With 1 out of every 3 U.S. health care dollars emanating from Washington, the federal government is the single largest payer of health services in the United States and accounts for nearly half of all national health spending. As our country ages, these forces are accelerating, with Medicare spending alone projected to increase by 7.5% annually through 2031. Healthcare companies that depend on government revenue – or are downstream from it – must begin to view policymakers as among their most important customers. Impactful organizations that will succeed in the new era of value-based care will learn how to leverage the unparalleled value of internal advocacy.  By creating extraordinarily powerful messaging for policymakers to understand what is needed for value-based innovation, we exercise our right to form a more perfect union.  While healthcare will never be perfect, we must still strive for perfection – that is at the heart of value-based care transformation in our country!

On the Race to Value this week, we interview Andrew Schwab – a value-based care leader, an intentional strategist, and a master of Washington’s internal game.  He brings a bold, brash, no-holds-barred approach to government affairs by coaching and mentoring forward-thinking organizations ready to invest in their internal policy teams so they can thrive in a new era of value-based care.  Prior to establishing his own firm, Platform Government Strategies, Andrew advocated in-house on behalf of both nonprofits and private sector organizations. Most recently, Andrew established Oak Street Health’s first government affairs function that put them at the center of the national value-based care conversation and contributed to their recent acquisition by CVS Health.

Episode Bookmarks:

01:30 The federal government is the single largest payer of health services and accounts for nearly half of all national health spending.

02:00 Healthcare companies that depend on government revenue must begin to viewpolicymakers as among their most important customers.

02:30 Introduction to Andrew Schwab and his public affairs consulting firm, Platform Government Strategies.

05:30 The glacial pace of the value-based care movement.  Is there truly bipartisan consensus on the aims of health value?

07:00 2030 Medicare VBC Goal (“The government is putting its thumb on the scale for value-based care.”)

08:15 The 1^st Amendment right to petition government for redress of grievances (“Advocacy and lobbying are quintessentially American.”)

09:00 “Elected officials and appointed regulators in Washington D.C. and in state capitals react to a different set of incentives.”

10:00 Explosive growth of the Medicare Advantage program.

11:00 Consumer-centric innovation and higher quality of care in MA plans.

11:30 Political controversy with MA (e.g. PE-backing, overpayment concerns, risk adjustment gaming, “perverse business model”)

13:00 Critics of MA ranging from physicians and hospitals protecting the “sanctity of fee-for-service” to those leery of privatization.

13:30 The incredible popularity of MA and the research showing it has superior outcomes.

14:00 Mitigating the potential for upcoding with the new V28 risk adjustment methodologybeing implemented over next 3 years.

15:00 MA is paid more than Traditional Medicare, but it offers more in terms of benefits (e.g. hearing, dental, vision, population health interventions).

16:00 Private equity investment and payvider innovation (e.g. Oak Street Health, VillageMD, Centerwell, Archwell).

17:00 The importance of Patient-Reported Outcome Measures since process measures alone don’t achieve patient-centeredness.

19:00 “Outcomes should be the most important metric by which we judge the health of our healthcare system.”

20:00 “We need to put providers that participate in value-based relationships at the center of advocacy pushes in Washington and in state capitals.”

21:00 If we are incentivized to keep patients healthy and out of the hospital, we will naturally do screenings. (Measuring number of screenings not as important as the outcome itself!)

21:30 NQF guidance on Risk Adjusting Social Risk Factors in quality measurement in order to pay for outcomes.

22:30 “Infusing SDOH, risk adjustment, and quality metrics into everything we do will shift the system to move towards outcomes.”

23:30 The role of CMMI in payment model innovation and the need for the continuation of the advanced APM bonus.

24:30 “True transformation cannot happen unless you have providers willing to take on full risk. Right now, there is not a full-risk track inside MSSP.”

25:00 The “courage of conviction” in knowing you can make people healthy.

25:30 The lack of value-based care training in medical schools and GME.

26:00 Capital requirements for full-risk.

27:00 Lack of clarity in VBC policy will perpetuate a multi-tiered system (e.g. specialists paid on FFS, primary care pushed more to capitation).

27:30 Full-risk is the only way forward to incentivize the entire system!  (Everything else is just half measures.)

28:00 How the medical establishment and generational divides in medicine are holding back the value movement.

30:00 Internal, professional government affairs expertise as an essential corporate positioning and sales function.

31:00 Positioning your views front and center to a government audience through internal advocacy.

32:00 Creating extraordinarily powerful messaging for policymakers to understand what is needed for value-based innovation.

33:30 Speaking to policymakers and elected officials is different than speaking to investors.

35:00 Figuring out the right model for advocacy (a hired gun lobbyist vs. an embedded government affairs function).

36:30 Leveraging the lobbying power of unified voice in a trade association (versus in-house government affairs that emphasizes the uniqueness of a company’s individualized and specific interests.)

38:00 Trade associations as the place where policy gets settled before it is advocated to elected officials.

39:00 Strategies for effective in-house government affairs collaboration with professional associations.

41:30 The need to teach incoming doctors about the benefits of value-based care to prepare them for success.

42:30 It is also important to teach medical students about the importance of advocacy and the effect of health policy on their career.

44:30 Medical school funding should be tied to solving a specific problem (e.g. integrating behavioral health into primary care).

45:00 “If we want to get to VBC and outcomes delivery, we have to start teaching advocacy and policy in medical schools to effectuate the future.”

47:00 Examples of effective advocacy (e.g. addressing the pediatric uninsured, the Chronic Care Act, direct billing of LSWs within Medicare, expansion of mental health workforce)

49:30 Private sector innovation in addressing health disparities in underserved communities (e.g. Oak Street Health).

50:30 “Forming a more perfect union” – always working towards perfection while knowing it will never be perfect.

51:30 How to follow and connect with Andrew!