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Words Matter: Doodling – We Should Foster It

As someone who was trained as an architect, I understand the value of sketches in the design process and have always “doodled” as I try to conceptualize what people are describing with words.  With that in mind, I really enjoyed this TED video and think it’s a good message for all of us in the communications field.

Post ESRX/MHS Merger – How Many Big PBMs Are There?

This seems to be one of the critical questions in the evaluation of whether the merger should go through.  We’ve always talked about the Big 3 PBMs – Express Scripts, Medco, and CVS Caremark.  If that’s the market, then going from 3 to 2 seems like a huge deal.

But, I think the market has and is changing.

  • What about OptumRx (formerly Prescription Solutions)?  Once the lives formerly managed by Medco are insourced in 2013, this is going to be > $20B company (I believe) which is part of a huge company (United Healthcare).
  • What about Prime Therapeutics?  They manage over 14M members (I believe) and have been actively bringing in lots of new management from other PBMs as part of their growth strategy.
  • What about SXC and CatalystRx?  They both have shown their ability to win against the “Big 3” and grow.
  • What about “captive PBMs” like Humana and CIGNA?  I think they would both want a bigger crack at the lives outside their insured book of business.
  • What about MedImpact?  They manage 35M lives today.
There are dozens of other PBMs that have shown success in the market – ReStat, WelldyneRx, Navitus.  I guess it also depends on whether you view the market as just PBMs or you look at it for drug spend in which case cash patients play into the mix and you look at what companies like Walgreens, Walmart, CVS, Target, and RiteAid do.  [One could hypothesize that in a >80% generic world that cash is really the dominant method since insurance discounts matter much less and the role of the PBM or PBA is more around claims coordination for utilization management and DUR.]
Ultimately, I think it boils down to whether size gets you unfair advantages in pricing and discounts (i.e., rebates, acquisition cost, network discounts).  I would suppose that Worker’s Compensation is an area to look at where there are dozens of smaller WC PBMs competing with Express Scripts – MyMatrixx, PMSI, CypressCare.  What’s their experience been?

Today’s session in DC will certainly be interesting.

[As noted before, I both own shares in some of the companies mentioned here and do business with others and/or seek to do business with the companies mentioned here.]

Handling A Mistake: Chevy’s Versus Jilly’s Cupcakes

I think in healthcare we are finally all realizing that the customer experience matters (#CEM).  The question is how to standardize and optimize that experience in scale and on a personal level when the people delivering that experience are call center agents, receptionists, physicians, pharmacists, pharmacy technicians, etc.  It’s the people in the field not those sitting in the corner office.

And, since exchanges will make healthcare a more individual buying experience and satisfaction is tied to loyalty, this is something we all need to figure out sooner rather than later.

As a family, we recently had a few experiences that show the two extremes here:

  1. Chevy’s.  This is a Mexican restaurant we frequent.  We go there probably once a week to the point where we have a preferred waiter (who knows our order before we sit down) and know the server and the manager.  Service has been great for years, but it’s begun to go down.  One night, it took 3x as long to get our food with no explanation, and we had to leave without eating.  The next time, the hot plate of food had some oil jump off and burn my wife (to the point of them getting her burn spray and ice).

    This seems like a great opportunity for an intervention by the manager.  But no.  They didn’t do anything.  They still charged us for the meal including my wife who’s leaving with an ice bag.  Oh well…time to find a new restaurant.

  2.  Jilly’s Cupcakes.  Here’s a cupcake store and restaurant that we’ve never been to, but we saw that they recently won on Cupcake Wars.  We decided to book a small birthday party there to decorate custom cupcakes.  When we show up, they are surprised.  Apparently, their reservations person wasn’t very good and got fired so they’re dealing with us and another party of 25 that have showed up unexpectedly.  A key opportunity for success or failure.

    I thought the General Manager did great.  She stepped right up and came up with a plan for us.  We got to go behind the scenes and meet the cupcake making team.  We got to customize our own cupcakes and really enjoyed it.  It was probably more memorable that the original party would have been.  In this case, I’m willing to drive people to her store and will send her a personal note to thank her.

One of the big points here is that it’s easy to either lose a lot of credibility or build up some credibility.  But, customers are fickle.  Much like companies strive for Six Sigma from a process perspective we need to keep that in mind from a customer experience perspective.  It won’t always go perfect, but how do you enable your staff and train them to respond quickly to keep the consumer happy and engaged.

Enchantment Infographics (by Guy Kawasaki)

I’ve had the privilege to hear Guy Kawasaki speak and have read a lot of the stuff he’s written over the years.  I haven’t read the new book Enchantment, but these infographics might get me to go out and do that.

I’d love to think about similar graphics which blend his work and the work of David Shore on trust in healthcare…how to you engage and build trust as a healthcare entity!

Your Refill Logic Has To Be Dynamic

I signed up for an auto-refill program recently.  It quickly made me realize how stockpiling happens.  (Stockpiling is where a patient ends up with a large supply of their medication over time…typically due to refilling too soon.)

