Last week, we wrote about the five market developments of the past quarter that are most likely to affect the strategy of specialty provider organizations (see Adjust Your Strategic Sails!). Two of those developments were focused on primary care.
If you’re not “connecting the dots” between primary care and specialty health care services, I’m not surprised. Traditionally, these two health care service domains have not had great intersection. But, that has changed over the past decade with primary care—medical homes, in particular—serving as the coordinator of all care in a much more formal way. In the wake of that changing role in the health care value chain, it is not surprising we’re seeing new models for financing and the delivery of primary care arise
The two developments of the past quarter in this area come from completely different perspectives—the private market and the federal government. First, CVS is planning to expand its HealthHUB® model (see CVS To Expand HealthHUB® Format To 1,500 Stores Nationwide By 2021). This new CVS model will expand its retail health footprint with chronic care management, telehealth, and more. Second, the Centers for Medicare & Medicaid Services (CMS) announced the new “Primary Cares Initiative” (see CMS Announces ‘Primary Cares Initiative’ With Five New Value-Based Models). CMS has outlined plans to use flat fees, population-based payments, and capitation to deliver primary care to Medicare fee-for-service enrollees.
What these two developments tell us is that the reshaping of primary care is happening from all angles—and they will have major implications for consumers, and present new threats and opportunities for provider organizations. For more on what these means for provider organizations focused on complex consumers, I reached out to my colleagues Sharon Hicks and Deb Adler, Senior Associates at OPEN MINDS.
First, Ms. Adler talked about what this means for consumers. She noted that 75% of the population lives within five miles of a CVS, making it a convenient option for most citizens regardless of their health care coverage—but particularly millennials, who often don’t have a designated primary care provider (see Can Retail Pharmacies Come to the Aid of U.S. Healthcare?). She also explained that many seniors see organizations like CVS as a trusted resource:
I think adherence to treatment plans depends significantly on “trust”. I know my Mom trusts the drug store pharmacist (who is part of the local community, attends her church) and would more likely engage in a new treatment protocol if this ‘”trusted resource” endorsed it. To the extent these retail clinics can offer both convenience and a sense of trust coupled with high customer service (e.g., no or little wait time), I think accessing health in this way is very likely to become the new normal.
Ms. Hicks agreed that this model is particularly well-positioned to serve consumers with mild to moderate behavioral health conditions, but less well positioned to help those with severe and complex conditions. She explained:
As with most of the innovation coming from the federal government and from payers, these models don’t really address the needs of persons living with chronic illness. The same holds true for the revolution in tech delivered care devices, namely that for people with a high disease burden, the level of support/service that is delivered via those low human touch mechanisms often just is not enough.
They also both agreed that this new type of service represents a threat to specialist provider organizations and that it may result in a potential loss of customers. Ms. Adler sees the sheer number of CVS locations and their customer service as a way to draw consumers from more traditional provider organization. Ms. Hicks believes that the HealthHubs will replace care for those with more mild to moderate behavioral health conditions.
But both of my colleagues see opportunities for specialist provider organizations—actually two different strategic possibilities. Ms. Adler thinks there is an opportunity for specialist provider organizations to work with the emerging primary care models, serving as a “wraparound” for consumers with complex needs. Ms. Hicks sees a slightly different opportunity: specialist provider organizations developing their own primary care model. This primary care role for specialist provider organization could take many shapes—from becoming the primary care provider to acting as the coordinator for primary care in models like the behaviorally led health home for individuals with SMI. Ms. Adler further explained her concept:
Specialty provider organizations experienced with reducing health care costs and improving quality outcomes for payers may want to think how they can be “connected” to these programs through telehealth or through some other connection (mobile services?) to wrap around services that CVS may not have “on-site” or may not have in enough volume (psychiatric crisis?) to warrant having the expertise. The wise specialty provider will think about how they can offer more virtual support for traditional services and be a bridge to serve the complex populations, yet supporting the consumer in what might facilitate his/her recovery to be accessing services in the “new normal” way. The one caveat to this is I think cutting a deal with CVS/Aetna will take a strong track record and large footprint to be attractive.
I don’t think these strategies are necessarily exclusive. Their feasibility will depend on the size and footprint of the provider organization, the distribution of health plans in their service area, their specialty, the competitive specialist provider organizations, and more. The key for provider organization executives is to determine where they “fit” in their market—and develop a strategy that reflects that changing market landscape.
For more, join us at The 2019 OPEN MINDS Management Best Practices Institute in Long Beach on August 14 for the session, “A New Value-Proposition: Primary Care & Behavioral Health Integration In A Value-Based Market” featuring Christy Dye, MPH, President & Chief Executive Officer, Partners In Recovery, LLC and Allen Brown, MSSW, Chief Executive Officer, Adult & Child Health.