Latest / The SEANC View / Lantern, Transparency, and Savings: Inside the State Health Plan

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Lantern, Transparency, and Savings: Inside the State Health Plan · The SEANC View

0:10
Hello, everyone, and welcome to another edition of the Scenic View podcast.
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I'm your host, Jonathan Owens, the Communications Director at Scenic.
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Alongside Artis Watkins, the Executive Director, and Sammy Klein, our podcast producer.
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Suzanne Beasley is not with us this week, but we do have our fifth Beatle in the house.
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Thomas Friedman from the State Health Plan, Executive Administrator of the State
0:31
Health Plan, has been so kind to join us this week and talk about all things
0:36
state health plan related.
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I think we'll just take up the whole episode with Thomas since he's such a good interview.
0:43
What do you think, Thomas? You up for that? I'm here for whatever y'all need,
0:46
whenever y'all need it. I'm the fifth beat, all right? I got to get to four.
0:48
Well, it's a great time to talk about the state health plan with the legislature
0:52
returning to session April 21st, I think. Yeah.
0:56
And obviously, there's going to be a lot of talk about the budget.
0:59
And a big part of that is the state health plan, right, Artis?
1:03
It shouldn't be an either or, whether the state funds the state health plan appropriately,
1:08
so that costs don't have to get shifted to members in terms of increased premiums,
1:13
etc., or they can have a pay raise that's anywhere close to keeping up with inflation.
1:19
But that's the way some people in the legislature look at it right now.
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We've been hearing a lot of that, that if we have to fund the health plan the
1:27
way we're hearing we have to fund it, then we're going to have to dial back
1:30
on what we give in terms of raises or anything to retirees.
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And that's not fair, number one, because employees and retirees can't control
1:38
the health plan's costs.
1:40
And that's, I know we got a lot of other things to get into, but I do want to say this.
1:44
For years, back in the day, we would have folks who were participants on the
1:50
board of the health plan actually say out loud.
1:53
These state employees cost so much money, as though we were sicker or more negligent,
1:59
like as though we ran to the hospital every time we got a slight headache.
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And that wasn't true, but that was thrown out there a lot.
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And what we don't want to do is go back to those days of misinformation in terms
2:11
of usage or utilization, I guess y'all call it, in the biz.
2:15
But I do think there's people who just feel like this health care is costing
2:20
too much. It's these employees. And it's not.
2:25
Health care does cost too much because health care costs too much.
2:28
The costs of health care is too much. We definitely understand that. I don't disagree at all.
2:33
And we're actively working to drive the cost of health care,
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And the cost problem is that we pay too much for healthcare problem.
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I feel very confident. You know, we've been consistent in our budget requests
2:44
from the legislature from last year. We try to be good partners.
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I'm very, very confident things will work out for a budget perspective.
2:49
But the responsibility to reducing the cost of healthcare is 100% on the state
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health plan to do going forward.
2:54
That is, that's explicitly my job. But we recognize we have to be the ones driving down costs.
3:00
I think Lantern is a good step in the right direction there.
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And I think there'll probably be some more questions about that a little bit
3:05
later. but it has really been a big catalyst for change. But healthcare didn't
3:09
get broken overnight. We're not going to fix it overnight.
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You know, we at the treasurer and I, I think we believe investing in the long-term
3:15
ability for the health plan to be sustainable, to keep it affordable,
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so we can start pushing costs down is what we need to do in the next couple of years.
3:23
And we're going to tackle it really hard. So we're definitely going to talk about Lanner.
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Now, there's been a lot of news recently about it.
3:30
Before we get to that, let's talk a little bit about what the state health plan
3:33
board of trustees did at their last meeting, they make the decisions for the plan, right? Yes.
3:38
Yeah, I would be happy to. So it was a good and interesting meeting.
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I was more excited about it and it probably seemed a little operationally,
3:45
a little dull, but it was something that I was really excited about for a couple reasons.
3:49
So something we learned from the Clear Pricing Project where I want to give
3:52
the treasurer a lot of credit is our members are extremely sensitive to price,
3:56
kind of going back to pay raises and salaries and healthcare being too dang expensive.
3:59
Obviously, folks are sensitive to price on things. And so that was one of the
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lessons we took from the Lantern program, which has been extremely successful.
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I really want to thank Scenic's engagement for that.
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Like y'all are the drivers of that. So we said, we need to double down on that
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and making providers compete for state health plan business.
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So Lantern surgeries are free and there are preferred providers.
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How do we make everything else cheaper?
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In a sustainable way. So we didn't really have a mechanism to allow providers
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to compete for our business, right?
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Because if you have a regular co-pay design, it's 15 bucks to go to Duke,
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it's 15 bucks to go to UNC.
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It's kind of cost agnostic to the person, so they don't realize that underlying
4:38
price is really, really different.
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So what we've decided in investing in is we're going to have providers we prefer
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where it's going to be materially cheaper for the member to go there.
