Speaker 1: 0:00

Changing behavior around healthcare issues is a complex and multifaceted effort. We know that carrots work better than sticks, but even if those carrots work, our current tools and survey methods for measuring behavior changes aren't really as accurate as we'd like them to be. So how can we solve that problem and what would that mean for patients and plans? We'll find out on this episode of Shift Shapers.

Speaker 2: 0:25

Change either energizes or paralyzes. The choice is yours. This is the Shift Shapers podcast, bringing the employee benefits industry interviews with individuals and companies who are shaping the industry shifts. And now here's your host, david Saltzman.

Speaker 1: 0:45

Industry shifts and now here's your host, david Saltzman, and joining us to help answer that question is Ross Biella, founder and CEO at Aletheus. Hey Ross, welcome. Hey, david, thank you, thanks for joining us. I appreciate it. Yeah, it's my pleasure, so let's talk a little bit. We always like to find out, you know kind of, how you got to be doing, what you ended up doing, what was your journey?

Speaker 3: 1:04

Well, the patient journey for me and the entrepreneur journey started when I was the CEO of another company, kind of being forced to help my employees find high-value health care, and on many occasions I would walk into the office and there'd be somebody waiting to see me because their child got hurt in the football game or fell off their bike or had to go to the ER, had to have an MRI, and they knew it was going to be expensive but didn't know how their benefit plan worked and the HR person either didn't communicate with them or just they didn't understand.

Speaker 3: 1:40

And since they saw me all the time, they just said, hey, well, we'll ask you understand. And since they saw me all the time, they just said, hey, well, we'll ask you. And so I ended up helping a few of them and really found out how difficult it is to find out what things cost, where to go for these services, why there's no quality information around, and it just became very, very frustrating for me. So when I left that company, I thought there's a business here. And 14 years later here we are, you know, working with over 100,000 employee lives and 200 companies across the United States.

Speaker 1: 2:12

And still working at it and finding out. You know the recipe. I think somebody on the podcast a few years ago was. We were talking about consumer-directed allegedly consumer-directed healthcare, and they use a great phrase that I think you work on. You must work on a bunch. On the back end they said that we've essentially created a bunch of functionally uninsured human beings. We've got folks who've got insurance cards in their wallet but who've got ginormous deductibles and out-of-pocket responsibilities and they don't know how to use their plans wisely. So is that recipe something that you guys are working on? Is that kind of part of what you guys do?

Speaker 3: 2:48

Yeah, absolutely, but what you said was 100% true. These people, who make $30,000, $50,000 a year and have, on average, less than $600 in their savings account, are functionally uninsured and they're just hoping that something bad doesn't happen. And that was really my eye-opening experience, coming at it from a senior executive position, where if I have a $2,000 health expense it's a bad day, but for most of my employees that's a financially devastating event. And that's when you really look into their eyes and think, wow, did the decision I made about increasing their deductible make sense Because it benefited the company? And we're thinking I'm going to increase the deductible from $1,500 to $2,000, or I'm going to put a penalty on for going to the ER to $500 or something, and not realizing at all that you just sunk a quarter of your employees who couldn't afford it for the first time.

Speaker 1: 4:00

Well, and maybe more to the point, you know. The secondary piece of that is that you've also sunk your health care plan, because what these folks tend to do is they defer care until they are so sick that they have no choice. They show up in an ER and something that started as a cough and could have been treated for a couple of bucks ends up being an eight-day stay in ICU for $70,000, $80,000, $90,000. So nobody wins. It's just a question of.

Speaker 1: 4:25

It's like Uwe Reinhart, when he was at Princeton, used to talk about hydraulic medical economics and he reckoned it to a tube full of liquid and he said you know, if you push down on this side, the liquid's going up on this side, and if you push down on the other side, the opposite reaction happens, but the liquid is still the same amount of liquid in the tube. It's just got to go someplace. So I know one of the things that you all have worked on diligently is you're really heavily invested in data and using data in a way that becomes actionable. Can you talk a little bit about how that works, both for the individual and at the plan level?

Speaker 3: 4:58

Yeah, let's talk about the data that's available to the average person. And this is really important for all those broker consultants out there who are developing consumer-directed health plans or community health plans, or they have a health plan that encourages consumerism and they're trying to use some of the data that's available. Or, under the CARES Act, the data that is now being published by some of the hospitals. So that's the first part of it. So the real data, the most accurate data, is adjudicated claims data. If you can get that, then you can see what things actually cost within a network. Unfortunately, a lot of networks don't provide that information or the companies haven't invested in structuring the data. So you can really see all the different claims claim line items that go into a rather complex procedure.

