Former @DeptVetAffairs Secretary @DavidShulkin on Population Health & Innovation
From the PopHealth Week Archives: In this episode from January 22, 2020, PopHealthWeek sits down with Dr. Rushika Fernandopulle, MD, co-founder & CEO of Iora Health and a physician who has spent decades improving the quality of healthcare delivered to patients.
Gregg Masters 00:10
You're listening to PopHealth Week on HealthcareNow Radio. I'm Gregg Masters Managing Director of Health Innovation Media, the publisher of ACOwatch.com and your PopHealth Week co host with my partner, co founder Fred Goldstein, President of Accountable Health, LLC, a Jacksonville, Florida based consulting firm. Our guest today is Rushika Fernandopulle, MD, a co founder and the Chief Executive Officer of Iora Health a unique model innovating in the primary care space. Dr. Fernandopulle is a physician who has spent decades improving the quality of health care delivered to patients. He was the first executive director of the Harvard interfaculty program for health systems improvement and served as a managing director of the Advisory Board company. He serves on the faculty and earned his AB, MD and MPP degrees from Harvard University and completed his clinical training at the Massachusetts General Hospital. Iora Health's website notes where changing healthcare from the ground up believing better health care starts with better primary care Iora health simple, yet radically different approach to restoring humanity to health care is threefold. team based care that puts the patient first, a payment system based on care, and technology builds around people not process. So Fred, over to you help us get to know Dr. Fernandopulle . And what he's up to at Iora health.
Fred Goldstein 01:41
Thank you so much, Greg, and Rushika, welcome to PopHealth Week.
Rushika Fernandopulle 01:44
Thank you. It is great to be with you.
Fred Goldstein 01:46
It's a pleasure to have you on — it's always great to talk to you. And hopefully I'll run into one of these conferences coming up soon, because it's always a fantastic opportunity. So why don't you give our audience a little feel for your background and history, and then maybe where our health is today?
Rushika Fernandopulle 02:00
Sure. So I'm a primary care doc, and about 15 or 16 years ago, was in a typical primary care practice. And it had this realization that doesn't take rock doesn't take genius, that the model we have of delivering primary care was not working. Right. I think a lot of good people a lot of good intentions. But the model fundamentally wasn't working, wasn't working for docs wasn't working for patients wasn't working for the system, everyone feels like they're on a hamster wheel. And things are going faster and faster. And you feel like you really can't do your job and help patients then. And then this is the key is that things are getting worse and not better. All of the above was was getting worse. The electronic medical records, a lot of the quality metrics, all the things that the people were putting in place to theoretically improve things weren't helping. And I think the real realization that I came to is maybe the the model we have is rotten to the core. And and really what it was that we built the system on a basis of transactions, document code bill, next, play these games about whether it's a 99213, or 99214. And really, none of that actually adds value. Right? It's not why I wanted to see medicine is not why patients were coming to see is that really the thing that heals people is relationships. And what we have to do is sort of maybe get rid of all these transactions, and rebuild on relationships, not add stuff to the current system, but maybe take stuff away one of my favorite quotes from Michelangelo, they asked him one day, you know, how do you get the Pieta is beautiful sculpture. And he says really simple. I take a block of stone and they chip away everything that's not the Pieta. Right? So maybe that's what we had to do the primary care. And so I started on a journey about 16 years ago, of what if we started over and built a new model of primary care that was sort of radically consumer centric value base was digital and met the needs of patients and doctors. And what if we weren't, we had the courage to start over from scratch, you know, I had in the past trying to fix health care, you know, through working at places like the Advisory Board company, which is a think tank in DC through running a interfaculty Health Policy Program at Harvard through working with people like Don Berwick at IHI into to Healthcare Improvement, and really realize all of those were what I call the incremental change model, take existing practices and tweak them a little bit, move them ever so slowly towards the future. And I finally ran out of ran out of patience that maybe we should start over. And that was the beginnings of what turned into Iora of really coming up with this brand new model of care.
Fred Goldstein 04:19
Iora is this model that you said you essentially start over with so what did you you mentioned this idea about patient centric. What did you feel were the key components in that? And how is that operating now as compared to some of the other models that are out there?
