For 30 years, the medical community, payers, the government, and the American public have worked to understand what “high-value care” really is. And for 30 years, Repertoire has been watching. We have reported as medical care expanded to include behavioral health, oral health, even socioeconomic wellbeing. We have watched retail clinics, urgent care centers, IDNs, digital health and even private equity firms transform medical delivery. We have reported how medical technology has affected healthcare providers and their patients. And we have watched med/surg distributors and manufacturers work tirelessly to address all these changes. Join us as we look at some of the highlights of that 30-year learning journey.
Sun Setting on Solo Practices
Once rugged individualists, doctors were joining groups when Repertoire started publishing 30 years ago. Some contracted with physician practice management companies (remember PhyCor?) to take care of the business side of medicine, while others sold their practices to hospitals and hospital systems … only to back out of those agreements and go back on their own … only to sell their practices once again to hospitals and health systems, insurance companies and even private equity firms.
By the end of 1999, physician practices around the country were calling it quits with physician practice management companies (PPMs). The year before, an estimated 5% of the 70,000 physicians who were affiliated with PPMs “unwound” those agreements and became independent again. Three factors were at work: First, the plunging value of PPMs’ stock prices, particularly worrisome for doctors whose deals were heavily weighted on the stock side. Second, some doctors found that the value proposition just wasn’t there. PPMs had promised to reduce administrative burdens and enhance revenues in return for 15% to 20% management fees. But it didn’t happen. And third: Maybe physicians just weren’t ready to share their practices with a business partner.
But unwinding from PPMs was no panacea for the challenges facing physicians in the 21st century. In 2003, Goldman Sachs Vice President Chris McFadden asked THE question: “How do you take undercapitalized and undermanaged practices, which are confronted by outside challenges, such as HIPAA, and allow the physicians to focus on providing better care, while someone else handles all these other issues? … [T]he cauldron is boiling over with many of the same issues that were emerging in 1989 and 1990.”
Nine years later, in 2010, it was clear that physicians had turned 180 degrees since the late 1990s and embraced ownership by hospital-based integrated delivery systems. “There is rarely a hospital we talk to that doesn’t already have or is in the process of acquiring a physician practice,” Deborah Holzmark, RN, senior manager, Dixon Hughes, a CPA and consulting firm in North Carolina, told Repertoire.
Two years after that, a new entrant joined the physician practice market: Insurers. With years of experience monitoring and paying claims, insurers claimed they possessed the management expertise and databases to affect how – and what – care is delivered, to whom, and with what results. In June 2011, Highmark Inc., an independent licensee of the Blue Cross and Blue Shield Association, announced its intention to pursue an affiliation agreement with West Penn Allegheny Health System in Pittsburgh.
By April 2017, fewer than half (47.1%) of physicians owned their medical practice. The American Medical Association estimated that in 2018 about 200,000 physicians worked for a medical practice that was owned or partially owned by a hospital or health system. But even ownership by a large healthcare organization couldn’t guarantee security for doctors – or health systems, for that matter.
Increasingly, health systems found themselves competing for the physician market not only with insurers, but with drugstore chains and other retailers, such as Amazon Care, Best Buy, CVS, Dollar General, Walgreens and Walmart. None were new to the game, but they were persistent. By May 2023, Repertoire reported on other “disrupters,” each with its own strategy. Some were acquiring physician practices and employing physicians, others worked on a contract basis to provide independent practices with support for IT, marketing and administration. (A spin on the old physician practice management concept.) Either way, it became clear that all roads in primary care medicine were leading toward consolidation.
Digital Medicine
Thirty years ago, “going digital” meant digitizing medical devices like thermometers and scales. Soon the term referred to transitioning from hard-copy patient records to EMRs, and then connecting those EMRs to diagnostic instruments in the physician’s office. Most recently, digitalization has come to mean connecting the medical team to patients in their homes or at work via continuous glucose monitors, apps and wearables. Virtual medicine has shaken longstanding traditions in healthcare delivery and will probably keep doing so for some time to come.
