Why Payers and Providers Can Get Along

In the new year, some providers and payers are gearing up for brutal, public fights. But there’s a better way.

Instead, they can collaborate for the good of both, says Dr. Dennis Weaver, chief clinical officer at insurance company Oscar Health. He’s optimistic because he’s seen it happen – last January, Oscar launched a co-branded insurance product with the Cleveland Clinic. The results exceeded investor expectations, posting a net income of $1.8 million in the first half of 2018.

Dr. Weaver is a seasoned healthcare veteran. Since receiving his medical degree from the University of Iowa in 1987, he’s practiced obstetrics, worked as a Chief Medical Officer at the Whiteman Air Force Base hospital, founded a strategic healthcare consulting company and, recently, worked as the Chief Medical Officer at the Advisory Board.

Even with everything he’s seen in his three decades of industry experience, Dr. Weaver says Oscar is building something truly new. We spoke with him about why Oscar is different from other payers, the challenges of introducing a novel product in the healthcare industry, and how, going forward, insurers will need to focus on patient outcomes. Here are some highlights:

What makes Oscar Health different from the typical insurer?

One key differentiator is that we really think of patients as consumers. That leads us to do things differently. For example, every single patient is assigned a concierge team composed of care guides and a nurse. So not only do patients interact with the same people every time they call, but they can interact through any modality they want. They can text via secure message, they can pick up the phone, they can get on the website. And that has led to the tremendous engagement numbers that we’ve seen.

In healthcare, it’s hard to bring something truly new to market. How did Oscar do it?

It starts with the people who founded the company. One founder was dealing with a grandfather who had a chronic illness. The other was researching maternity care for his pregnant wife in New York and was trying to compare the cost of care at different hospitals. Both felt the healthcare system was broken and could be built differently.

Would you describe your model as disruptive to traditional healthcare providers?

I get that question a lot. But when I sit down and think about it, I worked in the provider world for 30 years. I’m not trying to disrupt that world, I’m trying to partner with it. We’re not planning to build brick-and-mortar specialty clinics. We’re not going to build hospitals. Instead, we’re building frontline capacity. We want to complement health systems, not disrupt them.

How is Oscar structured to partner, rather than disrupt?

We prioritize not only improving the member experience, but also improving the provider partner experience.  We work closely with providers to build tools such as our Provider Portal and clinical dashboard. We share information and build interoperable systems so that providers and health systems find it easy to work with us.

Also, because of our emphasis on technology, we partner with high brand-recognition health systems, like Cleveland Clinic, who share our goals and who want to work together to build something innovative and new.  It’s important that, when approaching partners, we emphasize our shared goals and drill down on the best ways to reach them together.

What did you learn from the partnership process with Cleveland Clinic that informed how health systems and insurers can work together?

First, we learned how successful this type of partnership can be for everyone involved. Since we began offering co-branded health insurance plans last January, we’ve exceeded our enrollment expectations for our first year with 11,000 enrollments — almost 3 times our initial expectations.

On the patient side, we learned that when members can have a seamless experience, they really are willing to engage. Since launch, 75 percent of members have called or texted a person on their concierge team. And 80 percent of members have created an online profile.

We also learned that we can work closely with provider partners to build new, mutually beneficial products. For example, we’re rolling out direct scheduling, which allows our Cleveland Clinic + Oscar members to book appointments through the Oscar app. We bring this same collaborative approach to working with systems across the board.

Going forward, do you think insurance companies will need to focus on patient outcomes? Traditionally, that hasn’t been part of the business.  

Yes. And they’re not only going to have to focus on outcomes, they’re going to have to focus on outcomes that a consumer will understand and purchase. We’re moving to a world where consumers aren’t peripheral purchasers, they are direct purchasers of their health outcomes.

Are we moving to a world where the healthcare system will improve?  

I’m hopeful – on a number of fronts. I think, frankly, when insurers and providers aren’t at odds with one another, we’re seeing differential outcomes – clinical outcomes and patient and member satisfaction outcomes. I feel confident that this collaborative experience is going to create much better consumer-friendly products for members.

Jarrard Inc.