The industry in which most of us have spent our careers has centered around two primary groups serving as “gate keepers” of healthcare: commercial carriers and government. To say they have failed us would be a huge understatement.
At our recent Q4Live conference, Jeff Bernhard, president of Continental Benefits, conceded, “It’s no one carrier’s fault.”
Which, of course, it true. However, in my perspective, they are complicit (collectively and, in most cases, individually) in exploiting the market dynamics that has been brought on the industry, largely by the ACA. It is that collective exploitation that has resulted in our healthcare system reaching a breaking point. Something has to change.
There is no doubt, commercial carriers and government programs have created and exacerbated the problem. However, the solution isn’t to merely undo what they have done nearly as much as it is to avoid the problems they create in their roles as “gate keepers”.
It seems to me, tomorrow’s advisors are going to be, at the very least, distancing themselves from medical carriers. Some may avoid working with them entirely. In fact, I predict that, if carriers are going to survive, they will have to DRAMATICALLY alter the ways in which they operate. Today’s carriers will be unrecognizable in a relatively short period of time.
We’ve had the answers all along
At the same event, Dave Chase observed, “The answers to healthcare won’t come from Washington, D.C., they’ll come from you and me.”
Until recently, it may have been very difficult to imagine where solutions would come from if they didn’t include commercial carriers and/or government intervention. But, if you’ve been paying attention online at all, they have been hiding in plain sight.
In a recent post, I shared examples of existing solutions from Chase’s book “The CEO’s Guide to Restoring the American Dream.” Examples include a school district paying $4.6k per member per year vs. the state average of $8.8k. And companies saving literally millions in healthcare costs by changing their approach.
If you haven’t already, I recommend reading Chase’s book to better understand just how these solutions are being implemented. What you will find is that the solutions are very common sense, have already been proven, and don't depend on the politicians to "give permission."
It’s all (well, mostly) about transparency
Not to be overly simplistic, but a majority of the solutions center around transparency of what care does/should cost, transparency of the quality of the provider (expected outcomes), and direct contracting with providers of care. In many ways, it is about avoiding the carrier’s and government’s interference and (re)connecting you with your healthcare providers.
There is no way I can get into any of the details of these solutions here (read Chase’s book), but let me use one example of Direct Primary Care (DPC) to explain how your willingness to collaborate locally will determine the speed and extent to which these solutions can scale.
We need a new gate keeper
As Alex Lickerman, MD explained at our conference, the path to healthcare for most of us should lead through a primary care physician.
However, the typical fee-for-service physician has had to grow his/her practice to 2,500 – 4,000 patients, reducing the time spent with those patients to an average of 15 minutes. This is the result of the increased workload and the ridiculous amount of accompanying paperwork imposed on their practices by carriers and government regulations.
In contrast, direct primary care physicians, like Dr. Lickerman, may limit themselves to 600 patients and create a completely different experience. Patients pay a monthly fee, typically between $60 - $180, eliminating the time the physician’s practice spends with insurance carrier paperwork. Because of this significant change, Dr. Lickerman explained that his intake consultation with a new patient is 2 hours and subsequent appointments are closer to an hour.
Not only does a DPC better understand their patient, they are in position to properly coordinate any other care a patient might need, cutting down on unnecessary care, medications, and expense.
So, all we have to do is go out and sign up with a DPC physician, right?! Not so fast.
As obvious as this part of the solution is, there is a significant challenge in bringing this solution to your clients. For one, there simply aren’t enough DPC practices.
This is where you enter the picture
More specifically, this is where your willingness to collaborate locally becomes a factor. I think this is part of what Chase meant when he said, the solutions “will come from you and me.”
The healthcare solutions you are reading about online every day that are becoming familiar and obvious to you haven’t made it on the radar screen of your prospects and clients. Until there is critical demand from said prospects and clients, there will be a limited supply of DPC providers.
The basic laws of economics are at work
In order for you to have the ability (access to supply) to execute on these new ideas in your local market, you need to help create a critical mass of demand. To get to that level in a timely manner, you need the help of other like-minded advisors in your market.
Yes, you need to collaborate locally.
I don’t care who you are reading this, you do not have enough hours in the day or dollars in the bank to educate your entire market of prospects/clients as to why they need to embrace DPC as part of their benefit program. At least not in a timely enough manner.
However, when you collaborate with other like-minded advisors, add in the hours in their day and the dollars in their bank account, you can now get the attention of a critical mass of employers.
Your collaborated marketing/educational effort will help them to understand how DPC can help lower their costs. With a critical mass of understanding, your market will soon have a critical mass of demand. With a critical mass of demand, your market will soon have a critical mass of supply.
To paraphrase from Field of Dreams, “If you help build the demand, the medical practices will come.”
Larger percentage of a larger pie
I have worked in this industry long enough to know that I likely just lost many of you with this idea of local collaboration. Despite advisors’ willingness and desire to collaborate with other advisors from outside their markets, they are equally determined to avoid sharing ideas with their local competitors.
Get over it.
Especially when you know most of your local competitors won’t. They will remain hell bent on working in isolation.
And, when you do get over it, recognize that you and your cohort will still be a relatively small minority. Many brokers are coasting to retirement. Others are with brokerages who feel they have it all figured out. Still others have blinders on and will keep it that way. And, being completely honest, many just don’t have what this new game requires.
Which leaves a very small percentage of potential collaborators. A small percentage of collaborators who will be writing a significantly larger percentage of the business in your market.
The pain of the status quo has become greater than the pain of change
We all know Einstein’s classic definition of insanity, “Doing the same thing over and over and expecting different results.” My version of that definition is doing the same thing over and over and expecting the SAME results.
I am sure you have achieved your current level of success largely through an intense competitive spirit. It’s mostly been you against everyone else in your market. I get that. I actually admire that attitude.
But recognize how quickly our industry is changing. Your clients are going to depend on you to bring them creative new ideas. They will depend on you to be the drivers of demand and, in turn, supply. They are going to depend on you and your willingness to collaborate locally.
Yes, change is inevitable, you will either be its victim or its creator.
While the pace of change is faster than it's ever been before, it's also slower than it will ever be again.
Let's tap into a level of creativity only possible through collaboration. Seems to me, we can either choose to work alone and lose as an industry or we can commit to work together and win together.
The choice seems pretty obvious doesn't it?
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