FDA grapples with apps
In the summer of 2011, the FDA issued draft guidelines for apps, which the agency defined as software programs that run on mobile communication devices and perform the same functions as traditional medical devices. In its formal guidance issued two years later, the agency wrote that mobile apps had the potential to transform healthcare by allowing doctors to diagnose patients outside of traditional healthcare settings and helping consumers manage their own health and wellness. The FDA said it would focus its attention not so much on wellness apps (e.g., those that measure steps) but on apps that presented a risk to patients if they failed to work as intended.
Continuous glucose monitoring
By 2018, continuous glucose monitoring (CGM) was transforming the way blood glucose levels were monitored and managed by people with type 1 diabetes. (CGM for people with type 2 would follow.) In that year alone, the FDA cleared three systems for marketing in the United States, by Dexcom, Medtronic and Senseonics Holdings. (The Abbott device had been approved for marketing in 2017.) CGM had been shown in clinical studies to reduce the risk of hypoglycemia and diabetic emergencies.
Wearables: What are they good for?
By 2019, the term “wearables” was ubiquitous in discussions about health. An estimated 14 million U.S. adults subscribed to a digital health/wellness service, and some studies showed that 40% of U.S. adults wore some kind of digital health technology. The industry flourished, giving rise to companies such as AliveCor, Empatica, EnLiSense, Nemaura and VivaQuant. But with wearables came questions. “It is yet to be determined whether the growth of wearables will improve the diagnosis of pathology and improve outcomes or not,” Dr. Tom Schwieterman, vice president of clinical affairs and chief medical officer for Midmark, told Repertoire. “Whether the constant monitoring will improve cost of care is, in my mind, an even larger question.”
Karl Poterack, M.D., medical director of applied clinical information for Mayo Clinic, raised another question. “A device can accurately measure steps – but is that a modality worth measuring?” What’s more, very few practices had the infrastructure to import and sift through the massive amounts of data these devices could generate, he said. Physicians were also concerned about assuming liability and responsibility for reviewing that data – something that had not been clearly defined.
A new challenge: Hackers
As remote monitoring grew, concerns persisted about patient privacy, system interoperability and patient data overload. By October 2021, the healthcare community was considering how to cope with ransomware. It was becoming clear that medical devices would have to be scrutinized not only for the possibility of hackers interfering with them to hurt or even kill people, but also to prevent hackers gaining access to electronic medical records, personal patient information and even providers’ financial systems.
Who gets left behind?
Digital technologies were widely accepted as effective medical tools, but by 2023, some people questioned how equitable they were. Questions were raised about the accuracy of data gathered by wearables among people of color. And in a study of patients with diabetes, researchers noted that rewards by payers or employers based on healthier eating habits and lifestyles (aided by digital technologies) could end up rewarding the rich and penalizing the poor.
Disintermediated? Not Even Close
Distributors’ fears of being “disintermediated” by Internet-based medical markets ran rife in the 1990s. But by the end of 2000, following the collapse of such e-markets as Cimetek Commerce and Promedix, those fears were quelled. Yet a lot of work remained to be completed in order to integrate e-commerce into the med/surg supply chain.
The decision by Ventro in December 2000 to shutter Promedix – its specialty medical products e-procurement site – wasn’t an indictment of business-to-business electronic marketplaces so much as an indictment of B2B marketplaces that weren’t based in existing businesses, Repertoire noted the following month. By becoming leaders in e-commerce, med/surg distributors could strengthen their place in the supply chain. That’s exactly what they did, though it wasn’t a totally smooth journey.
By 2004, any web surfer could find bargains on medical scales, blood pressure equipment, even ultrasound equipment. But to call it ‘disintermediation’ would have been way off base. The dot-coms’ niche in medical commerce was pretty narrow, according to manufacturers, distributors and Internet exchange executives who spoke with Repertoire. “The bigger picture, perhaps, is that finally, the Internet is starting to deliver on its promise of improving the information flow among trading partners,” Repertoire wrote. “And that far outweighs any potential threats posed by disintermediation.”
