Heathcare Conversations: Curbing the Cost of Healthcare

About this episode:

With the high cost of healthcare, made even more dire by the difficulty some have in getting and maintaining health insurance, being able to afford being healthy can be tough. In this special episode of UB Insider, a group of local doctors share how they have each been combatting the problem in their own way. Subscribe or download this episode via Stitcher and iTunes.


Pat Parkinson: Greetings everyone, my name is Pat Parkinson. It’s my pleasure today to be podcasting from the beautiful Grand America Hotel in Salt Lake City, Utah. I’m here at a conference called, The Future of Healthcare. And it’s a pleasure to be working here with Utah Business magazine. We have a whole slew of fascinating guests, lots of extremely smart people to drop some knowledge on us today. There’s several panels of course, and I’m sitting here now with three members of a panel that spoke and presented today on the topic of “Bending the Healthcare Cost Curve”.

It’s no surprise that healthcare costs have been steadily increasing for quite a while now, and we have three people here today who are trying to change that trend. And maybe get that trend to start decreasing a little bit, hopefully. Let me give a few introductions here quickly before we get into the topic. I’m here with Arlen Jarrett. Arlen is with Iasis Healthcare. I’m also here with Dr. Rachot. And Dr. Rachot is a semi-well known guy around the valley here. He has several healthcare clinics. His company is called Medallus Medical. And I’m also here with Teresa Rivera who works for an organization that a lot of us have heard about if you’re in Utah. It’s called the Utah Health Information Network. The things these three people have in common today is they’re all serving on this panel that I mentioned called “Bending the Healthcare Cost Curve”. Let’s just get right into this Arlen. What does it mean Arlen? What does bending the cost curve mean to you and what you do at Iasis?

Arlen Jarrett: Well, you have to realize what’s been happening in the United States with the healthcare costs in general. And prior to our great recession which began in 2007, healthcare costs were rising at a rate of over 6% each year. When the recession hit, some things happened that actually bent that cost curve downward a bit. And now it’s, for the past several years it’s been down around 3.9% or so. So that’s something that bent the cost curve.

Pat Parkinson: 3.9% increase every year?

Arlen Jarrett: Every year. In general, across the board. We don’t think that those, that whatever happened during the recession is sustainable and will last forever.

Pat Parkinson: Do you know what that was?

Arlen Jarrett: There are a number of things that people have looked at. They’re kind of technical things. They’re not necessarily things that you would have thought about.

Pat Parkinson: By not sustainable, you mean that’s not going to work to continue to lower the curve?

Arlen Jarrett: They happened one time. It won’t keep the curve lower forever. So there’s a quest out for us to provide the right kind of care in the right place at the right cost. And if we can do that, and we can do it effectively, we can bring that cost curve down.

Pat Parkinson: Very interesting. Dr. Rachot, you’re no stranger to this topic obviously. Can you fill us in a little bit on what you’ve done in the past few years to address this topic and maybe tell us a little bit about your business and such?

Dr. Rachot: Yes, Pat. I own and operate urgent care clinics along the Wasatch Front for the past 15 years. About 6 years ago when the recession came around, I noticed that patients were sicker than they should be. I discovered that they were delaying coming to the doctors to get well due to increasing copays or no insurance. So I developed a program where it would increase access at lower cost. And we’ve been operating that for so long, it’s been six years now. And it is reducing the cost and keeping people healthier with no balance, no medical bills.

Pat Parkinson: Dr. Rachot, why did you start kind of adopting that model to begin with? Because it’s kind of an innovative, unusual model for healthcare clinics, is it not?

Dr. Rachot: Yes. About 15 years ago we were seeing patients with head colds with a $10 or $20 copay. Those were kind of easier days. But then they started coming in with full blown pneumonia when they should have come in a week before with a sinus infection. So, you know, as doctors we want to get patients well, and that was not happening. So I wanted to develop a program that would address that.

Pat: We’ve had other doctors who have alluded today to their frustrations with the healthcare system. And a lot of these business ventures of theirs, physicians like yourself who are business people now, that was kind of a result of that frustration and not being able to give that optimal care.

Dr. Rachot: Exactly. And the root cause of that frustration, let me tell you what, we as physicians are licensed to make people well. But the system makes us wish that people were sick so that they will come in. And that is wrong. But with the program that I have, it completely changed that mindset around. This is the only thing that will make the physician think, what can I do to keep patients healthy? Because they paid me already. Instead of telling them to come in so we can bill the insurance and get the revenue.

Pat Parkinson: Well everybody is going to have plenty of time to speak more today, let’s move on to Teresa. Teresa, you’re part of an organization that if you listen to the news and if you kind of stay in touch with what’s going on in Utah, you maybe have heard of the Utah Health Information Network. But maybe a lot of us have heard of it but we don’t know exactly what it is. Can you tell us what your organization is and how you’re contributing to this situation and this panel?

