Where payers are—and aren’t—focused in 2019

Four takeaways from the 2019 AHIP Institute

Last month, we met many of you at AHIP’s 2019 Institute in Nashville as we listened to a variety of talks from insurers and their partners. Read below for what stood out to us—and our takes on what that means for you.

1. Unaffordability isn’t up for debate. But cost still is.

Highlighting consumer frustration with extreme costs, Cigna CEO David Cordani announced an ambitious new goal: to match Cigna’s medical trend to the CPI. That would mean a growth rate less than half of what’s typical for the industry.

Shortly after, Andy Slavitt, the former acting administrator for CMS, shared that many large health system leaders estimated that they could cut 15-20% of their costs under a true global capitation arrangement (if pressed).

While nearly all insurers recognize that member affordability is today’s biggest challenge, even the most aggressive cost cutting we’ve seen leaves enormous waste unaddressed. Plans will have to navigate this industry disagreement about how much costs can drop, who must take responsibility—and how.

2. One approach to the drug cost problem: Pay more for less.

Amid all the talk about affordability, plans grappled with the central tension of their business: managing costs on average and outcomes for individuals. Several plans recognized that the need to distribute costs across a population has led to poor outcomes for certain segments, including along demographic, geographic, and genetic factors.  In that context, emerging high-cost drugs drive even more anxiety for plans, as many of these offer treatments for ever narrower segments.

But some speakers see reason to hope: new personalization capabilities might actually help to address costs, rather than drive them. Emerging sensor and testing technologies can allow better targeting of resources—from staff to drugs—to the right patients. So the future might mean paying more for treatments that apply to fewer people, but are highly effective—and reduce spending on ineffective treatments.

3. There’s a leadership vacuum for addressing social determinants—despite their ‘hot topic’ status.

More than 20 sessions across the conference—from keynotes to targeted breakouts—focused on addressing social determinants of health (SDOH), demonstrating the growing buzz of health plan activity and eagerness for avenues to prevent costs.

Most plans are focused on initiatives that deploy point solutions across the near-endless opportunities for intervention that increasingly extend into commercial populations. While this approach is logical as plans can’t feasibly finance every social need, it also reflects plans’ confusion about their roles and responsibilities.

A few plans are charting a more formal commitment to leadership. Gateway has built a performance scorecard for all of their staff members’ contributions to the organization’s SDOH goals. Centene has launched an entirely new company, Social Health Bridge. And AHIP itself announced the launch of their new Project Link, to create a research hub for SDOH information.

4. A little less member engagement, a little more Medicare for All?

We couldn’t help but notice that the buzz around member engagement has dropped off quite a bit this year. Discussions about the potential of better connecting with members to drive down costs were much more muted.

It might be that member engagement has proven to be complicated and challenging, and plans are struggling to get meaningful results. It might be that attention is shifting to the high costs of specialty drug and social determinants.

Or it might be that many plans were focused on ‘Medicare for All’, with quite a bit of time devoted to discussions about policy changes that might be coming from DC or the campaign trail, and what that could mean for the role of private insurance.

Regardless of shifting politics, purchasers are raising their expectations and already actively changing their local markets. Plans must keep pace with new mechanisms for radical network cost control and offer an easy-to-use, valuable product for members. We’ll be sharing our latest research on these challenges at our upcoming national meeting—click here to register.


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