This episode features an interview with Robert E. Andrews, CEO of Health Transformation Alliance (HTA), where he oversees the strategic direction of 60+ corporations that aim to fix our broken healthcare system. Prior to HTA, Robert served as a Member of the United States House of Representatives for nearly 24 years and was an original author of the Affordable Care Act. In this episode, Kirk and Robert discuss the evolving trends in health care, the potential impacts of gene therapy, and the importance of reducing friction in health benefits administration for employers.
This episode features an interview with Robert E. Andrews, CEO of Health Transformation Alliance (HTA), where he oversees the strategic direction of 60+ corporations that aim to fix our broken healthcare system. Prior to HTA, Robert served as a Member of the United States House of Representatives for nearly 24 years and was an original author of the Affordable Care Act.
In this episode, Kirk and Robert discuss the evolving trends in health care, the potential impacts of gene therapy, and the importance of reducing friction in health benefits administration for employers.
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“ When you have 5 million lives, which we do, and $40 billion worth of spend, we're able to go to behavioral health providers and say, people shouldn't have to wait six weeks to see a psychiatrist when they're feeling anxious or depressed. Why can't they see them in six days or less? And we're able to do that to expand the networks that are available. So that's how we measure our effort. Both in terms of the price that you pay and we think more importantly, the service that you get and the quality of the work that you get. So we're really all about using the leverage of collective bargaining to improve outcomes.” – Robert E. Andrews
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Episode Timestamps:
*(00:58): Reflecting on the Affordable Care Act
*(02:17): Current health care system challenges
*(12:50): Founding of Health Transformation Alliance
*(19:08): Employer challenges and solutions
*(30:43): Future of health care and AI
*(37:53): Global health care perspectives
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Links:
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[00:00:00] Kirk McConnell: Healthcare costs are rising, benefits are confusing, and the system doesn't always work for the people who need it most. But it doesn't have to be that way. Smart employers and their brokers are flipping the script, cutting costs, making things simpler, and creating a health benefits experience their people love.
[00:00:22] Kirk McConnell: Welcome to the Benefits Playbook. I'm Kirk McConnell, and in each episode we uncover the bold strategies that are rewriting the rules of self-funded health benefits. Today I'm really excited to be joined by Rob Andrews, CEO of the Health Transformation Alliance, and a former 10-term US Congressman. Rob, thank you so much for joining us today,
[00:00:42] Rob Andrews: Kirk, it's great to be with you. Thank you for the invitation.
[00:00:45] Kirk McConnell: There's a lot that I want to cover. I wanna talk about the Health Transformation Alliance, some of the things you're really focused on there, some of the things you're excited about in the future, but I think it actually might be useful to start looking backwards a little bit.
[00:00:58] Kirk McConnell: Rob, you were one of the original authors of the Affordable Care Act. I'm curious, 15 years later, looking back, how has it aged? Is it still relevant?
[00:01:08] Rob Andrews: I think it's done a lot of good. I think there's a lot more good left to do. Kirk, I think about the Affordable Care Act in terms of someone who works in a convenience store, 40 hours a week, small convenience store.
[00:01:24] Rob Andrews: Where the employer isn't large enough to have to get healthcare for them and too small to afford healthcare for them before the Affordable Care Act came along, it's very highly likely that that person and her children were uninsured. It meant that, uh, if they got into a car accident or felt really sick and took a trip to the emergency room, not only did they have to worry about the fact that they might be
[00:01:49] Rob Andrews: badly injured or sick, but they had to worry about the fact that a bill would arrive shortly after that ER visit that they couldn't pay. The Affordable Act changed that for about 30 million people, and it gave them the ability to either enroll in Medicaid or to buy an insurance policy with a federal subsidy in what we call the exchange markets, and I think that was long overdue and it's done a lot of good for the country.
[00:02:17] Kirk McConnell: So fast forward now. What are the elements of it that you think are interesting, especially in this current political moment? What do you listen for in the conversation?
[00:02:26] Rob Andrews: What I listen for is three things that worked and one thing that hasn't worked as well as it should. The first thing is, do people have coverage when they go to the emergency room or to the doctor?
[00:02:38] Rob Andrews: Is there some payer that helps 'em pay the bill? And for most people, not all people, that answer is yes. The second thing that I think that you hear is, is the policy that I have or the benefits under the coverage that I have good enough for me? The answer is not always yes, but yes a lot more than it used to be.
