The Emergence of High Performance Health Care

The health care mainstream is investing in a variety of mechanisms to beat back America’s health care cost and quality crisis –  ACOs, medical homes, data analytics, practice transformation, technology and app integration, patient engagement and decision support – but few have borne fruit. Hidden in our system, though, are companies with unique and successful approaches. For example:

There are companies that, by collaboratively working on different parts of drug spend, consistently reduce pharmacy cost by 30-50 percent. This can result in savings of 6-12 percent of an organizational purchaser’s total health care spend, a huge amount!

Another company uses a physical therapy-based approach to manage musculoskeletal disorders, and can intervene in about 80 percent of cases. Its work with more than 30,000 patients, including in Fortune 100 firms, shows that it gets wildly better health outcomes – pain reduction, improvements in range of motion and activities of daily living – in half the recovery time and with more than a 35 percent reduction in the cost of conventional orthopedic care. Recidivism events that occur over the long term drop by 50 percent. They’re so confident of their approach that they’ll guarantee improved outcomes with a 25 percent reduction in cost.

A few other companies that use primary care as a platform are capturing patients and then managing clinical and financial risk throughout the continuum, dropping total health care spend by 20 percent or more.

Another firm has developed a clockwork-like set of mechanisms that defend purchasers from hospital profiteering, yielding about $1,400 per employee per year for its rapidly growing client base.

A Caribbean hospital, an hour’s flight from Miami, focuses on intensive and complex surgical procedures, has made innovation a high corporate value and delivers very high quality at a fraction of US pricing.

The performance achieved by these companies is, if anything, testament to the rampant excess in US health care. They and other firms – in imaging, large case management, dialysis, transplant management, cancer management, and cardiometabolic management – have gone beyond most health care organizations’ dependence on the system’s perverse financial incentives, and rely instead on attracting purchasers by delivering far better value and getting paid for performance. They’re all in high dollar niches, so savings translate to dramatic impacts on overall health plan cost. For the most part, carriers and TPAs aren’t interested in them, because the resulting reduced utilization and revenues generated would reduce their share.

In other words, America’s health care world is upside down. The companies that the data say are the very best within their niches are often outsiders to a health system that protects low value. Rewarding high performance and turning away from low performance is the one surefire way purchasers can change how US health care works.

Over the last few years, I’ve been on a hunt for these High Performance Health Care (HPHC) organizations. Generally, I’m referring to organizations that, their founders driven by passion and deep subject matter expertise, have deconstructed a particular problem and developed an utterly different and better solution than the conventional.

On April 10th in DC, a pre-conference workshop of the World Health Care Congress aimed at employers, unions, brokers, health plans and health systems will spotlight several high performing health care organizations and their clients. Special rates will be available to people who want to come just for this session. The following day, there will be an invitation-only luncheon for senior execs at (mostly) large firms to discuss how purchasers can collaborate to favor high performance and so change the paradigm. These sessions will be Mecca for anyone interested in the leading edge in performance.

If you know a company that is genuinely a killer app, I’d love to be introduced. And I’m betting that everyone in this country who has become used to paying exorbitant prices for mediocre quality care would too.

Brian Klepper is a health care analyst and a Principal in Health Value Direct.

11 thoughts on “The Emergence of High Performance Health Care

  1. Maybe I’m being too cynical, but it seems to me this is a higyly lucrative industry that really cares nothing about patients, but how much they can get out of the system. I remember several years ago when the idea of wellness was discussed by those “in the know”, that if providers paid for wellness visits, why poor people would just go to the doctor, just for the sake of, well the visit is free, or doesn’t cost that much. As if, because they are poor, they had nothing better to do that go to the doctor. I heard that doctors fought tooth and nail against Medicare, now we read disgraceful stories about Medicare fraud. With the ACA, It seems to me that all this hand wringing comes down to will I have to settle for 18 K gold bathroom fixtures instead of the 24 K I was counting on. Will I have to give up my dream of that 100′ yacht I had my eye on, and have to make do with the 60′ one down at the club for another season. I also think for doctors, when a patient dies, they have somehow failed, as if a patient’s death is somehow a reflection on their ability as a physician. People die, that’s how things go, that’s how it’s supposed to be. No one gets out of here alive. Do they teach that in medical school, do they reinforce that. Some patients will die. And if you are an oncologist, it will happen more often than.not. It seems to me this becomes an issue of ego, I kept that patient alive for another month she might not have had. But was it a good month, or did the patient spend it vomiting, losing their hair, unable to eat, just so you could say, well, I kept her alive.

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