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I think we can blow past affordability on the 2012 benefits,
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making it materially cheaper for folks to use that.
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And why I think that, and when we're having conversations with health systems
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and practices about this right now, because one, their first ask was,
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you say you're going to do this, make it, be able to make it cheaper for members to go here.
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Show me you can do that. And that's what the board approved,
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is our ability to make a low-cost tier, a middle tier for like our more rural
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and out-of-state folks, and a non-preferred tier. Gotcha.
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So you know what first thing the providers who want to
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be in the preferred network say to me how cheap can you
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make it for our for your members to come here that is
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what they're asking that is the steerage they want they say we recognize we
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need to see more people how much more affordable are you willing
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to make it and that will drive their discount right so they are thinking of
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the member first because they they recognize it is the member's behavior that
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is going to drive this and help them be successful i wouldn't have told you
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i would have expected that to happen never 24 months ago but The folks we're
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working with, that's their focus.
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How affordable can you make it for members to come here? And not just co-pays,
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it is deductible out-of-pocket costs.
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It is, if you make the out-of-pocket cost, half of what it is now will give you a better deal.
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If you make the deductible half of what it is now, we'll make it a better deal
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for members to go come see us because that's how members are gonna make decisions.
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And that is really exciting to me. I wanna pause and, you know,
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we're really starting there in the three kind of urban areas of the state because
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that's where there's more competition.
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And I think about that as the triangle, but mostly Wake County,
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the triad kind of all over the place in Charlotte.
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That's a lot of our spend, but that's not a lot of our membership.
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A lot of our folks travel for care. So we wanted to make sure there is an access tier.
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Folks, we want to encourage folks to travel for care for the lantern we're going to pay for.
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But we also want to support local independent providers as we can.
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They're generally speaking not the most expensive providers.
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So we're going to have a middle access tier that, you know, if you thought about
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80% of the counties in the state, We're just going to make it a little bit more
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affordable to stay where you are from a care perspective and kind of drive drive that change.
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So if you can stay in your community, we can help them build sustainable models
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to be really excellent at something.
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And we want to get 90 percent of our members using those two tiers of providers.
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What does that mean for me, though, if I live in Plymouth, North Carolina or
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somewhere considered rural?
7:03
Sure. Yeah. So if you're in Plymouth, North Carolina, next year,
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your benefit is going to look great.
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Either the same as it does right now or a little bit better than it does right
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now in kind of certain areas. We've got to see what we can afford.
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We get kind of in the negotiation dance of things.
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But I don't want to punish folks in rural communities by making their benefit worse.
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And that's why we had to go to three tiers, right? Because we have to have better
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or there's not competition. We can't punish that. We can't punish you for living in a rural community.
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I can't make more providers show up, but I can't just implicitly charge you
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more because of where you choose to live.
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And then in those more competitive geographies, if for the systems and large
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ambulatory surgery centers who don't want to be a part of Lantern,
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who don't want to provide a better deal, it is going to be more expensive for members to go there.
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Because we use preferred very carefully. We prefer you go to these providers
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because, and you will save a tremendous amount of money.
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The plan will save a tremendous amount of money. So that is what the board approved,
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the structure to do that.
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And so now we are working with some of our partners to figure out how good of
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a deal can we get to cover the state of North Carolina.
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And that will continue to evolve over time. What I like about this model is it can continue to grow.
8:13
As folks want to continue to give us a better deal, we can continue to make
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it cheaper for members. And we don't have to wait to January 1 every year.
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And folks have reached out and said, hey, we're not part of this lantern thing.
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We're not part of this. How do we get to be a part of it?
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You mean providers? providers because they're losing volume they're
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losing business it's like well this is what you got to do here are the steps and i
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i think about this as kind of further if you're losing hospital volume
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because you made it more expensive for members
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to go there i'm happy to accept a better deal i'm more than happy that's kind
8:43
of the point of the lantern right yeah to introduce some competitions so yeah
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so it is a different way to think about it but the the crux of it is and i'm
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glad our partners get it we have to i'm sorry about my hands we have to reward members first at.
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This does not work if the member doesn't get the best skill.
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Okay, but we've talked about this a number of times.
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People are so suspicious of anything different, and I get that.
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But here we are. We were just talking about it, John.
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How would you boil this down in terms of we know you're suspicious, but?
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Yeah, I think one thing I've noticed a lot from our Facebook comments is people
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are afraid of what they call steerage.
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You heard of it like, you're making me go to this provider, or you're steering
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me to these folks. How do you address that?
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Well, I would say I'm not making you. We are going to keep everyone in network
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who wants to be part of the network.
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One of the challenges of traditional healthcare designs, and I think Treasurer
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Falwell was on this early, is that prices aren't transparent.
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So your co-pay, let's say for a specialist is 50 bucks.
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For you, it's 50 bucks. You don't know what the state health plan is paying.
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250 bucks, 550 bucks, 950 bucks. It doesn't make a difference to you.
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And it's too hard to figure out.