E-commerce and the sales rep
Smart reps took advantage of that improved flow of information. In 2011 Repertoire noted that for the sales rep, four things were most important: relationships, communication, time and information. “Without relationships, there’s no sale. But without communication, time and information, even the strongest relationships suffer. Starting with the personal computer a couple of decades ago, and extending through to smartphones and iPads, sales reps – like society at large – have been the beneficiaries of technology.”
“In the past, we would show up at an account with the distributor rep, then spend a lot of time learning more about the account,” Jack Moran, managing partner, MedTech/MedCare, told Repertoire in 2018. “Today, before such meetings, our reps have already invested time in the office to learn about the customer. They’re saying, ‘If I’m going to that meeting, I need to make sure I know more than I have to know.’ That’s very much a new skill, versus just being really good at talking about products and forming relationships. Yes, we need to do all that today. But doing our homework is critical.”
Richard Bigham, vice president, primary care market, IMCO, added, “Traditional sales presentations and product demonstrations are being utilized less frequently due to the proliferation of product information available to today’s buyer. These buyers utilize multiple platforms and networks to research potential products and suppliers, resulting in a highly informed consumer and nontraditional sales cycle. Adoption and utilization of social media for communication with their customer base and to provide visibility to potential customers will be a necessary skill set and behavior for these tenured reps.”
High-Value Care: Moving Target
High-value care: It’s what physicians, payers and patients want. But it’s difficult to define and difficult to incentivize, particularly in a healthcare system built on fee-for-service. The healthcare community has been trying to nail this moving target for 30 years.
In September 2004, James Martin, M.D., board chair of the American Academy of Family Practitioners, stated what many others were thinking: Current reimbursement methods were at odds with high-value care. “Payers reimburse only for face-to-face encounters, thus forcing patients to visit their doctor when a phone conversation or e-mail might address their problem,” he said. “The front office staff is overworked dealing with insurance issues, government regulations and the like. And by being slow to implement automated systems in their offices, physicians and their staffs are missing opportunities to deliver more efficient, better care.”
Five years later, in 2009, the American College of Physicians wrote, “Fee-for-service reimbursement has decimated primary care by rewarding doctors who perform procedures, while financially penalizing those who provide more consultations, counseling and long-term health management.”
Soon after, nine physician specialty societies published a list of 45 common low-value tests and procedures, that is, tests and procedures that were often unnecessary. The list – part of the “Choosing Wisely” initiative of the American Board of Internal Medicine – offered evidence-based recommendations that physicians and their patients should discuss to help make decisions about the most appropriate care based on the individual situation. (In August 2022, 10 years after it was started, the Choosing Wisely campaign announced it had grown to include lists of low-value services from more than 80 professional societies, citing a total of more than 600 procedures.)
“The trend is clearly moving toward outcomes and performance-based care,” said Tom Schwieterman, M.D., director of research and development for Midmark, in February 2010. “Doctors will be increasingly incentivized and paid based on how well they manage their disease management programs.”
By February 2012, governmental and private payers were beginning to demand that providers address the total cost of care rather than care delivered just in the acute-care facility, the doctor’s office, the long-term-care facility or the home.
In that same year, Medicare pointed to excess readmissions of previously hospitalized patients as a sign of low-value care and announced it would penalize hospitals for readmissions after 30 days of discharge of Medicare patients with pneumonia, heart attack and heart failure. Two years later the agency added elective hip/knee replacement and chronic obstructive pulmonary disease to the list. “The readmissions policy is reminding us that no matter what kind of doctor you are, you’re responsible for seeing the big picture,” that is, the patient’s overall health, not just the condition that caused him or her to be admitted to the hospital, said Tina Shah, MD, MPH, pulmonary and critical care fellow, University of Chicago, and a health policy researcher.