Rushika Fernandopulle 04:32
And so if you want to fix healthcare, like the goal, unfortunately, the current healthcare system is to do more stuff to people, but people come to us as a need, you fill the need, and you get paid for telling them what to do. That's moderately interesting. What's really interesting is it how do you help people actually do it? So in my own practice, you know, people would come to me and I'd have, you know, seven or 10 minutes to see them. And I would be able to say, look, you should eat less, you should exercise more, you should take your medicines, good luck sucker, I'll see you in three months. And then three months later you come back and you of course, haven't done everything and you bad, bad non compliant patient, right. And that sort of cycle will continue to really I didn't know we need to change the system where we need to A create a plan and publish shared care plan with patients. We need to have human beings we're not just doctors, not even nurses, and we call health coaches, who are from the community speak the language of the people they serve can actually help patients, figure out how to execute on the plan, you know, understand your condition, know what to track, take you for walks a teach you to exercise teach tou to eat, hold your hand, when that's the right thing to do. Kick you in the behind when it's the right thing to do. We had to integrate behavioral health into the practices and put, you know, mid level behavioralists in the practice, we had to tackle social determinants we were doing that for 10 years, we had to have patients know what's going on, if they're going to try and improve their health or let them see their whole medical record. We will do that for 15 years, get data from patients from their home, not just when we get into the office, get patients together in groups so they can help each other and learn create a de facto narrow network beyond this. So we can help people navigate the system and find the right specialists and co manage in the right way. Be with them when they're in the hospital as opposed to just dropping them. Like most people so uses a very different system. We also didn't realize that what you needed to do was build a different IT platform, right the electronic health records out there. Despite all the rhetoric are built to documents so I can bill hire not to manage populations? Sure they have registries, they usually afterthoughts, they often don't work. So we've had to build our own system that's really more of a relational system like a CRM than an EMR, right, that transactional system, we just feel the different culture, different space design, and the the the Big Kahuna, really, and the thing that I think keeps almost everyone from doing it is a business model. Right? It's not hard to come up with I just what I just said, right? How do you optimally manage people, the hard part, Why is no one else doing it are very few people doing it. Because the current business model a fee for service doesn't pay for it. And trying to get out of that, and figure out how to get a business model that does work has been the the real challenge over the last 15 years. And in some ways, the evolution of Iora has really been you know, the similar clinical model, of course, we make it better periodically. But really, it's been an evolution of the business model of how to do this.
Fred Goldstein 07:16
So as you said, all of those areas you discussed are they're almost I don't want to use the phrase, they're buzzwords, you know, but engagement, group meetings, all of these, and you obviously have put them together. So and you talk some a little bit about engagement. So let's dive into that a little bit, where you talked about having coaches from the community, which obviously is critically important. We've seen that in other programs as well, where people have explored that, what sort of things did you do to create that engagement, so that that individual doesn't come back at that three month point, not having done it, which is sort of the holy grail in a sense of a lot of this?
Rushika Fernandopulle 07:52
You know, I think it's exactly it, I mean, the big bet we're making is that that thing we start with is relationship, right? So that that this is all about behavior change, both by patients and by doctors. And if you don't cause behavior change, you're wasting your time. But by the way, there's a lot of waste of time going on in healthcare. And so but but the people change behavior because relationships and people who care about them so it's a great story. One of my favorites is we had a practice. And we the patient, I was the doc and when the health coaches said doctor, the patient who's coming to see us she's a hot mess. And they go in the room and it was Joyce and she looked awful like her hair was disheveled is blank look in her eyes she was had been in and out of the ER not going to work she was you know, not taking her meds very often she bad blood pressure diabetes out of control. So met with her gave her a health coach started coming to some of our groups sort of get got with the program. I ended up leaving the practice to try and figure out how we started second one and then I came back about six months later and the doctor to call for me to talk to Dr. Neil Patel said, Rushika. Remember that patient who came in the beginning, Joyce oh yeah the hot mess of advice. He said, right, she's back I want you to see her. So I go into the room and I almost don't recognize her. She looks amazing. Her hair is combed her makeup blue makeup on. I look at the chart back to work taking your meds, diabetes, hypertension under control. So I was like Joyce you look amazing. She said doc, I've never felt better in my life. So and they answer a key question. I said, Joyce, what have we done to help you? And you know, she didn't say the things that everyone in health care focuses on. You have the right payment model, you have the right IT system, you have the right protocols. She said something very profound. She said you all cared about me. You taught me to care about myself. And I didn't want to let any of us down. Right? You cared about me, you taught me to care about myself. I didn't want to let any of us down like that's the sharp end of the sword. That's what causes behavior change. Now in order to do that, we need to have the right payment model the right IT system, the right people who are paid for empathy, the right process the right experience. No, all of those are aligned around doing that. But but that's the sharp end of the sword.
