Brian Klepper
Published 06/27/2024 in the Healthcare Administrators Association Newsletter
Nearly every healthcare company promotes itself as a game-changer, but of course few are. Over the past decade, I have focused on identifying and vetting “high-performing” healthcare organizations. I mean this term to refer to firms that consistently deliver measurably better health outcomes and/or lower costs than conventional approaches, particularly in high-value niches – e.g., management of chronic disease, musculoskeletal conditions, cancer and other complex diseases, maternity, drug spending) – areas that comprise healthcare’s greatest costs.
The self-funded health plan market demands that new products and services deliver strong quality and cost results, and solve longstanding problems within their niches. But they must also be straightforward for employers to understand and implement.
A simple and powerful example is Guardant Health’s blood-based screen for colorectal cancer (CRC), Shield, which the FDA’s Advisory Panel . CRC is the 2nd leading cause of cancer deaths, but fortunately, the chances of surviving the disease rise significantly with early detection. Ninety percent of patients diagnosed in the early stages of CRC survive, while 14 percent survive if diagnosed in the late stages. 60% of CRC deaths could be saved by early detection, and the costs of care in these cases are a fraction of late-stage treatments.
The trick is getting people screened. About one-third of adults between 50 and 75 years old are not screened. Many are frightened or repulsed by the intrusiveness of a colonoscopy, or disgusted by screens that require them to handle stools. Shield requires a simple blood draw – most adults have become accustomed to these – and the sample is then tested for circulating DNA fragments that may have broken off from a tumor. The screening can be easily handled at local pharmacies, employer screening events, worksite clinics or primary care offices. Compliance rates for Shield’s approach are typically above 90 percent, closing most of the CRC screening gap.
Other innovations are valuable because they fill empty niches. Pharmacogenetic (PGx) testing develops a profile of an individual’s genome that tells which drugs that person can and cannot metabolize. Having this information lets a doctor avoid prescribing a drug that can’t work for the patient or, worse, prescribing a drug that may cause an adverse (and sometimes fatal) event. This is a powerful 15-year-old technology that has won only very modest integration into US clinical environments.
An innovative laboratory, Blue Genes, developed an inexpensive technology that makes a patient’s genomic profile immediately available and actionable to physicians, pharmacists, health systems, health plans, and pharmacy benefits managers. So now, when a physician prescribes a medication, an alert may immediately pop onto her screen, saying this patient can’t respond to this drug and an alternative is needed.
The impacts of a better approach can be tremendous. A 2022 study of 30,000 retired Kentucky school district employees on Medicare Advantage plans compared 5,000 patients with PGx profiles to 25,000 unprofiled patients. Total healthcare cost of the PGx group averaged $2,625 less per enrollee per year than the group that didn’t have the PGx profile. Generalizing these results to the Medicare population suggests that America’s Medicare spend would drop by a staggering $171 billion per year if all Medicare patients had a PGx profile.
Blue Genes did not develop a better PGx test, but developed an approach that made the information more readily available and pragmatically useful to patients, clinicians and purchasers. That’s the innovation in this case.
Often, transformative innovations are complex and marvels of ingenuity. This is true of artificial intelligence tools that, for example, allow more effective management of chronic diseases that consume 75 percent of total health care spend. Another is Sera Prognostics’ protein-based blood test that accurately identifies 88 percent of babies who will be born pre-term. In these cases, maternal and fetal medicine physicians can work to extend the gestational period, which can yield profound improvements in both the quality and cost of an individual’s life for his/her entire lifetime.
The healthcare marketplace is teeming with easily-implemented innovations that can dramatically improve the quality of care and lower overall healthcare spending. Health plan benefits advisors and benefits managers are besieged by vendors claiming to have the next greatest thing. So far, few organizations have emerged that rigorously assess the value of new offerings. Spotting the ones worth considering is currently a matter of determining how a new offering is different than others in the same space, and how that difference allows it to general consistently better results than conventional approaches.Brian Klepper, PhD is a healthcare analyst focused on value and high performance