In 2015, Health & Human Services Secretary Sylvia Mathews Burwell announced that the agency intended to tie 85% of all traditional Medicare payments to quality or value by 2016 and 90% by 2018. The feds took a step in that direction by passing the Medicare Access and CHIP Reauthorization Act of 2015, or MACRA, in April 2015.
MACRA might have been a step in the right direction, but observers said it fell short of its goal. “The main takeaway is that MGMA members view MIPS [Merit-based Incentive Payment System] as a reporting program without a clear link to actual quality improvement,” said Mollie Gelburd, associate director of government affairs, Medical Group Management Association, in 2019.
Like Medicare, private payers were convinced of the wisdom of ditching fee-for-service reimbursement. In August 2020, UnitedHealth Group released a report showing that primary care physicians who were paid under global capitation – which pays a set amount per month per patient – achieved key quality metrics at higher rates than physicians paid under fee-for-service. Findings include higher screening rates for breast cancer, higher levels of controlled blood sugar levels and higher rates of functional status assessment and medication review. Even so, progress toward value-based care was uneven, with the American Medical Association reporting that 87% percent of physicians said their practice still received payment through fee-for-service.
Writing in a December 2021 JAMA Internal Medicine editorial, Niloofar Latifi, M.D., of John Hopkins School of Medicine, pointed out that fee-for-service leads to more care, and that more care often means poorer care and outcomes. “The potential negative consequences of medical overuse include adverse effects of treatments and procedures, invasive and dangerous follow-up tests and treatments, overdiagnosis, psychological harm, treatment burden, social consequences, and dissatisfaction with health care.”
Medical Care ‘On Location’
In the movie industry, to shoot scenes on location means to film away from the studio. If the “studio” in medicine is the traditional physician’s office, “on location” today might refer to a drugstore, a grocery store, a workplace clinic, even a home. To what extent must medical professionals practice on location to accommodate patients’ calls for convenience and to stay competitive? … To be continued.
In 2006 and 2007, pundits were predicting that as many as 5,000 retail clinics would dot the country in just a couple of years. That didn’t happen. In 2010, there were only about 1,200 clinics in 38 states. That said, in 2010, such clinics accounted for 12 to 13 million patient visits. And operators of retail clinics looked ahead toward a bright future, one that would find them expanding into chronic disease management and closer partnerships with hospitals and hospital systems.
Sure enough, by 2013, there were more than 1,400 MinuteClinics, Take Care clinics, Little Clinics, Clinics at Walmart, and other retail clinics in the United States. Were doctors worried? “I would say they ought to be more aware than concerned,” said Ken Hertz, principal, Medical Group Management Association Health Care Consulting Group. The retail clinic did indeed present competition to the classical practice model, he said. And they addressed walk-ins far more efficiently than the traditional physician office. “At the very least, [physician practices] must be able to handle appointments in a timely manner. They must understand what they can do to provide a competitive advantage.”
Steady growth of retail clinics was far from assured, however, as some operators scaled back on their commitment to in-store clinics. In October 2019, for example, Walgreens announced it would close all (157) of its company-managed Walgreens Healthcare Clinics but continue to work with its network of local health system operators who owned and operated approximately 220 clinic locations inside Walgreens. (History repeated itself in October 2023, when Walgreens announced it would close 60 underperforming VillageMD clinics.)
Retail clinics weren’t the only non-hospital sites encroaching on the traditional healthcare establishment at the turn of the 20th century. By 2014, urgent care centers had grown in numbers, and hospital systems, private equity firms, insurers, doctors and private companies took note. Nearly 10 years later, in August 2023, the Urgent Care Association reported there were over 14,000 urgent care centers in the U.S., with a 7% growth rate for new ones. More than 78% of the U.S. population lived within a 10-minute drive of an urgent care center. And through consolidation, those centers were getting bigger.
