Can Retail Business Implement Primary Healthcare?
The question here is whether primary care can be commercialized more so than what it has been to date? Will profitability deliver a better healthcare model? Who will it serve? Can it survive without large healthcare institutions and hospitals supporting it? It might given where its location and the costs of utilizing it.
Can Primary Care Thrive Outside of Traditional Healthcare Players?
– by Katie Adams
The past couple of years have been rocky for companies looking to disrupt the traditional primary care model — with top retailers Walmart and Walgreens announcing that they’re winding down their primary care operations significantly. Others still stand, though the jury is out on whether they can master the tough unit economics that come along with healthcare delivery.
Recent failures in the retail health space beg the question: Is primary care only suited to remain within traditional players, such as health systems, physician practices and large employers? Four healthcare executives shared their responses to this question during a Sunday panel at HLTH in Las Vegas.
The answer depends on how you define primary care, according to Nolan Chang, executive vice president of strategy, corporate development and finance for The Permanente Federation.
Kaiser Permanente is an integrated health system committed to longitudinal value based-care — and that commitment colors his definition of primary care, Chang noted. Adding . . .
“Our patients stay with us, on average, for over a decade. It’s about how we develop relationships with patients to be able to drive outcomes. I definitely think [primary care] needs to evolve — and it absolutely can exist in different engagements. It’s part of our responsibility to find out what that is.”
Most of the retailers that have attempted to disrupt the primary care market in recent years have established transactional models that are difficult to integrate into the greater healthcare system, Chang pointed out. In his view, transactional primary care is going to continue to struggle moving forward.
In the future, he hopes there are avenues for traditional players like Kaiser to integrate with these retailers to make care experiences more connected and meaningful.
“For us, the retail opportunity is: How do we break down barriers and meet our patients where they’re at? If they’re already going to be out shopping near a Target clinic, what can we do to help them while they’re there?” Chang said.
Ananya Banerjee, chief commercial officer at Aledade, agreed with Chang that primary care can exist outside of traditional settings.
In fact, she said the industry “can’t afford” for it not to, given the fact that traditional players cannot keep up with the demand for primary care.
“So many [disruptors] have struggled because it’s hard to survive in a pure fee-for-service model. When you figure out what the right payment model is, that’s when you figure out how to thrive. And that’s what we try to do at Aledade — helping independent [primary care providers] transition from fee-for-service to value-based care,” Banerjee declared.
Another panelist — Michael Botta, co-founder and president of Sesame — thinks about the issue from an economic perspective.
He said that the primary care category creates “lots of value” in the healthcare system, but independent primary care practices don’t necessarily capture a lot of that value within existing structures.
“There are very strong incentives for larger, traditional healthcare players to acquire or build or integrate with primary care practices,” Botta declared. “When you combine [primary care practices] with these other parts of the system, there’s more value creation that other people get to capture.”
When envisioning what primary care partnerships should look like going forward, there needs to be a focus on what the patient/consumer wants, pointed out Tony Farah, Highmark Health’s chief medical and clinical transformation officer.
Patients’ preferences have changed quite a bit over the past decade, and primary care needs to evolve to meet those preferences, Farah remarked.
“They want on-demand care. They want convenient care, and they want it yesterday. Think about your most preferred app, whether it’s Amazon or something else — people are now conditioned to have different expectations,” he said.
The issue probably isn’t so much what people want as it is what will insurers agree to. Most people do not pay for their medical care out of pocket although they d have deductibles and co-pays.