The State of Healthcare & A Hopeful Future
| March 20, 2019
Transforming a broken healthcare industry through competition and performance: Healthcare Highways President Alan Scoggins discusses the causes of today’s high-cost health plans and shares his vision for putting health outcome-oriented, sustainable healthcare within everyone’s reach.
Q: What industry gap was Healthcare Highways founded to fill?
Alan Scoggins: As our founder and CEO Michael Wilson would say: Competition. Competition is sorely lacking among health insurance companies. Generally, self-insured employers select from two to four behemoth organizations with little difference between them–they share similar approaches, tools, provider network configurations and, relatively speaking, premium costs. Without options, price is whatever the market will bear.
Frustrated employers will eventually bid out their health benefits again, and repeat a cycle: In another few years, displeased with still higher premiums, they bid out again, choose from the same large carriers, and continue to watch their premiums rise. They may enjoy a one-time, small cost reduction for the trouble all while upsetting and potentially loosing talented employees.
Q: Why is it important to create true choice in the healthcare industry?
Alan Scoggins: Industries lacking choice will lack innovation, because both choice and innovation require competition—there’s little incentive to create a better, more affordable product without them. Without options, price is whatever the market will bear. If employers are without true choice, those prices will be expensive, because health insurance companies have no threat of losing their customer base.
Q: Was the healthcare industry more competitive in the past?
Alan Scoggins: Twenty-five years ago, there were up to 75 health insurance options employers could select from to build a holistic, yet flexible health plan for their workforces. For example, in 1993, an employer could have selected from dozens of diverse bids. Today, that same employer must choose from five similar options, at most.
Those five carriers have consolidated their way to market dominance over the past two decades. Their massive acquisition of independent providers, smaller health systems, and hospitals informed the provider network models those insurance carriers are linked to which impacts their cost and level of quality care. Why would an organization that essentially controls service costs and care standards risk losing that market influence by inviting competition?
Q: What makes Healthcare Highways competitive?
Alan Scoggins: We started at ground zero, building health plans that offer value for all parties: members, providers, and employers. We create proprietary, patient-centric networks of healthcare providers selected for their history of efficiency and high quality of care. Generally, healthcare providers are reimbursed based on the number—volume—of services they provide.
Healthcare Highways financially incentivizes its physicians based on patient health outcomes and practice efficiencies, which reduces over-utilization and unnecessary treatment costs. We avoid automating the claims process, because critically significant details like coding errors can be otherwise missed, resulting in unnecessarily high costs.
Our claims administration process applies apply an experienced eye to claims to resolve [coding] errors and missed savings opportunities. Unlike Healthcare Highways, the big five insurance organizations are doing the best they can with what they have accumulated, not something built with all stakeholders in mind from the onset.
Q: Do you see signs of transformation in the healthcare industry, driven by Healthcare Highways or other factors?
Alan Scoggins: Absolutely. The Amazon-Berkshire-JPMorgan health venture—that’s an example of frustrated employers determined to build a radically different relationship with the healthcare industry. The [healthcare] industry currently operates like an automotive market that only sells a handful of similar make and model options, with one high price point.
We understand that healthcare is something everyone must be able to afford, which requires different treatment options and amounts of care throughout Life’s stages; in the same way the automotive industry provides cars of different makes and models at varying price points to satisfy consumers’ changing transportation needs throughout their driving years.
Employers of all sizes are requesting progressive, new options from their benefits managers and brokers, who in turn, want to provide an affordable solution that will promote a healthy, productive workforce for their clients. In our efforts to be that solution, we have consistently empowered employers and saved them money, while providing their employees with health plans that are affordable and uniquely centered on their health.
ALAN SCOGGINS | President, Healthcare Highways Mr. Scoggins’ expansive career includes more than 35 years of experience in all facets of healthcare, finance, and operations management. Prior to joining Healthcare Highways as President, he served four years as Vice President of Government Products & Services for MultiPlan, three years as Vice President of Sales & Account Management for Viant Health Payment Solutions, and ten years as President of Texas True Choice. Read more of his insights here.