Fred Goldstein 10:05
Interesting. I would add one more thing, Rushika, and I think you sort of underplayed that a little bit from in terms of, you know, myself looking at behavior change over the years, and how we tried to do it, the various companies that you can put in all of the approaches, but it sounds like you have the culture within your organization. That's that. And so, yeah, I would assume your turnover is not very high. Is that true or not?
Rushika Fernandopulle 10:28
You know, that's absolutely true. And so it is all about culture, I could not agree with you more I think everyone talks about the process and IT and the payment, and, yes, you need to get that right, if you get that right, but the culture is wrong, it doesn't work, you can actually with the right culture, even make it work, despite some of the other things not working. But you know, we spent a lot of time explicitly building the culture that's aligned around this by but this is what what the vast majority of people in healthcare are doing is they're staying in their fee for service. You know, most of the business, you'll fee for service, they're taking some subset from other patients that they're trying to take some sort of risk or population based payment on. And they're trying to do the two things in the same place. And I think that's just a fool's errand, that, that it's not a little different, completely different, the culture it takes to optimize throughput and the culture it takes to optimize actually results and population health are not a little different. They're completely different. What we've been able to do at Iora is simply say, we're going to be in the new world, we don't care about the old world. And we're going to align everything around it. As opposed to what's happening in the vast majority of practices, the things are unaligned, and you get into all sorts of trouble. So you as aligned practices. Let's dive a little bit into this mental health. I know you've mentioned on the website, you focus on mental health and integrating that, how have you done that? And what sorts of areas do you focus on in mental health? Is it really deep, clinically? Or is it a little more counseling and things like that? Where are you with that? Yeah, I mean, so we're not a mental health intervention, per se, we are primary care practice. I think what we learned early on, is it particularly if you look at the sickest group of people, we talk to people with multiple chronic illnesses, virtually all of them have coexisting mental and health conditions that we can get into this question of, are they so sick because they're depressed or they're depressed, because they're so sick, it sort of doesn't matter which way the causality goes, they're correlated, you have to address both of them. If you don't address the depression, the anxiety and executive functions is fine. You know, all of those things. You're never going to address physical health characteristics. And then good luck trying to support send someone to psychiatry, right, then you can't find them. They don't take insurance in a misguided way, they won't even communicate with you because they think it's HIPAA violation, you know, all sorts of problems that the stigma that people won't go to, what we decide to do is we have to take care of this stuff. And we have sort of bundled it in with our services. and by the way a lot of people talk about mental health integration, but just sort of parallel play, they happen to share the same hallway. No, you can deeply integrate everything, the work off the same medical record, huddle together and talk about patients, do warm handoffs, etc, right. So as we integrate mental health, it's three levels. And it's based on some work that the VA has been doing over the last many years. So it's a basic level, all of our health coaches are trained in some basic mental health things identifying screening, as a basic interventions, a lot of it inspired by the IMPACT model from the University of Washington, then every practice also has a mid level behavior with typically a PhD psychologist who's had in the practice, who can do really do three things. One is you know, supervise and train the health coaches two is actually see people, warm handoffs, I'm a doc, I'm seeing someone you know, they've got some diabetes, but they also sound depressed. I've walked them across the hall. Hi, I want you to meet Judy Judy works with us. And there's no stigma involved. There's no extra copay, etc. And then we can do the warm handoff, and she can talk about depression. And then we co manage it together. She said, I think this, this patient could benefit from a bit of a med, I'll start it, but Judy, you can monitor it tell me if I need to go up in the dose. And the third thing Judy can do is from working and seeing patients is also giving people access to the broader mental health community. So to the extent it becomes worse, or they happen to have a thought disorder or something that we don't have any business managing, she can help, you know, interface with the broader Mental Health Network. So really, its at three levels, deep integration, and we do it because people need it and we think it helps improve outcomes.
