The past few years have been difficult for companies seeking to disrupt traditional primary care models, with major retailers Walmart and Walgreens announcing significant cuts to their primary care operations. The remaining candidates remain, but the jury is out on whether they can master the tough unit economics of providing health care.
Recent failures in the retail health sector have raised questions about whether primary care is only suited to remain within traditional stakeholders such as health systems, physician practices, and large employers. There is. Four healthcare executives shared their answers to this question during a panel discussion Sunday at HLTH in Las Vegas.
According to Nolan Chan, executive vice president of strategy, corporate development and finance at Permanent Federation, the answer depends on how you define primary care.
Kaiser Permanente is an integrated health system committed to long-term value-based care, and Chan said that commitment has influenced his definition of primary care.
“On average, our patients stay with us for more than 10 years,” he says. “What's important is how we build relationships with patients so that we can drive outcomes. I definitely think[primary care]needs to evolve, and that's going to be a combination of different initiatives. It's part of our responsibility to figure out what that is.”
Most of the retailers that have sought to disrupt the primary care market in recent years have established trading models that are difficult to integrate into larger health systems, Chan noted. In his view, transactional primary care will continue to struggle.
In the future, he hopes to create a path for traditional companies like Kaiser to integrate with these retailers to make the care experience more connected and meaningful.
“For us, the retail opportunity is how we can break down barriers and meet patients where they are. If they are already scheduled to go shopping near a target clinic, we can What can we do to help them while we’re there?’” Chan said.
Ananya Banerjee, chief commercial officer at Aredede, agreed with Chan that primary care can exist outside of traditional settings.
Indeed, given the fact that traditional companies cannot meet the demand for primary care, the industry “cannot afford” not to do so, she said.
“So many companies (disruptors) struggle because it’s hard to survive on a pure fee-for-service model. Once you understand what the right payment model is, you’ll know how to succeed. That's what we're trying to do with Aledade – help independent (primary care providers) move from fee-for-service to value-based care,'' Banerjee declared.
Another panelist, Sesame Co. co-founder and president Michael Botta, looked at the issue from an economic perspective.
He said the primary care category creates “a lot of value” to the health system, but independent primary care practices can't necessarily capture much of that value within existing structures.
“There is a very strong incentive for large traditional health care providers to acquire, build, or consolidate primary care practices,” Botta declared. “Combining[primary care practices]with other parts of the system creates more value creation that others can capture.”
Tony Farrar, Chief Medical and Clinical Transformation Officer at Highmark Health, said that when envisioning what primary care partnerships should look like in the future, it is important to understand what patients and consumers are asking. He pointed out that we need to focus on what we want.
Patient preferences have changed considerably over the past decade, and primary care needs to evolve with those preferences, Farrar said.
“They want on-demand care. They want convenient care, and they've wanted it since yesterday. Think about the apps that they like the most, whether it's Amazon or something else. “People are conditioned to have different expectations now,” he said.
Photo: sdecoret, Getty Images