[00:03:00] Rob Andrews: Before the Affordable Care Act, we had a situation where if you had a preexisting condition, and really all of us did, you know I had a bout with very minor level of skin cancer in 2007, so I have a preexisting condition. There's people that have had asthma, there's people that have had all kind of other skin diseases or problems that had preexisting conditions.
[00:03:23] Rob Andrews: And of course, Kirk, it used to be that you could either be denied coverage or forced to pay more for it. If you had a preexisting addition that's changed, that's no longer permitted under the law, and that's a good thing. He used to sometimes go to the supermarket. You'd see up on the bulletin board outside of the, where you put your cart away, that there'd be a, a social gathering or a golf tournament for a family that was trying to pay the medical bills for their kid who had leukemia or some other terrible disease.
[00:03:57] Rob Andrews: And that's because it used to be that insurance companies could put either lifetime or annual policy limits on how many claims would be paid. And if someone got into, you know, a couple million dollars worth of claims, they wouldn't be covered anymore. That's changed because of the Affordable Care Act.
[00:04:16] Rob Andrews: It used to be a lot of younger people graduated from college, got their first job, but the first job didn't have health benefits and so they were uninsured. Now, many of them, at that age, I sort of did think that you're impenetrable. You're always gonna be healthy when you're 24, 25 years old. Not always true.
[00:04:36] Rob Andrews: And so now people can stay on their parents' policy until they're 26 years of age or under. So those are good things that have changed. Another good things that changed, and it was one of the, the worst lies about the Affordable Care Act. You may remember people said there were death panels in the law, that some government committee was gonna decide which elderly person could get an operation, which one couldn't.
[00:05:03] Rob Andrews: That was never in the proposal. It's not in the law and it's not true. But here's what is true. If a Medicare recipient, while she or he is healthy, wants to go to a doctor for a consultation about end of life care, whether they want hospice care, whether they want be in the ICU, how they wanna live out their final days, it used to be that one of the people would turn to would be their family doctor.
[00:05:29] Rob Andrews: Someone people trust and respect. If the family doctor had that conversation with the senior citizen before the Affordable Care Act, he or she wouldn't get paid for. They'd have to do that as an act of charity, and many doctors did. Many doctors did. What the Affordable Care Act changed was a provision that said, well, the doctor can bill for that visit the same way he or she would bill for a sprained ankle or the flu.
[00:05:58] Rob Andrews: What has happened since then? Is that many, many people have voluntarily gotten an advanced directive or a living will, and they voluntarily decided that if they're, you know, beyond recovery, that they'd rather live out their days in hospice care rather than in ICU. The result of this has been, in my view, having seen family members go through this, more people dying in a dignified humane setting when they choose to.
[00:06:29] Rob Andrews: They want to be in the ICU till the very last moment. They have that choice as well. What that has done is to reduce the end of life cost of Medicare rather considerably for a lot of people and benefiting the treasury in that way as well. So those are three things I think that really changes for the better.
[00:06:46] Rob Andrews: What didn't change for the better, and it was a conscious trade off at the time. I think the main flaw in our healthcare system, the reason it's so expensive relative to the rest of the world. Is that in this country, doctors, hospitals, therapists generally don't get paid on the basis of how good of a job did you do in keeping people healthy.
[00:07:10] Rob Andrews: They get paid on the basis of how many pills did you dispense, how many visits did you do, how many tests did you run? And that has driven up the cost of healthcare in the United States, well beyond what it ought to be. We didn't fix that, so what we did was to get more people enrolled in a system where the value has not yet taken the place of the number of procedures yet.
[00:07:34] Rob Andrews: That's a very long answer, but I think that we had three achievements and one job left undone.
[00:07:44] Kirk McConnell: You are using some great examples of that person getting their first job or that person kind of thinking about what they want their end of their life to look like. But I think the reality of our healthcare system is so many of the pieces are connected, even if you're not directly touching those programs.
[00:07:59] Kirk McConnell: I'm curious, when you think about things like Medicare reimbursement rates, medicaid expansion, or contraction. What do you think those conversations are doing on the broader healthcare system? Maybe even thinking about local hospitals and facilities and providers, how is that changing the healthcare system writ large?
[00:08:16] Rob Andrews: Um, it's changing it for the worst, Kirk, and it's a really good question that you ask in our healthcare system. The question almost always is not will the person get care? They do. Occasionally people get turned away from emergency rooms or hospitals. It happens. But by and large, anybody who walks into the ER or is wheeled into the ER gets care and the triage nurse and the doctor, the emergency room doctor, and the team doesn't say, oh, you know, this person's in coronary arrest, but they don't have an insurance card.