Imagine the following:

  • I get a 90-day supply of a medication.
  • At day 75, I get a refill of the medication.  (I have 105 days left at this point.)
  • 75 days later, I get my next refill.  (I now have 120 days left at this point.)
  • 75 days later, I get my next refill.  (I now have 135 days left at this point.)
The problem here is what I would call “static refill logic”.  The auto-refill program is triggered to fill the drug 75 days after it was last filled.
What is needed is “dynamic refill logic” which calculated days supply on hand.  This isn’t easy, but it makes a lot of sense.  The risk (if I’m a mail pharmacy) is that without this, I get gaps-in-care and/or create a short-term retention issue.
Imagine the following:
  • You ask me to refill, but I have 30 days on hand so I say no.
  • Now I forget to refill on time and I have a choice – (a) skip my medication for a few days or (b) go back to retail.  Neither is ideal for the mail pharmacy.
BUT, all of this could have been fixed if the logic was dynamic and they called to confirm my refill when I had just a few weeks left (i.e., enough to be thinking about refilling but also enough to have time to get it shipped to me).

The Royal Wedding Symbolism For Healthcare

This is a day most of us will remember.  I still remember the wedding of Princess Diana.  Regardless of how you feel about the monarchy, it is a joyous celebration of life.

It made me think of several words that are key to healthcare – trust, passion, and engagement.  (Another great example here is the real Patch Adams.)

Let’s start with trust.  You have to trust your physician.  You have to trust that the course of treatment will work.  You have to trust that your actions can make a difference.  Those are fundamentals to getting better. 

Passion is another critical element (even if the royal couple was light on the PDA).  Healthcare runs the risk of becoming a “hot industry” with sustainable business which draws people towards it to be employed and get paid well.  That’s very different from the traditional people who were in healthcare because they felt passion for curing people.  I talked with one researcher recently that mentioned one of his client had to increase their staffing by over 10% to get the same jobs done.  They attributed that to a lack of passion for the job.  (On the flipside, healthcare needs those from outside the industry to help reform ourselves.  Change has to be a mix of internal and external.)

Engagement is a word I use often.  The idea here of the long-term engagement process, transition into being a royal, and the commitment the royal couple feels is very different than the quick engagement and wedding of Princess Diana.  I see that as very similar to the need for long-term solutions that engagement people around intrinsic motivators not the short-term boosts we see from things like financial rewards or quick diets.  Healthcare is a change.  Engagement is a process NOT an event.

The people over at Seduce Health pulled out a few other lessons from the wedding which I agree with. 

So…engage your employees, your family, your members, and your patients.  Build up their passion for life and health and help them believe that they can be successful.

Could CVS Caremark Become A Kaiser?

I know the popular opinion is to talk about CVS Caremark splitting up.  Let me go radically in the other extreme. 

I think everyone has an appreciation for what Kaiser has created – insurer, provider, pharmacy, …  They’ve created an integrated system with impressive outcomes, passionate consumers, and a connected technology backbone.  There are a few other organizations that have had regional success doing the same – HealthPartners, Geisinger, … 

The question I would have is who is in the best position to build themselves into an integrated system.  The two companies that jump out at you are United Healthcare and CVS Caremark.  Of course, neither of them have the provider (aka hospital) assets. 

But, I think the point here is that most people I talk to agree that an integrated model is the right model “on paper”.  It can (in theory) offer the best patient experience.  It can drive the best integrated data.  It can coordinate across business lines to accomplish the best outcomes. 

So, it makes me wonder why we let Wall Street dictate the strategy here.  In many cases, structural changes take time.  If building an integrated model is the right concept, why isn’t the talk about CVS Caremark buying a health plan and subsequently jumping into the provider space with ACO models?  Why isn’t the discussion about United Healthcare buying up hospitals and physician groups?

Maybe I’m just trying to present a different scenario or maybe I have rose-colored glasses on, but I think it’s an interesting question to ponder.

(Note: As I’ve disclosed before, I both own CVS Caremark stock and have a business relationship with them.)

QR Codes – The Ultimate Opt-In Tool

You probably are starting to see them more (those 2D barcode boxes).  They’re called QR codes.  Here’s a few articles about them:

I find this a fascinating area.  Imagine a few examples here:

  1. You want to get a member to opt-in to a program (e.g., auto-refill).  You can put a QR code on their invoice.
  2. You want to offer an educational video about a condition.  You can put a QR code on the Rx label.
  3. You want to get consumers to opt-in to a SMS program.  You can put a QR code on a mailing.
  4. You want to offer a physician access to the clinical studies about a drug.  You can fax them some information with QR codes on it. 
  5. You want a patient to learn more about a condition.  You could put up DTC materials in the provider’s office with QR codes. 

I think you get the point.  I expect this will grow rapidly especially as the smart phone market grows and more and more people have cameras in their phones (devices). 

One of the biggest uses right now in pharmacy is from Walgreens where they allow you to order a refill by scanning the QR code on their bottles using their mobile app.

Why I Quit Facebook

For someone who is so active in social media (blogging, tweeting), I think people are surprised that I quit my Facebook account (technically deactivated). Maybe, like Twitter, I’ll take a break and return later.  [Unfortunately, I’m sure there are several people out there who think I de-friended them and won’t realize I just quit.]

But, why quit? Isn’t it a great tool for communicating?

