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    May 7, 2021

    Your Free Cup of Coffee

    Most of the time these days, we worry about fishy mail of the electronic kind.  But there is a piece of physical mail many people are now getting that looks like a scam but is legit.  Don’t toss it too quickly.

    Last October, the Blue Cross Blue Shield Association (BSBSA) agreed to a $2.7 billion antitrust settlement and those potentially impacted are starting to receive notices about how to file for their share.  Before we get to what in this settlement might really matter, let’s do some simple math in case you got a card and think you are about to buy a load Dogecoin stock and retire.

    The $2.7 will quickly drop to about $1.9 billion after lawyers (everyone is after the lawyers) and administrative fees. Then this settlement covers about 12 years and the 35 independent companies that make up the BCBSA collectively cover about 100 million Americans.  That means your payment might cover a cup of coffee, and I mean a real cup of coffee, not one of those $7 Starbucks drinks that have 28 words in the name.

    $2.7 billion sounds like a big number and makes for a good headline.  Does this really matter, especially when the cost is amortized over that much time and that many organizations?  The settlement dollars?  No, that doesn’t matter a lick.

    But something else happened this week related to the settlement that just might.

    The BCBSA companies have historically been ‘independent’ in only a laughable use of the term.  The group is clubbier than the NFL owners meeting.  By joining the BSBCA, each of the 35 companies got exclusive rights to use the Blues-branded business in their territories.

    ‘You independently dominate over there, and I will independently dominate over here. See?  We are not the evil UnitedHealthcare.’

    Humans being humans, over time, the self-interest of the 35 companies has threatened the club.

    Some have gobbled up others.  Anthem is the bully with 40 million of that total 100 million covered lives.

    And several have launched lines of business NOT carrying the Blues brand as way to steal some growth outside their BSBCA territories.  To prevent total cannibalization, the Association had a rule that at least two-thirds of each company’s revenue had to come from Blues-branded business.  That is what changed this week that might matter in the long run.

    As part of the settlement, the Association dropped the two-thirds rule.  Theoretically, and hopefully, that means these companies will increasingly compete across markets.  As many have a very dominant position in their markets that allows them to dictate pricing both upstream to employers and individuals, and downstream to providers, any additional competition is welcome.

    The move is based on the premise that greed will trump group affiliation as a driving motive.  A few millennia of human history give optimism to that idea.  We shall see.

    Note, a major provider class action suit against the Blues is still alive, one that could have a real financial bite.  Keep watching that one.

    Tim Coan
    Tim Coan

    CEO and founder

    Tim Coan, ALN’s CEO, writes an insightful and witty blog weekly about a variety of topics relevant to independent physician practices.
    April 29, 2021

    Hurling Turtles

    Somewhere in my office is the 1997 book ‘Guns, Germs and Steel,’ by Jared Diamond.  Though it sounds like it could be a summary of 2020, it is actually about how different societies develop over time.

    There are several interesting ideas in the book about the advances and declines of competing people groups, even if some are uncomfortable (We’ll wipe you out with our diseases, for which you have no natural resistance because that is cheaper than sending our army. Call it ‘conquest by cooties.’).  One involves the critical role that war plays in advancing cultural progress.   It goes something like this…

    Say we live over here in one corner of the world whereby our defensive weapon of choice is loading a turtle into a sling and launching the poor reptile as a projectile at our enemies.  Over the years, we have worked hard to improve and perfect our artillery.  We’ve bred for bigger turtles with harder shells.  We’ve fashioned better slingshots and created an academy where young warriors are trained to the highest levels of twirling and flinging.  Recently, we had a breakthrough, perching our fighters atop llamas, enabling a mobile attack.  We are, without question, the world’s most unique ‘armored cavalry.’  With that protection, our people live in peace, knowing that they are protected by a phalanx of flying turtles.

    That is, until someone comes over the hill with a gaze of raccoons.  (Yes, ‘gaze’ is the collective plural for raccoons.  Now you know.)  They feast on our turtles as they invade us.

    The point is that getting your butt kicked by a more technically advanced enemy forces you to step back and assess your thinking, your assets, and your strategy.  If you are not totally wiped out in the process, war brings you face to face with advanced capabilities and propels you forward.

    Obviously, this dynamic is not limited to actual shooting wars, be they with bullets or terrapins.  For example, losing political parties now evaluate how the winners better used social media.

    In business, the learning value from getting invaded is clear as a bell.  Your organization is heads down in your corner of the world, working hard to improve all aspects of your flying turtles, and then, what? A gaze of raccoons comes along, and the financial scoreboard gets your attention.

