That frontier continues to develop as the dynamics of healthcare evolve: There are escalating costs, complex insurance coverages, government regulations and rapidly developing technology.
What has not changed are the needs of patients at the center of healthcare. They want access to quality healthcare and a decent chance at wellness. It’s in this climate that healthcare experts are pondering the future of the $3.12 trillion industry.
These dilemmas were posed to industry leaders at a recent participant-sponsored roundtable held at Rivkin Radler, a law firm headquartered in Uniondale. The panel included Robert Iseman and Benjamin Malerba, both of whom are partners in the firm’s health services practice group; Dr. Zeyad Baker, ProHEALTH Care Associates president and CEO; Jeffrey Kraut, the executive vice president of strategy and analytics at Northwell Health; and Dr. Simon Prince, president and CEO of PRINE Health, a new startup medical group, physician network and management company.
The discussion, moderated by LIBN Editor Joe Dowd, addressed how the financial realities facing the medical community are impacting patient care.
“Providing good health insurance benefits had always historically been important in recruiting talent and keeping it – but now it’s insufficient,” warned Kraut. As the industry grapples with ever-changing challenges, “employers now have to rethink their benefit structures.”
Dr. Zeyad Baker (right) says ‘it’s the patient who should drive the bus.’ (Photo by Judy Walker)
Insurance matters
“My understanding is there are approximately a little under 5 percent of the people who remain uninsured in New York,” Iseman said.
“From a public societal perspective, nobody should go without – we’re the richest country in the world,” Prince said.
And the industry is riddled with a myriad of hurdles, among them navigating through the coverage provided through the Affordable Care Act. In 2017, Northwell began the 18-month process of shutting down its health plan, CareConnect, because of regulatory issues stemming from the Affordable Care Act and loss of federal funding that made the insurance company financially unsustainable.
Now, experts say a “hybrid approach” could provide solutions.
“I really like the public private partnership hybrid in Medicare Advantage,” Prince said.
“We should be able to provide [for those in need] and nobody should go bankrupt paying for their medical bills,” he added. “We should be able to figure out a way to do that.”
But whether it’s the government doing it alone as a single payer, or another model “the devil is always in the details,” he said.
Still, the industry would do well to focus on a basic premise.
“Patients want essentially two things,” Baker said. “They want outcomes, and they want to be satisfied with their access to care.”
Baker pointed out that “it’s the patient who should drive the bus.”
And when that happens, “every other problem in healthcare downstream is solved,” he said. “What’s best is going to make the patient healthy. If they’re healthy, they’re not sick. If they’re not sick, they’re not hospitalized for 10 days, they’re not in the ICU and they’re not getting transplants.”
But with new pressures, “burnout is up to 50 percent after five years,” Baker said, speaking about physicians. “Forty percent of doctors after a decade wish they never went into medicine – that’s never happened before. But if we solve the economics, you bring back some autonomy and we’re only concerned with doing what’s right for the patient.”
You need a team of individuals to manage people’s health, says Jeffrey Kraut (right). (Photo by Judy Walker)
The economics
In terms of healthcare dollars, in the United States, 80 percent is spent on 20 percent of the population, Kraut said. In general, those dollars are spent on those at the last year or two of life, the chronically ill, the disabled, those institutionalized in long term care, and others.
“There’s a growing cohort of people who are living longer,” Kraut said. “To care for these individuals, it’s not just a doctor, it’s not a hospital – you need a team of individuals to manage people’s health.”
Increasingly, he added, “we’re understanding that some of the healthcare behaviors that are manifested that lead to obesity and smoking are also a function of poverty, it’s a function of education, and food insecurity and housing.”
These challenges are “somewhat inter-related and that’s why the newer models of care that are evolving, and what we’ve really made an enormous investment in is to create, it’s beyond delivering care,” he said.
Kraut said, “sometimes we have an issue where an individual has an asthmatic condition and instead of prescribing medication to someone, we buy them an air conditioner because they’re living next to the highway.” In another initiative, Northwell opened a “food farmacy” at Long Island Jewish Valley Stream with the assistance of Island Harvest and other partners. To ensure that patients struggling with medical conditions stemming from a poor diet get access to nutritious food, the hospital writes prescriptions for fruits and vegetables and other healthy food.
