Bloomfield Connecticut-based Cigna insures more than half a million North Texans. The global health services company is, like the rest of the industry, facing a major culture shift in American healthcare.
It’s now focused its efforts into getting its customers more engaged in their own care, from cost and quality standpoints. The company is providing customers and physicians with more data in an effort to remove itself from the foreground of healthcare. Cigna, ideally, would like to be an intermediary between the physician and the patient: Help provide support resources that can illuminate a patient’s history of care and bolster the relationship he or she has with the primary care physician.
Last week, LaMonte Thomas, Cigna’s president and general manager for North Texas and Oklahoma, visited D World Headquarters to chat about the company and its shift from volume to value based care. Below is a conversation about that and a slew of other topics, including the rise of high deductible health plans, the importance of employer wellness programs, and the future role of the insurer. It’s been edited for length and clarity.
Cigna participated in the healthcare reform marketplace. How did it perform?
It went well for what we offered, especially as it related to our network being a more robust network than some of our competitors, which became an issue with the exchange. People bought based on price and then realized they didn’t have a network that supported their needs.
We put our LocalPlus network on the exchange, which was our high performance network. So, based on our Accountable Care arrangements or our medical home arrangements, we had those doctors plus our Cigna Care-designated doctors and specialists, who are high performing specialists. So that was your doctor pool.
What are some of the challenges in switching to value based care from volume?
Healthcare has been so rooted in fee-for service. It’s been a system structured on, especially from a delivery system standpoint, that I can perform a surgery and get paid and if I made a mistake and had to go back and correct it, I got paid. It was kind of a perverse way of payment. Now, moving toward results, healthcare reform has done a great job disrupting everything and shifting a focus back on quality.
How do we remove waste from the system? How do we get individuals engaged as consumers? I think that’s the biggest shift that’s taken place. As we take the system and shift to volume, we realize we have to move upstream and identify opportunities to keep people from falling into the system at a higher cost. And, not only for employers but for the individual and for the system itself, it’s kind of counter intuitive. We spent the last several years building all these hospitals and hospital beds and being measured by bed dates, and now you have to change the idea and keep them out of the hospital, keep them out of the beds.
What role does data play in that?
We had access to data that sitting in our vaults, sitting in our offices, did no good. We had to get that information into the hands of the individuals so they could, as consumers, understand transparency, but more importantly get it into the hands of the physicians so they knew what was happening to individuals once they left their office: whether that individual filled that prescription, whether that individual went to an emergency room.
All that data that we had, we now share with our physicians and our Accountable Care arrangements or others refer to them as medical homes or ACO arrangements. We also realized we needed people resource. These physician groups that we partner with, we provide an embedded care coordinator, or at least the funding that allows them to hire an embedded care coordinator. What that does is tighten the relationship between the physician’s office and the patient and pulls us out of the middle of that relationship. We believe the most impactful place for healthcare to move from volume to value is that point of care, that relationship between the physician and the patient. So the closer we can drive those two together the better the results we’ll be able to achieve.
Let’s talk about your relationship with employers, many of whom seem more interested in providing wellness programs and working with the insurer to come up with plans that incentivize not smoking or being a healthy weight. Are you finding more employers interested in that personalization of care?
What’s important is what do we do with those individuals. So I think that’s what separates Cigna from our approach with working with employers, understanding what to do next. And we’ve seen an evolution with our clients from wellness programs based on activity —if I go to the gym, if I stop smoking—to more focused on outcomes. OK, so if I’m diabetic am I engaged or am I working with a coach, things like that that are based more on results. And if I am overweight, and my BMI is “X,” am I getting in within the range of X minus Y and rewarding individuals for those outcomes. And that’s a big shift, which is driving costs out of the system because it’s improving outcomes; it’s improving health instead of just activities.
Is this a recent shift?
I’d say over the last couple years. Before people kind of eased their way into it and realized that we’re paying out a lot of money for people that were going to go to the gym anyway and for people who said, ‘OK I may stop smoking, but, I really won’t, so I’ll pay an additional premium.’
Now, they’re doing health assessments where in order to get insurance, family members who are on a plan who are older than 18 have to do health assessments as well as requirements for differentials from a premium perspective for those individuals that may continue to smoke to where it’s going to hit you in the pocket book unless you’re engaged in some type of program. Even to move to a point where realizing that weight has an impact on overall health, so if you’re within BMIs that are not desirable, there are programs to put in place to help you get there and premium differentials.
Let’s talk about high deductible health plans. PwC found that nearly 40 percent of employers are considering offering their employees only these plans. Others say that the deductible may prevent people from seeking care. How do you believe their proliferation will affect healthcare?
We’ve done an eight-year study on CDHB or consumer directed type of programs and what we’re seeing is that people aren’t avoiding care. The key piece to that is communication because it’s the beginning of consumerism. Now, it’s no longer that $20 copay and you think that covers everything, it’s really you having skin in the game and understanding and managing a pool of money that’s your money.
And now, you care more. So when you get an MRI, you’re looking at data that says OK, I can go get an MRI here or at a freestanding facility for $300 or I can go to where I’ve been referred to by the doctor who may own the equipment and that’s $3,000. So you’re now making consumer decisions and you care. When you get a prescription, you’re asking questions of your doctor: Is there a generic alternative to that prescription that you’re writing for me? And you’re having a better dialogue with your doctor. From a treatment standpoint, the doctor may say, ‘hey I get paid for doing a surgery, you need surgery?’
You’re asking, are there alternatives to that? And you’re looking for resources within the insurance company with the information they have, saying, are there alternatives that I may want to consider and have a conversation? So contrary to belief that it will now have people not seeking care, we’re finding people more engaged in their health and more engaged with the cost and quality of their health than ever before under these plans.
What do you see the future of the company and the role of the insurer going forward?
I think as healthcare continuously evolves, the role that we’ll play is conveners: Conveners of the stakeholders as we continue to evolve and continue to grow and adjust as we learn more amid technology changes. There will be different access to information, to resources as the medical field evolves. So we’ll be conveners for employers, for hospital systems, and for those that are consuming healthcare.
We’ll provide and continue to provide coaching, we’ll continue to provide management and medical management services that we provide today. I don’t think that model changes much. For us at Cigna, since most of our business is self-funded, we’ll be serving greater resources for employers to help them in their efforts to continue to push their employees closer to the physician.
Our role for the physician is to provide data and resources to make it easy and helpful for both of those parties as they move closer together. In an ideal situation, if there’s risk and you’re paid on results rather than activity, then you’re incentivized to guide that person to the high quality place for the most cost efficient. You’re incentivized to write prescriptions for generics instead of name brand. So that role as navigator and transparency goes closer and closer to the physician, more so than companies like Cigna or other companies out there building models around transparency.
So you’ll be more of an intermediary between the two.
Absolutely, with us getting away from the middle of that relationship.