    OK, let’s bring this silly analogy to a close.

    If all healthcare is local – if that is still just as true as always – then it makes sense to attend to your turtles.

    But if the rise of the ‘brand’ in driving consumer preferences and the obliteration of the constraints of geography by rapidly advancing technology starts to seriously undermine that premise, you might want to start raising hawks and owls (they eat turtles).

    Invasion, as painful as it is, serves a useful purpose.  You get to see, up close, what the enemy has that you don’t.

     

    Tim Coan
    Tim Coan

    CEO and founder

    Tim Coan, ALN’s CEO, writes an insightful and witty blog weekly about a variety of topics relevant to independent physician practices.
    April 22, 2021

    Kitten Cloning

    Deep question for you this morning…

    Why is it a ‘copycat?’

    I am not a cat guy (point on my resume about which I am very proud) so I don’t have a lot of daily observation data points, but do cats walk around all day mimicking one another?  Do they get together in groups and dance in step like some K-pop boy band?

    I have no idea why the coiner of the term decided to use cats.  Copyrabbit or copygnat or copy-12-year-old-girl would have seemed more appropriate, but copiers are cats and that is derogatory.  No one wants to be called a copycat.

    But that is exactly what masquerades as the business strategy for too many organizations.  See what the leaders or innovators are doing, and then just do that.  90% of business book sales are based on this idea.  For many, the notion of ‘best practices’ is really a marketing spin to make copycatting sound more sophisticated.

    As we are exploring the current relevance of the old adage, ‘all healthcare is local,’ we’ve looked at two big forces that challenge, or at least reshape, that idea – the role of technology to render geography irrelevant, and the growing trend of consumers to trust brand over a personal relationship when making choices.  If you are an independent physician practice and are starting to feel or anticipate these changes having a negative impact on your practice, there will be a temptation to just mimic whatever the new players are doing.

    Throw up Zoom and announce you are in the telehealth business.  Replace the big counter in your waiting room with a coffee bar and pretend your office now feels like an Apple store.

    It won’t work.

    The problem with business copycats, in particular, is that they see something that is working for the competition but only replicate the surface aspects of it, failing to adequately appreciate the depth of what it takes to make it all work.

    Back to the example de jour, telemedicine.

    If all you did was stand up a technical platform to allow your physicians to use a screen instead of an exam room, but you didn’t revise your process flow to maximize the unique aspects of telemedicine, then your patients will not have as good an experience as with someone who did.

    And of course, you trained your providers and staff on the nuances of what makes for a good telemedicine experience and how that is different than being in person, right? No?  You think glass magically improves a physician’s bedside manner?   Apple is good, but not that good.

    Three quick points…

    If you want to copy an innovation (by all means, that is fine), do the real work to understand what it takes to get the result.

    You can’t ‘out Amazon Amazon.’  So even if you copy, you better bring your own unique twist of value to the party.

    Just ignoring instead of the hard work of real replication is not an answer either.

    More next time.

    Tim Coan
    Tim Coan

    CEO and founder

    Tim Coan, ALN’s CEO, writes an insightful and witty blog weekly about a variety of topics relevant to independent physician practices.
    April 15, 2021

    Medstreet Journal Podcast: Tim talks rev cycle

    No blog post this week, as Tim is out of the office.  Rest assured new weekly  musings will continue to come down the pipeline.  In the meantime we encourage you to listen to Tim’s recent visit to the Medstreet Journal Podcast on Apple  Podcasts.

    Here is a short clip, and you can find the whole audio podcast at the link above.

    Tim Coan
    Tim Coan

    CEO and founder

    Tim Coan, ALN’s CEO, writes an insightful and witty blog weekly about a variety of topics relevant to independent physician practices.
    April 8, 2021

    Beam Me Up, Scotty

    Let’s start with a little bubble bursting, and no, I am not talking about the price of Bitcoin.  Apologies to the Trekkies, but nowhere in the original Star Trek series were the words, ‘Beam me up, Scotty’ ever uttered.  Captain Kirk came close a few times, but that iconic phrase is some weird amalgamation of our collective imaginations.

    The very idea of the teleporter in Star Trek arose from an economic need.  The original show had a very small budget (Let’s save money on costumes by making them all wear these pajama outfits all the time!) and could not afford to show the entire Enterprise spaceship landing on different planets for each episode as originally planned.  So, someone came up with the idea of the teleporter, and wa-la, Kirk, Spock and the gang could magically appear wherever the script needed them to be.