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So the folks that are going to go on that higher cost here, they're the ones
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who are charging you more money every time you go.
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Part of being in our preferred provider program is you're going to get our members
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in faster. You're going to commit to higher quality care.
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And you're only going to be rewarded and allowed to stay in if you deliver high
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quality care. So I appreciate the skepticism, but if it costs the state health
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plan two to three to four to five to six times more for you to stay with your
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provider, you are going to have to pay a little bit more.
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But we are going to do everything we can to have more lower cost providers.
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I've talked to a handful of members the past few months that they,
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you know, they're sick folks that they're like, I'm hitting the out-of-pocket
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max of $16,000 every single year.
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Yeah. We are going to get that out-of-pocket maxed on for that preferred tier
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by several thousand dollars.
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That it's not a raise, but if you're paying $5,000, $6,000 less a year on health care.
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Well, back to, your point's well taken.
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Back to how we started this, if the General Assembly is saying,
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look, the health plan costs us too much money, so we can't give you much of
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a raise, it's affecting everybody's pocketbook at the end of the day.
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So I'm all for steering people towards encouraging people to go to providers who are competent,
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But give a fair deal to the state. And it's a choice. Nobody's forcing anybody.
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So don't take the choice if you don't want to, but don't be mad that the choice is out there.
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I mean, when you have the, y'all have had some pretty big players in terms of providers join in.
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So you want to elaborate on that. If you think about the big providers that
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have joined the Lantern Network.
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Wait one second. Let's explain Lantern because I feel like a lot of people on
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our Facebook page still don't understand how you can offer surgeries for free. Great. Yeah. I'm sorry.
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I did, too. I jumped right in. We talk about it so much we feel like it's old hat.
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And so Lantern is something we continue to evolve the framing on.
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So lantern is our partner for you to call to to get higher quality lower cost
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care they are not doctors they are the the folks that get you to those doctors
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and help us negotiate those deals.
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So who you're getting care from are places like emerge
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ortho novant ortho carolina is a
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new partnership we're rolling out unc those are
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providers that have been delivering health care to state health plan members since
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before any of us were alive and they've stepped up and said
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we recognize the value of state employees and we're
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going to give you a better deal in exchange for making it
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cheaper for members so we get more volume so
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lantern isn't cutting anyone open i promise you and it's not every doctor at
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these practices and not just anyone can get in these the practice it is folks
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that do these surgeries a lot of times but it's with the doctors you're going
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to right now and something i think is really really important along those lines
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is you don't have to do this,
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keeping the surgical options open, but we recognize surgery is expensive,
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it is complicated, it is scary, and it is hard.
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Asking you to shop for a surgeon when your knee's killing you or your back's
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killing you or you need bariatric care or you need heart care, that's not fair.
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That is not a reasonable ask to be like, hey, on top of everything,
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go online and look at 58 different doctors for the best price.
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The nice thing about Lantern is that they will help get you to a provider who
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has agreed to take a significant discount to deliver that care.
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We pay them faster. We didn't do prior administration. They get more volume
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because it's a better deal for them.
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And that's how we can offer. It is not a free surgery. I assure you,
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I sign checks every single day for surgeries.
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It's free to the member. It is free to the member because we save so much money.
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And the only fair thing to do when we are saving money on a surgery or a procedure
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is to pay them, reward the member first.
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And I can't go cheaper than free right now. It's the how you save money part,
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I think, that still confuses people.
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So I'm looking at the board materials from the board meeting.
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And this is a pretty cut and dry example. And it's, you know, it's probably not...
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It doesn't get into the details, but let's, it says, let's say that a provider
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wants to pay, wants to charge $30,000 for a surgery.
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So that would be that the plan would pay $25,000 and the member would pay $5,000.
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But if you can use a Lantern provider that will charge $15,000 for that same
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surgery, then the plan would pay $15,000.
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The member would pay nothing and the plan still saves $15,000,
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right? $10,000, I think. Yeah, yeah. I'm not going to. Yeah.
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But so we save money. The member saves money. And again, you got to go back
14:47
to if we're expecting folks to behave differently.
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We got to give them the incentive. It's their surgery. It's not mine. Yeah.
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But it's not free because, hey, we want you to go to these places and then it'll
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be free for you because these doctors are questionable.
15:03
It's free because these massive health care systems you just mentioned and hopefully
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many others have said, we want your business.
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And so we're willing not to rip off the state health plan. We're willing to give a reasonable deal.
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And we hope we're going to get big volume out of that. So it's not free because it's lesser, man.
15:24
But I kind of wonder, and this, you know, leaving you out of this,
15:29
Thomas, because the health plan is not part of this.
15:31
But when we get these comments, John, sometimes they're members.
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Sometimes they're not. Yeah. And sometimes I wonder when people are throwing
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rocks at it, are they real people?
15:42
Sometimes you can see a trend among the steerage part that I saw.
15:48
I saw several comments that were using that language.
15:51
Yeah, that doesn't sound like your average state employee that's interested in this issue.