Speaker 3: 5:53

Now colonoscopy typically, if it's a screening colonoscopy, you've got two claim line items for a screening 45378 for the facility and 45378 for the physician. That's simple. But even when you get into a little bit more complex colonoscopy with a polyp removal and maybe cauterization or maybe a tattoo that someone might put in the colon to show where they removed a polyp, now you've got lab and pathology. That goes along and most people and anesthesia. It's not uncommon to have that. So people who are trying to find, well, what is the cost of this Unless they're really understanding what goes into each procedure just going to those files that are now published through the CARES Act it's really hard to find the correct answer because the average person doesn't know that on a colonoscopy, I could have Versed, which is twilight anesthesia, or I could have attended anesthesia Well, versed's $35. Attended anesthesia is typically $300 to $1,500. And you don't know which your provider is going to use.

Speaker 3: 7:07

So how do you look at this and look at these data points that are being published and know what's real and what's not real, or know what should be included? So a friend of mine, leo Wisniewski, has got HealthCost Labs and Leo has published a lot of this data and he's got an app called Billy and it does do a pretty good job of showing what these costs are that are being, or the prices that are being published by the health systems, and I refer to that from time to time and I'm on a regular basis talking to Leo about does this data look right? Is this incorrect? And the truth is there's a lot of junk data out there and you really have to know what you're looking at to know if something's good or not, and so when I see a hospital facility fee that's being published as $600, I know that that's not a good number. Something is someone messed up on the data file, but the average person isn't going to know that and the typical broker consultant who's just looking at this may not know that as well, and I think you really have to be careful about who you use to provide the information.

Speaker 1: 8:13

Well, and on the prejudicated side radiologists, anesthesiologists, pathologists oftentimes not part of the network. So a patient thinks they're going to a network facility and they find out early on in the first set of billing that, oh my gosh, those guys are charging the sky's the limit because, well, they're not in network and that creates confusion and et cetera, et cetera. So once you get that data and let's assume that you're able to get clean data that's actionable how do you present that to a mere mortal, a non-geek like us, in a way that's actionable for themselves and their family?

Speaker 3: 8:47

You have to normalize the data so that you have the same inputs. You're comparing apples to apples. So for me, when I'm looking at colonoscopy providers, for example, I don't need to know whether they're using a tenant anesthesia or Versed or what goes into their sauce as to how to bill for the procedure, because you see a lot of goofy things Like I see hospitals sometimes adding these 99999 codes for transportation of materials, you know, and it adds $150 onto the claim. It's ridiculous. And for colonoscopies, oftentimes you see them throw on a E&M code for seeing the patient which is atypical, but you see it happen all the time.

Speaker 3: 9:37

And then we see in certain facilities where the percentage of the patients that have a polyp are so far beyond the normal distribution in a population, you have a question about that. So you really have to understand kind of what's going on with that particular location. And I can tell you that if someone goes in there for a screening colonoscopy, in that particular scenario it's going to be coded as a colonoscopy with a polyp removal and I'm going to assume that somehow that group is getting every patient that requires a polyp removal in the state. But it doesn't matter. So if I've got two people and they're turning right out of their driveway. If they go to that location, it's going to be billed in a certain manner and it's going to cost that much. But if I can get them to turn left and go to one of the higher value places that I know do clean coating and that I know are decent quality, we've won the game. And that price difference is probably 50% of what the other group would be and that's not atypical in healthcare.

Speaker 1: 10:48

So how do you connect the patient with the data, with the carrot and what are the carrots? How do you get them motivated to go to the place that gives you clean data, where you know you can depend on getting a true reflection of what the procedures that were actually done. You know you can depend on getting a true reflection of what the procedures that were actually done.

Speaker 3: 11:05

Yeah, the best broker consultants out there have figured out that money works and even the simplest person can understand that in certain cases, if they go to this provider, they're there, will be no cost to them.

Speaker 3: 11:22

And that's the magic word no cost to you or free. And so these tiered health plans that are becoming much more popular, it's a win for everyone. It's a win for the providers who are offering this high value, trying to fight it out against the big health systems that advertise on TV at night where your independent GI doc or orthopedic doc, they don't have that big money that the teaching institution has. So they're going to win because you're going to send them patients and those patients are going to pay a fair amount of money. And I'm not even talking about negotiating anything down or going outside of the network or anything like that. And these broker consultants who know the game know that there are, these independents exist and if they can get the patient to go there, they've set up a plan design that weighs the deductible and co-insurance when you use these high value providers, whether it's imaging, orthopedics, colonoscopies, just many, many different procedure types- and now a word from our sponsor.