Teresa Rivera: Absolutely, Pat. I’m fortunate to lead an organization that is connecting providers such as Dr. Jarrett, Dr. Rachot so that they can provide care coordination to the patient. So what we do is we have a secure way that data can be presented so that the patient can have the benefit of their physician having all the data on them. Patients, as you know, do not stay in one healthcare system. They’re going to have services with Dr. Rachot. They’re going to go to the Iasis hospital for a colonoscopy. And Dr. Rachot needs to know what the results of that colonoscopy is. And so by us connecting those two, Dr. Rachot is able to see the results from the colonoscopy and add that to his medical record so he can properly treat the patient. In addition, we are able to alert him when one of his patients has entered into one of the Iasis hospitals and let him know that one of his patients that he’s caring for, and trying to keep well, has had an emergency visit, or emergency admission to the hospital. Once they’re discharged, he can follow up with that patient to keep that patient out of the hospital and from being readmitted back to the hospital.

Pat Parkinson: Is that true?

Dr. Rachot: Yes, it is. And, you know, this is a great process that is moving us away from the fee for service model, toward the operation management. Instead of letting patients decide when to go, where to go, where they could be worse and it could be costly, we get that notice to us and we reach out to the patients. We start managing them right away so we can keep them healthy and preventing them being readmitted and to go to other places that are increasing the costs.

Pat Parkinson: Arlen, there seems to be a lot of collaboration going on between these organizations and organizations like yours. Is this collaboration important and necessary?

Arlen Jarrett: Definitely. It’s really needed. As healthcare providers we have a mantra, it’s called “free the data”. The data relates to that knowledge that we might have of when a patient is in an emergency room or when they’ve been diagnosed with a certain condition or when they didn’t take their medication. Or when they went out of town and visited another hospital somewhere else. And in order for us to really help that patient manage their care pathway and stay healthy, we need to have that data. And it’s very, very difficult to get that data from disparate entities. Teresa is a champion of that cause. We just wish we could do more for them.

Pat Parkinson: So why don’t you tell us, I think we understand more about what Dr. Rachot and Teresa do in their respective organizations. Can you tell us a little bit about Iasis Healthcare and what your role is specifically in this?

Arlen Jarrett: Great. Thanks for the opportunity. I’m an obstetrician/gynecologist by training and I’ve spent my entire career practicing at Jordan Valley Medical Center in West Jordan. And I’m currently the Chief Medical Officer for the Iasis healthcare system in Utah. And our system has five hospitals: Davis Hospital in Davis County, Salt Lake Regional Medical Center, Jordan Valley Medical Center, Jordan Valley Medical Center – West Valley Campus in Salt Lake County and we opened a new hospital in Utah County called Mountain Point Medical Center in Lehi, just this year. Additionally, we have over 1,500 physicians that are affiliated with us. About 10% of those physicians are employed by our physician group, but the other 90% are independent. We also have a health plan. The thing that we do…

Pat Parkinson: You have a health insurance plan.

Arlen Jarrett: We have a health insurance plan. And the thing that we try to do is bring all three of those entities: the physicians, the health plan and the hospitals together to the same table so that we can actually be serious about bending the curve. You mentioned earlier that physician’s sometimes get frustrated that their great ideas just never take off, they just never get the wind in their sails. When you bring these three entities that hold all three legs to that stool of healthcare, that’s where you can have great success. Get the health plan, the physicians and the hospitals working together.

Pat Parkinson: At the risk of being redundant here, can you speak to some of that frustration? I think you probably become a doctor, and obviously it can be a great livelihood of course, but you probably become a doctor, for the most part, because you want to help people. It’s probably a very demanding job and you really need to kind of care about it in that way. Have you experienced that dualism? Or that kind of dichotomy of being in such an important…obviously doctors are very important in society, but you might seem stuck in a system that might seem broken or even failing at times. I wonder if you could speak to that a little bit?

Arlen Jarrett: Well, it might be a little ill. And if we’re good physicians, we’ll help heal it. But, like Dr. Rachot was saying earlier, we’re living in a generation of time when our incentives, our financial incentives regarding healthcare are somewhat perverse. We are paid more for doing more, not necessarily for keeping people healthy. That’s frustrating for physicians, like Dr. Rachot said. We want to keep people healthy. And interestingly, there is a movement going across the country now that I think many, many people are coming to the table and saying, that’s our goal. We want to keep people healthy. Hospitals are having to take that somewhat stern realization that they are a cost care center, that they can’t always just increase their volume at everyone else’s expenses. They have to come to the table and be willing to sacrifice somewhat. That’s what we’re doing.

Pat Parkinson: Well said. Teresa, in your role at the Utah Health Information Network, we have a few minutes left here and I’d love to hear from all three of you about, maybe some practical advice and tips that you have for people. And tips might sound a little strange, but I know, I mean, I’m frustrated with the healthcare system with my personal healthcare system and insurance situation. And I wonder, Teresa, and all three of you, if you guys can leave us with any advice or observations. I guess we all hope that you’re optimistic about the situation. Are you optimistic? What can you tell that person who’s frustrated, who may not have healthcare, or may not see a way to get healthcare. Or maybe they have shoddy healthcare that’s not doing the job. Can you offer any advice or comfort for that person, Teresa?

