I was reading my AIS Health Business Daily e-mail this morning. Today’s quote of the day is below. It made me wonder. Think about any healthcare organization. We have a long way to go to get here.
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I was reading my AIS Health Business Daily e-mail this morning. Today’s quote of the day is below. It made me wonder. Think about any healthcare organization. We have a long way to go to get here.
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When I was at AHIP last week in Seattle, I had a chance to see Alan Lotvin from CVS Caremark present on specialty pharmacy. It was one of the best presentations that I’ve seen in a while.
It was good because I actually heard things that I’d never heard discussed around specialty pharmacy before. And, as he pointed out, specialty will represent 50% of the pharmacy spend and about $235B in total spend by 2018. This is where everyone is focused and the opportunity for differentiation exists.
So, what does all this mean? Let me share some highlights:
o This article says that CVS Caremark is working on a formulary with 200 brand drugs excluded.
But, the most important thing was their strategy to get clients to ZERO TREND for specialty pharmacy. (It reminded me of the program I developed at Express Scripts where we actually guaranteed a 3-year zero trend…if you followed our very aggressive recommendations.) He outlined the following:
He also went on to talk about the consumer experience. I think a lot of specialty pharmacies are thinking about the same things, but there were several things he shared that were new to me. It was exciting.
As I’ve said before, as specialty pharmacies really start to think about the patient and focus on the experience over time, we will start to see more coordination with pharma about going beyond the pill and driving lower total costs.
The Prime Therapeutics Drug Trend Report was released yesterday. Interestingly, they start out the report by making the point that what really should matter is net ingredient cost not trend. I’ve made the point before that trend isn’t a great number to focus on for many reasons. And, if you’re comparing trend numbers (which we all do), then you need to understand different methodologies. I think Adam Fein does a good job of summarizing that in his post. (BTW – This is a tough discussion to have especially when you’re getting spreadsheeted by consultants as part of an RFP.)
As comparisons, you can see my reviews of the other drug trend reports here:
Their report was short and to the point. Here’s some of the key data points:
Of course, anything anyone really cares about these days is specialty. Specialty represents only 0.4% of the scripts they fill but 20.5% of the spend for a commercial account. (They point out that this is much less as a percentage of scripts than other PBMs which have closer to 1% of their scripts classified as specialty…which could influence trend numbers.) The chart below shows how some of the things we all did around traditional drugs apply to specialty drugs.
And, they make a few predictions going forward:
For some people running mail order pharmacies, this analysis is no big surprise. They’re running off to their boss to show them that it’s not just their mail order facility, but it’s an industry issue. To others, they’re left scratching their head trying to figure out why this is. If mail order is where all the money is, what does this mean to them? (The historical PBM model put most profit in generics filled at mail order.)
Per a statistic mentioned in Drug Benefit News from Pembroke Consulting (and discussed here by Adam Fein), mail order prescriptions from 2012 to 2013 (excluding Medicare) dropped 9.2% while retail prescriptions jumped 2.7%. (This is not new news, but this is a big drop.)
I’ve talked about the issues and challenges of mail order many times:
At the end of the day, I simplify the mail order issue down to four major challenges:
Will mail order disappear? Of course not, but PBMs need to continue to either find ways to improve the consumer experience and make it better or they need to recognize the issues that exist and continue to diversify. And, with more 90-day prescriptions at retail for the same copay (i.e., CVS Caremark), this will continue to shift expectations.
I think this is really interesting. Cleveland Clinic has opened a Chinese herbal-therapy ward. In the US, we’re very much a medicated society. There’s a pill for almost every ailment you have and some you didn’t even know you had. Even admitting that Western medicine might not have all the answers is a big step forward especially for such as prestigious hospital such as Cleveland Clinic.
So, what are they doing? According to what I’ve read, they see patients with chronic pain, fatigue, poor digestion, infertility, and sleep disorders. The clinic is run by a certified herbalist under the supervision of several classically trained physicians. Access to the clinic is only on a referral basis, and according to Ohio law, the physician has to continue to oversee the patient’s treatment for a year after their referral.
The clinic is a single room with bright pillows, a tapestry, candles, and a cot.
Compared to China, the herbal formulas here are all encapsulated versus sent home with them to brew.
Of course, one of the worries is drug-herb interactions which requires them to coordinate care using an EMR and have people that have the right training and work with a clinic that can provide them with the right herbs and still meet their safety standards.
A consultation costs $100 which is typically not covered by insurance. Additionally, follow-ups are $60 and a one-month supply of herbs will cost $100 (on average).