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Want to take your game to the next level? Visit benapowerai or schedule a demo at info at benapowercom. Find your power with Benapower. And now back to our conversation. So those best agents also know that the longest period of time in the universe is the period of time between the open enrollment meeting when you discuss this stuff, and the time somebody needs care and has forgotten about this stuff, and the time somebody needs care and has forgotten about this stuff, do you, do you create an advocate that you know? Ok? Well, if you're going to have this, you should call these people and they can explain to you where to go and why. Or how do you deliver that information so that it really is, to use the phrase off your website it's a carrot, not a stick.

Speaker 3: 16:18

Yeah, and that seems to work. Yeah, and that seems to work. You know, there's all sorts of company cultures that we've experienced over the last 14 years and some company cultures will do exactly what they're told to do. It's the culture of the organization. Other cultures, you know, are the opposite of that and you really have to cut through that to understand.

Speaker 3: 16:44

How do we communicate with these groups? And you know, the one time you communicate them at, open enrollment is never going to be enough, right? So how do you create an environment which facilitates recognition of those people who are saving money or are making informed health care decisions? And so we do a lot of things by promoting the benefit plan, promoting the contact of an advocate and so on many of these plan designs that we have, we encourage our employer clients to offer something that's common and probably may not have a big price disparity within it. I'll just give you a mammogram, for example.

Speaker 3: 17:31

For a 3D mammogram, I think a high-value place is $220. In our markets, typically it could go as high as $350 for a decent value place. They can get crazily priced, you know $850. But compared to a knee replacement, where you're going to save, you know, $20,000 at a procedure a mammogram you're going to save $200 or $300 maybe, but if you can put something an incentive there or you can waive the cost, the women who make 80% of the healthcare decisions in the United States are going to say wait a minute, I got this for free. Or, since mammograms are typically a covered event, I got a $25 or $50 cash incentive. And if my child or my husband needs a procedure, they can get a cash incentive too. And all I need to do is look at this list of procedures or providers that are free or that offer an incentive. Then that seems to remind them to think about it and make the call.

Speaker 1: 18:38

As you work with advisors, do you have materials where you educate them to say here's one of the best ways to get through to folks, here's how you make this known throughout the course of the year? What do you do on the education side at the benefit advisor level?

Speaker 3: 18:52

Yeah. So we'll work with the provider to understand the culture of the organization and part of our onboarding of a client is really helping our advocates understand the culture of that organization and we're moving more and more to that. It's really important that when you're dealing with a machine shop that is 80% men, that your communication vehicles or your targets are different than if you're dealing with a bank where you have 60 to 70% women who are the tellers and administrating the business. So hitting the employee where they're going to engage with that material makes sense. So we work with the broker consultant to really understand that and then understand what vehicles have worked for that employer.

Speaker 3: 19:40

Like I said, some cultures. If the CEO says we're all going to jump off the cliff, they do. You know, I've had Sargento Cheese as a client for a number of years. And if Lou Gentine said that, they would go. And it is a great culture, just a wonderful company.

Speaker 3: 19:59

And I've got other companies where the culture isn't there for many reasons. Sometimes you've got a distributed workforce where you've got two people in an office and you've got 200 offices across the United States. It's a very different thing where everyone does their own thing and you really have to say how do we reach those people? So you've got to meet them where they are. You've got to meet them where they are and really support the HR team.

Speaker 3: 20:25

Now, hr managers today are asked to do so many, many things and they're being asked to do or take on more liability or at least responsibility for the cost of the health care, and so they really rely on the broker consultants to identify where the opportunities are, whether it's in the PBM or in specialty pharmacy or in guiding people to value or guiding people to quality. And then, once that strategy is determined, like, who are we going to target? So if I've got a large client and one of our clients we've got over 10,000 employees, so their focus may be very different than that 150-employee company, and targeting the right people can really drive the savings. So we can do that through data and we can do that through benefit plan design.

Speaker 1: 21:21

Do you have any long-term stats on how, if you get your programs engaged properly, if all the carrots are all lined up and they're all the same size? I have a one-track mind. I stay on analogies. I can't help it. What might that do for the bottom line of a plan?