I did find it interesting, and there is more and more information out there…BUT

  1. It changed how I interacted with people.
  2. It sucks up valuable time (and I didn’t even get into Farmville and the other games).
  3. I’m an introvert so I’m not sure I care to share that much.

Ultimately, I felt like my relationships online where different than reality. I would categorize them as follows:

  1. People who I should talk to offline (e.g., family) but where it became easier to talk via Facebook.
  2. Professional friends that I all of a sudden knew more about them then I normally would or needed to.
  3. Acquaintances who I all of a sudden kept in touch with on a semi-regular basis.
  4. Old friends that I would never talk to without Facebook and where I now was in a constant high school reunion.

It essentially became technology enabled voyeurism. Which might be interesting for a few times but gets old.  Even staying involved with Facebook on an occasional basis uses up time. I would think about saying that I didn’t have 30 minutes to work out when I know I spent 15 minutes online.  Maybe I’m being a little “fuddy-duddy”, but at the end of the day, I have

  1. Friends who I want to talk to live (although rarely have the time).
  2. Professional friends and acquaintances for which LinkedIn gives me everything I need.
  3. High school reunions every 5 years which is plenty.

Facebook essentially reverses the trend of having a smaller and smaller circle of friends as you get older.  You create a body of friends from every era of your life and keep them with you over time.  It’s certainly interesting, but unnecessary in my perspective.

Data: Should You Be Paranoid?

I think we all know or are quickly realizing that everything we do leaves a trail of breadcrumbs.  That trail is a series of data points which now can be aggregated to create a record of you.  What you do?  What you buy?  What ads you respond to?  Who your friends are?  The list goes on. 

The question of course is whether you should be paranoid and worried about it. This video below shows you the extreme scenario of how data could be abused.

In a more balanced view, Time Magazine had an article call Your Data, Yourself which just appeared on March 21, 2011.

Oddly, the more I learned about data mining, the less concerned I was. (Joel Stein, author of article)

The article talks about a variety of companies that collect and sell data:

  • Google Ad Preferences
  • Yahoo!
  • Alliance Data
  • EXelate
  • BlueKai
  • RapLeaf
  • Intellidyn

The author makes a key point…a lot of the things we get for free are free because people collect and sell our data.  Otherwise, these “free” business models wouldn’t exist.  Would you pay for all the content and other things you get today or do you just want to understand what happens to your data?

On the other hand, the author shows you how data put together adhoc can paint erroneous pictures of you.  Should you care?  Do you want to fix this?  Can you control it?

This is all important since there is some do-not-track legislation being discussed.  (See Joe Manna’s post on this for some additional perspective)  Several people bring up the good question…

While we say that we don’t like to know that our data is being used to target ads at us, do we really want to have to sort through all the irrelevant advertisements?

Of course, we all become a lot more sensitive around healthcare data.  But, somehow, I doubt many of us think about what happens when we use our work PC to research a condition (see article on 10 ways to monitor your employees).

The article also suggests some sites for protecting yourself:

Don’t expect this one to go away.  With issues like the data breach at Epsilon, people are concerned.  Additionally, as data gets co-mingled and your credit score is used to determine health programs (for example), there may be limits about what and how information is used.

Likelihood Of Being Wealthy

I found this test in Money Magazine (Sept 2010) interesting especially when you dig into the research behind the questions and the scoring.

  1. Optimists do better financially than pessimists although extreme optimists don’t save as much money as moderate ones.
  2. A child born into the wealthiest 20% of families has a 55% chance of staying in that quartile.  A child born in the poorest fifth only has a 9% chance of reaching the top and one born in the middle a 13% chance.
  3. If you’re raised in a home your parents owned, your more likely to stay in school and buy your own place.
  4. If you have chronic conditions (diabetes, arthritis, Crohns), these are associated with less wealth.
  5. People with IQs over 130 (top 2%) early $6K-$18.5K more per year…but that doesn’t correlate with better savings.
  6. A college grad will earn $450K more in their lifetime than someone with only a high school education.  Getting a graduate degree adds another $120K.
  7. A 6-foot tall man earns $5,525 more per year than someone that’s 5′-5″.  “Hotties” (their word) are twice as likely to make an above average income as their homelier peers and slim people have a higher net worth than heavy ones.
  8. The more brothers and sisters you have the poorer you tend to be.
  9. Boomers who got and stayed married accumulated 93% more wealth than their unmarried counterparts.
  10. Kids drain wealth.
  11. Being too agreeable leads to lower earnings.
  12. Affluent people exercise more.
  13. Families that own businesses are more affluent.
  14. Although adreneline junkies earn more than their cautious counterparts they are also more likely to make poor investing decisions.
  15. 84% of millionaires shop for bargains.

So, this may be neither hear nor there, but I’m fascinated by tests like this as they are data that can be used to predict and segment people from a communication perspective.  Understanding their behavior within sub-segments is critical in understanding why they act or don’t act.

Happy Fat Holiday!

Not to be a party popper since I love the holidays, and I ate my Corned Beef & Cabbage meal a few days ago (and hope to have another).  But, I pulled up a quick recipe to see the calories (700), the calories from fat (470), fat grams, etc. in such a meal (assuming you only eat one serving), and it got me wondering.

