Friday, August 7, 2009

Health Innovators Series: Chris Parks from Change:Healthcare on the Power of Transparency


Chris Parks, the always entertaining CEO of Change:Healthcare, shares his vision of healthcare consumerism straight from his worldwide headquarters in NashVegas.

Can you tell us a little about your background and what your company does?

I’m focusing on helping people save money and make better health care decisions based on information. I began as an exercise physiologist who worked at Healthways. Later, I had the opportunity to work at HCA when Rick Scott was there. I left to work with Kaiser focusing in on capitated health plans. I next tried my hand at a small biotech company called Neopharma which focused on supply chain management. This is when both of my parents became ill and after watching both of them pass away, I was left managing over ~$25K in debt. I could not figure out where, when, and from whom I was being charged this money. It was actually the trigger that helped to found our company.

How do you approach the problem of reducing cost while improving quality?

If you make health information a commodity and present it in an understandable and actionable format to individuals, they will make good decisions as long as their wallets are impacted. Most individuals will not be able to understand all the clinical mumbo jumbo and will default to the doctors expertise; however, they almost universally understand financial choices. We see this as individuals will often choose not to undergo tests or procedures that have unknown outcomes when they are spending their own money.

We have found the challenge of defining quality is that it is subjective and constantly changing depending on the latest study or interpretation. We believe that the more time you spend defining and canonizing quality you will lock into predefined notions of quality that might not be widely applicable given everyone’s different value systems. As a result, we have chosen to focus on the cost side of the equation and let people make their own definition of quality.

Can you share some examples of how you guys do this?

We have a company of 1,000 employees in the back hills of KY - all blue-collar, tobacco-chewing workers without very good connectivity. Yet 95% have adopted our online tools, even though many required going over to their cousin’s house to help them figure it out. Our tools are useful to them as they save real money by reviewing their own and their colleagues health purchasing experience. We solve a real need that is tangible.

On the opposite end of the curve, what you can’t do is tell people they are now responsible for the first $5,000 dollars and then leave them to their own devices. How do they know how to allocate their money most efficiently? We can help them know that their wellness check, colonoscopy, and other preventive services has an excellent return on investment. Not only do we help them understand this but we also help remove barriers for them to access this information or benefit design problems where they are disincented to obtain these services.

I laugh at the co-pay strategy. A $50 physician office visit is still a buffet card to an all you can eat health services menu. We need to get that to $500 or $5000 to be able to see true consumerism take over.

You work alot with consumers, what is the pain they are feeling?

They are utterly frustrated, confused, and just plain mad about how difficult it is to interact with the health care system. We are trying every day to tackle some of the biggest problems they face - primarily around creating patient friendly billing information. This goes on every day in every city where patients are given bills that make no sense, are not tied to anything they understand, and don’t provide a way for them to understand whether they received good value or not. We tackle the touch points for patients/employees by making this type of information easy to understand, relevant, and actionable.

If I need an abacus and a spreadsheet and late night seance to figure out my bill, there is a problem. We chose to jump into the middle of the messiness by simplifying and communicating more effectively than a dead EOB. We soon found that people don’t want to put any effort into getting organized as it is just too much work. But tap into their wallet, and then are burning the candle on both ends to save a quarter. Our company found that employers are nice aggregators of consumers and health information. We determined that we could create a tool, which we call the Healthcare Consumerism Index, to help our employers and their employees understand what they were paying for and getting from their health care spend. It has an immediate impact on helping everyone understand which providers, which pharmacies, and which programs are actually providing good value.

Change:Healthcare is designed to be a platform and we’ve integrated this into a network of our users. So everyone who is on the platform can benefit from what the others on the platform share about pricing, experience, and related information. This information allows employers to come up with better benefit design, share information more fluidly, and ultimately create a much better user experience. Its fast becoming an ecosystem to capture and catalog health value.

How would this platform help someone with obesity to manage their health more effectively?

Well, we don’t approach the problem like the disease management companies do. We tackle the behavioral problem directly through the wallet. It is our contention that some people are going to be fat and smoke and not manage their diabetes. They are free to do that but they also need to understand that there is a consequence to this decision - typically in the form of higher co-pays or differential premiums. People will only change when they want to . . . but we provide some tools that provide some financial motivation to do so. We help provide support to the rest of the care team who is actually doing the heavy lifting - the physicians, nurses, dieticians, spouses, and families - by aggregating all the information in a way that allows them to see the consequences of their behavior.

The reality is that it requires a series of carrots and sticks, crisis and fear, and ultimate internal motivation to make the changes required. We have found some success in using financial incentives to spur on the internal motivation (and the external influence in employer settings).

What would you recommend as the key initiatives to reform our current health system?

I have heard alot of talk about blowing up our current health system and moving to something completely new. While I like big explosions and the feeling of anarchy it engenders, I am actually an advocate of working off the current system. What we need to do is focus on making it much better than it is right now by leveraging what is currently useful to employers and consumers.

A key part of that is make make health plan data portable in a format that is “mashable” by anyone that the consumer designates. There is no value in obfuscating the pricing or outcomes or information anymore - that model is appropriately dead. People need to be able to know the prices, compare quality between physicians, and then make a decision that is relevant to them. Claims data is a commodity. Negotiated contracts are a commodity. It is the consumer service experience that trumps all and matters most. We can dramatically improve the consumer experience by empowering them with information that allows them to make their own health choices.

What are some health care innovations that believe are ready for prime time?

I think there are many things that have promise - one that I personally love is the notion of the medical home. The concept has been around for a very long time but now that the employers are coming to the table to participate with the payers I see this gaining real traction. It’s really quite simple if you think about it - a physician is responsible for a population of patients and they work together using new tools and technology to achieve the best shared outcomes.

I would also love to see more innovation around behavior change (short term costs), insight (long term cost), and opinions (which drive adoption). Alot of this is related to the personalization including both delivery but also the information of the care experience. Most people want alternatives with choices and consequences and the freedom to make their own decisions. I also think there are alot of new online and interactive widgets that if brought together in the right way would be powerful contributors and great innovations. Still really like the idea of the iPhone as the platform and everyone designing on the platform.

Where do you think the X PRIZE can serve as a catalyst for innovation?

I would love to see teams focus on improving how we engage, communicate, and connect with each other. I want to see health care transformed and reconfigured with a human face, a human voice, and the human touch that everyone can comprehend. I would also love to see platforms and networks created that make it easier for me to do what I am trying to do. What is the platform that can serve as the gateway to communication and collaboration? I would love to see teams push the envelop on this.

I believe the X PRIZE could take the current system and create wrap around tools, presentation layers, simplicity, and a better user experience. I would like to know if my doctor is any good; I want a market place where I can get the information I want when I want it; I want grandma-friendly, actionable, relevant, and insightful information that someone has surfaced from all the data that is floating around out there about me. I want someone to simplify, explain, and interpret my health care experience.

Who else should we be speaking to?

You should be talking to the consumers of the system - talk to the people who are the most frustrated by what is going on. See what confuses them, what is difficult, and what they would like to see fixed. I think this perspective is the most relevant.
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