Here’s more on their clinic:
Back in March 2014 (yes I’m behind), Fast Company put out a report on the World’s Most Innovative Companies. I thought the list of 12 trends or lessons from their research was worth sharing.
Above: Tech Immigrants: A Map of Silicon Valley’s Imported Talent (from VentureBeat article)
Curing Camden is a quick read on how different groups collaborated to change the healthcare cost curve in Camden, NJ. Here’s the official language from the Amazon site, but after reading it, I thought I’d highlight a few things that caught my attention.
As the federal health reform debate played out in the national media spotlight, author Christina Hernandez Sherwood was reporting on the American medical system from the street level. From 2010 to 2012, she wrote a half-dozen stories for thePhiladelphia Inquirer that focused on an innovative healthcare nonprofit: the Camden Coalition of Healthcare Providers. These stories centered on the nonprofit’s role in combating falls, violence, diabetes, and other issues in Camden, New Jersey, a city known nationally as one of the country’s poorest and most violent, but that is now making a name for itself as an innovation leader in the public health sector.
In Curing Camden, all of Sherwood’s articles have been collected into a single book, including the unpublished final installment profiling the nonprofit’s founder. This book takes readers from the living rooms of Camden residents to the halls of the New Jersey State House in Trenton and beyond. Sherwood highlights how Camden could be the first US city to bend the cost curve by lowering healthcare costs while improving care. The ideas revealed in this book could be translated into practice across the country, and Camden could become a national model of 21st century medicine and public health.
The book goes through several core chapters. The first one is on creating a citywide health record by working with the 3 primary health systems in the city. The core part of the success here is that they used the framework of opt-out not opt-in which would drive more participation at the consumer level. This behavioral economics framework called “active choice” has been used by several companies that I’ve worked with in the healthcare space to shift behavior patterns. This obviously has the opportunity to reduce duplicate testing and improve care coordination.
The second chapter is about create an ACO for Camden with a 3-year Medicare demonstration project. It’s an interesting discussion about how Dr. Jeffrey Brenner began using data to learn things about the Camden population. For example he found out that most of the population will vista a hospital at least once in a 2-year period (which is 2x the national rate). He also found that most of the top reasons for going to the emergency room were all primary care issues. He makes a great point in the book that while people think that complicated patients simply like going to emergency rooms the reality is that they don’t have better choices.
The third chapter was about protecting against the risk of falling. From 2002-2009, Camden residents made more than 17,000 trips to the hospital (the number one cause of hospital visits in Camden). This isn’t a localized issue either. Falls affect 1 in 3 seniors every year and drive $19B in costs according to the CDC. In the book, they make an interesting point about the “vicious cycle” of falling which leads to less activity which leads to weaker patients increasing the likelihood of another fall.
The fourth and fifth chapters are about diabetes. In Camden, almost 13% of adults have diabetes. These patients can be high utilizers which is something they talk about along with their focus on the 13% of patients that drive more than 80% of the costs in Camden with one patient having over $5M in charges over 5 years. Of course, people in dangerous communities are at higher risk of obesity due to lack of access to food and safe places to exercise which contributes to the diabetes issues.
The sixth chapter is about violence and helping victims. Camden’s 77,000 residents experience more than 13 aggravated assaults per 1,000 residents (which is 5x the national rate). This lead to 9,361 trips to the hospital from 2002-2009.
It’s an interesting read. They had a lot of grant money, but at the end of the day, it was about several things:
At the front of the HealthLeaders Magazine, they have a FactFile every month with data from Truven Health. The one from March 2014 focused on price variation and transparency. I thought I’d share a few of the charts.
This first chart shows their projections about the impact of a price transparency tool on cost savings over three years. (BTW – If you’re looking for information on price transparency tools, I would go to Jane Sarasohn-Kahn‘s blog HealthPopuli and look at her posts on transparency – Part I, Part II, Part III, Part IV, and Part V). Their projection was $6,786,000 in year 3 for an employer with 20,000 employees (or about 46,000 total covered lives if you assume a ratio of 2.3).
The other topic in the FactFile is about price variation and potential savings. They looked at three procedures and the variation in pricing for them. They then estimated the savings from those three procedures for an Chicago based employers.
As you can see, the variation is dramatic. What this will eventually lead to is called “reference-based pricing” where payers will agree to pay a fixed amount (or reference price) for a procedure and consumers will have to use transparency tools to figure out which providers will meet that price or pay out of pocket to go elsewhere. The hope is that this will drive down prices, make consumers aware of differences, and finally help people understand that price and quality are NOT correlated in healthcare.
