systems can leverage technologies in different ways to rapidly adapt to major disruptions and other market dynamics. Priorities are in the right place: the patient’s best interests. Value is generated by delivering the right level of care, in the right setting, at the right time.

Because value-based care focuses on avoiding chronic disease and helping patients recover from illnesses and injuries more quickly, it has the promise to significantly reduce overall costs in the United States, where nearly 18% of gross domestic product was spent on health care before the pandemic — significantly more than comparable countries. That figure rose to nearly 20% in 2020 during the pandemic.

While providers may need to spend more time on implementing new, prevention-based services and technologies, they will spend less time on managing chronic diseases. And thanks to the preventive approach of value-based health care organizations, society benefits because less money is spent managing chronic diseases, costly hospitalizations and medical emergencies.

Value-based organizations drive additional societal benefits. They understand that building trust with patients requires cultural competency — tailoring services to an individual’s cultural and language preferences. During the pandemic, building trust was especially important with underserved communities, where mistrust of health care systems is prevalent.

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Aledade: Mandy Cohen joins, Farzad speaks

Aledade is the “build an ACO out of small independent primary care practices” company. It was founded by former ONC Director Farzad Mostashari and has been growing fast and profitably in the last few years, having raised just shy of $300m. Farzad recently both tweeted out the latest and put up a slide deck about their financial and business progress. Aledade also announced a major star signing in Mandy Cohen, previously Secretary of HHS in North Carolina, who is becoming CEO of a new division called Aledade Care Solutions. I had a wide ranging conversation with both of them about what Aledade has done and what it is going to do, as well as the general state of play in primary care and risk taking–Matthew Holt

TRANSCRIPT (lightly edited for clarity)

Matthew Holt:

Okay, it’s Matthew Holt with THCB Spotlight. I’m really thrilled to have Farzard Mostashari and Mandy Cohen with me. So, both of these two doctors have spent a lot of their time in public, much of their career in public service, Farzad for many years was in New York City, and then later was at ONC. Mandy was at CMS, and more recently, was Secretary for Health in North Carolina. In fact, towards the end of the Obama administration, Farzad was doing venture capitalism in a bar and got given a check and founded Aledade. And the news just recently, was that Mandy, who has just finished her term in North Carolina, is now going to join Aledade and start a new division there. So, I thought we would chat about how Aledade’s doing, what it’s doing, and what it’s going to do in the future and hopefully, yeah.

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Imaging a Different Future


Two articles have me thinking this week.  One sets up the problem healthcare has (although healthcare is not explicitly mentioned), while the other illustrates it.  They share being about how we view the future.  

The two articles are Ezra Klein’s Can Democrats See What’s Coming? in The New York Times Opinion pages and Derek Thompson’s Why Does America Make It So Hard to Be a Doctor? in The Atlantic. Both are well worth a read.  

Mr. Klein struck a nerve for me by asking why, when it comes to social insurance programs, Democrats seem so insistent on replicating what has been done before, especially in Western Europe.  He asks: “But what about building here that which does not already exist there?”  He worries “that the Biden administration’s supply-side agenda is stuck in the past and not yet imagining the future.”

Those are exactly the right questions we should be asking about healthcare.

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