The 2020s also brought about a new concept in healthcare – home-based primary care. Not to be confused with traditional Visiting-Nurses-style home care, this type of care allows the primary care team to monitor patients in their homes and manage chronic conditions, such as heart and lung disease. Here’s the rationale: Clinics had been built to optimize the productivity of clinicians in a fee-for-service healthcare world, wrote one healthcare executive in 2023. But that model was fading, and it didn’t work well for people who were unable to go to a doctor’s office due to age or disability. According to the American Academy of Home Care Medicine, an estimated 2 million frail, seriously ill and vulnerable adults – many with two or more chronic conditions – were unable to visit physicians’ offices.
The question was, and remains: Is home-based primary care sustainable in a fee-for-service world, given its demanding systems and logistics requirements? … Another developing story.
Stretch Time for Primary Care
Advances in diagnostics and medical/surgical therapies have expanded the capabilities of primary care physicians. But so too has a growing awareness of the impact on human health of factors that traditionally were never considered medical/surgical, such as oral health, mental/behavioral health, public health and even health in extreme temperatures. Med/surg may remain bedrock for Repertoire readers, but physicians might welcome a dialogue with their reps about some of these other factors affecting their patients and their practices.
Cancer: A chronic illness
By 2010, improvements in diagnostics and treatment had transformed some cancers from death sentences to chronic illnesses, presenting new challenges to primary care doctors as well as specialists. Thanks to molecular diagnostics, clinicians had come to realize that cancer was a heterogeneous disease. “Not all cancers are the same,” said John Blackwood, vice president and general manager of Beckman Coulter’s immunoassay business center. “So the question goes from, ‘Does the patient have cancer?’ to, ‘What is the likelihood that that specific cancer will spread or cause significant disease?’ That’s where cancer diagnostics is going today and in the future.”
Opioid use disorder
Opioids – once used primarily to relieve pain following surgery or cancer, or at the end of life – were being used widely by 2010 to relieve severe pain caused by chronic low-back injury, accident trauma, arthritis, sickle cell, fibromyalgia and other conditions. With the increase in opioid usage, however, concerns grew about abuse, addiction and diversion. Opioid use disorder continued to grow throughout the decade, putting an enormous burden on primary care, where the majority of opioid prescriptions were written.
Systemic and oral health converge
In January 2017, Oakland, California-based Kaiser Permanente opened a pilot integrated medical-dental clinic in Beaverton, Oregon. The clinic, Cedar Hills Dental and Medical Office, made Kaiser Permanente’s Northwest division the first commercial health care organization to integrate medical and dental health records as well as offer coordinated services.
In 2018 researchers continued to connect the dots between oral health (particularly periodontal disease) and chronic medical conditions. In October 2018, Dominion National, a dental insurer and administrator of dental and vision benefits, released a study indicating people with chronic health conditions such as asthma, diabetes and heart disease who received preventive dental care covered by insurance had fewer emergency room visits and hospital stays.
Chronic diseases common and costly
Repertoire reported that in 2018, chronic diseases and conditions – such as heart disease, stroke, cancer, type 2 diabetes, chronic obstructive pulmonary disease, obesity and arthritis – were among the most common, costly, and preventable of all health problems. As of 2012, about half of all adults – 117 million people – had one or more chronic health conditions. One in four adults had two or more. Caring for people with diseases that used to be fatal called for physicians to expand their knowledge about treating chronic illness.
Behavioral health and the primary care practice
In April 2021, as many as 40% of patients seen in primary care settings were reported to have a mental illness, and as many as 70% of primary care visits stemmed from psychosocial issues. At the time, integrating behavioral and physical health was still uncommon among U.S. physician practices. But a year and a half later, 70% of all primary care visits included a behavioral health component, and 118,500 primary care physicians had co-located with nearly 140,000 behavioral health clinicians in 23,000 primary care practices.