[00:08:48] Rob Andrews: Let's let them die. It happens rarely, but it usually doesn't happen. There's a, so the question really is not will the person get care, but who's going to pay for it? And every time a person is wheeled in or walks into the emergency room and they don't have some kind of coverage, basically employers and commercial payers pay for it.
[00:09:13] Rob Andrews: And here's why. The hospital provides the care. They have to pay the nurses pay the doctors pay for the tests. So they incur those costs. They don't have the ability to shift that cost back. They can't, first of all, they can't operate at a deficit. You can't spend a billion dollars a year and take in $900 million a year and stay open as a hospital.
[00:09:35] Rob Andrews: So what happens is they have to shift the cost onto some other payer to keep their heads above water. Well, they're not gonna shift the cost into Medicare because it's a huge system that just dictates the price it's going to pay. They really can't shift the cost onto Medicaid for a similar reason, because those are large government programs that
[00:09:57] Rob Andrews: the hospital doesn't negotiate those rates. They just collect them. All that's left there really is the individual who isn't insured or the fully insured person with a insured's policy or the self-insured employer. So every time there is a cut in Medicare or Medicaid, that negatively affects the ability of hospitals or medical practices to take care of people.
[00:10:23] Rob Andrews: Somebody pays for it. And again, usually the somebody is an employer or an insurer or an individual who pays out of their own pocket.
[00:10:32] Kirk McConnell: You know, so often we think about the taxpayer paying the bill of these programs. But you make a really interesting point that in a lot of ways, even these are not programs geared at employer insurance.
[00:10:43] Kirk McConnell: The commercial market is increasingly bearing the cost of those programs. Do you think that's well understood within the employer space?
[00:10:50] Rob Andrews: I don't think it's well understood, and I think it needs to be better understood that this idea that you can save money in healthcare by reducing what public programs spend to help people just isn't true.
[00:11:05] Rob Andrews: Now, you can save money in public programs if the money spent in a way that keeps people healthier. So I, I truly believe, I think the data support this too. That if Medicare were more focused on prevention. Here's an example that I've heard recently. A lot of people have a cholesterol problem in the country.
[00:11:29] Rob Andrews: Millions, tens of millions of people have a cholesterol problem. But when the Center for Disease Control looked at this issue maybe seven years ago now, they found that about six out of every 10 Americans who should be getting some help for their cholesterol weren't, and many of those are Medicare recipients.
[00:11:47] Rob Andrews: Well, you know, by and large, the drug class called statins has been highly effective at regulating cholesterol and reducing heart attacks and strokes. You know, maybe Medicare should give free statins to every Medicare recipient who's clinically eligible for them. Give it away because what that would do, I think, is to reduce the number of strokes and heart attacks that happen.
[00:12:13] Rob Andrews: And if for every thousand statin pills you gave away, you might avoid 10 days worth of ICU care for a stroke or heart attack thing. So that to me would be an example of how you could reduce what government programs spend, but by improving health outcomes, not by denying care for people or charging more for.
[00:12:33] Kirk McConnell: Let's segue that into your work with the Health Transformation Alliance, because I think that really is another great case where you have employers who their job was hard enough already, but now to bridge to our last conversation, they might be bearing more and more of the cost of the healthcare system and some of these programs change.
[00:12:50] Kirk McConnell: What was the original founding idea behind the Health Transformation Alliance?
[00:12:55] Rob Andrews: Four of our founders, HR leaders at American Express and Macy's and Verizon and Caterpillar got together and said, look, we're the biggest bill payer next to Medicare in the system, but our voices really aren't heard. Our concerns are really not seen in a way that they ought to be.
[00:13:17] Rob Andrews: You know, there was a view that sometimes carriers advocated for employers, but sometimes not. And sometimes pharmacy benefit managers advocated for employers, but sometimes not. And rather than outsource the question of, well, what do we wanna see in healthcare, employers decided to take matters into their own hands.
[00:13:38] Rob Andrews: Not in the halls of Congress or in the state legislatures, but in the marketplace. In the marketplace. So the HTA was really formed by those four companies. I was fortunate enough to be. I asked to help out with that at the very, very beginning. I'm blessed that I was given that opportunity. Since then, we've grown into about 75 companies that spend $40 billion a year or so in the US healthcare market.
