Consumer Driven Health Care Are You Ready?
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1 Consumer Driven Health Care Are You Ready? Speaker: Jonathan H. Burroughs, M.D. Wednesday, March 7 12:30 1:30 p.m.
2 Jonathan H. Burroughs, MD, MBA, FACHE, FAAPL Jonathan H. Burroughs, MD, MBA, FACHE, FAAPL is President and CEO of The Burroughs Healthcare Consulting Network, Inc. and works with some of the nation s top healthcare consulting organizations to provide best practice solutions and training to healthcare organizations throughout the country in the areas of governance, physician hospital alignment strategies, credentialing, privileging, peer review and performance improvement/patient safety, medical staff development planning, strategic planning, physician performance and behavior management, as well as ways in which physicians and management can work together in new ways to solve quality, safety, operational, and financial challenges through the creation of population health programs and clinically integrated networks. Dr. Burroughs serves on the national faculty of the American College of Healthcare Executives and the American Association for Physician Leadership, where he has been consistently rated as one of their top speakers and educators. In 2014, he and Dr. David Nash were awarded a development grant by the American College of Healthcare Executives (ACHE) to develop a twelve hour national program to address population health and the disruptive innovative business models necessary to support it. He developed a two day advanced physician leadership program for AAPL which was introduced at the Fall Institute in Arizona in November, In 2016, he, John Byrnes, MD, and Richard Priore ScD, FACHE were awarded a national development grant by the American College of Healthcare Executives (ACHE) to develop a twelve hour national program to address C suite collaboration and the link between quality, safety, and service outcomes with financial performance. He is the author or coauthor of the following books: Redesign the Medical Staff Model-A Collaborative Approach (published by Health Administration Press, January, 2015 and honored with the 2016 James A. Hamilton Award for outstanding healthcare management book), The Complete Guide to FPPE (2012), Medical Staff Leadership Essentials (2011), Engage and Align the Medical Staff and Hospital Management: Expert Strategies and Field Tested Tools (2010), A Practical Guide to Managing Disruptive and Impaired Physicians (2010), The Top 40 Medical Staff Policies and Procedures, Fourth Edition (2010), Emergency Department On-Call Strategies: Solutions for Physician-Hospital Alignment (2009), and Peer Review Best Practices: Case Studies and Lessons Learned (2008). His next book Building the 21 st Century Healthcare Enterprise will be released by Health Administration Press in early Dr. Burroughs is a former Senior Consultant and Director of Education Services for The Greeley Company where he was rated as one of their top healthcare consultants and educators over an eight year period. He is also a past medical staff president, past president of the New Hampshire chapter of the American College of Emergency Physicians, and served as an emergency department medical director. As a member of the governing board of Memorial Hospital in New Hampshire, he chaired the ethics, succession planning, and bylaws committees and sat on the joint conference, strategic planning, and medical executive committees. He previously served as a member of the clinical faculty of Dartmouth Medical School, where his research interests included introducing EMT defibrillation and automatic defibrillation into the field. Dr. Burroughs passion for the outdoors has led him to serve as a physician on mountaineering expeditions and he has reached the summits of over 5,000 peaks throughout North America, South America, Europe, Africa, Asia and he is the coeditor of the 26th edition of the White Mountain Guide and the first edition of
3 the Southern New Hampshire Trail Guide. He was the first person to hike and log all 2,000 + miles of maintained trails in the State of New Hampshire. Dr. Burroughs received his bachelor s degree at Johns Hopkins University, his MD from Case Western Reserve University, and a healthcare MBA with honors at the Isenberg School of Management. He is a certified healthcare and physician executive and is a fellow of the American College of Healthcare Executives where he was recently honored with a service award and the American Association for Physician Leadership.