Public health and primary care: Worlds apart
The COVID pandemic drew attention to the gap between public health and medicine. From the start of the 20th century, medical and public health practitioners had been educated in separate schools and upon graduation, went their separate ways. But by January 2022, almost two years after COVID struck, the two professions came to realize that collaboration was essential, given escalating healthcare costs, ever-widening health disparities, increasing emphasis on preventive health and, of course, outbreaks of infectious disease.
Inequities in health care
Propelled by COVID and other societal factors (e.g., Black Lives Matter), researchers, clinicians and public health professionals started to pay more attention to inequities in medicine. In 2021, the Blue Cross and Blue Shield Association – the national federation of 35 independent and locally operated Blue Cross and Blue Shield companies – launched its National Health Equity Strategy, a multiyear program to focus on four conditions that disproportionately affect communities of color: maternal health, behavioral health, diabetes, and cardiovascular conditions. In its announcement, BCBSA noted the Black men were 70% more likely to die from a stroke as compared to non-Hispanic White men; millennials from majority Black and Hispanic communities had lower diagnosis rates of major depression compared to White communities; and African American adults were 60% more likely than non-Hispanic White adults to be diagnosed with diabetes by a physician; and Black mothers had three times higher maternal mortality and two times higher morbidity than White mothers.
Climate: Its impact on emergency and chronic illness
Socioeconomic issues aside, the medical community by 2023 was coming to realize another public health threat – climate change. In April 2023, the World Health Organization stated what most people suspected: Global temperatures and the frequency and intensity of heatwaves were only going to rise in the 21st century. Heatwaves could acutely affect large populations for short periods of time, often triggering public health emergencies, excess mortality and cascading socioeconomic impacts. But researchers came to realize that extreme heat has a long-term impact on health as well, causing cumulative physiological stress on the human body and exacerbating respiratory and cardiovascular disease, diabetes and renal disease. Addressing the health implications of extreme temperatures would continue to fall onto hospital emergency departments, public health authorities, community health centers and primary care physicians.
Medicine Over the Wire
In 2010, telemedicine was no sure thing. “We’re not there today because of the complexities involved,” Jim Woodburn, M.D., vice president and medical director for clinical initiatives at OptumHealth, a UnitedHealth Group company, told Repertoire. But Dr. Woodburn and others would probably agree we are there today.
According to a 2016 annual survey by the National Business Group on Health, nine in 10 large employers said they would make telehealth services available to their employees. By 2018, the American Hospital Association and the National Association of ACOs (Accountable Care Organizations) were among organizations voicing their support for a proposed $100 million program to promote telehealth among low-income families and veterans, with a focus on services and applications delivered directly to patients outside healthcare facilities.
Telemedicine soared in 2020 due to the pandemic, but usage plateaued afterward. Still, it was clear the technology wasn’t going away. The medical community pondered the details: What role would telemedicine play in urgent care and chronic care management? Would it lead to fewer in-person visits? Would it change the type – and number – of services offered in the clinic? “We don’t pretend to read all the tea leaves, but we believe the right ecosystem is a hybrid model,” that is, a combination of face-to-face and virtual visits, said David Houghton, M.D., MPH, the head of Ochsner Health’s telemedicine and digital health initiatives in New Orleans. “That means providing the level of care that is appropriate every time and providing patients with accessible and available technology that complements the important patient-provider relationship.”
Telemedicine advocates caught a break with the 2024 Physician Fee Schedule from Medicare, as several telehealth-related provisions instituted during the COVID Public Health Emergency were extended until Dec. 31, 2024. They included:
- Temporary expansion of the scope of originating sites for services furnished via telehealth to include any site in the United States where the beneficiary is located at the time of the telehealth service, including an individual’s home.
- Expansion of the definition of telehealth practitioners to include qualified occupational therapists, qualified physical therapists, qualified speech-language pathologists and qualified audiologists.
- Continued payment for telehealth services furnished by rural health clinics and Federally Qualified Health Centers.
- A delay in the requirement for an in-person visit with the physician or practitioner within six months prior to initiating mental health telehealth services.