If we look at all our holidays – New Years, Valentine’s Day, St. Patrick’s Day, Fat Tuesday, Fourth of July, Easter, Christmas, Thanksgiving, etc., is there any wonder we have food issues?  A lot of our favorite memories are tied to holidays which are tied to food.  You take those experiences (which typically include some snacks and deserts), and you can eat a few days calories in one day.

Not that it’s bad if you burn off more calories than you take in, but it certainly embeds this food problem right into our culture.

Medical Data From Thomas Goetz

Here is a video of Thomas Goetz (Wired magazine) from TEDMED…

He talks about redesigning medical data and how to present it for people to understand.

He talks about a key notion of helping people see their way to better health.

He talks about the feedback loop of Personalized Data – Relevance – Choices – Options.

He talks about how Captain Crunch can inspire information delivery for prescription drugs.

And, then he shared the Wired article on redesigning information.

Did You Pay Too Much?

I was looking at a few hints from Money Magazine about ways to shop smarter this season.  They are interesting from a communication perspective, but not always directly transferable to healthcare.

1. We pay more for items that we can touch…41% more.  And, the more time you spend holding the object, the more you were willing to pay for it later.  (How do we make healthcare services more tangible?)

2. Ever wonder why companies give you free chocolate?  It’s because people who eat even one increase their desire for luxury goods by 25%.  (What’s the “free chocolate” of healthcare?  How do we make consumers appreciate cognitive services by MDs and pharmacists more?)

3. People pay more when they’re distracted both online and offline.  And, how many of us aren’t distracted with kids and electronics these days?  (How do we get consumers to really focus to understand how to optimize their healthcare dollar?)

Is the Male “Customer” a Red Herring (in Healthcare)?

If you haven’t paid attention, the gender inequity in salaries in some areas seems to be broken.  For city-dwelling single people in their 20s, females median full-time income is 108% of their male counterparts (Reach Advisors research of 2008 Census Bureau data).

And, if you look at the statistics from “The Rise of the Sheconomy” in Time (11/22/10), the statistics paid a clear picture of change:

  • 35% of women (vs. 27% of men) ages 25-29 hold a bachelor degree or higher
  • Women hold 49.6% of non-farm jobs in the US
  • Women own 29% of companies
  • 64% of women with children under age 6 also work outside the home
  • Women make up 58% of online retail dollars spent
  • Women make 80% of healthcare decisions
  • Women purchased 45% of electronics
  • Women make up 44% of NFL fans
  • Women control 51.3% of the private wealth in the US
  • 35% of wives earn more than their husbands
  • 9 out of the 10 occupations predicted to add jobs in the next 8 years are dominated by women

You shouldn’t be surprised by this.  I personally have several friends that are the stay-at-home dads.  I worked for a women who had “never” been to a grocery store.  And, I know a lot of women who could tell you more about professional football than I could.  (Here’s an older list of facts.)

“Get the guy right and you’ve made a sale; get the woman right and you have a customer.”  (From Marti Barletta in the Time article)

So, will that play out in healthcare or has that ship sailed a long-time ago?  If females make 80% of the decisions, do you really need a male strategy?

Females accounted for 57 percent of all personal healthcare spending in 2004, although they made up just 50 percent of the U.S. population. Across all payers and services, females spent about $1,448 more per capita on healthcare than males in 2004. The greatest disparity was in nursing home care, where females spent nearly twice what males spent.

The gender divide in share of total spending should not come as a complete surprise, because women have a longer life expectancy (80.4 years compared to 75.2 years for men).

The estimates were based on administrative data from Medicare’s National Claims History Files, the Medicaid Statistical Information System and the Medicaid Analytic Extract System. (Source)

At the same time, we know that…

Men Frequently Ignore Symptoms and Are Reluctant to Seek Care Until There Is a Crisis

“Health, United States, 2009,” reports that men from ages 18-44 years were 70 percent less likely to visit a physician in 2007. The report also indicates that men were 80 percent less likely to have a usual source of health care, as compared to women. (source)

So, what does this all mean?  It means that males still represent about 1/2 the healthcare costs although it appears their use of the system is either prompted by a female in their live (wife, mother, sister, friend, caregiver) or by the fact that there is a crisis.  This plays well into the quote about targeted “shopping” versus looking for a relationship.

One could assume that means that males are more likely to use urgent cares and/or clinics…but I couldn’t find that data.

Getting males to be more preventative is one challenge.

Getting them to view a health plan or pharmacy as more tailored to their needs is another.

Is it worth the money and effort or should you (as a healthcare company) appeal only to the females?  I’m not sure I know the answer, but the data certainly points you in a direction.  It would be interesting to look at conditions that are primarily male or drugs that are tailored to male conditions and understand how females drive those decisions and utilization (knowing that a lot probably has to do with whether it’s asymptomatic or not.

Would Anyone Care If Pharmacy Support Was Offshore?

We’ve all had our bad experiences with an offshore call center, and I’d bet many of us have also had times when we didn’t even realize that we were talking to someone offshore.  Being offshore no longer means building a call center in India (which is now so cliche that they have a show about it – Outsourced).  It could be anywhere in the world.  Or, it could involve offshoring differing services – paper claims processing, clinical review, e-mail response, exception management, …

It certainly is less expensive per transaction although there are data integration costs, management costs, and other challenges.  The key question is whether the consumer cares.  I believe one PBM tried this years ago and got some backlash from their clients.  I’ve heard that another PBM is trying it again although I’m not sure it’s frontline customer support.