Fred Goldstein 14:29
I assume you've built in the assessment tools into your initial assessments around depression screenings, or stress and anxiety screening and things like that. Maybe a fair amount of business I understand it's Medicare Advantage so you're working off an annual wellness visit type approach.
Rushika Fernandopulle 14:42
So absolutely. So we're invited to things which would be screening for including depression, anxiety, substance abuse, you know, we screen for some childhood traumas, all of those are actually really important to understand if you want to actually take optimal care of the patients. And by the way a lot of doctors don't ask they don't know what to do. And they don't have the time or the people or whatever. So so if you don't want to know, don't ask, you know we do right now.
Fred Goldstein 15:07
And does this same approach apply across your book of business? Are you doing commercial and Medicare any other space, any direct to consumer stuff or things like that?
Rushika Fernandopulle 15:15
We are thought to I mean, I mentioned that that really, Iora has been evolution, the business model 15 years ago, even before it was called Iora. It's called Renaissance health, we started in the direct primary care space, we were under the very first direct primary care practice in the country, Garrison Bliss. So I'm sure you know, in Seattle and Tom Lee, and a variant of the model are One Medical and those done in Chuck Kylo, and a thing called Greenfield health in Portland and kind of Allen Dappin in Washington and you know, ourselves in Boston, we sort of all came up almost independent, we're all Doc's, who got fed up with the current system realized fee for service, one of the problems, no payer would give it the time of day. So we went to patients and said look if you paid as 40, 50 bucks a month, and we get out of this stupid payer thing, we would be able to create a new model of care. So we started in that realm, we realized that what we're doing is not just improving outcomes and improving satisfaction, but it actually lowers downstream spend, by doing better primary care to keep people out of the hospital out of the ER under procedures they don't need. So then we sort of morph that about 10 years ago, into working with self insured employers so tried to work with the Boeing Company, the casino workers in Atlantic City, the SEIU, and we did that for many years. And then we morph that into saying, this actually works really well for Medicare Advantage patients. So we do all three of the above right now, the most of our growth recently has been the Medicare Advantage space because it's such a no brainer in Medicare, and we still work with a number of self insured employers. So what we need to do is work with employers who've got long term workforces, you know, we're investing in people. So people like the Boeing Company, the teachers union, in in Washington, the state employees in Massachusetts carpenter, you know, those sorts of people. And then we do a little bit of the retail direct primary care left
Fred Goldstein 17:02
as you morph this model you mentioned earlier, we're talking about different payment models and approaches are most of these set up as at risk models obviously Medicare Advantage and the other commercial business route?
Rushika Fernandopulle 17:15
Yes, what we don't do is fee for service, we think that's toxic to primary care. So we simply don't do it, we start with sort of primary care cap, where it gives us a fixed amount to take care of patients, and let's get on with it. And by the way, let's have it be roughly double what typical primary care gets primary care is typically 5% of health care spend. That means 95%, of what we spend in this country typically is failure in primary care, that seems like a stupid investment philosophy, so at least double down on the primary care. And increasingly, like said, if you do primary care, right, you can lower down to metallization, we are moving toward what's called Global risk, where just give us pretty much as much of the health care dollars we can get. And we will be responsible for, you know, the cost for hospitalizations, and ER visits and specialist visits and procedures. So now when we lower those by doing better primary care, we can benefit from it. And can we physically shift that money back into primary care?
Fred Goldstein 18:05
And as you consider that move to a global capitation? What do you see or believe to be? I mean, I've heard different numbers out there, the typical spend associated in a globally capitated model, say in Medicare on a on a, you know, percent of premium basis.
Rushika Fernandopulle 18:21
Yeah, I mean, so we, I mean, so it's a huge amount of money on the Medicare side, right. So the average premium, or the average spend for a Medicare beneficiary is probably at $800 per person per month, or about 10,000 per year, you know, we tend to go after sicker, older, and lower income communities, because that's who we think need us. So our patients are probably 1.2 times that. So, you know, in the $1,000 per person per month premium. Now, the health plan when we work with them, you know, they keep a chunk off the top.
