Tag: Startups

From Startups to Shocking Bills: The Realities of Navigating Healthcare and Value-Based Care

In the latest episode of the VBCA Podcast, we explore the complexities, frustrations, and sometimes absurd realities of today’s healthcare landscape. This episode isn’t just about theory; it’s a hard-hitting look at the challenges faced by healthcare startups, providers, and even patients themselves—all in the quest for a healthcare system that truly serves people. If you’ve ever questioned the current system or wondered why value-based care (VBC) is so difficult to implement, this episode is a must-listen.

Why Starting a Healthcare Startup is Harder Than It Seems

Starting a healthcare company sounds like a noble mission, especially when focused on value-based care. After all, who wouldn’t want a model that emphasizes quality over quantity? But the reality isn’t as rosy as it sounds. Many startups rush into VBC with dreams of transforming care, only to find themselves facing an uphill battle. The biggest misconception? Thinking that patients will flock to them purely based on reputation or technology.

To succeed, startups need more than just a slick business model—they need real patient engagement. Building connections within communities, establishing referral networks, and fostering partnerships are essential. Without a solid patient base, even the best VBC models fail to achieve the steady patient volume needed for success.

Balancing Volume with Quality in Value-Based Care

For those who do manage to attract a patient base, a new challenge emerges: maintaining high-quality care as patient numbers grow. Healthcare isn’t just about volume; it’s about balancing that volume with consistent quality. If patient care starts slipping, the very foundation of VBC is compromised. Achieving this balance requires disciplined management and a commitment to quality, both of which are essential for healthcare startups looking to stand out in the competitive VBC arena.

Tough Calls in Healthcare Negotiations: Lessons for Providers

The episode also dives into real-world payer negotiations and the tough decisions healthcare leaders face. From the CFO of a mid-sized hospital wrestling with low reimbursement rates to a rural hospital negotiating pay-for-performance contracts, the insights shared shed light on the gritty details of healthcare finance. Here’s a breakdown of key strategies discussed:

  1. Highlighting Value Beyond Quality – When negotiating, healthcare leaders are encouraged to bring in cost efficiency data alongside quality metrics. Sometimes, emphasizing both quality and affordability can be the leverage needed to secure better contracts.
  2. Navigating Unilateral Amendment Clauses – Contracts with clauses that allow payers to unilaterally change terms with short notice can lead to unpredictable financial swings. Leaders are advised to push back, negotiate for mutual amendment clauses, and, if possible, extend the notice period to at least 90 days.
  3. Making Pay-for-Performance Realistic for Rural Providers – For hospitals in resource-limited areas, pay-for-performance models should reflect realistic goals. Negotiating for adjusted quality metrics, phased implementation, and financial support can help rural providers meet targets without compromising care.

Should This Really Be Happening? Healthcare Stories That Make You Question the System

The podcast’s new segment, “Should This Really Be Happening?” delves into outrageous and, frankly, unbelievable healthcare experiences. These stories highlight how far our healthcare system has to go in terms of fairness and functionality. Here are some of the most eye-opening moments:

  • The $18,000 Baby Nap – After a minor scare, a family’s ER visit for their baby turned into an $18,836 bill for a “trauma response fee”—despite no trauma occurring. The fee was eventually waived, but not without a fight. This case underscores the seemingly arbitrary nature of hospital billing, especially in emergency situations.
  • Denied Emergency Treatment for a Non-Emergency – A woman experiencing severe pain, worried it could be appendicitis, ended up with a $12,000 bill when her insurer denied coverage, claiming the situation wasn’t an emergency. This story raises serious concerns about how “emergency” care is determined and how patients are penalized for erring on the side of caution.
  • Life-Saving Treatment Denied as “Unnecessary” – In a shocking denial, a family’s insurance refused to cover emergency epinephrine and steroids for a child’s life-threatening allergic reaction, claiming it wasn’t “medically necessary.” This story exemplifies how flawed insurance decisions can be, even in cases where lives are at stake.
  • Algorithms that Deny Care – Finally, an investigation into Cigna’s automated system reveals that some insurers are using software to deny claims at unprecedented speeds. In this case, an automated system processed and denied 50 claims in just 10 seconds, affecting patients needing essential medications for conditions like asthma and heart disease. This automated denial system raises major ethical questions and illustrates the dangers of letting algorithms override physician input.

Why This Matters

Episodes like this one underscore the urgent need for transparency, reform, and accountability in healthcare. From startup challenges to unfair billing practices and questionable insurer algorithms, it’s clear that significant work is needed to ensure that the healthcare system serves patients first.

The stories shared are a call to action for anyone involved in healthcare, whether as providers, patients, or innovators. They remind us that while value-based care holds promise, the journey is fraught with obstacles. However, by tackling these issues head-on and advocating for fairer practices, we can work toward a system that truly values quality, accessibility, and patient outcomes.

Listen Now: Ready to hear the full stories and gain insights into making healthcare better? Don’t miss this powerful episode of the VBCA podcast.

Digital Therapeutics and Healthcare Reimbursement

Many digital therapeutics (DTx) providers are working to obtain reimbursement from U.S. payers. The following post discusses stategy for reaching patients and partnerships. A reputable DTx company will have a strategy for reaching patients considering whether the therapeutic is curative or designed for chronic care.

  • Digital therapeutics (DTx) represent a novel approach to delivering improved clinical outcomes, but the unstructured nature of today’s DTx access process has presented a major hurdle to broader uptake
  • Payers are still at very different stages in their acceptance of DTx, and in contrast with traditional pharmaceuticals, buy-in from senior leadership will be an essential part of the top-down decision-making process for DTx prioritization
  • Pharmacy benefit managers (PBMs) have taken a leadership role in facilitating a pathway for digital therapeutics adoption, and they are likely to remain the optimal entry point for DTx coverage and reimbursement in the near term
  • Employer groups are likely to be early advocates for the benefits of DTx after running individual pilot programs, whereas managed care organizations (MCOs) may be less receptive to covering DTx until a national body of real-world evidence becomes available
  • Ultimately, payers still have limited willingness to pay for DTx that lack clear impact on plan expenditures, and they will expect to see risk-sharing contracts on the table that can address these uncertainties

PAYER REIMBURSEMENT

More developed DTx companies are coming to discover that payer acceptance and reimbursement is key to market viability and that preparations to engage payer support need to be made in the development stage. Typically, companies partner with pharma companies to leverage traditional insurance reimbursement and distribution pathways, as in the case of Pear Therapeutics benefiting from its partnership with Sandoz. However, are seeking alternative payer reimbursement pathways, looking instead to pharmacy benefit management plans or distributing directly to patients through employers as additional benefit programs.

PHYSICIAN ADOPTION
As the oldest of the DTx have begun to mature, physician adoption is the final hurdle to consumer adoption. There are three major approaches to gaining physician adoption. Pear Therapeutics is using the pharmaceutical model, leveraging pharmaceutical distribution partnerships to make physicians aware of and willing to prescribe the product. Better Therapeutics, which develops a product for insomnia, is partnering with a pharmacy benefit plan that specifically offers a digital dispensary – effectively curating benefit-covered products in a single platform that physicians can use when making therapeutic recommendations. Kaia Health is taking a less traditional approach – the company has been targeting physicians as part of a marketing campaign, but the app is on the App Store and offers three subscription packages for patients.