Few have seen so much up-close change in the health care industry as Ken Goulet, recently retired president of commercial business for Anthem, Inc. Now that he’s transitioning into retirement to spend more time with his family, I had a chance to tap his experience for some insights. In part one of two, Ken and I discuss recent changes in health care and how he sees the industry continuing to evolve over the coming years.
What’s the most significant development in health care you have seen in the past five years?
There are several significant changes that have occurred over the last five years that will continue to impact health care in the United States. First, the passage of the Affordable Care Act (ACA) and the expansion of coverage that has resulted: The ACA has had a significant and everlasting effect on how we operate. It has expanded coverage, it has changed our products, it has changed our distribution and operating models, and it has influenced the way we compete for consumers.
Second, evolution of the payer and provider relationship: We’ve been taking different approaches to risk sharing and pay for performance as we transition away from the fee-for-service model of the past.
Finally, a shift in customer focus: The industry has begun to move from business-to-business to business-to-consumer, and the way we communicate directly with consumers is beginning to change. We increasingly need to take a complex subject and try to make it as understandable as possible.
How do you see the health care industry changing in the next few years?
On the near-term horizon, I see more consolidation with both carriers and providers, as well as more innovative partnerships and joint-venture arrangements with providers, such as Vivity.
I’m also seeing large amounts of money coming in to health care through venture-capital and private-equity firms, along with increased interest from the technology sector and Silicon Valley. They will continue to “disrupt” the way in which we offer services, particularly those with a strong focus on the consumer. This will make employers, consumers and carriers want to move faster.
Finally, there will also be continued efforts to expand access to high-quality care in nontraditional ways, such as telemedicine.
You mentioned the evolution of the provider and payer relationship earlier. What changes do you anticipate in the relationship between providers and payers as our health care system evolves?
I anticipate continued progress as carrier and provider partnerships increase, but also that providers will continue to explore competing with insurance — and the relationships will go down two paths:
- Partnerships. We’ll continue to develop risk- and profit-sharing models, such as Anthem’s Enhanced Personal Health Care program, Vivity and Accountable Care Organizations. These will be a key part of the evolution from fee-for-service contracts with volume incentives to partnerships with more quality-aligned incentives.
- Competitors. In some markets, certain providers will get into the insurance business through Medicare, public exchanges and even commercial business.
It is likely that both partnerships and competition will continue to evolve, although I think the biggest shift will be to the partnership approach.
How do you see employer-sponsored health benefits evolving in the next few years?
Employers currently have a major role in providing benefits, and that will continue over the next five years. That said, I see changes in three key areas for this market.
First, as employers continue to focus on quality, cost and new solutions, many are likely to begin to try narrow networks and private exchanges. Second, employers will demand more transparency in quality and price, as well as implement more products designed around transparency, such as reference-based benefits. And third, employers will raise the bar and demand more multichannel, multitouch customer-service options, similar to our Anthem Health Guide model. Consumers will demand this, too.
If you were managing health benefits at a large company, what are the top two or three things you would do to make the most of the offered benefits while balancing controlling costs and keeping employees happy?
I’d select a health care provider based on the total value they bring to the employee population — not only discounts and cost impact, but also how they align with providers, how they communicate directly with employees to drive engagement and, of course, how well they do at managing the basics. I’d also develop a deep understanding of the health of the population, such as the percentage with chronic diseases and the impact on spending, then develop custom programs to address the sick and keep the others healthy.
Look for Part II of this interview, where we’ll discuss wellness-program trends and changing expectations in the workforce.
Becki Rupp joined the health care industry 11 years ago and uses her writing skills to help translate complex topics to be better understood by all who interact with health care and insurance. She currently works for Anthem, Inc., and specializes in marketing to large multistate companies and their employees.