A lot of times people worry about data security, but that should be manageable.  (Plus there are enough data issues here in the US so keeping it onshore doesn’t seem to help.)

If the number on the back of your pharmacy card took you directly to an offshore call center, I believe some patients would care.

If the clinician reviewing your formulary exception or prior authorization request was offshore, I don’t think people would care.

If the people doing data entry and managing paper claims were offshore, I don’t think people would care.

Given that 50% of people misunderstand e-mails to begin with, I wonder if people would care that e-mail responses were from offshore (although they should be pretty generic since there’s no clinical information exchange happening).

Of course, there are economic times where sending anything offshore is frowned upon by the general public which views this as not supporting the US economy.

I’m just thinking out loud here.  Several people have brought it up to me, but I haven’t seen anything else about it.

(Note: This is different from outsourcing which is something that lots of companies do or centralizing the call center which some companies do.)

What Happens When You Get A New Home Phone

We just added another phone line (land line) to our home.  (Bucking the trend of only using mobile phones, we now have 4 home phone lines plus our mobile phones.)  I’ve been intrigued to see what happens.  I haven’t given the number to anyone nor have I had the time to put it on the DNC list.  (I’m not even sure what the number is.)

But, in the week since I’ve plugged in a phone, I’ve gotten a bunch of calls:

  • 918-442-0768 (looks like spam based on the 800notes.com site)
  • 918-442-0926 Home Security (selling security systems from whocallsme.com site)
  • 636-925-1746 PISA Group (this was someone selling me the local paper)
  • 800-238-3770 (looks like telemarketing from DirectTV based on 800notes.com site)

They have each called me an average of 4 times in one week.  I think the phone companies should default you into the DNC list and force you to opt-out.  But, they must make money by doing it the way it is today.

Why Don’t You Get A Thank You From Your Provider

From someone in the industry, this is going to seem like a silly question.  BUT, from a customer perspective, I think it makes a lot of sense.

  • Why don’t I get a thanks from my physician for coming to them?
  • Why don’t I get a thank you from the hospital after choosing them for my surgery?
  • Why don’t I get a thank you from the pharmacy for choosing them?

Is it that we’ve grown away from such niceties?  Is it that we don’t think we should thank the customer?  Is it that we think we deserve their business?

People often ask about topics like retention or loyalty or satisfaction.  I was just thinking wouldn’t it be nice if one of my initial experiences was a quick thank you card from the provider that I just used for the first time.

Guest Post: Sports Drinks for Kids: A Do or a Don’t?

Joy Paley is a guest blogger for An Apple a Day and a writer on online nursing classes for the Guide to Health Education.

Sports drinks have been getting a ton of bad press lately. Google the subject, and you’ll find a myriad of newspaper articles and blog posts “exposing” sports drinks for what they are—water with sugar and a little artificial coloring. But it’s no surprise that sports drinks have sugar in them; that’s something that’s never been hidden. The real question is, will that extra sugar be bad for your kid? Well, as most things, it depends.

Dental Health: One mark against sports drinks like Gatorade is that they can be bad for your teeth, if you drink them often enough. They all are relatively acidic, which can lead to enamel degradation. Juice and soda are acidic too, though, so it’s not like sports drinks are special in that regard.

Performance: The literature review of the effectiveness of sports drinks on preventing dehydration and increasing performance is mixed. In most respects, water and sports drinks perform equally well. After working out however, kids who have had the sports drink have been shown to have a higher body weight—meaning they lost less fluids during their workout. This is one potential benefit of choosing a sports drink over water.

Calories: Sports drinks are generally full of high-fructose corn syrup, providing many sugary calories to whoever drinks them. For example, 20 ounces of Gatorade Performance has 122 calories! That’s less than 20 ounces of soda, but it’s still nothing to sneeze at.

And, many studies have correlated a higher intake of sugary beverages, like soda and sports drinks, to higher body mass index and worse diet in children. It makes sense right? If a kid is drinking soda all the time, they’re consuming more calories, and drinking less of the beverages that are actually beneficial, like milk or 100% juice; greater intake of those beverages correlated to an adequate intake of calcium, vitamin C, vitamin A, and magnesium.  

In Moderation: If you look at all the scientific studies I mentioned above, you might want to make a knee jerk reaction and pull that sports drink right out of your kid’s hands. Those studies aren’t about your specific child or family, however, and it’s important to realize how your particular situation could come into play here.

If you live in a house where kids rarely have soda or other sugary drinks, letting them have a Gatorade at sports practice isn’t going to make them obese. If your kid is already guzzling soda at home, then adding a sports drink isn’t going to help—but sports drinks are only one thing that should be on your list of dietary worries.

What you do want to avoid is having your kid think that sports drinks are somehow “healthy,” when the truth is that they’re not. And, you don’t want a situation where your kid drinks sports drinks in place of water, because they think the sports drink will somehow make them feel better. However, as long as the drinks are had in moderation, like being consumed only at a specific activity like sports practice, they aren’t going to make your kid unhealthy.