[00:14:06] Rob Andrews: What we've tried to do is to identify high value care and try to steer as many dollars of that $40 billion toward that high value care. So what it really does, Kirk, is to put it in terms of an example, if we find a, an endocrinology practice that's really good at helping people manage their A1C and keep their BMI down and manage their diabetes well, we try to identify that provider and steer more people toward that provider so that there are fewer strokes, fewer heart attacks, fewer amputations, fewer sick people, more people feel better, and they cost less to take care of that way.
[00:14:50] Rob Andrews: That's the idea is to use our data and our dollars in the marketplace to try to create a system, or at least stimulate the creation of a system where providers who do a great job are richly rewarded for that. And candidly, providers who don't do such a great job have to up their game in order to keep getting market share.
[00:15:13] Kirk McConnell: In a lot of ways that seems like such a simple premise, but the delivery and execution of that, I think is where the magic happens. What are some of the programs or the approaches that get you excited within HTA?
[00:15:26] Rob Andrews: One is, um, we have a program with the City of Hope Cancer Center called Access Hope.
[00:15:32] Rob Andrews: We're not the only ones in it. A lot, a lot of people serve by it, but the way that works, if a person who's in rural Kentucky, I. Gets diagnosed with a form of cancer that her doctor's never really seen before. Her local doctor, she has the ability to have her doctor interact with a care team at City of Oak Cancer Center of caregivers who maybe spent their whole careers on that kind of cancer.
[00:16:00] Rob Andrews: She doesn't have to get on an airplane and fly to Los Angeles. This can be done virtually. She doesn't have to leave her village in Kentucky, her town in Kentucky. But the same care that a head of a foreign head of state would get if they came to the United States. She gets, and you know, we're in a situation where sadly, about 30% of original cancer diagnoses are incorrect.
[00:16:27] Rob Andrews: Sometimes they're incorrect because the person has cancer and the doctors miss it. Sometimes they're incorrect because the person doesn't have cancer and the doctors think they do. More often than not, though, it's because the doctors don't correctly identify exactly the form of cancer that the person has.
[00:16:47] Rob Andrews: And I, I'm an amateur at this, thank God, but I, I know enough about this to know that the chemotherapy regime is becoming more and more personalized and more and more targeted. It's why cancer? You know, people keep asking you for a cure for cancer. It's happening before our very eyes, week by week, month by month.
[00:17:07] Rob Andrews: And one of the reasons that it is, is because there's so much more known about the cytology of certain tumors and how you treat them well. Having someone who understands that cytology be able to be on a screen like this one with your community doctor saves people's lives. And that's the kind of thing that we've been able to do at the HTA that excites us.
[00:17:31] Rob Andrews: Another example, you know, again, when you have 5 million lives, which we do, and $40 billion worth of spend, we're able to go to behavioral health providers and say, people shouldn't have to wait six weeks to see a psychiatrist when they're feeling anxious or depressed. Why can't they see them in six days or less?
[00:17:53] Rob Andrews: And we're able to do that to expand the networks that are available. And I don't know this for a fact, Kirk, but I, I'd like to think that there's some people who didn't attempt suicide or didn't have a desperate episode owing to a mental health condition, behavioral health condition, because they got seen by someone sooner.
[00:18:13] Rob Andrews: So that's how we measure our effort. The more that happens, the better we think we do, and the better we do, the more we can do. You know, growth is important to us that like anything else, if you buy a hundred cases of water, you get less attention to somebody who buys a thousand cases of water. Both in terms of the price that you pay, and we think more importantly, the service that you get and the quality of the work that you get.
[00:18:41] Rob Andrews: So we're really all about using the leverage of collective bargaining to improve outcomes.
[00:18:50] Kirk McConnell: When you talk to employers, I think those ideas that you just mentioned are so interesting. Access, hope, behavioral health, but sometimes it feels like a privilege to get to think about those interesting ideas.
[00:19:01] Kirk McConnell: That's almost their night job because their day job is choosing a carrier, choosing a PBM, choosing a plan design. How do you walk your employers through kind of what that foundation should be so that there's less day job and more time on the fun stuff.
[00:19:16] Rob Andrews: We let them walk us through what their day is like and we understand we're at our best when we are friction reducers for health benefits professionals.
[00:19:25] Rob Andrews: We're at our worst when we're, when we add friction. So an awful lot of what we're about. The reason we're a co-op that's owned by employers, so our member companies, Comcast and Intel and JP Morgan, and Coca-Cola, Marriott, they're not our customers. They're our owners. They sit on our board. They tell us the team what it is that they want done and what we should do.