15:56
So, in other words, if I did not want to give a good deal, I might have interest
16:00
in piping up and trying to poo-poo ideas like this.
16:08
Look, it's even been said to us, y'all are being too cozy with the state health plan.
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You give me a hard time all the time. I was going to say, no one's going to
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be harder, I feel like, in just a factual way, hopefully, and just putting issues
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out there to be talked about.
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But no one's going to be harder on y'all than us.
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However, in addition to saying what we've said before, you can't say no to everything
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and then expect everything to get paid for at the same rate.
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But also, they're trying something at the state health plan, y'all.
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So if you're a state employee or retiree hearing this, when the state health
16:45
plan is making a concerted effort that does not do anything to diminish the quality of your care,
16:50
it's a voluntary choice, but it would save them so much money their ask of the legislature is less,
16:58
there's more money there for you as a state employee or retiree to get something
17:05
given to you to keep up with the cost of living.
17:08
It's not there if the state health plan is soaking it all up.
17:12
So what these folks are doing is saying, we've got to try to bring people to the table.
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Right now, the law prohibits them from saying, here's what we're paying everybody.
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Y'all can look at it and you can throw rocks at the providers that are charging us too much.
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The law prohibits them from doing that. So they've had to get creative and this is their answer.
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So yeah, you're darn right that we're cozy with you about doing that because it's doing something.
17:39
And I was looking at this one comment here. So the comment is,
17:42
so you have to go to have your surgery two or three states away?
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Like, who wants to do that?
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And then I looked at the profile, and it was clearly AI-type pictures and things.
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So I wonder if there is a concerted effort to take down.
17:57
Have you seen pushback like that? We have seen pushback in a few ways,
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and some of it is fair. Some of it is reasonable.
18:04
We, not every provider wants to deliver high quality care at a lower cost.
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So some folks are going to have to travel more. And that is a fair criticism.
18:14
If some folks, if you live by yourself, if you don't have help,
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you might not be able to access it right away. But we have to start.
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And I will tell you, the providers who aren't in are feeling it right now. And they want to get in.
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And you got to start to get to the next place. So we will continue to grow the
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program to provide a higher quality options.
18:34
And let's pretend that statement is true. You got to go two states away for care.
18:37
That means someone in North Carolina, no doctor, no health system, no surgeon.
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Was willing to give a good enough deal that we couldn't save more money sending
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someone there. That's not a critique of me.
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That is a critique of the system and the pricing of the system.
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And willing to pay for your flight and your hotel if that is the best deal possible
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for a complex care with a high-quality provider, that's my job is to make sure
19:01
you get that and to make it as affordable and as seamless as possible.
19:04
But this thing needs to build on itself. But you built it more than I thought you would, actually.
19:10
I honestly wondered. You were very skeptical the first time we talked about
19:14
it. I was. I wondered how many providers would do it.
19:17
I really did. I thought they would just freeze you out.
19:20
Yeah. You know, it takes one to start because I think they had to feel the pinch.
19:24
And I'm grateful for Lantern who brought in a network.
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I'm grateful for Novant and Emerge North Carolina to make a bet, right?
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Because as the folks that are calling now are the folks that lost volume,
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are losing volume. And they're talking to their friends.
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And that's how we get more. We got lucky that we had good partners and y'all
19:42
and good partners in the provider community to jump in with both feet to try something different.
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And that's how it's going to grow and get better.
19:51
It is not perfect. It is never going to be perfect.
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The U.S. health care system has got its, not without a share of problems,
19:59
but we are going to continue to push and make it better and better and better for state employees.
20:03
And because that's my job, that's the right thing to do.
20:05
Let's talk briefly about the success that you've had. I'm looking at the presentation.
20:09
It says you've had 1,848 cases as of March 4th.
20:15
That's pretty amazing for a program that's only been in place,
20:18
I guess. Well, you launched it in October, right?
20:20
We launched it in October. It was small. And that is before,
20:22
that number is before Novant joined. That is before all of Emerge Ortho was in.
20:27
We're running about four times higher than I thought.
20:29
Multiple of four of where I thought and probably ten times higher.
20:32
Again, I'm shocked. I honestly thought that they would successfully freeze you out.
20:38
So, kudos to y'all for having faith in it and for being diligent about it to just not,
20:44
Not let that happen. Well, thank you for that. And what's exciting is I think,
20:49
you know, we've also heard from smaller hospitals and independent practices. How do we get in?
20:53
I think we chatted last fall, we had kind of a procurement process for the big,
20:57
and that's how Novant kind of got to win, how UNC has gotten to win in some areas.
21:01
We're going to go back out to some of the smaller systems and some of the smaller
21:04
entities, give them a chance to engage.
21:06
They still got to give the same deal. They've got to deliver the high quality
21:09
care, but that's how we're going to get more providers in.
21:12
We're really going to capitalize on that momentum and be very clear,
21:15
these are the rates we're expecting.
21:17
It's not the 160-day-of-all-last, where it's not the 200% some of these bills,
21:21
where it's less than both is our expectation on these things.