Other Possible Beverages: I would caution parents to avoid replacing regularly sugared sports drinks with lower-calorie artificially sweetened ones. The trouble with these? In studies, greater intake of diet soda has been linked to higher BMI. Why? People rationalize that they are consuming less calories, so they “make up” for it by eating more.

Instead, try creating your own fruit-infused water. Cut up strawberries, cucumbers, and apple slices, and let them sit overnight in a pitcher of water. The result is delicious and low-calorie. Or, pick up a low-sugar 100% fruit juice from the store.

The Bottom Line: If your kid eats a healthy diet and avoids most sugary beverages, letting them have a Gatorade at their practice or game isn’t going to hurt. Just don’t let sugary sports-drinks replace water in regular day to day activities.

How Donald Trump Would Evaluate Vendors?

I often get asked the question of how to best evaluate two vendors especially when I am out in a sales role for Silverlink.  People often see so many marketing pitches that they start to look the same.  Some people just want to do an RFP which often ends up just focusing on the cost lever.  Others get so focused on “cute” demonstrations.  What really matters is how they perform in a real scenario and what results they achieve.

I’ve talked about this for years after a client of mine did this with two vendors years ago (see old post from 2008), but after watching the Apprentice the other night, it helped me frame this.  Donald Trump has this great way of sorting thru lots of smart people.  It’s not perfect since I know as an INTJ that it probably wouldn’t be the best forum for me, but it’s a great analogy.

The resume is the marketing pitch.

The interview is the demonstration.

You can hit both of those out of the park, but it still may not be the right fit.  The question is how does the candidate work with others.  How does the candidate perform under pressure?  What are the end results?  How do they perform over time?

It’s obviously hard to duplicate that in a corporate world, but I always encourage our clients to put us head-to-head with the competition.

  1. Identify a challenge (e.g., increase use of mail order pharmacy).
  2. Ask each company to design their best solution.  (Focus on what questions they come back to you with…that tells you a lot.)
  3. Pull your target population and randomize them into one group for each competitor plus a control group.
  4. Make a few last minute changes to your program (which is reality) to see how the company deals with that.
  5. Have the company implement the solution.
  6. Look at their execution process.
  7. Look at their reporting.
  8. Compare their outcomes with the competition and against a control group.
  9. Ask them for recommendations on how to improve the program.

Now you’re at a point to make an informed decision.  You’ve seen how their team works.  You understand their process.  You’ve seen actual results.  You’ve seen how they think.

The money spent to get this decision right and the learnings you will have will pay for itself in the long term.  Everyone is always short staffed, but it’s worth it.

At the end of the day (IMHO), you want to find partners not vendors.  A few key partners that understand your business, challenge your assumptions, and improve your outcomes is always better than a lowest cost player.  Focus on substance not glitz!

(And another hint I often tell people is to do reference checks with people who work with the company on a day-to-day basis not the executives who may be removed from the first hand experience.)

Pharmacy 2011 – 11 Things To Consider

I pulled together (in Prezentation Zen style) 11 Things to Consider in the Pharmacy industry.  It’s certainly a matter of opinion, but it’s a point of view meant to cause you to think.  I spend a lot time with clients thinking about the industry, and I thought this was a fun way to put some of those thoughts out there. 

I divided these up into two areas:

The Consumer:

  1. Patient Centric approach is critical path. (i.e., create an experience)
  2. Be proactive not reactive. (think Obesity)
  3. Literacy and health disparities need to be addressed. (simple and direct)
  4. People are different…act appropriately. (mass customization)
  5. Genomics are fascinating…but can be confusing. (and healthcare in general is already very confusing)

Business Strategy:

  1. The pharmacist role has to change from refills to outcomes. (see prior post)
  2. Blend high touch and automation in specialty. (they have the same needs about information)
  3. Integrate your physician and consumer strategies. (the HIT focus will make this more pressing)
  4. You need a STAR strategy for your PDP. (hottest topic in Medicare right now)
  5. Mobile is here to stay. (but may not be a business model unto itself)
  6. Social media will change the conversation. (so what are you doing)

Smaller Homes – Better Health?

Apparently, there is a trend toward smaller homes (although I don’t see it out in the burbs).  The median home size has dropped from 2,300 square feet in 2007 to 2,100 square feet with more than 1/3 of Americans saying their ideal size is below 2,000 square feet.  (stats from article)

This makes me wonder if having less room will encourage people to get out of the house more.  Go out in the yard and play.  Go out to the gym.  Be more social. 

Will this encourage more neighborhood interaction?  Since we know that social pressures affect our decisions around smoking, eating, and exercise, this would seem like a good thing. 

It would be an interesting thing to study at a macro level.

$ESRX – Continued Growth

Some people think I should be impartial on my blog. But, no one really wants to read posts that are just PR recast for the sake of driving hits to the blog. One of the things I did a lot at Express Scripts was to see new research, try to find flaws in it, point out the flaws, and then try to find ways to innovate around them. I enjoy doing that here. With a lot of my clients, I get to do that in meetings where they respect my bluntness around what they are or aren’t doing. In other cases where I’m not included in those dialogues, I may play out some of those thoughts here. Hopefully, it’s a helpful perspective.