Here’s a few articles to read on price transparency:
For those that are part of the Quantified Self movement, this is just a natural extension. You can now measure your different sports.
On the one hand, this stuff is fascinating and amazingly cool. On the other hand, who even knew that dribble force was something for me to be coached on. It will be interesting to see how athletes and coaches adopt these technologies and how they help improve sports over time. Will they increase the stress for the average athlete who was never going to be great and was just playing for fun? Will they improve everyone and help players and coaches really focus where they can make a difference?
This was just one of the really great data points I got from the Medication Adherence Clinical Reference page from the American College of Preventative Medicine. It’s worth a read.
But, let me highlight a few other points:
I think this is important because a lot of the industry solutions focus on the pharmacy and the consumer. They don’t (IMHO) go back to the initial discussion with the provider. How are we helping to enable those conversations to last longer than 99 seconds in the average encounter in which time they have to explain the medication, the side effects, and help the patient feel like the medication is going to make a difference? (Of course, this always make me think of my favorite placebo effect video.)
Additionally, this chart from the Adult Meducation publication was a great list of factors reported to impact adherence. (Sources: Miller et al., 1997; Nichols-English and Poirier, 2000; Vermiere et al., 2001; World Health Organization, 2003; Krueger et al., 2005; Osterberg and Blaschke, 2005)
They also share this chart (which I’ve seen a version of many times):
[Source: National Association of Chain Drug Stores, Pharmacies: Improving Health, Reducing Costs, July 2010. Based on IMS Health data]
There was an interesting story which came out of Michigan this past week from Christy Duffy about how her physician’s office was requiring all minors between the age of 12-17 to have a 5 minute private conversation with them (according to the law). Of course, it appears that they made a mistake per her later post, but I think it serves to make several interesting points.
1. Don’t always assume that someone’s interpretation of the law is right if it doesn’t make sense. Sometimes, you have to apply common sense and push back or ask questions.
2. There is a gray area between protecting the rights of our kids and protecting our rights. While the intent of allowing our kids to have honest and open conversations is appropriate, there needs to be some involvement of the parents.
It’s an interesting topic for discussion. Should our teenagers have access to providers on their own? Yes. If a teenager has a health issue, I think we’d all prefer that they talk to a professional rather than Dr. Google or their friends to find the answer.
Should a provider be able to force a private conversation with a minor? Yes…if they have a legitimate concern about abuse, but I don’t see any other reason.
Should a teenager who’s covered by my insurance and lives in my house be able to block me from having access to their medical records? Yes. This is the law, but should providers be having private conversations to offer them this option? I don’t think so. I would like them to have those discussions with me and my child to say that here are their options.
Should a teenager have a private conversation with their provider about STDs, HIV, and birth control? Yes, BUT I’d like to have the conversation at the right age with me in the room initially and then offer the private option. I don’t think forcing that conversation on a 12-year old would make sense in a private setting.
Ultimately, this comes down to the issue of access to the medical records online. What I heard was that this would also require the provider to get a cell phone and e-mail address for my kids. Obviously, if they’re doing something confidentially with the doctor, that’s one thing, but as a matter of record, I disagree. (I don’t even give out my kid’s Social Security numbers.) I don’t want my kids to start getting e-mails, phone calls, and letters sent directly to them as early as 12-years old. And, yes…I do try to shelter them a little. We talk about all the issues, but in a way that my wife and I want them to learn, not according to some formula driven approach that’s mandated. But, ultimately, I don’t think a 12-year old is mature enough to make all their own health decisions or to feel like they should.
Obviously, some part of this falls on the parent regardless to create an environment of open dialogue with their kids. The kids have to feel comfortable talking with their parents which is important for health and many other challenges that our kids have to deal with. And, unfortunately there’s always bad people in any profession so while sexual abuse by a physician or nurse is rare it’s not unheard of. Ideally, I think you should have the choice of when to encourage a private conversation and never have it mandated (unless of course the provider suspects abuse). Unfortunately, with a report of abuse being made every 10 seconds, we have a huge problem in our country.
I was reading an article the other day about devices like FitBit and their use within corporate wellness programs. One of the questions it was asking was why use them when people abandon them after a while. I found this great chart from Endeavour Partners in their whitepaper which looks a lot like an adherence curve. They say that 1/3 of people abandon their devices within 6 months which makes it a hard investment for anyone.
It’s the same question you might ask around mobile apps. While this chart shows that Americans install almost 33 apps, the questions is how long they use them.