21:24
And I talked to the heads of eight hospitals yesterday throughout the state.
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They're all interested and engaging.
21:30
They recognize qualities at the front door, to your point. We're not taking
21:33
a surgeon who's done these things three times. We want your best providers at
21:38
the practice. Because you have to pay for it later.
21:40
That's right. If it's not a good surgeon and there's complications.
21:43
That's right. I don't want to pay twice.
21:46
And then the member has to pay to go through surgery twice. And that's not fair.
21:50
Yeah. And you'll hear about that. Yeah.
21:52
So we're going to continue to build and roll this out to try to bring it into
21:56
more communities. And in ask of members, you know, I would ask you to advocate.
21:59
If your provider's not in and they're telling you I'm not in, what was me?
22:04
Y'all have another bite at the apple. Yeah.
22:06
Get in. Be a member, right? Right. We would gladly have you if you can deliver
22:10
high-quality care at a fair price to employees.
22:13
And if they want to continue to charge state employees more for care,
22:17
you can keep going there, but that's what's going to be driving up premiums
22:21
in the future, not the other side of it.
22:22
And rural health care has been such a problem across the board in terms of making
22:26
sure there's access for folks more than making sure it's affordable a lot of times.
22:31
But I know that the vast difference in what some providers were being considered.
22:39
Compensated in terms of a percentage of Medicare as a reference point.
22:43
Some of them were so low and some of them were so wildly high.
22:46
But my understanding was the low ones, a lot of the times, those were in rural areas.
22:52
So is there not a possibility that being with Lantern with this program,
22:56
it could actually help rural health care?
22:58
100%. Thank you for it. Yes, that is the value proposition we're offering,
23:01
right? You might be able to make actually a little bit more money.
23:04
You might get a lot more volume and folks can say closer to it and you can grow
23:07
your program. It's also an economic development thing for somebody.
23:10
Exactly. Get really good at it. And, you know, something the treasurers challenge
23:13
me directly is like, right now, 70, 80 percent of care drives to urban communities for care.
23:19
We got to make some services excellent and help support other services being
23:23
excellent all throughout the state of North Carolina to help the local economies,
23:26
but also to create centers of excellence so those health systems can be more viable.
23:31
We don't need them to be the best at everything, but let's pick a few things,
23:34
get really, really good at it.
23:36
And we can steer our state, I'm going to use the word steer because I think
23:39
it's the right word, state employees there for low-cost free care.
23:42
Well, and that was one of the things we did like a lot about the idea of the
23:46
Clear Pricing Project is that some of those kind of underpaid providers would
23:51
be able to still stick around.
23:53
And it sounds like you've got that covered.
23:56
I think so. And, you know, we heard loud and clear from primary care that they
24:00
wouldn't be able to be sustainable without the rates from the Clear Pricing Project.
24:04
So we put those back in effect for primary care, assuming they could get,
24:08
we put some requirements around it. You get state employees in.
24:12
You help get them to those lower cost options. You continue to deliver that
24:16
high quality care. You have better access for them.
24:18
That's fair. We recognize, like, we're happy to give you more money,
24:21
but it's not free money. It's a partnership. Yeah.
24:24
So if you're an orthopedic surgeon in, say, Plymouth, North Carolina,
24:28
you could rack up with all the people in the east, right?
24:30
I mean, if you're doing a good job delivering high-quality care and you can
24:34
deliver it at a price that is reasonable and fair to stay in place, absolutely.
24:38
There's no reason you can't. You can draw all the people. A lot of folks in
24:41
that northeastern part of the state go up to Norfolk, don't they?
24:46
I would prefer they stay in North Carolina. We've got to give them a better option, right?
24:49
There's some really good health care delivered in the, you know,
24:52
southeastern part of Virginia. there's great healthcare in the northeastern
24:55
part of North Carolina too.
24:56
And we got to help them amplify what they're doing and make it attractive to
25:01
go there. And talking to folks, I think they're very willing to do that.
25:03
We just got to focus. And I don't think anyone's really engaged them to say,
25:06
I need you to be really good at this thing.
25:09
I am going to have thousands of people in your local counties every year for now in perpetuity.
25:15
State government's not going away. DOT is not going away. Prisons aren't going away.
25:20
Police officers aren't going away. Schools aren't going away. We can help you grow.
25:24
You know, AI has not taken those jobs quite yet. We were speaking to some police
25:28
officers a few weeks ago, and there was, you know, there's interest in trying
25:33
to, as there is in anything else, in trying to find ways to bring healthcare costs down.
25:38
And they're not, obviously, they're in, for the most part, in their local systems.
25:43
Some local systems are part of you, though, right? Like, how many locals are
25:46
now in the state health plan?
25:48
We have overall 456 different units.
25:51
That's a lot. There's a lot of schools, a lot of charter schools, ABCs.
25:54
We range from, you know, HHS to charter schools to ABC stores in some towns.