I have a fine path to walk which is to protect the confidentiality that I have with lots of PBMs while at the same time providing a fresh perspective on the industry. I hope all of you view it that way. I know all the analysts and competitive intelligence people enjoy what I talk about and lots of industry veterans find the views worthy of discussion. But, I think of few people take the intellectual challenges personally. Don’t.

One thing that a few analysts have asked about is my thoughts on why Express Scripts stock has done so well (see below). The short answer is FOCUS. But, I’ve certainly learned from talking to them that I see things differently. I’m often looking at the edges of the strategy and the innovation versus focusing on what the day to day operations are doing. At the end of the day, the analysts and the street are pretty focused on achieving the quarterly numbers.

Some of the things that they do that have made them successful are listed below.

  1. Focus. They have been one of the few companies that have really stayed the course on the PBM core business model – processing claims and mail order. I’ve talked to a bunch of the Wall Street analysts to gain their perspective. They look at things differently. While I may find much of the ancillary activities and strategy more interesting, George Paz (CEO) has been great at keeping them focused on what matters and constantly improving the key metrics.
  2. Integration. One of the best things they’ve done repeatedly is buy PBM assets and integrate them into the core system and existing business processes. This drives efficiency and scale which is critical to the core model.
  3. Research. From early on under Barrett Toan, the company brought in a group of statisticians and researchers. They focused on using data to research interesting topics and publish them. Eventually, this got better integrated with product management, and this now gives them a core team around which to build on for segmentation and predictive models. (Note: This research focus has become the norm in multiple PBMs now.)
  4. Consumerology. While I could talk on this one for days, this was an important move. They claimed the space before anyone truly realized it was the competitive battlefield for PBMs. They found a way to rapidly test things and package them up for the market to digest. (Although I’m disappointed that the Consumerology blog seems to have died with no new postings since May.)
  5. Generics. They realized early on that there was more money to be made from generics than from rebates and pushed hard for this. (Although I’ll admit to a few ugly meetings between me and the rebate team early on.) This positioned them well (“we save when you save”) and allowed them to have a leading generic fill rate (GFR) for years (although others have made up much of that ground).
  6. Intense Culture. The company has successfully adapted and rallied around numerous challenges with a relentless focus. For those that like this culture and can adapt on the fly, it creates a highly intensive environment of competitive people. They’ve created a GE culture of rewarding the high performers and creating competition for upward mobility. And, there is a hyper focus on a few key competitors – Medco and CVS Caremark… a lot of my friends didn’t even know who the other PBMs were.
  7. Worker’s Compensation. This business unit struggled to find a home forever, but some core people continued to push it based on the margins it represented. They seem to have doubled down with their acquisition of MSC a few years ago and have brought their lower cost approach to the market to win business.
  8. Medicaid. They seem to be one of the few PBMs that have traditionally played in the managed Medicaid business. Given the increase in lives that may come into Medicaid via healthcare reform, this could create a large growth opportunity.
  9. Golden Handcuffs. When you have a stock that’s growing like this, what do you want to do…tie people to the stock. The executives have huge investments in the stock and traditionally got lots of options. People that have been there for years have lots of options. This has definitely reduced turnover.
  10. Small Risks. They have also tried a lot of things under the radar. If it wasn’t for an analyst, I wouldn’t even know that they had started a GPO with Krogers. And, they barely talk at all about their work in China. The view there has definitely been that when you try something new to manage the risk.

All the PBMs are doing interesting things. The market has become very dynamic compared to some of the “me-too” days of old. Everyone is finding their space and claiming it. The next few years will continue to be interesting.

[A point of clarification and disclosure – I do not own any individual Express Scripts stock although it may be held by some of the funds that I have invested in.]

Scary Healthcare Realities

Thinking about Halloween got me to thinking about what “scares” me about healthcare…

  1. We have 10’s of millions of uninsured and underinsured people in the US while being one of the most prosperous nations.
  2. People can and do actually go bankrupt due to trying to medical costs.
  3. Health literacy is a huge problem and isn’t being addressed at a systemic level.
  4. Surgery on the wrong body part still happens.
  5. You can get sicker going to the hospital than you were before you went.
  6. People who work in healthcare can’t figure out the system (much less the people outside the system).
  7. Over 20% of kids need medication.
  8. Obesity, diabetes, depression, and other conditions are all related and growing quickly.
  9. Health and wealth are correlated yet the financial payment system rewards sick care and short term ROI.
  10. People don’t want to be PCPs due to the risk, the pay, and other challenges.

What scares you about our healthcare system or health in general?

Your Personal Brand

Years ago, one of the articles that changed my approach was by Tom Peters called The Brand Called You. It’s a great article if you haven’t read it.

Here’s a good presentation I just stumbled upon with some similar messaging…

Decisions When Running A Race

For the first time in a year, I ran a race yesterday.  It was a half-marathon.  I didn’t train that hard so I didn’t have huge expectations.

But, as I was preparing and running, I thought about all the things that go thru my mind and figured I’d share that.