(Source: http://www.statista.com/chart/1435/top-10-countries-by-app-usage/)
According to Flurry, most apps peak within 3 months, and they show that health and fitness app retention is only 30% after 90-days. Again, that doesn’t make you want to invest a lot of money in a mobile app. But, there are lots of reports out there telling us that people want to use mobile to communicate with their providers, track calories, and do lots of other health related tasks. (see RuderFinn report, see IMS report, see Pew report)
So, what gives? Do we have unreasonable expectations? I would say yes.
We live in a ADD culture where people are constantly multi-tasking. People want things that evolve and constantly change. It’s the same reason we don’t want the same experience every single day. It’s the reason that you’ve seen people from gaming coming into healthcare. They understand how to keep people engaged over time.
Whether you want to picture it as a customer journey or different phases, the reality is that messaging needs to evolve with the consumer. If you got the same letter every month, at some point, you don’t even pay any attention to it. At some point, you wouldn’t even open it.
When I worked in healthcare communications, it was the same challenge from a strategy perspective. How would we coordinate communications across channels? What would the first message say versus the fifth message? How do you avoid message or channel fatigue?
It’s the same thing in the digital or device world. So, I ask the question…do we have unreasonable expectations about these tools by thinking that we can put them out there and sustain use of them? I think so. We need an evolving, constantly changing strategy about content, community, functionality, etc. to keep engagement sustained.
First CVS Caremark began offering mail order (90-day Rxs at lower cost) at retail stores (aka Maintenance Choice), and now with Specialty Connect, they are doing the same thing in specialty pharmacy.
Specialty Connect was a pilot program that won the PBMI Innovation Award this year. What it does is to allow consumers the choice of getting their specialty medications at either the CVS Caremark specialty pharmacy or picking them up at a local store. This is a change since: (1) many pharmacies don’t typically stock specialty medications; (2) many PBMs require use of a specialty pharmacy (i.e., mail); and (3) specialty medications typically require some addition handling and counseling which may be difficult to do at a local store level.
But, this is a very consumer friendly solution, and it has had some positive initial success. Here’s a quote and some data from their press release: (some additional data in the original PBMI document)
“Specialty Connect helps specialty patients with these critical therapies by helping to eliminate common challenges they had often faced and by offering them flexibility and choice,” said Alan Lotvin, M.D., Executive Vice President of Specialty Pharmacy for CVS Caremark. “The program makes it easier and more convenient for patients to submit and receive their specialty prescriptions either through CVS/pharmacy or by mail. What’s more, it increases medication adherence, improves outcomes and lowers overall health care costs for specialty patients and payors.”
Specialty Connect has demonstrated high levels of patient satisfaction as well as improved adherence for specialty pharmacy patients. In fact, pilot program results demonstrated a 13 percentage point increase (from 66 to 79 percent) in patients who were optimally adherent to their medication. Early program results also show that the program is improving upon the patient experience and reducing traditional barriers to getting started on medication, with 97 percent of patients successfully starting on therapy after only their first interaction at a CVS/pharmacy store. In addition, more than half of patients, many of whom were existing mail service pharmacy customers, chose to pick up their specialty medications at CVS/pharmacy.
Hopefully, this and many of the other CVS Caremark successes will make people wonder why they ever wanted to break the company up into different business units. As I’ve said for years on the blog, in the press, and to many Wall Street analysts, the integration of the business units can offer huge value once the synergies are realized and the consumer experience is integrated.
The other interesting things that I thought about when reading about Specialty Connect were:
The IMS Institute for Healthcare Informatics published a report in January called “Engaging Patients Through Social Media“.
One of the things it highlighted is the incredible use of Wikipedia for healthcare information. People are typically going to Google and looking for a disease. Based on Wikipedia’s page rankings, this often leads them there.
Now, what makes this more interesting is the article in the BBC News which says that 90% of wikipedia articles on health contain errors.
Of course, the trick in reading the article closely is that it says they found that “90% of the entries made statements that contradicted latest medical research”. What’s the difference? Well, we know that it takes years for evidence-based medicine to become adopted within healthcare. So, how long does it take the latest medical research to get updated on all the sites? What I would love to see is a comparison of Wikipedia to WebMD, Ebix, and Healthwise. That would be telling.
When I saw this article and image in JAMA, I was really excited. It’s a good collection of structured and unstructured data sources. It reminded me of Dr. Harry Greenspun’s tweet from earlier today which points out why this new thinking is important.