[00:19:53] Rob Andrews: And the reason we chose that form of business is exactly what your question, Kirk, implies. I have no idea what it's like to run a health plan that serves 30 or 40,000 people, but I know enough to know that. If 300 of 'em don't get their card honored today at a doctor's presence, that's a big problem.
[00:20:15] Rob Andrews: If 30 of 'em don't get their bill paid because of some administrative snafu, that's a big problem. If they're supposed to see an oncologist for a specialist follow up and there's some hassle about the referral or the network coverage, that's a big problem. So what we try to understand is that are there ways
[00:20:37] Rob Andrews: that friction can be reduced and just likely negotiate for better pricing and better outcomes. We also negotiate for simplicity and friction reduction, and these sound like they're very much in the weeds, but is there a dedicated team at the call center to answer that employer's questions or not? When someone calls the call center and speaks Vietnamese, can someone communicate with them or not?
[00:21:06] Rob Andrews: Uh, when someone doesn't have transportation, when they don't own a car or don't live in near public transit, is there someone there that can help them with an ambulance or an Uber or something that gets 'em to the next visit or not? So before we get to the kind of stories that I told you about cancer care or behavioral health, we live in that world.
[00:21:28] Rob Andrews: What can be done in a way that delivers better care, but reduces friction for the benefit lead? Who is responsible for running that program, and we have great respect for those women and men who do that.
[00:21:42] Kirk McConnell: When we think about that foundational, what I might call that friction layer, what trends are you seeing across your membership and the folks that are saying, I'm gonna go all in, carved in through a carrier.
[00:21:52] Kirk McConnell: I'm gonna use a carrier, but bolt on solutions, move more to a TPA model. Where is it and where? Where do you think it should go?
[00:21:59] Rob Andrews: You know the space well, Kirk, by asking that question, we think there are three tribes, if you will, of self-insured employers on this question. One is the carrier tribe. It's the biggest one.
[00:22:11] Rob Andrews: And candidly, for reasons of friction reduction and whatnot, they're not interested in switching or carving out or bolting on. They want to optimize the performance of their carrier. They're looking for an ally, an advocate, who will get some of the things done that I just rattled off, like the language capability at the call center or help with transportation, and that is most employers in this space.
[00:22:38] Rob Andrews: There's another group that is willing able, sometimes required to carve out services or bolt on. So they might carve out the specialty drug spend that runs through the carrier, or they might bolt on a behavioral health network on top of what the carrier offers for the reasons we talked about earlier.
[00:22:59] Rob Andrews: There's a third group that has reached the conclusion that they don't want to carry. They want a third party administrator. And they believe that they can achieve better results and better economics, and frankly, they very often do. What we try to do at the HTA is not to preach, but to facilitate. We acknowledge the sovereignty of each member over their own health plan.
[00:23:24] Rob Andrews: We don't second guess anyone's strategy. We try to be sure that we have solutions that fit all three of those strategies. Candidly, I think the evidence shows pretty well. When you have a TPA that is not beholden to the Medicare advantage and fully insured objectives of a carrier, they get better economics.
[00:23:46] Rob Andrews: We've seen it. There are challenges with TPAs as to whether they're gonna deliver the kind of customer service that we talked about. I think many do. I think some don't. And you know, I, I think it, it is incumbent upon the more successful players in the space and you work with one of them, Collective, to show what they can do.
[00:24:08] Rob Andrews: Because our experience with groups like Collective is that yeah, they are capable of reducing friction and they are capable of delivering better financial results. But what we do not do, Ker, is to say to the women and men who run the healthcare programs, well this is what you have to do. I wouldn't want someone telling me that about my job, and they certainly don't want it about theirs.
[00:24:32] Rob Andrews: So we try to educate, facilitate. Support on that question of education.
[00:24:36] Kirk McConnell: TPA is a loaded three letters when people have a positive association with TPAs. What do you think is resonating, and for folks that aren't excited or apprehensive to move to A TPA, what do you think is holding them back?
[00:24:54] Rob Andrews: There's two things that I think resonate.
[00:24:55] Rob Andrews: The first is I was surprised I'm getting fewer calls from my employees that they're unhappy about something. Not more, not the same. I'm actually getting fewer that my employees feel like there are resources and skilled care team people, navigators, whatnot, are helping them. And I'm getting fewer complaints, not more.
[00:25:18] Rob Andrews: That's a huge deal if you can deliver that. That to me is the holy grail. And then the economics, it certainly resonates. We've had members whose claim spend, not their ASO fee spend, but the claim spend. Is 11, 12, 15% lower than it was with a carrot, which is serious money, but it's Kirk, it's in that order.