  1. When do I buy a new pair of shoes?  I’ve had the same style of New Balance for years.  But, I make sure I don’t end up running a pair into the ground right before a race and have to switch to a new pair.
  2. Do I carry a drink or use the race drinks?  I prefer to carry a drink and save the time of slowing down during the drink stations.
  3. Should I walk to drink or run through the drink?  I’ve tried both.  I like to walk on the full marathon, but run through in all the other races.
  4. Should I listen to my iPod?  Yes for me since that’s how I train.
  5. Should I run with someone?  I’ve tried it a few times.  It works well if you have a similar pace and goal.  I think it’s important to do training especially long runs with people.  My old training group helped me get a lot faster in the past.
  6. What should I eat the night before?  Pasta and carbs.
  7. Where should I start?  I’ve started at the frontline (for a 5K) with my average pace group and with other groups.  I think this is somewhat mental.  If I start with people that are too fast, I run the risk of trying to keep up and burning out.  If you start too fast, you also have people passing you which can be psychologically frustrating.  If you start with a slower group, you might have to do more navigating to get to run fast, BUT I do like being able to pass people.  It’s a good feeling.
  8. What types of splits should I do?  The debate is whether to start fast, run all your miles at the same rate, or start slow and get faster.  I personally like to start slower and keep getting faster.
  9. Do I wear clothes to shed or start the race cold?  I always try to wear shorts (although yesterday was under 40 degrees), and I put Icy Hot on my legs which seems to keep them warm early in the race.  I’ve worn a long sleeve shirt to toss away, but yesterday, I wore a light coat the whole time.
  10. Do I bring gel (or beans) or take what they give you?  I always bring my own because you know the flavor you like.
  11. How much sleep should I get?  I try to get two good nights of sleep before I race (7 hours).
  12. When do I go to the bathroom?  Believe it or not, this is important.  You’ll wait 20+ minutes in line for a portapotty, but you want to hydrate before the race.  I hear that the hard core people just pee down their leg while they run, but I’m just not there.  If I really have to go, I stop during the race.
  13. Do I wear the race shirt?  I personally don’t like to wear the race shirt for the race.  It feels amateur to me (as if you don’t have any other shirt to wear).
  14. Where should I put my race number?  My friends (who run a lot) told me to put it on the front of your shirt and to put it low so it’s basically just above your waist. 

That’s a quick list.  I’m sure there’s more.  What amazed me was the amount of planning for this.  I know I do a lot of planning for presentations (logistics, clothes, sleep, run in the am, etc), but I’m sure that others plan a lot more for their recreation than they do for work.

Sleeping With Your Mobile Phone

There is lots of good data in the new Pew report on “Cell Phones And American Adults“.  It shows that people who text a lot also talk on the phone a lot.  It shows how adults use text messaging compared to teens.  The one that stuck out at me was that 65% of people had slept with their phone.

Why do people do this?  I do it if I’m using the phone as an alarm at a hotel, but otherwise, I don’t want the phone beeping at me at night with e-mails (legitimate or spam). 

Does Playing An Instrument Increases Odds Of Being An MD?

I’m skeptical.  My kid wants to be a physician so she was all upset yesterday when they played a video at school saying that 52% of kids that are in band in grade school go to medical school.  There’s no time for her to play multiple sports, study, and be in the band so of course we said no.

I was in the band when I was a kid so it’s not an issue with the band.  There are plenty of studies around music and academics.  Not that I’m going to call the school out on the video, but I’d like to see the research.  A quick Google search didn’t find anything on this correlation.  I’d more importantly ask the question of what percentage of physicians played an instrument, at what age, and for how long.  Did they play piano?  Did they play the recorder?  Did they play in marching band in college?  Did they play in a heavy metal band?  There is a difference.

I hate when groups “market” themselves hard to the kids.  My son was all worked up a few weeks ago when the boy scouts talked about shooting guns and bows and arrows (neither of which I intend to let him touch for a while).  He thought this was a way around me by joining boy scouts. 

Anyways, if anyone knows about research on band (or other activities) and the correlation with being an MD (I prefer causality), please comment.  Thanks.

The Power Of A Name

Believe it or not…Cows with names produce 68 more gallons of milk a year (according to Newcastle University in the UK).

So what does that mean for you?  Imagine how important it is to treat your customers as people…or your employees.  Think about that personal experience when you interact with a member.  If you’re the consumer, think about how it makes you feel when you get a general message from your healthcare provider.  Isn’t it better when it’s personalized to you?

Bullets Do Come Down

Growing up in and around Detroit, I often think of glorious holidays like Devil’s Night or activities where people shoot off guns into the sky (not to stereotype the city too much).   People seem to forget that the bullets come back to earth to either injure people or put holes in roofs that become leaky. 

But, I have similar thoughts about 4th of July celebrations.  I heard a radio host say this morning that you can tell the smart people on the 4th because they print out the map to the local urgent care before they start drinking and lighting off fireworks. 

Nationally, 9,000 people were injured and 2 were killed last year from fireworks.  Additionally, the 4th of July has more fires than any other holiday with about 50% being started by fireworks (source).  How would you feel about lighting your neighbor’s house on fire and watching it burn to the ground?

Fireworks are great.  I enjoy watching them, but I always have some concerns about people putting on their own displays in the middle of a subdivision.  We had a house burn down in our old neighborhood, and I saw one catch on fire when I was a kid. 

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