People share more accurate #health & #lifestyle info through social media than with docs, what does that mean for…
— Harry Greenspun, MD (@harrygreenspun) May 27, 2014
But, it also made me think about this image and what was missing. The chart shows all the obvious data sources:
It even points out some of the newer sources of data:
But, I think they missed several that I think are important and relevant:
These things seem more relevant to me than fitness club memberships (which doesn’t actually mean you go to the fitness club) or ancestry.com data which isn’t very personalized (to the best of my knowledge).
In some cases, just simply understanding how consumers are using the healthcare system might be revealing and provide a perspective on their health literacy.
We’d like to think this was all coordinated (and sometimes scared into believing that it is), but the reality is that these data silos exist with limited ability to track a patient longitudinally and be sure that the patient is the same across data sources without a common, unique identifier.
The 5/26/14 edition of Forbes has a great article on Novartis called “Will This Man Cure Cancer?”. It’s an interesting article and Novartis has really ramped up their focus on Oncology with their purchase of Glaxo’s Cancer drugs. And, they recently got FDA approval for a lung cancer drug of theirs.
The article talks about Joseph Jimenez’s leadership at Novartis and highlights several interesting things:
There is some discussion on a new therapy that they’re working on based on some initial trials which uses CARTs (Chimeric Antigen Receptor T-Cells) to attach cancer. At the same time, Juno Therapeutics is on the same trail and raised $175M in their first round to research it.
I really liked one quote from Jimenez in the article that seems to imply a focus on the end goal not necessarily whether they win.
“You look at a company like Celgene, and you know they’re going to figure it out. And they should figure it out. It will be good for patients. We want to beat the competition, but we’re really using the competition to trigger us to get to the patient.”
He goes on to talk about the issue of pricing especially around oncology drugs (but also applicable to specialty drugs in general). He calls it “a new brutal world” because costs will go up with the aging population and new medicines which will cause more backlash against price. He talks about looking at how to be innovative about pricing which could be interesting.
This is definitely worth a read. They have it nicely packaged up with a slide deck also once you register. Here’s a few highlights.
Look at the gap between perceived value and satisfaction with clinical programs offered by specialty pharmacies.
Look at the huge jump in plans to educate physicians.
Look at the different adherence management strategies. I’m amazed at the low percentage using an outside vendor but the huge perceived effectiveness.
Look at some of the benefit strategies that companies are planning to use.
This is an interesting one that shows that companies are really going to focus on controlling specialty benefits in the exchange world in the future.
This shows the variation in terms of coverage (medical versus pharmacy) for different categories of drugs.
There’s more in the deck and report, but these should be enough to tease you to read more.
I like this quote from Debbie. It reminds me of my post from the other day “Care Is Coming To Your PBM” and is very much in line with the article I tweeted yesterday – Pharmacy Chains Continue To Blur The Line. The point is that complex conditions like oncology are a lot more than simply filling the drug. To be truly patient-centric, you need to be able to answer all these questions:
Cancer is a great example of where everything comes together from a care coordination, testing, diagnosis, delivery, and pharmacy perspective. At the same time, we know that patients still see multiple doctors who don’t coordinate their care. We know they get mis-diagnosed. We know that don’t stay adherent with their medications. We know they don’t always articulate their wishes. And, we know the amount of care spent in the last months of life is disproportionate (IMHO) to the minor life extension which they get (often in less than optimal conditions). Here’s a good summary of some key data from the EMD Serono report: |
I always enjoy Bruce Temkin’s reports and analysis. He just came out with his latest report on customer service.
It’s not a healthcare focused report so you have to gleam a few things from his summaries although you can buy the report to see the details by company. Without doing that, I thought I’d point out a few things from his charts.
1. Humana was the most improved (of all companies) in terms of customer service. Great job. Coventry (which was bought by Aetna) had the biggest drop (of all companies) in terms of customer service. [Perhaps not a big surprise as integrations can always be tough.]
2. As it has in past years, healthcare continues to be at low end of the spectrum in terms of customer service. While you can divide up the market into pharmacies, physicians, hospitals, PBMs, and insurance companies (with many other players out there), one of the biggest groups which is covered in the survey is health insurance companies. They fall below airlines and way below other types of insurance companies – i.e., auto / home.
3. Five of the bottom 20 companies he highlights on his blog are all health insurance companies. [But, you’ll have to click through to see who!]
Seems like a great opportunity for someone to help those and the entire industry to think differently about customer service and consumer engagement.
“Hubbub is a technology-driven online playground and mobile wellness solution that uses social circles and gamification to motivate and engage people in healthy behaviors.”