Teresa Rivera: Well, a couple of things. First, for the individual, they do need to get engaged in their healthcare. I’ll let the doctors speak to that and why it’s so important that the patient care about their own healthcare. A physician isn’t going to really make me lose weight. I am the one that has to make the decision to take care of myself. But as an employer, I think it is important for the employer to look for healthcare coverage for their employees that is embracing this new value-based reimbursement methodology so that we are moving that cost curve and bending that downward.

I would advise them to look to their healthcare insurance plan to see if they are providing case management services. Are they also stepping in and trying to help the employer help their employees get healthier? As well as manage those pre-chronic diseases before they get to the point where there’s no return.

Pat Parkinson: These are big areas that need attention, in your eyes, it sounds like. I appreciate that. And I like the way you kind of addressed my question about the patient, but you also spoke to the  business and I appreciate that. How about you Rachot? I think that’s maybe even more poignant for our audience. Can you speak to business owners and such who are struggling with healthcare challenges? What is their biggest healthcare challenge, do you think, for a small business owner?

Dr. Rachot: Definitely. Teresa was alluding to changing the mindset and changing behavior, and that’s exactly what needs to be done. We used to think that insurance covers everything. It doesn’t anymore. We need to change that mindset. Because we thought that healthcare is expensive, and it isn’t. if you divide it into basic care and advanced care, basic care is not expensive, advanced care is, but you rarely need advanced care. Right? And then the other thing is you need to change your behavior.

We used to use our insurance to see the doctor. Well, you see what happened when you went to use your insurance, it’s costly! So you don’t go to the doctor. So buy insurance and leave it alone, don’t use it, right? But then go to the doctor by prepaying that doctor. That’s right. You have pre-payed insurance for so many decades, why can’t you pre-pay a doctor with your own money? And it’s only a dollar a day, that’s all you need. It works! We have proven over six years.

Pat Parkinson: Your business?

Dr. Rachot: Yes. Just like my talk. So, now patients have an affordable channel to their doctor and when they need to go see the doctor for basic care/primary care, which is what most people need, it’s $10 per visit. So they don’t have hesitation to go in to stay healthy. Once you’re healthy, you don’t access the advanced care and that cost comes down. And then insurance premiums can come down. So my advice, for the general public, and especially employers, don’t go and buy insurance that’s so expensive that covers everything, because the cost is going to go up. Buy major medical, put it aside, tell your employees, don’t use that. And then find a program, a medical membership program just like my talk, and prepay the doctor for your employees.

Pat Parkinson: This advice applies to both the individual and the employer.

Dr. Rachot: Exactly. Your employees will be happy because you pay for their high access that is low cost. They go in to stay healthy. And they can also make the insurance company happy because when you prepay a doctor, and the doctor takes care of the patient, the doctor won’t send the claim to the insurance company. So no claim means lower insurance premiums now, hopefully.

Pat Parkinson: Well said. I appreciate that. It sounds like a very interesting model. Arlen, would you like to speak to that question? I’d like to hear what’s top of your mind when it comes to this.

Arlen Jarrett: Absolutely. I agree completely with what Teresa and Dr. Rachot said about how important it is for patients to become engaged and for employers to become engaged in the healthcare process. But I would add to that. How vitally important it is for the healthcare system to set that patient up for success. The doctor needs to be practicing evidence based medicine and making sure that they educate the patients about the right way and the wrong way to receive healthcare. The hospital needs to be making certain that they provide opportunities for the right kind of care in the right place, not just follow the old gone by mandate of filling up beds at all costs. And insurance companies need to reach out and help educate patients.

Pat Parkinson: Excellent stuff. We’ve had a really great conversation here. I have one more question that I’m just going to position as a yes or no question. But I want to know if anyone has anything else to add about what we’ve already discussed. Does anybody have any burning thoughts that they need to get out there?

Arlen Jarrett: I would say that I think there’s reason for us all to be optimistic. I think there are many, many, many smart minds in this country and in this state who are really working hard at solving this problem and I think we’re going to tackle it.

Pat Parkinson: Well that’s a nice transition into my last question here, Arlen, and I’ll hit you with it first. The topic of the panel was bending the healthcare cost curve. Yes or no, can we bend it down?

Arlen Jarrett: Yes, we can. And we’ve been doing it.

Pat Parkinson: Rachot?

Dr. Rachot: Definitely. I actually wrote a book called The Demise of our Healthcare. But it’s followed by, we can prevent this, ok? So there is definitely hope here. We are in a healthcare crisis now. We can’t rely on the government to do something. We need to step up and do it ourselves. Doctors, patients and employees/employers, we all can make it happen.

Pat Parkinson: Teresa? Do you really believe we can do it?

Teresa Rivera: Absolutely. I believe we can do it. Because I think that we are entering an age using all of our health information tools that will provide the physician and the hospital data and information so that they can treat the patient right the first time. Better health. Better care. Better cost.

Pat Parkinson: Well said, Teresa. What a pleasure to be here with these three interesting, dynamic individuals. Again, Arlen Jarrett from Iasis Healthcare, Dr. Rachot from Medallus Medical and Teresa Rivera from the Utah Health Information Network. It’s a real pleasure spending time with you today. Enjoy the conference.