26:00
But we're better together than apart. And we're all in this together.
26:03
So if we can partner with those systems and have that mentality of like,
26:06
we want you to be successful, but we need you to invest in us too.
26:11
That's how this all works together is we want you to be a hospital here forever.
26:16
We want people to have high-quality local care, but it's gotta be high-quality,
26:20
it's gotta be at a reasonable price, and folks gotta be able to get in.
26:23
If you can do that, the state is, state employees are more recession-proof than any other job, right?
26:28
We're not gonna not have corrections officers, we're not gonna not have DOT,
26:32
we're not gonna not have all of these folks work for the state.
26:35
They're committed, they stay at their jobs longer.
26:37
Yeah. Correctional officers, there's not gonna be like a little AI robot replacing them.
26:41
And they deserve high-quality, low-cost care in their communities.
26:46
So we need health systems providers to think about this as a partnership that we can do together.
26:53
Let's grow together. Let's improve health together. Let's improve health outcomes
26:56
together. And let's improve our businesses.
26:58
Do you feel like you're leading the way without intending to?
27:02
You're trying to take care of the state health plan because that's y'all's job.
27:05
But does it ever occur to you that it might be leading the way to helping North
27:10
Carolina out of that number one costliest for health care position?
27:14
Because if you're one-tenth of the commercial market and you bring costs down,
27:18
you're going to move the market a little bit.
27:19
I sure hope so. You know, and that's the treasurer's point of view,
27:22
right, is we got to bring everyone along together.
27:24
I'm going to give him all the credit for that, not me. But yeah,
27:26
that's how we do this, right, is if it becomes a competition on price and quality,
27:30
rather than racing to the highest price, you're going to race to the most critical
27:34
pool of patients that can help you.
27:36
That drives costs down. That helps folks get more efficient.
27:38
That helps them think about side of care differently. Something I think that
27:41
was, having worked at a health system, I think about a lot, but is like probably
27:45
not intuitive to everyone, you know, if you have a surgery at a hospital,
27:49
the cost of the surgery is higher because the rent's higher,
27:53
the bill, the cost, then if you have it at an ambulatory surgery center or a
27:57
doctor's office, there's just more stuff going on.
28:00
Doesn't mean it's a better surgery. In a lot of cases, it means it's a worse
28:03
surgery. Not in a lot of cases, but it could be the case.
28:06
So why don't we get that surgery to the safest place it can be where it costs the least.
28:12
Because I'm going to pay you the same amount of money one way or the other.
28:14
This is the amount of money you're getting for the surgery.
28:16
You can make more money if they all get more efficient, and you're going to get more volume.
28:21
Let's go back to the cases that you've had already, and this may not be available,
28:25
and it may just be anecdotal, but what is the response of people who have gone through Lantern so far?
28:31
Have you had many complaints or any big success stories you can talk about?
28:36
We're working on some videos of success stories right now because we have had
28:39
quite a few success stories and the people are really excited.
28:42
You know, I think the frustration we have seen is around having to travel for
28:45
care, which I understand.
28:48
It's a newer program. The costs are zero, so I haven't had too many concerns
28:51
about costs quite yet. But I think the biggest concerns we've heard is having
28:55
to travel and it takes a long time to schedule care.
28:58
Healthcare takes a long time to schedule care. But, you know,
29:00
we're getting you in much faster here.
29:01
So I think that when you need surgery, you want it now. You don't want to wait
29:05
any amount of time. And I get that.
29:06
And I think that's a perfectly reasonable complaint. But just know we're going
29:09
to continue to push it forward and drive it forward.
29:12
Yeah, we've had a comment, a few comments on our social media about folks who
29:18
have gone through it and they've been excited about it.
29:21
One person said their son is about to do the same, that she had surgery and
29:25
now her son is going to do it too. So it seems like it's been successful.
29:29
It has been. And the more word of mouth we can get, right, like kind of go back
29:32
to a few premises. is like people don't trust insurance companies.
29:34
They shouldn't. People trust me maybe like a little bit more.
29:37
People trust their doctors, pretty decent, but they trust the people they work
29:41
with. They trust their friends.
29:42
And so the more, you know, positive word of mouth we can get on this from our
29:46
members who have had a great experience, that's what folks are going to listen
29:49
to and believe in, right?
29:50
Because you can hear some bureaucrat like me talk about stuff forever,
29:53
but when your neighbor does it and works out for them, I think that probably
29:56
hits them a little harder.
29:57
And I think that's right. That's what I was getting ready to mention is that
29:59
I saw this chart about the, And by the way, this chart did have—this comes from
30:04
the Bureau of Labor Statistics—.
30:08
So it's a real thing, not just something somebody's trying to, some propaganda.
30:12
But anyways, it shows from 1970 to 2015, the growth of physicians versus administrators
30:19
of hospitals, the executives, not the people actually giving you care.
30:24
And from 1970 to 2015, the physicians only grew by about 200 percent,
30:30
but the number of administrators grew by 3,000 percent.
