Wellness Market: Too Many Chasing Too Little

CrowdHaving taken a hiatus from last year’s Health 2.0 event, was looking forward to this year’s event to see what may be new and upcoming among those looking to disrupt the status quo. Unfortunately, surprisingly little.

Health 2.0 a couple of weeks back had your usually cheery crowd of those who are looking to transform healthcare. As with past Health 2.0 events we have attended, hype was far out in front of market reality but that does not seem to deter the cheerleaders, which were again present with abundance among the some 1,700+ attendees.

Show Me Your Big Data – That’s what I thought, not so big after all
There was plenty (i.e., too much) talk about Big Data when in reality, presentations focused on relatively small datasets with little thematic similarity in any one session. For example, the Risk Assessment & Big Data session had Dell talking about genomics, Sutter Health talking predictive analytics for CHF, another about mashing up claims and clinical data and the last looking at risk assessment. At the conclusion of this session, nary a question was asked – audience confused. Another session on Big Data tools for Population Health Management (PHM) was cut short, thankfully, when the power died. Hard to say if it is the industry drinking the hype, this particular event (though experienced similar at HIMSS’13), or what but this silliness has to stop – we really need clarity, not smoke n’mirrors =- and don’t even get me started on PHM…

Track Me – Track You and no, I probably don’t want your data, at least not yet
In addition to riding the Big Data hype, the event also jumped on the hype surrounding the rapid proliferation of self-tracking, biometric devices now entering the market and all the great things that will come as a result of consumer adoption and use of such devices to monitor health. Not all are jumping on this band-wagon and for good reasons. There is no doubt that in time, such devices will be used by clinicians and patients together which will be the focus of a forthcoming Insight Report from Chilmark but our early research points to a number of challenges in the adoption and use of such devices in the context healthcare delivery.

There was again a plethora of solutions for price transparency. Some odd partnerships that are more opportunistic, for the partners, than providing value for the end users, e.g., the Dr Chrono-Box.net demo was so laborious I can’t imagine any clinician actually doing it. On the patient engagement front, plenty of new solutions on display and was particularly impressed with what Mana Health had build for the NYeHC patient portal contest. Simple, clean, straight-forward and intuitive to use refreshing.

Of course no Health 2.0 event would be complete without one of the large commercial payers taking the stage to announce their latest and greatest member outreach initiative. Two years ago it was Aetna with CarePass. This year it looked like it would be Humana until they were a no show – but Cigna was there with GO YOU Hub. First impressions of GO YOU: a fairly shallow pool in the health & wellness domain with lots of catchy phrases and colors – something your pre-pubescent daughter may like – but this adult quickly lost interest after four clicks

Health & Wellness Redux, Redux, Redux
And again, no Health 2.0 event would be complete without a gaggle of health & wellness solutions, the majority of which won’t be around by 2016.

There are now far more health and wellness solutions in the market than what the market can absorb. This situation is not likely to get better anytime soon as the numerous incubator/start-up accelerators continue to spew more of these solutions into the market every year. The only thing I can think of is that the barriers to entry must be exceedingly low, yet few of these companies realize that the barriers to adoption are exceedingly high and the market is on the verge of contraction.

The Big Squeeze
We are now projecting a significant level of contraction in the health and wellness arena as the broader market comes to grips with a shift in risk from payers to providers with providers ill prepared to accept that responsibility and the migration of many employees off of their employer plans and onto Health Insurance Exchanges (HIX).

This will create two challenges:

Providers are not accustomed to providing such solutions to their patients. While risk may shift to providers, provider adoption and use of such solutions to manage their patient populations is limited. When one adds in self-tracking devices, well…

…providers are struggling with the data dumps from their recently install EHR. The last thing they are seeking is another data source. Healthrageous is one example. A self-tracking wellness solution that was developed by provider Partners Healthcare, adopted in pilots by some big providers, failed to gain traction and was quietly sold to Humana. Not a pleasant outcome. If a provider organization can’t make a go of it through a spin-out, to the multitude of these health & wellness solutions think they can?

Second, we are at the very beginning of a massive shift of employers directing employees to HIX. Despite a fitful start, the use of HIX will grow overtime as a wide range of employers, but especially those in the retail and hospitality industries, direct their employees to these exchanges. Shifting employees to HIX reduces employer exposure (risk shifting) and will lead to decreasing interest and adoption of health and wellness solutions by employers.

Yet despite these challenges, the cheerleading at all Health 2.0 events and a questionable future, one thing that comes through every year is that there are a significant number of people that truly want to do something good, something meaningful to improve the sorry state that is our dysfunctional healthcare system, which we all struggle with at times. These are the people that attend Health 2.0, the ones willing to talk about the “Unmentionables”, the ones to project a vision of a better future for us all, the ones willing to take a risk. For that they should be applauded. But be wary as most will not be around three years hence.

But next time, can we actually have some front line providers in greater abundance to give us their take on all of this. Unfortunately, this event was sorely lacking in such, though it did have its fair share of various healthcare representatives – they just weren’t the ones from the front lines which is who we all need to be hearing from today.

Special thanks to Graham Watson for the image. Graham is easily the best cycling photographer in the world today.

And an extra special thanks to Cora who was there with me and provided a few tidbits of her own to this post.

 

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Looking at Healthcare Through Payer Lenses: Part One

Attending the annual health insurers confab (AHIP Institute) last week gave one some insight as to the challenges this part of the healthcare industry is facing. There were plenty of sessions on addressing data analytics for everything from population health management to fraud, a number of other sessions on consumer engagement, disease management, health & wellness, and of course the ever ubiquitous sessions on Accountable Care Organizations (ACOs).

But what pervaded many a discussion, panel session, and even keynotes was the level of uncertainty in the market today. Though the Affordable Care Act (ACA) was passed and signed into law, its future is anything but certain. There is both legal and political uncertainty. Legal in the numerous lawsuits that have been filed, particularly regarding the individual mandate that will ultimately be a Supreme Court decision. Political in that numerous politicians and some presidential contenders have built a portion of their platform on repealing ACA. Such uncertainty makes it extremely difficult for payers and employers to effectively plan for the future. Regardless, there were a few key areas that seemed to attract the most attention: ACO, Consumer Engagement & HIX.

Following are some quick snapshots:

Accountable Care Organizations (ACOs): Plenty of talk on this subject, primarily from the consulting firms who seemed to have run most of the sessions at AHIP. Payers have been experimenting with the model for some time now, well in advance of CMS’s NPRM. In one session, Blue Shield of California (BS-CA) talked about their ACO with Catholic Healthcare West. A very challenging relationship that took 4 years to iron-out and stand-up the ACO and the only reason they kept at it: Calpers was supporting them with an enrollment of 40K new members and Kaiser-Permanente was beating the hell out of both of them in the market. More competitive necessity. This may foretell future attempts and challenges to move to this model. One other important point expressed many times over regarding ACO: data exchange is an ACO’s life-blood.

Consumer/Member Engagement: Numerous sessions drilled down on how payers will market to and serve their members in a deeper, more meaningful fashion but it all sounds just so superficial. Sure, payers are indeed trying to engage the consumer (marketing to new prospects via HIX – payers are really struggling here) and provide consumers with information they can use to make better “value” choices. There are also the ubiquitous efforts of payers to promote health & wellness and institute various disease management programs. Yet based on the sessions attended, seems more like a lot of hand waving and not convinced payers are seeing any meaningful traction in truly engaging their members.

Health Insurance Exchanges (HIX): In accordance with the ACA, a State must have its HIX operational by Jan. 2014. Each State in the country will have their own, slightly nuanced HIX to meet the needs of their citizens and in compliance with their laws. There is no commercial off the shelf (COTs) solution so each exchange will be a separate, custom build. The big winners here are consulting/system integrator (SI) firms (e.g., ACS, CSC, Deloitte, etc.) and they were out in force at this event. They are going to make a killing first standing up these HIXs and then of course keeping the HIX up and running over the years to come. The big challenge, however, is that these exchanges are slated to support Medicaid recipients and most States’ Medicaid IT infrastructures are so outdated that they need to be rebuilt. Even more $$$ to those SI/consulting firms.

What may have been the most bizarre aspect of this event was simply its isolation from the rest of the healthcare sector. This was a very insular event. There were no consumers/members giving presentations or keynotes on what they are looking for from this industry sector. There were few if any providers or representatives of provider organizations talking (either in sessions or keynotes) about what they were looking for from payers, how they wish to engage them, work together to improve health outcomes, improve the value of healthcare delivered.

All very, VERY strange.

If this sector of the healthcare industry is truly interested in improving the quality and value of healthcare delivered, it has its work cut out for them. In our next post we’ll delve into the three overarching challenges payers face with the coming changes brought about by ACA. Small hint, start with trust.

Addendum:

Consulting firm Perficient was also in attendance and wrote about the ACO issue as well that is worth a read.

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