“It transcends the doctor,” he said “For people who are chronically ill who generate most of our costs – that’s who we’re hoping will get the biggest savings.”
Aiming to mitigate challenges, Northwell is considering how to best deliver healthcare.
“We’re an essential part of this community’s healthcare structure,” Kraut said.
The healthcare system is developing “Northwell at Work,” a program that provides employers with preventative health and wellness services for their workers such as biometric screening, stress management, flu shots and primary care, as well as occupational health services such as injury prevention.
“We’re putting these services together now to design a benefit plan and works with employers to essentially make health insurance more valuable and usable, while providing access,” he said. “Our objective is to remove the hassle and the risk of receiving care for their employees.”
Staying ‘completely independent is becoming incrasingly difficult,’ says Dr. Simon Prince (right) (Photo by Judy Walker)
Driving the bus
Evaluating healthcare delivery opportunities ahead, Iseman wonders “who’s going to drive the bus in the next five years on Long Island?”
These possibilities include the hospital-based systems and large multi-specialty physician groups.
Potential opportunities are piquing the interest of investors, Malerba said, but in New York, there are legal restrictions.
But, Malerba said, he’s seeing “those boundaries come down” and “more money coming into New York, financing operations.”
Legal experts, he said, are working towards “appropriately structuring vehicles” in a way that “they can invest their capital in healthcare but leave the clinical decision-making patient care firmly in the hands of physicians and providers so that there’s no interference whatsoever with the delivery of healthcare to the patient.”
And the industry may take what seems like surprising turns.
“What if someone on Wall Street came in and financed a group of physicians, formed an IPA [independent physician association] or large specialty group, and that group could show through empirical data that they had the best results, they were the most efficient, they could deliver the greatest value for the healthcare dollar,” Iseman said.
This IPA would find new power in the market.
“They say ‘We have a large outpatient facility and we can do all the things the technology allows us to do and we’re going to bring our patients to that outpatient facility as part of our private practice of medicine,’” Iseman said.
The model would likely get the attention of the region’s hospitals.
“They have their patients go through the ambulatory center for their colonoscopies and their joint replacements, and then they say we need to have a place to go to take our patients for open-heart surgery and neurosurgery,” Iseman said. So they decide to issue “an RFP to hospitals and say, ‘We’ll go wherever we get the best deal. Because now we have the patients.’”
And in this market, timing may be everything.
“There’s this dynamic going on here where the health systems are hiring up all the doctors, and the question is can they continue to afford to do that?” Iseman said. “And at the same time we have large groups of independent physicians who, if they had the right leadership and they had the right capital, might be able to drive the bus…. The physician network says, we’re going to bear the risk – we have sufficient reserves to do it because we’re capitalized through Wall Street.”
And while fee-for-service medicine has been the foundation for medicine – that’s changing, Iseman said.
“We can create a model with the right infrastructure with the right leadership and right resources that can champion physicians’ leadership in a way that allows physicians to really play a meaningful role in who actually drives the bus,” Prince said.
“Now the trend is you’re going to be paid for the outcomes you achieve and the efficiency, value and quality that you bring,” Iseman said.
That will happen through what Iseman called “the new value-based payment methodologies.”
Through these methodologies, “the health system or physician system – or whoever’s driving the bus – will be given a certain amount of money per patient, or certain amount of money per group of patients, and told, ‘here’s the amount you have.’ It’ll be a negotiated amount. There are actuarial and demographic calculations that go into how much that amount is, still achieving certain value and efficiency metrics. If you succeed in managing the care of those patients, and there’s an excess, you get to keep it. If you overrun the budget and you spend more than we have budgeted for you, you bear the risk.”
And healthcare experts can partner together, Prince said, noting that “to remain completely independent is becoming increasingly difficult. So how can we figure out a way to aggregate physicians? Give them a real meaningful seat at the table and a voice in something and create our own position in the changing marketplace, which is increasingly challenging to navigate.”