WASHINGTON, March 12, 2015 /PRNewswire/ -- While
patient-centered health care transformation remains in its early
stages nationally, the trend's momentum is building, Centers for
Medicare and Medicaid Services (CMS) executive Patrick Conway, MD, told an audience of hundreds
of health care providers, employers, payers, policymakers, and
retailers at Future of Health Care Summit on February 18 in Washington, DC.
Dr. Conway, Deputy Administrator for Innovation & Quality
and Chief Medical Officer at CMS, cited the quick adoption of
Medicare alternative payment models, which virtually did not exist
within the system in 2011 and now comprise 20% of provider
payments. He also noted that unprecedented patient safety
improvements led to $12 billion in
savings from 2010 to 2014, driven by a 17% reduction in patient
harm and 1.3 million fewer adverse events and infections.
The inaugural Summit, convened by The Advisory Board Company,
brought together a day's discussion focused on health care payment
transformation as well as the emergence of more consumer-oriented
retail models in coverage and care delivery. Videos of
plenary and select breakout sessions are now available on the
Future of Health Care Summit website.
In addition to payment reform, CMS officials discussed how
access to health care is increasing. Meena Seshamani, MD,
PhD, Director of the U.S. Department of Health and Human Services
Office of Health Reform, noted that this year, the number of
uninsured individuals reached its lowest level since the 1970s.
The public exchange market has enabled almost eight in 10
people to find a health plan with monthly premiums less than
$100, Dr. Seshamani remarked, adding
that for first time in a decade the proportion of patients who
either avoid care because of cost or are not able to afford care is
declining. "We've been able to bring people into the health
care system in a new way," said Karen
DeSalvo, MD, National Coordinator for Health Information
Technology and Acting Assistant Secretary for Health.
Walmart Explains Its Retail Care Strategy
New entrants are also accelerating the health care industry's
movement toward retail-based care. Walmart wants to "become
the number one retail provider of affordable health care," said
Alex Hurd, Senior Director for
Product Development, Growth, and Payer Innovation in Walmart's
Health and Wellness business. He stressed, however, that, "We
cannot be successful in isolation. We are looking for
partners."
Mr. Hurd noted that Walmart's partners already include
government, provider, payer, and startup organizations. In
partnership with First Lady Michelle
Obama, Walmart formed a healthier food initiative that saved
customers $2.3 billion on fresh
fruits and vegetables in its first two years. The retailer
has also worked with a startup on smart kiosks that have provided
1.7 million visitors per month with information on their body mass
index, weight, and vision.
Building on these early partnerships, in combination with
patient behavior, Mr. Hurd noted that Walmart sees a huge
opportunity for growth: 75% of consumers reported that they did not
have or could not name a primary care physician or had not visited
their physician in the last two years. "A
large percentage of the population is not engaging," in primary
care, Mr. Hurd said.
Mr. Hurd also indicated that Walmart may participate in the
retail market for health plans. While Walmart is not planning
on marketing its own health plans—"Right now, it's not on the road
map," he said—it is considering becoming a distributor of health
plans sold by other firms.
Insurance Exchanges Shifting Decision-Making to
Consumers
The Summit discussion also focused on the emergence of private
market health insurance exchanges, noting that consumers will
become increasingly price sensitive as they enroll in health plans
with higher cost sharing obligations. Observing that some
analysts predict as many as 40 million individuals could be
shopping for insurance on private exchanges by 2018, the panel
discussion demonstrated that the impact of these marketplaces is
already taking hold.
Sears Holdings Corp. saved $38
million in employee benefit costs during its first year on
the private exchange, according to Dean
Carter, Chief Human Resources Officer at Sears. But he
also pointed out that achieving cost savings is not the only
positive impact: "Ninety percent of our associates now say that
they like the ability to choose their own carrier." The
benefits of private exchanges are so strong that Mr. Carter thinks
most human resource officers are at least considering a
shift.
Many employers have noticed employees' sensitivity to costs in
choosing a health plan but need new tools to help employees manage
their own exposure to the cost of care, according to Jim Levine, Director of Compensation and
Benefits at Church & Dwight. To that end, exchanges will
be more successful if they "also implement tools that allow
employees to make better consumer decisions when they're selecting
the actual health care that they get," Mr. Levine said. As
consumers increasingly face cost-related decisions about both
coverage and health care services, providers must compete on cost
both at the point of coverage and at the point of care.
Public Insurance Exchanges Enter New Stage of Consumer
Impact
Public exchanges were another topic of conversation at the
Summit, with the official open enrollment period closing just days
before the Summit. "Exchanges are moving into adolescent
stage," said Timothy Jost, Professor
of Law at Washington and Lee University
School of Law. "People are just now realizing they have to
pay," when they incur penalties for not complying with the
(Affordable Care Act's) individual mandate and "that is going to
drive a lot of people into the exchanges or into the private
insurance market."
Ultimately, through public insurance exchanges and the
Affordable Care Act, "We're in this incredible period of
transition from the way that care has been delivered historically
to the way that care is being delivered as we move to integration
and coordination," observed Diana
Dooley, California's
Secretary of Health and Human Services. "We can't keep paying
for making widgets," under a volume-based payment system, Ms.
Dooley added. She noted that providers in California have approached the state seeking
to adopt payment models that transfer greater financial risk to the
provider, leading to "dramatic" market changes.
The Future of Health Care Summit also brought discussion and
insights on many other topics, including emerging trends in
employer-sponsored coverage, the impact of the retail insurance
market, strategies for improving (and competing on) the convenience
of care, the market for narrow provider networks, and the use of
data in consumer engagement.
"As health care enters more crowded and sophisticated retail
environments for coverage and care, providers will continue to face
urgent questions on how to compete and where and how to invest in
new capabilities," said Lisa
Bielamowicz, MD, Chief Medical Officer and Executive
Director, Research and Insights at The Advisory Board
Company. "The national dialogue between the public sector,
private payers, employers, retailers, and startups plays an
invaluable role in helping providers understand how to adapt to the
new health care purchasing landscape."
About The Advisory Board Company
The Advisory Board Company is the leading provider of
insight-driven technology, research, and services for the health
care and higher education industries. Through its innovative
membership model, the company collaborates with more than 230,000
leaders at 5,000 member organizations to elevate performance and
solve their most pressing problems. The company provides strategic
guidance, actionable insights, web-based software solutions, and
comprehensive implementation and management services. For more
information, visit www.advisory.com.
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