Several people have suggested I take a look at what Hubbub Health is doing so I did. At first glance, there were several things that caught my attention (beyond the interesting teaser description of the company):
Of course the question is whether this is just another one of many mobile companies making a play in healthcare or whether they’ll actually survive for a few years and get traction.
But, Hubbub isn’t just another one of the many wellness vendors out there. They’re part of Cambia Health. You’ve probably still never heard of them, but Cambia is Regence which is a BCBS plan operating in Oregon, Idaho, Utah, and some counties in Washington. Additionally, they own and/or invest in lots of companies – e.g., HealthSparq, GNS Healthcare, OmedaRx, and Wellero (plus Hubbub).
So, this gives them some instant credibility. And, it’s an interesting time in the market. The Population Health Alliance (which used to be the Care Continuum Alliance) recently put out a post looking for contributions around “Return on Value” or VOI (Value on Investment) which is the focus these days in Population Health Management.
This sounds a lot like what you see in the presentation and white paper by Hubbub.
What was more interesting was some of the foundational elements upon which Hubbub was built like:
Cognitive Evaluation Theory (CET) concerns intrinsic motivation, motivation that is based on the satisfactions of behaving “for its own sake.” Prototypes of intrinsic motivation are children’s exploration and play, but intrinsic motivation is a lifelong creative wellspring. CET specifically addresses the effects of social contexts on intrinsic motivation, or how factors such as rewards, interpersonal controls, and ego-involvements impact intrinsic motivation and interest. CET highlights the critical roles played by competence and autonomy supports in fostering intrinsic motivation, which is critical in education, arts, sport, and many other domains. (source)
Self-Determination Theory (SDT) represents a broad framework for the study of human motivation and personality. SDT articulates a meta-theory for framing motivational studies, a formal theory that defines intrinsic and varied extrinsic sources of motivation, and a description of the respective roles of intrinsic and types of extrinsic motivation in cognitive and social development and in individual differences. Perhaps more importantly SDT propositions also focus on how social and cultural factors facilitate or undermine people’s sense of volition and initiative, in addition to their well-being and the quality of their performance. Conditions supporting the individual’s experience of autonomy, competence, and relatedness are argued to foster the most volitional and high quality forms of motivation and engagement for activities, including enhanced performance, persistence, and creativity. In addition SDT proposes that the degree to which any of these three psychological needs is unsupported or thwarted within a social context will have a robust detrimental impact on wellness in that setting. (source)
Those are foundational for a lot of the work in healthcare, and I liked this graphic about motivation.
Whether the app works and captures my attention is still TBD. I did download it and register, but I didn’t really get engaged upon registration. And, the website seemed better than the mobile app, but it still had a few issues in terms of how the large top image dominated most of my screen on my laptop.
At the end of the day, their key role like anyone in this space is to figure out how to engage the consumer (or patient or member or individual) as validated in a study they use.
In the spirit of the Internet of Things and the Smart Home, I was intrigued by a short article I read about Menssana Research which can identify 2,000 chemical compounds from our breadth…including signs of cancer and radiation exposure. Pretty cool!
I guess this explains how dogs can detect diseases in humans.
Of course, my mind jumped to the idea of how you could use existing devices (like Nest) which would be tied into our HVAC system and could monitor the overall air in an entire house and look for risks based on the air. (like my idea of the smart toilet) Maybe that’s a little too scary like why an underwriter wants your cell phone data or too much like the Snapshot from Progressive. And, while on the one hand it’s cool, I’m not always sure we’re ready to know things too much in advance so the question would really be how early is the device identifying people and how accurate is it.
As I’m enjoying my time thinking about what’s next, one of the things that I’ve thought a lot about key problem areas in our healthcare system. Obviously obesity is one of them. And, you have lots of companies trying to figure out what to do here.
So, I was thinking about what I would do if I were at a Weight Watchers or Jenny Craig or Vree Health…
Just some ideas that I thought I’d share.
As the parent of kids, I’m obviously concerned about what they do as they grow up. On the one hand you want them to learn to make decisions. On the other hand, you don’t want to endanger them. That requires helping them to understand right from wrong. That requires helping them to make smart decisions and understand the long-term implications of them.
This is where I struggle with the modern attitude towards the legalization of marijuana. While it may not be a “gateway drug” according to science, it is certainly highly correlated with future drug use, and it has a negative impact on health. Additionally, it’s addictive for about 10% of people and more addictive when you’re younger.