30:35
So I think, you know, therein seems to lie the problem.
30:39
I think that's a big part of the problem. I think the other problem,
30:41
and maybe it's part of the same problem, I'm not entirely sure,
30:44
is no one's challenged them on cost before.
30:47
You know, the negotiation's like, well, the prices go up.
30:50
Or we go to value-based- It's complex. Y'all don't understand.
30:53
And, you know, having been on the other side of this corner,
30:55
I think I understand, maybe not fully, but I understand maybe a little bit.
30:58
And healthcare has a cost problem. We, as a health plan, haven't tackled a cost
31:02
problem, the cost of healthcare.
31:03
And I think folks are trying on the provider side to tackle the cost problem,
31:07
but they've got a lot of work to do, too.
31:08
Well, but I can't buy that when in terms of, you know, it being a cost problem
31:12
in terms of it's just very costly to provide this care.
31:15
No, that's why they haven't looked at it. I don't think they've done a good job looking at it.
31:18
And the way you know, if nothing else, is the sheer volume of advertising they do.
31:24
And knowing how much that costs, it's like, no, you're fine.
31:28
You're absolutely fine. I don't think the treasurer would mind me sharing this.
31:33
But his point of view is the more celebrities you have in your ad,
31:37
the less interested he is in doing their drug.
31:39
By the way, we keep saying the treasurer for folks who aren't regular listeners.
31:43
The treasurer of North Carolina is Brad Briner.
31:45
This is his first term, second year of his first term.
31:48
And so Thomas reports directly to Treasurer Briner because Treasurer Briner's
31:53
office of the treasurer has the state health plan under its umbrella of duties.
31:58
And the state retirement plan. Yeah, all the things really that are the most
32:02
important to the state employees and retirees.
32:04
But we want to echo what Thomas said, you know, thank you to Treasurer Briner
32:08
for taking this so seriously and allowing you to dig into it.
32:12
It's been great for his direction.
32:14
You know, I think his point of view is we have to be more efficient.
32:17
We have to do a better job. There's too much opportunity to not try some stuff
32:21
because the current model is not working for anybody.
32:24
Providers are burning out. We're paying too much money. We're not getting any healthier.
32:29
Why would we keep on keeping on?
32:30
We've got to realize the value in the healthcare system is the patient.
32:35
And we should be competing. Every other part of life, we compete for customers.
32:39
By creating the best value proposition for customers, we need to make healthcare like that.
32:43
There should be nothing more valuable to healthcare providers than state employees.
32:48
And there should be nothing that has had such bipartisan support for secrecy
32:53
like there is for healthcare pricing.
32:57
But there traditionally has been a completely bipartisan effort to keep us from knowing.
33:04
And so I think that tide seems like it's shifting a little bit.
33:08
I think so. I think we're moving in the right direction.
33:11
Slowly. Not as fast as I'd like. Because it's hard to go home and explain that
33:15
you don't think the people should know.
33:18
So do you have anything else you want to talk about in the state health plan
33:21
realm before we get to the fun
33:24
stuff? No, so we covered Lanter in the next round of procurements there.
33:27
We covered the benefit design.
33:31
I'm just really grateful for y'all. I think, you know, we're not out of the
33:36
woods on the kind of deficit we inherited, but we're moving in the right direction.
33:40
We're moving to get costs down for those who want to partner with us.
33:45
Oh, I know one thing we need to talk about briefly. So the news that you're
33:50
not going to resign with Aetna and you're going to put the contract back out
33:54
to bid, that caused a lot of comments on our social media. Yeah.
33:58
The contract runs for 25, 26, 27, and there's two optional extensions.
34:04
It doesn't mean Aetna's not going to be our TPA in the future.
34:07
If you think about, and they both have their strengths, if you think about Treasurer
34:10
Falwell, you think about Treasurer Briner, and you think about the previous
34:13
executive administrator, pretty different points of view on things.
34:16
And I want to give kudos to the previous administration for a lot of things
34:19
they did. A lot of things that I don't agree with. I believe in value-based care.
34:22
I believe in population health management. And so we want a contract,
34:26
a TPA contract, that reflects the values we're bringing to things here.
34:30
So, I don't think of it as any sort of way other than that. It's just different.
34:32
Do you believe in value-based care, or is value-based care not even really the
34:36
thing anymore that y'all are doing?
34:38
It seems like it's morphing, right? So, it is morphing into the value is the member. Right.
34:44
And I believe we do have to invest in population health, but we got a lot of
34:47
fat to cut on the prices first, and that's the money we're going to use to invest
34:52
in those things rather than asking members to pay more money.
34:54
Let's get the money out of providers first and get their incentives aligned,
34:58
right? So just a different value set.
35:01
There's no reason that Aetna can't win and be the TPA there, but...
35:06
We just thought, why continue on something that isn't just— Can you tell us
35:10
what you'll be looking for, or is that getting into stuff you can't get into?