Fred Goldstein 18:51
Rushika Fernandopulle 18:52
You know, typically, they're allowed to keep about 15%, by the MLR rules, and that sort of about what they keep in general. So there's the beginning, you know, roughly 85%, of premium, you know, that varies a little bit depending on who we work with and where we are, but but the rest of that, then that money becomes ours.
Fred Goldstein 19:06
You know, I don't want to obviously get into your specific numbers there. But I've heard, you know, bandied around, you know, and we talk about a 25%, or maybe more of healthcare waste, fraud and abuse, different issues, such as administrative costs, but there's a fair amount of clinical savings and, and I appreciate the fact that you've gone in upstream to give me the higher risk people because there's actually more room to make improvements there. So it may seem the wrong approach. Is it fair to say and I'm also thinking about this from an employer perspective that we could take those premiums down 20% 15 20% fairly easily with a very sophisticated model like you have.
Rushika Fernandopulle 19:11
Yeah, so we are running MLR medical loss ratios on the Medicare side that's in the sort of 70% range, right? If you think that 85 is sort of the where it starts. So that's the 15 percentage points drop in ended when there's some places we're now running mid 60s, and then if you said of that, 15 percent, that the health plan take, there's a huge amount of waste in there, too, we could easily take five of that out. I think that's why we get to the sort of 20% numbers we and we have, we've done this with working with employers, particularly if you if you select out the sicker, folks, and again, we're seeing numbers like sort of 18, the numbers of 18 and 20% drop in total healthcare spend, right? Again, this is not, it upsets me when people like Oh, the goal should be lower, you know, bending the cost curve, you know, changing that 5% a year to 4%. No, no, no, no, no, we need to ground it
Fred Goldstein 20:32
Rushika Fernandopulle 20:33
And by the way, put that money back in people's pockets, right, the healthcare system has been confiscating a huge amount of our wealth over time. And I think when we and it's better, not just as other people like that, to take this seriously, and decided we're going to build systems wholly around this, we see numbers that are similar,
Fred Goldstein 20:51
Rushika Fernandopulle 20:51
20% drop in total spending, you know, and it's driven largely by big drops in hospitalizations, 40, 50% drop in hospitalizations, 40, 50%, drop in ER visits, similar drops in sort of specialist costs and specialty visits. You know, again, there are things we can't fix. Some of the pricing issues are a problem, largely due to sort of Monopoly pricing and some shenanigans. Obviously, drug pricing is a big issue, which we can try to help but is, is difficult, but in general, there's a lot of a lot of waste in the system.
Fred Goldstein 21:24
So as you look at the healthcare system, and you know, these health insurers have become payviders, United Optum is the largest insurer of doctors, you're watch HUmana man with Conviva Florida Blue becoming Guidewell and splitting out and becoming providers. And your your delegated beneath some some of those except in the cases where their employer groups going, you know, who are fully insured and going at risk with you. Do you see, obviously, you and others have proven this model? Do you see the move potentially, to just take out that insurance layer? And that's how you get to the 20 plus percent. So that just it just direct contract with you. I mean, CMS is even pushing that out now through their primary care model. Is that the future?
Rushika Fernandopulle 22:02
Yeah, I mean, Mark Bertolini, you know, who is a former CEO of Aetna, as he said, publicly, if we were starting over, it's not clear, we would have health plans, if there were actually organized physician groups, health plans exist, because physicians have been unorganized and doesn't and don't have the capability. And our whole proposition is that a lot of the quote managing cares that health plans have planned to do with their sort of nurse in a call center in Idaho, calling you at dinnertime to try and look at claims data, you know, is wholly ineffective. There's no evidence that any of those programs work, you know, all of the CMS demos that have showed sort of care management have been from physician groups who have real clinical data and real relationships with the patients and can actually change care without sending Mother May I faxes. So So I actually think and you see, this is why I think health plans are moving in this direction of aggressively buying, you know, etc, partnering with provider groups, because, you know, I think the value that's going to be created that sort of ratcheting down of this unnecessary utilization, and, you know, the relationship with the customer, the consumer are both better done by, you know, well organized and providers than they are, you know, health plans. Now, the question, of course, is not every provider can do this, right. It requires some expertise, it requires capital, it requires, you know, having IT systems and data capabilities. And, you know, and I think that sort of solo Doc, you know, the two doctors practice with the wife of the billing clerk, the daughter and the front desk staff, you know, doesn't have a prayer to compete at this level. But I think, well, organized provider groups actually are probably the best platform for this.
