Blue Shield of California takes on 'broken' health system

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(Bloomberg) -- Blue Shield of California, one of the state’s largest health insurers, is rolling out a series of experiments aimed to improve health care for patients and physicians, the company said on Tuesday.

The program, called “Health Reimagined,” ranges from expanded telehealth connections in rural Butte County to building out primary care in Monterey. New “community health advocates” in Los Angeles and elsewhere will help members with nonmedical needs, like housing and food assistance.

“We came to the conclusion that we couldn’t just incrementally improve on a system that’s fundamentally dysfunctional,” said Paul Markovich, chief executive officer of Blue Shield of California.

Even before the coronavirus pandemic began, physicians suffered from high rates of burnout and frustration with the medical system. Patients too are frequently flustered by the cost of care, difficulty getting it, and a system that doesn’t fully meet their needs. Health insurers are a frequent source of ire for both.

“Patients are not satisfied. Providers are frustrated and burning out,” Senior Vice President Peter Long said. The system costs an “inordinate” amount of money, he said, adding “when we look at that, we think that we need a solution or set of solutions that are commensurate with the magnitude of the problem.”

Blue Shield of California, a tax-paying nonprofit with 4.4 million members and $20 billion in revenue, aims to expand those local programs that succeed quickly. The initiative builds on Altais, which the insurer formed in August to reduce physicians’ administrative burdens. In April, Brown & Toland Physicians, one of the Bay Area’s largest medical groups with 2,700 doctors and 350,000 patients, joined Altais in a proposed acquisition.

“Altais was created with the express purpose of supporting physicians adopting Health Reimagined,” Markovich said.

Primary care doctors and independent practices have faced particular stress. Many have seen revenue dry up as Covid-19 forced the cancellation of in-person appointments. The challenging economics of running a primary care practice have led many doctors to join large hospital systems in recent years, a trend that some employers fear will accelerate during the pandemic.

The Pacific Business Group on Health, a group representing large California employers, has urged the federal government to expand support for primary care. “The impending collapse of independent primary care practices represents a concern of vital national interest that must be addressed swiftly to avoid profound and irreparable damage,” the group wrote in a letter to Health and Human Services Secretary Alex Azar this month.

In Monterey County, south of San Francisco, patients sometimes have to wait six to eight weeks to get an appointment with a primary care doctor, according to Michael Larsen, executive director of the Municipalities, Colleges, Schools Insurance Group, which manages health care for dozens of public agencies in the county.

Blue Shield is opening two Altais clinics in the county, and adding mental health and orthopedic services in response to needs identified by Larsen’s group. “We’ve been working on trying to bring in more primary care providers for a long, long time,” Larsen said. When the clinics are open, he said, the 14,000 people on his plan will be able to get appointments the same day or next day.

Blue Shield isn’t alone among insurers expanding into care delivery. UnitedHealth Group Inc.’s Optum unit has almost 50,000 doctors, according to the company’s annual report. Humana Inc. announced a joint venture earlier this year with private equity firm Welsh, Carson, Anderson & Stowe to expand primary care. And Kaiser Permanente, the California-based health maintenance organization, has 23,000 doctors.

In California, Blue Shield says it wants to ease the burden on clinicians it works with. It’s adopting technologies like voice recognition so doctors can dictate notes into digital records instead of typing them in by hand. It’s also accelerating payments to doctors and hospitals. Another pilot program will lift prior-authorization rules if patients and clinicians undertake a “shared decision-making” session in which they review the evidence for a course of treatment and agree on the best way forward.

Reaching Displaced PatientsRichard Thorp, a primary care doctor with Paradise Medical Group, said Blue Shield’s support has been instrumental in helping the group’s 20 or so clinicians survive the wildfires that destroyed Paradise, Calif., in November 2018.

“We had a number of docs we had to meet payroll for and we had no revenue stream because we were out of business basically,” he said.

In addition to grants from the insurer, assistance setting up telehealth systems eventually allowed Paradise Medical Group to reach patients who had been displaced by the fire, Thorp said. When Covid-19 arrived this year, the practice was ready to move online seamlessly.

Now a community health advocate, funded by Blue Shield, works in Thorp’s clinic, which has relocated to nearby Chico. The advocate helps patients with needs around food, transportation, loneliness or shelter. And new payment arrangements from Blue Shield allow Thorp and his colleagues to spend more time with the patients who need it the most, rather than limiting visits to 15 minutes.

The goal, Thorp said, is to have a health system with “the patient and the clinician at the center of it, and not the health plan or anyone else.”

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