[00:25:42] Rob Andrews: If you say to the consensus of benefit leads, we can save you 11 or 12% on your claim spend. The first question they really ask is, what kind of experience is this gonna mean for the plan member who's in the plan? Because the number one thing I think is on the minds of. Health benefit leads and should be is recruiting and retaining great people to work for their company.
[00:26:08] Rob Andrews: If health benefits are seen as a pain in the neck, as a burden, not good for recruitment and retention, if they're seen as a special thing that they're really good here, you know, you want that employee to be out there saying, I'm so glad that I work here at exco. Because when my child got sick, they took really good care of him.
[00:26:32] Rob Andrews: That's what you want to hear. So when TPAs talk to Health Benefit leads, the very first thing I think that needs to be said is we take better care of your people than what you're getting right now. You will have fewer complaints, you'll have more people who feel like they're being listened to and respected.
[00:26:51] Rob Andrews: And if you wanna look at the economic results, here they are. Because you do get that kind of save. My prediction to you is that the TPA slice of the market, which is probably 10 to 15% of the self-insured lies right now, I think will grow because I think that the economics are compelling and when TPAs figure out how to be better at consumer service, not just as good but better, I think that's the path to growing that market share.
[00:27:23] Kirk McConnell: I'm curious, as you think about your membership, some of the leading employers out there, what advice would you have for other benefit leaders who find themselves caught in this maelstrom of all these forces in healthcare, how do you advocate for the employer needs where carriers have multiple interests, public programs, and multiple local hospitals? How do you advocate for yourself?
[00:27:46] Rob Andrews: All are better than one. Combining is better than isolation. And I guess what I would say to a, a benefit lead is that you're probably really worried about six week waiting times for someone to see a psychologist or a psychologist or a 15% increase year over year on your specialty drugs bought through your carrier.
[00:28:07] Rob Andrews: Well, so are some of your brothers and sisters. You're not alone. The HTA aspires to be a place where you and your colleague, brothers and sisters can talk freely about how you feel about these issues. And then we do something about, and that what we try to do is when our members say, yeah, the specialty drug cost explosion is a huge problem for me.
[00:28:32] Rob Andrews: Well, we offer solutions. We have a carve out where a member can carve out from their PBM or their carrier or both and obtain specialty drugs from a different kind of entity. Most members choose not to do that, but we have that as an option for those that want to.
[00:28:48] Kirk McConnell: What are the characteristics or parameters of someone who might be a good member for HTA?
[00:28:54] Rob Andrews: We, we don't, we're not selective in that we, we think everybody could be a good member. But we, we do think this, you have to be willing to look at the data and take it where it leads you. Or better yet, you have to work in an organization where if the data lead you away from where you are now, you'll get support.
[00:29:14] Rob Andrews: From total rewards from the CHRO, from the CFO on up the chain. I think a lot of health benefit leads feel like they're in a catch 22, that they're somehow held accountable for improving health outcomes and saving money, and therefore increasing recruitment and retention. But they're not necessarily given the tools as to how to do that.
[00:29:41] Rob Andrews: So you've gotta put out this forest fire, but you have a garden hose. Our most successful members are the ones who are willing to look at where the data would take them in making a change, and then they have support from the corporate structure to make that change. So they feel empowered by that, not for nothing that our members who take the greatest advantage of the solutions that we offer.
[00:30:05] Rob Andrews: So we sort of measure each company against how many solutions they use. Those that use the most solutions have a total cost of care that's about 20% less than the market. And they, more importantly to us, they have hospital readmission rates that are much lower than the market and avoidable hospitalizations rates that are better than the market.
[00:30:27] Rob Andrews: So better outcomes, lower costs, and, but there's risk. I mean, your, your question was perfectly framed earlier. How do we lead them down this path? We don't. We let them lead us down the path they want go to and try to be as supportive of them as we can.
[00:30:43] Kirk McConnell: Where do you think that path is leading in the next few years?
[00:30:46] Kirk McConnell: Where's the puck going? What are the topics that you think are gonna be most top of mind?
[00:30:50] Rob Andrews: I've heard for years that exploding healthcare costs for employers is unsustainable. I don't think that's true. If they were truly unsustainable, why wouldn't there be significant? Major change in the system. What I think is true is that there is a tidal wave of new costs coming to the system in the form of genetic medicine, gene therapy.