As someone who has watched people throw away their life on drugs and the son of someone who worked in drug and gang rehabilitation centers, I personally see it as a slippery path. I agree that alcohol may be the gateway “drug” when not used appropriately and can be very dangerous for kids and for many adults who can’t control themselves. You can find lots of research on alcohol related deaths due to increased disease burden or simply drunk driving.
So, like many health related topics, the information out there is very confusing for our kids. On the one hand, we point out what your brain looks like on drugs (if you remember the PSA from the 80s and 90s).
On the other hand, we talk about medical marijuana, and we have states where it’s now legal to buy marijuana like Colorado. But, the idea of walking down the street and seeing cannabis stores is crazy to me.
Perhaps a sad sign of this issue is the spike in travel to Colorado especially around Spring Break. They’ve also seen an enormous jump in applications to go to college in Colorado. (I think I’ll bet on causality not just correlation here.)
At the end of the day, I think we want to keep our kids safe and help them avoid anything addictive – tobacco, drugs, and alcohol. (And, yes…you could take this further to look at caffeine or sugars or other things that impact their health.) At a minimum, we want to help them understand the facts and make sure they know the risks and determine if they fit the addictive profile or not. They already have a hard time navigating childhood and adolescence…let’s be careful not to make it too easy for them to fall off track. Unfortunately, decisions like this have broader implications on our next generation even if they don’t actually use marijuana.
Of course years ago, we used opium, cocaine, and herion as medicine also…but we outgrew that phase of “modern healthcare” so maybe this too will pass.
This statement alone should scare anyone as you think about all the new consumers coming into the healthcare system. That will only stress the system more leading me to believe we’ll see bigger drops in satisfaction in the years to come.
This data is from the latest American Customer Satisfaction Index (ACSI). You can see a blurb on them below along with the full ranking of different industries. Not surprising, healthcare isn’t at the top, but let me highlight a few of the categories:
In general, I found the industries to be very tightly clustered. I’m going to reach out to them to see how to interpret that.
About ACSI
The American Customer Satisfaction Index (ACSI) is a national economic indicator of customer evaluations of the quality of products and services available to household consumers in the United States. The ACSI uses data from interviews with roughly 70,000 customers annually as inputs to an econometric model for analyzing customer satisfaction with more than 230 companies in 43 industries and 10 economic sectors, as well as over 100 services, programs, and websites of federal government agencies.
ACSI results are released throughout the year, with all measures reported on a scale of 0 to 100. ACSI data have proven to be strongly related to a number of essential indicators of micro and macroeconomic performance. For example, firms with higher levels of customer satisfaction tend to have higher earnings and stock returns relative to competitors. Stock portfolios based on companies that show strong performance in ACSI deliver excess returns in up markets as well as down markets. And, at the macro level, customer satisfaction has been shown to be predictive of both consumer spending and GDP growth.
I’ve been thinking a lot about the excitement of being an entrepreneur or an innovator and how that compares with being a consultant. While I could find a few articles out there comparing these two career paths, I thought I would share my observations.
I think the two have some of the same fundamentals:
Agree? Disagree? Thoughts?
After working at Express Scripts for almost 5 years and then selling into the PBM industry for almost 5 years, I’ve had the chance to lead and work on a ton of very interesting projects:
I’ve found that I love business development (working with clients and vendors). I enjoy bringing ideas from concept through pilots and then determining how to scale them. I love doing research and presenting. I enjoy working cross functionally. I enjoy leading teams and pushing the envelope to get people to think different. Ultimately, I enjoy solving problems. I like being the person who’s brought in with a business challenge and can then figure out the solution – do the research, evaluate the options, create a plan, implement the plan, and create a process of continuous improvement.
So, after spending 2 years working in the care management side of healthcare and learning about case management, disease management, claims code editing, and other solutions to manage complex patients with cancer or chronic kidney disease, I’m ready to jump back into the pharmacy industry (specialty, PBM, retail, pharma, payers or related companies). (And, I’ll be bringing a lot of lessons learned with me.)
I think the industry is going through another inflection point which is what Mark Merritt from PCMA pointed out a few years ago is the core skill – adaptability. If you think about the trends, I think there are several key things that make this an interesting time to be in the industry. And, everyone is fighting commoditization by trying to differentiate themselves.
And, the fundamentals are good for the industry.
Of course the question is what to do…
All of these things sound interesting, but here’s what I’m going to focus on:
(If you know of something interesting, let me know.)
The creation of the “softer, gentler” PBM is one of my predictions driven by the rise in specialty pharmacy. While generic fill rates and mail order penetration still matter to earnings, the focus across the industry is on specialty.