4 Minnesota Hospital Association St. Paul, Minnesota Consumer Driven Healthcare- Are you Ready? Jon Burroughs, MD, MBA, FACHE, FAAPL March 7, 2018 How and When did Patients become Consumers? Cost/risk shifting from defined benefits to defined contribution ($338B (2014) to $413.5B (2019) out of pocket expenses) High deductible policies and health savings accounts (HSAs) Squeezed out of the traditional market (25% of disposable family income) Frustrated and value starved from complexity, cost, and physician/hospital centered system 1
5 What do Consumers want and need? Value transparency (quality/cost) (The Surgery Center of Oklahoma) 24/7 access from anywhere Responsiveness to market driven (as opposed to sales driven ) demand Reasonable margins based upon real (and not fabricated or cost shifted) costs with optimization of cost structure Standardized evidence based practices and elimination of non-value added variation (quality/safety) Outstanding and responsive service! The Explosion of International Medical Tourism Global competition for world class quality, safety, service at the lowest possible cost Medical Tourism is the fastest growing industry in healthcare ( : $20 billion to $120 billion and expected to double every two years) Resources: Woodman, Josef, Patients Beyond Borders: Everybody s Guide to Affordable World Class Medical Travel,
6 Typical story: Paul H., Texas: Executive needing meniscus surgery of knee. Couldn t find facility to do it under $32,000 or with epidural. Went to JCI accredited hospital in Monterrey, Mexico and paid $6,200 (including first class travel/accommodations/nursing) for Texas trained surgeon/anesthesiologist to perform procedure under epidural What do you consider your service area? Your community, your state, or the world? Large employers are moving forward: 1. Greater cost sharing from defined benefit to defined contribution towards purchase on public/private insurance exchanges 2. Create and contract through narrow/tiered networks for high quality/low cost providers 3. Provide disease management programs for high risk pool and health wellness programs for all to reduce costs and enhance productivity 4. Reference based prices for high cost procedures/care 5. Utilize navigators/registries to guide employees through the system 6. Create and contract through centers of excellence bundled payment program 3
7 The Explosion of Domestic medical tourism: Walmart s Centers of Excellence for all heart, spine, and transplant surgeries for its 2.2 million associates ($466.1 billion in revenues): 1. Cleveland Clinic, Cleveland, OH 2. Geisinger Medical Center, Danville, PA 3. Mayo Clinic in Rochester, MN/Scottsdale, AZ/Jacksonville, FL 4. Mercy Hospital Springfield, Springfield, MO 5. Scott and White Memorial Hospital, Temple, TX 6. Virginia Mason Medical Center, Seattle, WA 7. Scripps Health System, San Diego, CA Meet Ronnie Smith, MD A Humble Country Doctor and his team from Vidalia, Georgia 4
8 What is going on with Amazon, Berkshire-Hathaway, and JP Morgan-Chase Given up waiting for the industry to serve corporations in the global market and are creating an: Insurance product Employee Health program for its 1.2 million employees with predictive analytics and population health management Serve as a prototype for other large employers worldwide In Response to Healthcare Consumerism and Pent up Value Based Demand Healthcare will be: 1.Digitized. Why? 2.Standardized. Why? 3.Commoditized. Why? 4.Globalized. Why? All around consumer (patients, employers, payers) needs! 5
9 With the Internet, The Earth is Flat Thomas L. Friedman (The Rise of Brands and Fall of Geography) >100,000 health and fitness apps ($26 B worldwide industry) Top 10 health and fitness apps generate > 4 million free and 300,000 paid downloads Top ranked MyFitness Pal has 40 million registered users WebMD attracts 2.16 billion users annually to its websites VC investment of $2B into digital health DO YOU HAVE AN APP YET? Healthcare System Apps (UCLA Health app by Mobile Smith): 1. General Information: map, directions, accepted insurance, phone numbers (tap to call) 2. Services: directory of services and providers (tap to call/ ) 3. Virtual Tour: 360 degree tour of rooms, maps and access information, times of operation 4. ER Wait Times: dynamic wait times for all facilities 5. Interactive gallery, events, and social media: streaming content and interactivity 6
10 Leading Patient/Consumer Apps: 1. Exercise (34%) 2. General Reference (11%) 3. Weight loss (10%) 4. Sleep and Meditation (9%) 5. Women s Health (7%) 6. Tools and Instruments (6%) 7. Medication (5%) 8. Pregnancy (5%) Source: Verisoni, 2012 Social Media Rules! Worldwide Users: Facebook: 1.4 B, Twitter: 0.5 B, Linked in: 0.25 B (2013) (world pop 7.4 B) >70% of healthcare organizations actively utilize social media (97% facebook, 66% twitter, 54% youtube, < 20% google+, linkedin, blogs) 90% of text messages read within 3 minutes! Children s Hospital (LA) and BIDMC (Boston) have raised millions in additional revenues VIA Facebook! Mayo Clinic Center for Social Media (MCCSM) CEO blogs (St. Luke s Health, Boise, ID) 7
11 From a Supply-Based to Demand-Based Economy 1. The Quantified Self 2. Smart Care Teams (eco-system) 3. Transparent Consumer Markets 4. Retail Clinics and Focused Factories 5. E-Health 6. Community Collaborations 1. The Healthcare Consumer is Evolving to the Quantified Self Healthcare apps with monitoring devices, social media, blogs, and contact with e- health care providers (95 M and counting) Big data and predictive analytics (IBM Watson) Passive monitoring with early interventions (wireless technology) Lifestyle medicine (pursuing personal goals/objectives) Consumer engagement with customized self-managed care plan 8
