ACHE 2017: Embracing value-based care essential to attracting big purchasers like Boeing, Walgreens

 - Linda Brady, Boeing's ACO portfolio manager
Linda Brady, Boeing's ACO portfolio manager, speaking at ACHE 2017 in Chicago

Large corporations want healthy workers and lower healthcare costs. If hospitals and medical groups are going to win the right to provide care to those employees and their families, innovative approaches to care, having the right infrastructure in place and taking a lot of meetings are a must.

At the American College of Healthcare Executives (ACHE) Congress in Chicago, providers heard from benefit managers from three large corporations: Boeing, United Airlines and Walgreens, which account for more than $4 billion in annual healthcare spending. While some in the audience may have been surprised to hear cutting costs isn’t the sole objective for large purchasers, all three speakers repeatedly emphasized that the ability to lower the price of providing healthcare is key when picking providers.

“There is no other part of our business that has had the ability to have someone to stand in a position and present a 6 percent increase annually and still have a job without any return," said Thomas Sondergeld, vice president of global benefits and mobility for Walgreens Boots Alliance. “Yet I’ve been able to do that for 20 years. Why? Because we’ve tolerated this bad marketplace.”

The three managers all presented different paths to keep costs down while providing better care for their covered populations.

Boeing, for example, is trying an accountable care organization (ACO) model in several areas where it has a larger concentration of workers, beginning with its 75,000-plus employees in Washington. Linda Brady, manager of Boeing’s ACO portfolio, said it entered into direct, shared-risk contracts with two health systems (after initially seeking a single contract): Providence Swedish and the University of Washington.

She said there have been challenges from the design standpoint—like setting up a patient experience call center which few patients utilized—but the biggest hurdle has been integration and sharing data between different providers to cut down on redundant services.

“I think it’s a daunting challenge, especially for primary care. They’re being asked to do things that they normally and traditionally haven’t been able to do,” Brady said.

The ACO initiative has been expanded to new areas, like South Carolina and the St. Louis region. Brady said for future projects, Boeing isn’t married to the direct contracting model for its ACO partners, but expects providers it works with to buy into value-based care, show evidence they can adapt, invest in IT and personnel infrastructure and be able to measure their progress.

United Airlines’ benefits director, Vicki Giurato presented a very different scenario. Due to contracts with its heavily unionized workforce, United can’t play with plan design in the same fashion as some other large companies, so it has to try to keep costs down across a much larger network of providers. Helping employees navigate the healthcare system is one of its biggest challenges.

It did enter into two direct contracts with center of excellence (COE) partners in cardiac and orthopedic care. That transformation hasn’t been smooth, Giurato said, with employee awareness and an unwillingness to travel (even for airline workers) meaning fewer surgeries are being performed under those contracts than United would have hoped.

It’s so frustrating, in fact, that Giurato said the company has considered paying employees directly in exchange for seeking care at these centers, though the union contracts don’t give United that kind of leverage.

“Lower readmissions, faster recovery times, all that stuff will be such a benefit for us as a company that we’d be literally willing to write our people a check to just to get them to consider one of our center of excellence locations,” she said.

The consensus from the panel seemed to be that efforts to better integrate and coordinate care driven by insurance carriers haven’t worked, so their companies decided to find different partners who are willing to share risk and trying different approaches. If providers want their business, the managers said they have to be willing to embrace changes in care delivery.

“There is still a significant amount of practicing providers who think accountable care, patient-centered care, is the newest fad. It’s going to go away,” Brady said. “As an employer paying for these costs, that’s not going to work anymore.”