This will bring back a focus on how pharma and the PBMs work together which has had a bumpy past. Initially the two were very close. Then, with the rise of generics and more trend programs like prior authorization and step therapy, the PBMs and pharma butted heads frequently.
Of course, the situation for pharma has changed also. They are trying to figure out how to go “beyond the pill” and create new consumer relationship and make money. (Here’s a good article about pharma and digital from the other day.)
In case you missed them, here’s a few other things that are relevant:
And, I think this screenshot from the Barclays Global Healthcare Conference Presentation given by Express Scripts shows that they are focused on this care and delivery intersection by continuing to show the success from the Therapeutic Resource Centers.
So, what do you think? Will the PBMs become more care management focused? Will they integrate with the other care providers? Will this be the beginning of their focus on working with ACOs and PCMHs? Will this change their approach? Will we see PBMs differentiating around key, chronic diseases like the specialty pharmacies have done? Will this create an opportunity for integrated PBMs (i.e., Humana, Cigna, Aetna) to differentiate?
The CVS Caremark publication Insights 2014: Advancing The Science Of Pharmacy Care came out the other day. They took a different approach than the detailed trend report which Express Scripts put out. Their document is more of a white paper about “7 Sure Things”.
The 7 Sure Things are to help you know what to do with your pharmacy benefit and cover:
If you’re managing a pharmacy program and you’re surprised by any of these, I would suggest you look for another job.
So, let’s drill down into the report to see what it shows us:
o 0.8% for traditional (non-specialty) drugs
o 15.6% for specialty drugs (down from 18.3% in 2012)
o 3.8% overall
o They hint at an interesting question of whether utilization is growing due to an improving economy. (correlation or causality?)
o Simpler labels
o Synchronizing refill dates
o Reminder devices
o Digital / mobile tools
At the end, they give 5 sure strategies that clients should do.
Overall, this was certainly the easiest “trend report” to read. It tells a clear story which is probably great for the average client and would drive more discussion with your account manager.
Every time I talk to a PBM, they want to convince me that they are unique. And, that is important to me (and should be to you). If they are simply driving generics, getting network discounts, and filling mail and specialty scripts, they’re clearly in a commodity space. It’s a race to the bottom, and they’re fighting very large companies – Express Scripts, CVS Caremark, and CatamaranRx. And, none of those companies are standing still. Of course, the other PBMs that are part of United Healthcare, Humana, and Kaiser are all looking at how they leverage the care assets and broader solution which they can bring to the client. (And, I’d put Prime Therapeutics somewhere in the middle based on their ownership by the Blues.)
But, as I’ve seen, value isn’t just about cost. That maybe one leg of the stool, but you need to improve outcomes and the consumer experience (i.e., The Triple Aim). With that in mind, I created a checklist of what I want to know to see if a PBM is really different.
This isn’t new…I’ve been talking about this for years. Here’s my whitepaper on this from 3 years ago.
And, here’s a presentation that I’ve given on this topic at several conferences.
I just finished reading the 2013 CatamaranRx Drug Trend Report (2014 Informed Trends: Moments of Opportunity) and wanted to share some of the things that caught my eye. (BTW – CatamaranRx was formed by the merger of SXC and CatalystRx.)
One of the early comments in the document caught my eye. While simple, it is still so true in healthcare.
“Bringing consistency through a national perspective on best practices, a “local” understanding of how health care is practiced and deep insights at the individual level, to promote the very best outcomes.”
“The looming pharmacy demand is also driving the healthcare market toward expanded cost containment and coordinated care measures. Industry estimates are projecting more than 30 million new PBM customers as a result of the ACA. This influx of new customers will stimulate creative cost management paradigms and entice new entrants into the PBM sector.”
o Over what time period?
o Is this all members prescribed an Rx?
o Is this all members with one Rx?
o What is the percentage of members with over 80% PDC (versus the average PDC)?
o (Note: These are the same questions for every PBM that shows you adherence numbers.)
o Member risk scoring and personalized interventions.
o Tailored clinical programs, including step therapy, quantity limits and prior authorization.
o Aggressive management of controlled drugs to reduce misuse and abuse.
o Formulary management tailored to address client-specific, high-cost medication classes.
o Exclusive specialty through BriovaRx, a high-touch, patient-centric model.
o Plan designs with copay differentials that promote cost-effective choices.
o Multi-channel communications that engage members in their healthcare.
o The need for the right message.
o The need for targeting algorithms.
o The need to vary channel based on preference.
Two miscellaneous comments here: