Relocalizing Health: Chapter 9 Highlights

In this chapter, I detail the five straightforward steps to high-performance plans that spell out “LOCAL” because high-performance plans realize that health starts at home with mom and dad and then extends to the neighborhood and community. Too many health plans act as though health started in a pill or a hospital. For those concerned about introducing change to employees, it’s worth noting that four of the five steps are either invisible to the member or only a clear, new positive element to their plan.

1. Learn how to be liberated from the status quo
2. Optimize plan infrastructure (e.g., advisor relationship, plan docs/admin)
3. Carve out PBM
4. Add Value Based Primary Care (e.g., DPC)
5. Leave behind value-extracting PPO networks

Typically, people don’t think of health care when they think about “Shop Local” programs. Yet, what is more local than an interaction between a patient and a clinician. Despite this, a county such as the one I live in with 250,000 people spends over $2.5 billion annually on health care (across all ages). At least $1 billion of that is extracted out of our local economy as a “tax” to Wall Street (via their money-handling mega carriers, PBMs and health systems). Imagine if just 10% of that extracted money was repatriated back into our local economy every year to fund what drives well-being such as better pay, education, safe neighborhoods, social services, public health, clean air/water and more. This chapter (PDF) and the rest of the book explain how this is being put into action. Will you join these forward-looking community leaders?

Key chapter take-aways

• There are five straightforward steps to improving benefits while lowering health care spending 20%-40% or more.
• Nothing happens until there is a mindset shift. Most people mistakenly believe that solving health care is like trying to solve Middle East peace. They would like that solved too, but it seems hopeless and out of their control. Fortunately, proven approaches to slaying the healthcare cost beast abound in every corner of the country, in rural and urban settings, in large and small organizations and in public and private sector plans.
• Hardly a health plan exists that does not need a serious case of spring cleaning. Some employers have found $1,000 of savings per employee per year (PEPY) just by getting rid of junk fees, conflicts-of-interests and watching over claims even through outdated health plans. As employers understand the level of shenanigans in their contracts, they become open to where the bigger opportunities lie such as moving to post-PPO health plans. Without cleaning up damaging contractual terms, some strategies such as direct contracting with willing and able local providers are barred.
• Shenanigan-central is the drug portion of your health plan. Countless employers have dropped their Rx spending in half without employees noticing other than if cost-sharing is removed due to wiser drug procurement. Most think PBMs are collecting one or two revenue streams when they have created 32 different revenue streams.
• The first change that is noticeable to employees is adding proper primary care which many have forgotten exists. Employees are delighted when they can access their doctor 7×24 and via modern methods rather than waiting weeks to get in and then still having to wait for an interminable time in a waiting room (aptly named!). Let’s not forget that it is impossible to price gouge or surprise bill a patient for an ER visit that never happened.
• The last step is the one that has the highest reward. However, it is the one that requires thoughtful planning. In the hands of amateurs, leaving behind value-extracting PPO networks can create problems for members such as balance billing. In contrast, a well-planned rollout generates a highly positive response from members. Everyone loves leaving behind the bewildering array of bills, EOBs (that do not really explain anything) and financial stress of astronomically high deductibles. Instead, wise employers have member champions that help guide people to the highest value providers. The only paperwork the member deals with is a thank you survey.

Watch Dave’s session on Relocalizing Health