Fred Goldstein 23:36
Is there a way you could integrate those types of providers into your system if they could achieve the appropriate behavior in terms of their management of the practice of the patients? Or is it just a great far of a stretch for an independent practitioner?
Rushika Fernandopulle 23:49
No, I think it's a great question. And we're starting to play with what we call Iora Inside, which is, you know, right now, you know, really what we said we had to do was, we had to build a vision, to where we want to go right of where the future is. And the way to do that was to take away all the constraints and just build it. We did. And I think it's a thing of beauty. And we've got 49 practices across the country now in 12 different markets and works. The next step is how do you get from here to there? Right. And I think we are getting approached by a lot of largely independent primary care groups, Occassionally multi specialty groups, occasionally some health systems, by the way, that are pretty progressive to say how widely how might we partner to do this, and I think that the game changer is increasingly against members of the payment model has been the tricky part. When we started doing this, it was very hard to convince payers to do this. Now. There are more and more progressive payers, you know, virtually every national health plan. You know, many of the Blues plans, many progressive self insured employers are now eager if you can show you can do this to sort of give you these sorts of contracts because they work better than the old ones. And then the big game changer you mentioned in passing was CMS, that they are moving towards this direct contracting model. Where your physician group, you can take sort of essentially full risk on patients who are in sort of traditional fee for service Medicare. And that's a huge game changer, right in terms of changing economics. And so I think that opens up an opportunity for, for us as a How might we collaborate with existing groups that have lives already, but may not have this clinical model? And how do we put those two things together?
Fred Goldstein 25:21
So I think we have time for one final question he or she can I could probably go all day with you at this rate.What are you looking at? As you look at your system? Where do you see areas that you'd like to get further improvement or or change or add?
Rushika Fernandopulle 25:35
I think there's a lot of them, I think one is really pushing more on, on how to empower consumers to self service. You know, we in some ways, what we've done is taken, you know, things that were very doctor centric, and we've pushed it down into really sort of these health coaches and other team members. The next step in that evolution is how do we sort of push to give consumers tools where they can do a lot of this themselves, right, never alone, but but with 80% of it, they can be done. Think about in every other part of the economy, whether it's buying airplane tickets, or you know, doing searches or investing. There are tools where individuals now can do things that previously required some media intermediary. And I think the more we can allow people to do it themselves with some great customized tools and and the backstop if you need help. I think that leads to better outcomes. It's better for the consumer, and it's also going to be lower in cost.
Fred Goldstein 26:28
Well, fantastic. It's, it's a pleasure to talk to you Rushika, it always is — you're doing some amazingly fantastic stuff. So thanks for joining us on pop Health Week. We'll have to get you back on.
Rushika Fernandopulle 26:38
All right, thank you very much and all the best. Happy New Year.
Fred Goldstein 26:41
Happy New Year to you. Back to you, Gregg
Gregg Masters 27:01
And I thank you, Fred. That is the last word on today's broadcast. I want to thank Rushika Fernandopulle , MD co founder and chief executive officer of Ioira health for his generous time and many insights for more information or to follow Dr. Fernandopulle and team Iora health's work go to www.Iorahealth.com. or on Twitter follow them via @Rushika1 and @Iorahealth that's I-O-R-A Health. For PopHealth Week my colleague Fred Goldstein and HealthcareNOW, this is Gregg Masters saying bye now.
About the Hosts
Fred Goldstein is the founder and president of Accountable Health, LLC, a healthcare consulting firm focused on population health, health system redesign, new technologies and analytics. He has over 30 years of experience in population health, disease management, HMO, and hospital operations. Fred is an Instructor at the John D. Bower School of Population Health at the University of Mississippi Medical Center and the editorial Board of the journal Population Health Management.
Gregg is a seasoned senior healthcare executive, having provided leadership and consulting support for hospitals, health systems, capitated medical groups, IPAs, PHOs, MSOs, and several hospital/physician managed care joint ventures. He is Founder & Managing Director at Health Innovation Media, the publisher of ACOwatch.com, and is consistently recognized by his peers as a thought leader in healthcare social media via @GreggMastersMPH.