Speaker 3: 21:37

Well, I can tell you that when we look at this, we're trying to provide an honest assessment of savings, because if you look at some of the programs, I'm a big fan of Al Lewis and one of the things that he beats on a lot of times are wellness programs and, as a former CEO, we put a wellness program in my company with 300 employees and it was a great program and we had a lot of fun with it and I think it really helped people focus on health care. I don't think we saved any money on it and but that's not why we did it. We did it to get people engaged in their health and it's amazing to watch people drop 100 or 150 pounds when they engage with the program, when they engage with the program. But when we talk about things like this we really want to focus on what can we do on the individual level to really get people to turn the needle and if we can identify, for example, infusion patients and that's a big opportunity right now where you go to facility a and I think okra vis is one we looked at where it's eighty five thousand dollars. And infusion, where, if you go to an independent infusion center with a white bag strategy. It's forty five thousand dollars, so you don't need too many of those to really move the needle.

Speaker 3: 23:06

So for our, the way we look at this and the way we assess savings, david, is we know what the average cost of a claim for a procedure was for that employer over the last couple of years. Typically we get that through historical claims. So I can say I've looked at your last 50 colonoscopies and your average price was $4,800. And I know that we have high value options where your average price will be $2,400. Thus you're going to save about $2,400 per colonoscopy. Now, that's on average. So you know. And the employers will say, well, yeah, but how do I know that my employees aren't using the high value places? Now and I say you know, it's all about market share. What market share do you think those high value places have today? And most of them, if they're honest, will say well, you know, 5%, 10%, which is because these independents and there's fewer and fewer of them competing against bigger and bigger health systems they're not going to have more than 10% share. So let's just rule that out, that your people are going to the higher value place because typically they're not. So we'll know what the average price is. And then I just set that as the example. And that's an average price.

Speaker 3: 24:27

So in Western Wisconsin, where we sit with a couple of health systems that are very expensive, where a colonoscopy, for example, on an average cost is over $6,000 for a screening colonoscopy, whereas less than 50 miles away in Minneapolis, the average cost of a screening colonoscopy is about $2,000 and maybe less, but that's the average cost of a screening colonoscopy is about $2,000 and maybe less, but that's the average cost I can tell you.

Speaker 3: 24:51

At the high end we see those colonoscopy costs as high as $18,000 and I'm not exaggerating. So when I use an average price I'm using the average price in that market. That's a reasonable average price. I'm not taking it from the most expensive, but I am using it from the average price of the high value options that we have. So I can set that up to say I know that we moved 10 colonoscopies that had we not moved them you would have paid $6,600. Instead you paid $2, and that savings is your net savings. And then to make it even fairer for the employer so I'm not over-exaggerating what our savings are or their ROI. We net that against the $200, $300, or $500 cash incentive. They will pay the patient or the employee for going to that high-value place.

Speaker 1: 25:50

We've got a couple of minutes left. I wonder what are you looking at in the future? What are you seeing in the near term and the midterm for improvements in overall advice to patients and utilization of data in ways that we can get patients activated to go in the right directions?

Speaker 3: 26:08

in ways that we can get patients activated to go in the right directions. Yeah, I think the key here is communicating with the employers to really help them identify those black swans that are going to happen, and their better broker consultants know that these 150 life companies that five years ago may never see a $50,000 infused drug, they're going to see one, and so you have to write that into your plan, design or protect somehow, whether through your specialty pharmacy or through a steerage program or infusion program that works. I think the other thing is really to work within the network to identify those high quality and high value places and really work to get people to go there. And you had asked a question about what are we seeing for bottom line. I want to answer that and I think we're typically seeing we can save between 3% and 8% of the cost of their healthcare. Our top groups are having engagement north of 50%, our average is about 22% to 24% and a low engagement group is anywhere from 8 to 12 percent. So the higher the engagement, the more savings.

Speaker 1: 27:14

And that makes perfect sense, and perfect sense is a great place to end our conversation for today. Ross Biela, founder and CEO at Aletheus Ross, thanks so much for sharing your information with us.

Speaker 3: 27:23

Yeah, thanks, david, I appreciate it. Yeah, thanks, david, I appreciate it.

Speaker 1: 27:31

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Speaker 2: 27:47

visit him at hatchermedianet, that's H-A-T-C-H-E-R medianet. This Shift Shapers podcast is copyrighted content and may not be reproduced in whole or in part without the express written permission of Shift Shapers Solutions LLC. Copyright 2024.