    We’ve been thinking about the Star Trek teleporter as a metaphorical representation of the role technology (along with consumer brand preferences) is playing in the erosion of the old adage, ‘All healthcare is local.’

    Sheldon or some other theoretical physicist would tell us that actual Star Trek-type teleportation is impossible.  But while we can’t disassemble, transport, and then reassemble actual atoms, we can do a lot of things that now render the restrictions of time and place far less restrictive.

    Telemedicine, which sounds a lot like teleportation but then turns out to be more like a FaceTime call with your mother than a quick trip to Vulcan, is just the most front-of-mind example because of ol’ annoying COVID but is illustrative.

    Once patients adjust to using technology to access aspects of their healthcare, then the range of alternatives gets a lot bigger.  It used to be the options for getting your meds filled were the pharmacy on this corner or that one.  To compete, you just had to be a little better than the other guy.  Now you must beat Amazon, too.

    Telemedicine is the same.  If your patient experience is limited and clunky, your patients are just a click away from someone better.  Local doesn’t mean jack squat.

    I acknowledge the immediate objection.  Most things in healthcare still require one human (let’s call them the least interesting and sexy thing we can imagine – how about ‘provider?’) to lay hands on the patient.  Technology can help, but not replace, that process.

    Fair enough.

    But ask yourself this – how much more healthcare can be delivered remotely now compared to just five years ago?  What about five years from now?

    What will remote patient monitoring change?

    How about patient-directed at-home diagnostic testing tied to a ‘provider’ via technology?

    Even hospitals, never even a finalist in the ‘most innovative thinkers’ competition, are trying to imagine the ‘at home hospital.’

    The point is technology will continue to abolish historical demands that care must be local, including things in your practice that you take for granted.

    Next time we start talking about what you can do about this sea change.

    Tim Coan
    Tim Coan

    CEO and founder

    Tim Coan, ALN’s CEO, writes an insightful and witty blog weekly about a variety of topics relevant to independent physician practices.
    March 25, 2021

    Gages vs. Green Aprons

    In a time long, long ago (that is, before COVID) a lot of us used to enjoy taking the laptop and headphones to a nearby coffee shop to plop down and do a little work.  Our oldest, who slipped in just in time to qualify as a Millennial, and I, just barely a Boomer, were debating our respective coffee shop preferences one day.

    My choice was the ubiquitous one.  I traveled a lot (yeah, this was long ago) and frequently had coffee shop meetings.  I could count on finding my coffee shop on every corner, their Internet was reliable, and I didn’t have to stand staring at the menu for ten minutes trying to figure out how to get just coffee.

    She stated that she preferred ‘authenticity,’ a central Millennial value that was a coded diss to all things Boomer.  As typical, I was confused and agreed to meet her at one of her favorite places down in the old industrial part of town that was suddenly the hippest neighborhood around.

    There I learned that ‘authentic’ for a coffee shop meant there had to be creaky wood floors, a dog laying by the door, extension cords pulled everywhere to power the laptops, and a dude behind the counter with a lot of ink and those big holes in his earlobes.  There were no freshly pressed green aprons being worn by overly eager smiling staff who had completed 8 hours of corporate training on customer service.

    Marketing experts frame this difference in customer values as my preferring ‘consistency’ while my oldest wanted ‘distinctiveness.’

    As we explore whether the old axiom ‘All healthcare is local’ still holds true (or better, how true is it still?), part of the question pivots around this particular dimension – do patients want consistency or distinctiveness?

    That may seem a bit odd given the set up of my prologue as most patients probably don’t seek out a doctor with the grunge factor of 1980s’ Seattle band, but let’s frame it this way: Do patients prefer getting to see the whites of the eyes of their personal physician or are they now increasingly trusting, and preferring, the ‘brand?’

    I get that even asking that question will get me in trouble with some of my clients (not a good marketing strategy, regardless of your generation) who have patients who have been loyal to them for years, but we must ask it if we are to help you plan for the future.

    There are plenty of stories about small players succeeding in the face of big brands by delivering ‘distinctive’ in a special way to a targeted and relevant audience.  We love those stories. That truth will hold in healthcare as well.

    But we would not be talking about these local success stories as success stories unless the larger backdrop were not about people increasingly opting for the known consistency of bigger brands.  That truth is just as true for healthcare, and maybe more so since consistency, not unique and cool, matters more to my care than my coffee.

    Tim Coan
    Tim Coan

    CEO and founder

    Tim Coan, ALN’s CEO, writes an insightful and witty blog weekly about a variety of topics relevant to independent physician practices.