Amazon, Berkshire, and JPM are Diving into Healthcare

Amazon, Berkshire, and JPM are Diving into Healthcare

Amazon, Berkshire Hathaway, and JP Morgan Chase announced last month the introduction of their new independent healthcare system, Haven Healthcare.  Haven is targeted to offer more affordable and transparent care to patients, starting with Amazon, BH, and JPM employees and eventually scaling to the public market. The companies, combined, employ over 1.2 million people and insure as many as 2.6 million in the United States. Like many US companies, Haven voiced that the founding corporations are “frustrated by the quality, service, and high costs that their employees and families have experienced in the U.S.” It’s not a unique sentiment. Other business giants including GM, Disney, and Intel have also begun exploring leveraging their population size to create innovative and affordable health solutions for their employees. With many employers funding 80% of healthcare costs, employee health is a painful burden that is eating away at the bottom line. Additionally, continued growth in national healthcare spending is passing costs on to employees, causing premiums to soar and routine care to be out-of-budget. Over time, this inaccessibility of care hurts employee health and increases costs exponentially long-term. Haven Healthcare aims to be a “safe space” for employee health. Using both innovative and simplified approaches to patient treatment, they propose to offer quality healthcare and affordable prices. Price transparency plays into their goal of accountability to prioritize patients over profits, and health incentives encourage patients to maintain good health over time. Though the patient-centered approach has obvious benefits for patients, ultimately the investment in prolonged affordable healthcare frees up valuable capital for the corporations to use in areas of business growth- propelling businesses like Amazon, Berkshire, and JPM into higher profit margins and its employees into better…

Employers are Buying into Digital Doctors

Employers are Buying into Digital Doctors

Digital doctor visits or telemedicine is a growing market for employers, says the 2018 Employer Health Benefits Survey (EHBS). Employers are investing more heavily in telemedicine, with 39% of firms (50 or more employees) providing financial incentives for using telemedicine in 2018.   This comes as employer-run health programs are at an all-time high.  Companies like GM, Walmart, Boeing, and even Walt Disney are negotiating health programs directly with hospital systems. It’s no subtle movement- employers are out to find healthcare solutions. Telemedicine is patient care received remotely from a medical professional through means such as video conferencing or remote monitoring. In large firms, the 2018 EHBS saw employer-offered telemedicine increase from 63% in 2017 to 74% in 2018. The big attraction: better care and lower costs. Benefits of these digital care plans include lower costs of care in comparison to an office visit and more flexibility for the employee. By allowing or even promoting employees to visit virtual clinics, employers are spending less on healthcare and reducing the time-off typically required for employees to schedule doctor visits. Health systems in North Carolina have quickly adopted telemedicine as a cost-saving solution to offer more intensive care to both local and remote patients. Novant Health’s Video Visits offer 24/7 primary care for minor illnesses and injuries. UNC Health Care also unveiled their UNC 24/7 Urgent Care program in 2018, with round-the-clock access to a medical professional. Beyond primary care, Duke Health has implemented telemedicine in physical therapy and ALS treatments, while Wake Forest Baptist Health’s Telestroke network offers 24-hour access to stroke experts to patients in rural health facilities. The growth of accessible programs and the increase in employer interest could spell wider adoption for states like North Carolina in…

New Pricing Model for North Carolina in 2020

New Pricing Model for North Carolina in 2020

Ever wondered where those big ticket deductibles are coming from? How much does healthcare actually cost? This is the transparency issue being battled by North Carolina Treasurer, Dale Folwell, who is confident that price transparency could save state employers and employees close to $300 million.   Folwell has overseen the state’s employee health plan (SHPNC) since 2017 and has taken responsibility for auditing the $3.2 billion annual healthcare spending budget. The SHPNC represents 727,000 state employees and is one of the largest employers to go to bat with health costs. Where is the money going? The standard pricing model in the US sets healthcare costs based on networks, where hospitals and insurers privately negotiate fee schedules. This relationship is the biggest point of contention in the North Carolina pricing war. In 2011 the NC Office of State Auditor recognized the risk of the relationship with their insurer stating that “…the Plan’s auditors do not have access to BCBSNC (Blue Cross Blue Shield of NC) contracts and cannot independently verify that the Plan receives the proper contractual discounts from BCBSNC’s provider network.” Folwell also noted that, “For years, the Plan has paid medical claims after the fact without knowing the contracted fee. It is unacceptable, unsustainable and indefensible. We aim to change that.” New Health Plan in Effect for 2020 According to the SHPNC, Folwell’s Health Plan is set to launch on January 1, 2020 which will include a major transition in pricing. This roll-out will require hospitals to have full price transparency and ditch the commercial-based payment model for a reference-based model pegged to the Medicare program. Folwell’s office is estimating price-matching with Medicare to save upwards of $366 million in healthcare expenditures between the state and the state employees. Interviews published in the Winston-Salem Journal quoted Folwell: “Reference-based pricing is intended to provide transparency in provider rates by indexing fees to a published schedule.” The Medicare reimbursement measurement “is transparent and adjusts for provider differences”. Though the solution in theory seems straight forward there has been significant push-back from both healthcare professionals and hospital systems, accusing the plan of being “drastic”. Conversations and appeals are likely over the course of…

How Direct Primary Care Can Actually Improve Your Profitability

How Direct Primary Care Can Actually Improve Your Profitability

Employers are experimenting with a primary healthcare option that is providing patients with better care, providers with lower risk, and everyone with cost-savings. It’s a high claim but it’s called Direct Primary Care (DPC)- an information-age take against the traditional fee-for-service payment method. The system is gradually gaining momentum across the United States as the healthcare industry toys with the idea of value-based care. DPC is essentially the Netflix of primary care; By opting-in to DPC, patients pay a flat monthly fee to a provider which covers all primary care services. No insurance claims. No co-pays. Just care. Price Competition Employers have begun examining the benefits of DPC as it pertains to price competition. Instead of fighting privatized healthcare, DPC embraces the free market concept by letting providers set rates, instead of insurance companies. This is attractive to employers because providers must use price competition and results to gain routine patronage from large companies. Quality Savings Employers can spend as much as 82% of the healthcare costs for their employees, which can get very costly very quickly. Most spending is related to high-cost long-term care and specialty medications. The DPC concept encourages patients to use what they pay for and maintain a regular relationship with their primary care physician, ultimately enforcing better monitoring of employee health. This leads to better preventative care, early diagnosis, and simplified treatments which saves employers and employees from high cost health. Cost Savings The costs DPC are on-average only $77 per patient per month- that’s less than $1000 per year. To put that in perspective, the Health Care Cost Institute found that median spending a visit to an emergency room in 2016 was $1,917… per visit. In a comparison of one ER visit per year per patient versus unlimited DPC , an employer with a base of 5,000 employees would see roughly a $5 million difference in costs. Also, because nothing is filed through insurance, DPC can become a cost saving substitute for employer insurance plans that do not cover primary care. There are still many companies without access to the benefits of DPC because of the limited number of practices involved. However, recent growth in DPC physicians has expanded access to 36 states; There are as many as 30 practices in the state of North Carolina. Click here to find a DPC clinic near you. Or click here to learn more about DPC…