12 1. The Quantified Self can be Digitized (Eric Topol, MD): 1. Exposome: environmental exposures 2. Epigenome: chemical changes to one s DNA 3. Microbiome: the DNA of one s microorganisms 4. Metabolome: one s metabolites 5. Proteome: one s proteins 6. Transcriptome: one s mrna 7. Genome: one s DNA 8. Anatome: one s body images (MRI etc.) 9. Physiome: one s physiologic sensors 10.Pheonome: one s social/external interactions 1. The Quantified Self can be detected through the use of: Adhesive bandages, glasses, earbuds, wristbands (e.g. Apple Watch), headbands, necklaces, contact lenses, garments, smart phones with microfluidics and detect. Vital signs and heart rhythms O2 saturation and cardiac output Eye pressure (e.g. glaucoma) Blood sugar/hba1c Brain waves EKG Lab tests and breath analyzers 9
13 2. Smart Care Teams Health Information Exchange (HIE) with coded predictive analytics and decision support tools Enables the risk stratification of individuals-personalized EBM Real time biometric/clinical feedback Requires access to enterprise IT/analytics capability Physician/patient ratio predicted to move from 1 to 2,000 to 1 to 6,000 Predictive Modeling: Predictive Summary Source: Courtesy of Conifer Health Solutions, a revenue cycle management, population health management solutions company. 10
14 3. Transparent Consumer Markets Castlight, ZocDoc Healthgrades.com; Propublica.com; Leapfrog Safety Ratings Transparent pricing (referenced based pricing), quality metrics Significant financial incentives by employers and payers (narrow/tiered networks) I-phone will be the primary healthcare entry point 4. Focused Factories Shouldice Hernia Center, Thornhill, Ontario (1945): 89 beds, 5 ORs, 7,500 cases/year, LOS 3 days (surgery on day 2) Average general surgeon: cases/year Shouldice surgeon: 700 cases/year 99.5% success after 300,000 cases Harvard Business School: 4 th most popular case study (>500,000 copies) 11
15 4. Focused Factories-Key Characteristics Singular focus with a standardized approach/culture/service World class quality, service, and costeffectiveness Team based approach willing to adopt and support evidence based clinical/management practices Often bundled payments for outcomes Strong world-wide or regional brand 4. Retail Clinics Predicted to grow to 50,000 outlets by 2020 Staffed by APRNs under medical directorships 36 high volume/low risk diagnoses and treatments (URI, OM, bronchitis, rash without fever etc.) with strict compliance to protocols and medical consultation No charge for consultation and referral Increasing use of lower cost diagnostics 12
16 Revenue Pressure Primary care drives lifetime patient value But this basic relationship is threatened: Patients cannot get in to see a PCP So retail clinics are meeting the demand PORTLAND LOS ANGELES SAN DIEGO DENVER MINNEAPOLIS DALLAS DETROIT ATLANTA PHILADELPHIA HOUSTON CUMULATIVE WAIT TIME 18.5 ALL SPECIALTIES 19.5 FAMILY PRACTICE BOSTON NEW YORK WASHINGTON D.C MIAMI Number of US Retail Clinics Merritt Hawkins, 2014 Survey: Physician Appointment Wait Times and Medicaid and Medicare Acceptance Rates, Advisory Board, Telemedicine and Concierge Care: Trends in Consumerism and Non-Traditional Primary Care Delivery, Examples of Disruptive Entrants: CVS Health/Walgreens/WalMart CVS: 7,700 retail pharmacies, 900 walk-in medical clinics ($20 B), pharmacy benefits management with 64M plan members, $132 B net revenues with operating margin of 15.35% Walgreens: now treats chronic medical conditions (diabetes, hypertension) WalMart adds tele-medicine capabilities (Smart Care Doc) to its retail clinics 13
17 5. E-Health: Disruptive Innovation for Low Cost 24/7 Access Retail Kiosks (employers, retail and clinic settings) Mobile apps and devices (computers, I-pad, smart phones, smart watches, etc.) 24/7 access to physicians or APRNs for common, low risk, easy to diagnose/manage problems Rapid expansion with large employers, health systems, health plans 5. E-Health: Largest Player- American Well, Boston, MA Turnkey tele-health platform (lease or buy) to organizations/health plans/payers/employers, online care group Access to 100 M health plan members across 45 states $49/visit VIA credit, debit, HSA cards Payment processing, payer management, advanced reporting and analytics, dynamic pricing options, e-prescribing, provider driven follow up tools, medical home tools (registries) 14
18 5. E-Health: Most Common Uses Urgent care (e.g. URI, UTI, rash, flu etc.) Chronic medical management On demand inpatient consults (e.g. rural areas) Emergency department case flow (MSE) Home healthcare services Post discharge/surgical care Behavioral health Contribute physicians to national pool What Patients/Consumers want in the 21 st Century 1. Transparent healthcare markets (quality and cost) 2. Superb customized and timely service on demand 24/7 3. Control of their own healthcare information 24/7 4. Evidence based care 5. They are the center of their own care and control! 15
19 Final Things to Think About: If the rate of change on the outside is greater than the rate of change on the inside, the end is near. Jack Welch If you do not change direction, you may end up where you are heading. Lao Tzu Our only security is our ability to change. John Lilly, MD Questions, Discussion, Key Learnings, and Wrap Up 16
20 Thank You for Joining Us! Jon Burroughs, MD, MBA, FACHE, FAAPL
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