[00:31:20] Rob Andrews: But right now, gene therapy deals largely with exotic and rare diseases, sickle cell anemia, some very unusual muscular or developmental diseases for babies and children. But there is all kinda research now going on for cholesterol and behavioral health and much more common conditions when that gene therapy wave tsunami hits the system.
[00:31:49] Rob Andrews: That is what I believe will force a structural change in the healthcare market. That's where I think we're going, and I foresee a future where there's a two tier plan in this way. There is a fully insured entity that bears the risk of taking care of people who are high cost claimants who need these gene therapies, and then there is a self-insured entity, or like the employer who is responsible for those who are not HighCo claimants.
[00:32:21] Rob Andrews: So imagine a world where the stop-loss kicks in at like $5,000 instead of $2 million. That's the world I think we're headed to. What I find attractive about that is that a risk bearing, fully insured entity has a tremendous incentive to achieve a better result. 'cause that's how they make their margin.
[00:32:46] Rob Andrews: And I think that we're headed for something that looks like that over the next five to 10 years.
[00:32:50] Kirk McConnell: You know, it's interesting you hear. People worry that gene therapies are gonna push healthcare to 30% of GDP. You also hear people say, hold on. AI is gonna take it down to 10% of GDP because of how differently care will be delivered.
[00:33:05] Kirk McConnell: What are you excited about or curious?
[00:33:08] Rob Andrews: I'm an optimist in the following way. Science and diagnosis is really about sorting. So a scientist who is looking for the right gene profile for someone who's likely to get liver failure. Basically starts out with a hypothesis and then eliminates different cases in that hypothesis.
[00:33:29] Rob Andrews: So you've had scientists have worked for four decades on eliminating hypotheses and say, Nope, it's not this sequence that causes it. Let's try the next one. What might take humans 40 years to do using the tools of the last couple decades? Might take 40 days with generative ai. Generative AI is a supercharged sorting tool among many other things.
[00:33:54] Rob Andrews: So I think what's gonna happen is that generative AI platforms will absorb mountains of data that have been compiled over centuries, not just decades, but have the ability to sort through that and said, no, it looks like here's the top 10 possibilities that would explain a genetic tendency toward late stage renal failure.
[00:34:18] Rob Andrews: And then you go test those 10. So I think what this is gonna do is dramatically trunking the time and cost of finding what works. So the faster you find it and the better you find it, I think that brings cost for the system down, not up.
[00:34:34] Kirk McConnell: Let's wrap up by thinking about that future. You mentioned a couple things to be nervous about and a couple things to be optimistic about.
[00:34:41] Kirk McConnell: Let's go 10, 15 years down the line. What makes you a pessimist about our healthcare system? What makes you an optimist?
[00:34:49] Rob Andrews: I'm pessimistic because it will take some shock, whether it is a price shock or a health crisis shock. To change the fundamental system in the way it has to be changed, which is providers should be rewarded for great outcomes.
[00:35:07] Rob Andrews: They should be penalized for bad outcomes. You would've thought that maybe the pandemic would've done that. It didn't. I'm concerned that there won't be a financial shock and we'll sort of muddle along. The reason that concerns me is it is not news that a woman of color who lives in a low income neighborhood is a greater risk to have a preterm baby than a woman who's wealthier.
[00:35:33] Rob Andrews: And, you know, in, in better circumstances in life. It's not news at all, but it keeps happening every day. Every, you know, as we are recording this, there are no doubt babies being born at week 32 who didn't get proper, whose moms didn't get proper care. And these chi, these children will survive. They'll be born at two or three pounds.
[00:35:55] Rob Andrews: They'll be developmentally delayed in some cases for their whole lives. We know this is happening. The reason we're not fixing it. Is that really the present system doesn't reward someone for fixing. That's what we have to change. And so I'm concerned that that won't happen. There won't be that kind of fundamental change in the structure of who gets paid to do what in the system.
[00:36:17] Rob Andrews: The other thing I worry about, and it's a bit contradictory, I do think that AI has the chance to accelerate solutions to the problems like we just talked about, preterm birth. But I also worry that AI will be used on the cheap. It'll be used to substitute algorithms for human judgment. That's a bad idea.
[00:36:38] Rob Andrews: It'll be used to jeopardize the privacy of people in their own health records. That's a bad idea. The good idea of generative AI is to take smart people and make them even smarter and more effective because you give them this tremendous tool to use. I come down to ultimately Kirk, on the optimistic side, I think that.