35:14
You know, I think what we're looking for is—and I've said this publicly,
35:17
so I don't have a problem saying it—partners that are really focused on helping
35:22
us execute what we want to do.
35:24
And that previous RFP was different folks, what different folks wanted to do,
35:27
right? Like, I don't—that's not a critique of anyone.
35:29
We want to prioritize things like population health, patient navigation.
35:34
The system is too hard and too complicated. and getting really strong patient
35:38
navigation, someone whose incentive is to get the patient to the right place,
35:41
not an insurance company, not the state health plan, someone whose job is to
35:45
get the patient to the right place for them and understand things,
35:47
to be a patient advocate.
35:49
Those are the things we are prioritizing. If it's not clear,
35:52
like I'm a little bit of a control freak and I like a lot of flexibility and
35:55
I want a contract that reflects like, you know, the state gives me pretty broad latitude in state law.
36:01
The executive administrator's got a lot of responsibility. I also want a contract
36:04
that reflects that, right? You know, I think that those are important to me.
36:06
And with pharmaceuticals especially, I know you came out pretty strong that
36:12
you didn't want to overpay for those. We do not.
36:14
And similarly, at the same time, we have our RFP out for our pharmacy benefit
36:17
manager that's also going to start at 1-1-28.
36:20
So we are trying to move to contracts that better reflect our values.
36:24
We're not necessarily saying we're going to change, but the contract terms have
36:28
to be about aligning our incentives.
36:30
You have to look at it. It's our job to look at it.
36:32
So as you can see, the state health plan is a huge, huge brawling spider of
36:38
topics. As important as anything in somebody's life. Yeah.
36:41
So you could have your own podcast. I think I told you that last time.
36:44
You need to start your own because you could talk about this every week for
36:47
an hour. He's busy trying to get people to. I got to do the doing.
36:50
Well, thanks so much for coming in. And we're going to, you're actually going
36:54
to help us with our question of the week. Okay. I don't know if you knew that
36:57
or not, but you're going to.
36:58
I'm old hat, a fifth beetle. Okay. Play my theme song. John's wacky weird question.
37:09
This week and i've already asked you so well
37:12
kind of in a roundabout way but who's gonna
37:15
win the national championship and i
37:19
ask you because you gotta accept that up now yes so
37:22
i went to the university of arizona and i'm from tucson arizona so i am a wildcat
37:26
through and through bear down arizona i'm very hopeful we win the national championship
37:31
this year equally as hopeful that unc does not take our basketball coach that's
37:36
in the ether there that they really interested in Tommy Lloyd, Treasurer Briner,
37:40
is a big UNC fan. Oh, okay. I knew I liked him.
37:42
Yeah, me too. So I've begged and pleaded with him, like, y'all,
37:46
let us keep our basketball coach.
37:47
But Arizona through and through. You've got to be pretty proud that you have
37:51
somebody that everybody wants,
37:52
because he is probably the hottest name in all of coaching. I think so.
37:57
If you didn't watch the game, the first thing he did was give the players a
38:01
lot of credit, and he gave credit to a former Arizona coach who passed away
38:04
a couple years ago. And just, you know, he's a leader by leading and giving
38:08
credit where it's due, not taking it.
38:10
So I am very hopeful he sticks around Arizona for a long, long time.
38:13
So I can go next because I hate to say it, but I think that Michigan will probably
38:19
win because I've watched them all year and they're just very talented, very big.
38:24
Look, they're always lurking around there towards the top. And they have a former
38:27
Tar Heel in Elliott Cadeau as their point guard.
38:30
But I think I'm pulling for Arizona just because I want Coach Lloyd to win a
38:37
championship there and then come to Chapel Hill and finish out his career.
38:42
No, we'll probably hire somebody who won an NBA championship as a coach like 20 years ago. Yeah.
38:49
Is that a Belichick reference? We're just making some choices.
38:54
That's all I know. We're just making some choices.
38:56
So you've been away. Have you been paying attention to the games?
38:59
Yeah, well, as long as it's not UConn, I'm cool. Because Hurley, I cannot.
39:04
See, I kind of like him. Oh, goodness. I cannot.
39:07
He's like in on the joke, though. He's not like, I don't know.
39:10
I think his brother coached at Arizona State, which is the University of Arizona.
39:14
And that fool couldn't keep his head up.
39:17
Well, we had to deal with him when he was a player. His brother.
39:20
Yeah. They've got a lot of passion, but the Hurley family.
39:23
So you're not making a prediction other than you don't. No, I wouldn't know
39:27
what to predict right now, honestly. Yeah. What about you, Sammy?
39:30
Was I supposed to be paying attention to this tournament?
39:32
Because I haven't been. To basketball? No, I don't know. Oh,
39:35
okay. Western Carolina's not in it? Yeah.
39:37
All I know is I don't want you and C to win because I'm still mad at y'all for
39:41
taking our best football player. Yeah. So. Had one good season.
39:46
Probably left us after one, too. So don't worry about it. So that's our episode
39:50
for this week, and we'll see you next week.