[00:36:57] Rob Andrews: People will live longer and be healthier 20 years from now than they are today. I had a grandson born on May 5th of this year. I wouldn't be shocked if he could live to be 200 years old. I'd like to be at his 200th birthday party. That's unlikely, but I think that could happen. My concern is not so much him, it's very much him, but it's that a schoolmate of his who might have been born in.
[00:37:24] Rob Andrews: A rural village in South Dakota or Kentucky or in East LA will not get the same kind of care that he's getting and will have a totally predictable outcome of asthma or, you know, some developmental disability because of not being properly nourished as an, this is not news and we can fix it, but until we have a system
[00:37:48] Rob Andrews: where providers get rewarded for great outcomes, we won't be fixing it the way we should.
[00:37:53] Kirk McConnell: That question is so interesting about the two grandsons that could have different trajectories, and I'm curious. I don't think that's a nationwide problem alone, global problem, global, but even more micro. I would have to imagine a lot of the members within HTA have that dynamic within their workforces as well.
[00:38:14] Rob Andrews: They do. Marriott has hotels in virtually every country in the world. Coca-Cola sells soda in every country in the world. American Express, one way or another, does banking in every country in the world. And if we learned anything from the pandemic, is that the delusion that Oh, COVID is some weird disease out of a Chinese fish market?
[00:38:38] Rob Andrews: It doesn't affect me. Oh really? And so yeah, a world where, what? 60 to 65% of people live way, way, way, way, way below the accepted poverty line in the industrialized world is a tinderbox waiting to catch on fire, a world where there is clean water and where there are vaccinations and medicines available that help people live better and become workers and consumers and students and investors,
[00:39:13] Rob Andrews: is a world that will be safer and more prosperous. So you're absolutely right. The trajectory of my grandson and the little boy born in East LA are not just about the United States. There's a little girl being born in Ghana or a little boy in Nicaragua that we need to be worried about as well, and.
[00:39:32] Rob Andrews: That's just from, not only from the perspective of public policy, but from the perspective of somebody who sells hotel rooms or soda or credit cards all over the world as well.
[00:39:42] Kirk McConnell: I think one of the takeaways from this conversation is how interconnected, not only the healthcare system is within the US but all these forces nationwide, and whether they ask for that responsibility or not, the benefits leader is in the middle trying to navigate all those things.
[00:39:56] Rob Andrews: Yeah, they, they are, and, and again, can't say this enough. There are thousands of doctor visits taking place today under that Benefit Leader's umbrella, and if five of them go wrong, she's gonna hear about it. So, I mean, they have a massively difficult job in just getting the system to work the way it should.
[00:40:16] Rob Andrews: It is a luxury to be thinking about bigger order problems. Again, that's why we think that the formula is, let's reduce friction, let's get better outcomes. Which means more people wanna work there and stay there, which then clear space in the budget and in the mind share to think about, well, what can we do about preterm births for our employees?
[00:40:42] Rob Andrews: What should we do that's better? That will make sure that that baby's born after full term and his or her chances of normalcy and good health from day one? And the mom's chances are that much higher. It's everybody's job to contribute to that in one way or another. We're trying to do in the HTA is to compliment the efforts of public policy makers, great thinkers, and those running the practical side of health plans every day to be part of doing that job well.
[00:41:12] Kirk McConnell: Well, it sounds like the HTA is the center of so many interesting conversations right now across your membership. As we wrap up, if someone wants to learn more about joining the HTA, how can they do that?
[00:41:25] Rob Andrews: Everyone's welcome in the HTA. Typically, our members are about 2,500 employees and up. But everyone's welcome.
[00:41:33] Rob Andrews: We're on the web, htahealth.com. We welcome all comers and we do so not because we believe we have some corner on great ideas or the truth. We welcome all comers 'cause we believe that others do. And we've had the degree of success we've been fortunate to achieve because we've learned from our members.
[00:41:53] Rob Andrews: So there's always more to learn. There's always more to say and we would welcome anybody who would like to be a part of that.
[00:41:59] Kirk McConnell: Well, Rob, I want to end on that note. Thank you so much for the conversation. Now get back to your grandson as on his path to 200.
[00:42:06] Rob Andrews: Kirk, this was a great pleasure. Thank you for the opportunity.
[00:42:08] Kirk McConnell: Thank you very much, Rob.
[00:42:10] Producer: This podcast is brought to you by Collective Health, a health benefits solution that guides employees toward healthier lives and companies toward healthier bottom line. Check us out at collectivehealth.com.