At the HLTH Conference, Former CMMI Director Patrick Conway Looks Back, and Forward

May 8, 2018
Patrick Conway, M.D., CEO of Blue Cross and Blue Shield of North Carolina, was interviewed as part of a general session at the HLTH Conference—looking back on his tenure as CMMI Director, and forward into the future

At the HLTH Conference being held this week at the Aria resort in Las Vegas, Patrick Conway, M.D., the president and CEO of the Durham-based Blue Cross and Blue Shield of North Carolina (BCNC), and the former Chief Medical Officer, Deputy Administrator, and Director of the Center for Medicare and Medicaid Innovation (CMMI), a division of the Centers for Medicare and Medicaid Services (CMS), was interviewed onstage by Annie Lamont, managing partner at Oak HC/FT, a Greenwich, Conn.-based venture capital fund. Dr. Conway, who spent more than six years at CMMI, before joining Blue Cross Blue Shield of North Carolina in October 2017, shared his perspectives on healthcare change.

Interestingly, the recently appointed new Deputy Administrator and Director of CMMI, Adam Boehler, appointed last month to the post, had been scheduled to join Dr. Conway onstage, but Lamont revealed that Health and Human Services (HHS) ethics administrators had intervened over having both the current and former CMMI directors appear on the same discussion panel.

In any case, as Lamont noted, Dr. Conway was both the first, and the longest-serving, CMMI Director, serving in that position from May 2011 to September 2017, when he left to take the BCNC position the following month, and having served under three presidents (Bush, Obama, and briefly, Trump). What’s more, she noted, he is the first physician to run a Blues plan; and he still practices medicine, though nowadays as a volunteer in pediatrics (his medical specialty), in order to avoid any potential conflict of interest.

Annie Lamont interviews Patrick Conway, M.D. at HLTH

Meanwhile, asked what he is most proud of accomplishing at CMMI, Conway said, “A few things. I’m most proud that we really did shift the system, especially for Medicare, but really, across the board, in a major way. When I started at CMMI, we had zero percent of Medicare payments in alternative payment models. By 2016, we had reached President Obama’s goal at the time, of 30 percent of payments in APMs; we had $200 billion in some form of alternative payment, and 200 contracts with providers. That’s a huge shift. Don Berwick [Donald M. Berwick, M.D., the former CMS Administrator, and president emeritus and senior fellow at the Cambridge, Mass.-based Institute for Healthcare Improvement] said on a recent panel that we’ve made a huge shift, and that we still have a long way to go, and he’s right.” Meanwhile, Conway cited work on facilitating improved patient safety in healthcare, and the development of the several accountable care organization (ACO) shared savings programs, as further achievements, noting that shaving 2 to 6 percent off the costs of any group of providers, under any alternative payment model, is a significant achievement. What’s more, he said, “I think Adam will do a great job.”

One element that Lamont asked about was the limited involvement of for-profit organizations as partners in development work with CMMI. “Yes, that was a learning,” Conway said. “We shouldn’t limit the competition; whoever can build projects with you, should be involved. Also, the CMMI process ended up getting built somewhat like the rulemaking process. When I started, the time from idea to actual launch, of any concept, was three years—there’s no way that was the right answer. We got it down to six months. And I believe that working with smaller prototypes and moving faster, would be great. But initially, the federal government was convened about some of those smaller prototypes. I hope that’s changing over time.”

Another element in all of this was the staff-based team that Conway built during his tenure at CMMI, and starting from a very small base. “When I started,” he recalled, “we had 70-80 people, and when I left, we had 400. And it’s an amazing team. I recruited them from all sorts of industries, and gave everybody literally the same pitch: ‘You’re going to work really hard, and get paid less than in industry, but you’ll have the chance to help change healthcare. Want to sign up?’ So we got some experienced civil servants, which you need, but also people from outside government, which is also important.”

Looking at payers and payment questions

Lamont asked Conway to address some questions around reimbursement reform and payment systems. In particular, she asked him whether he thought that some kind of Medicare-for-all health insurance system could work in U.S. healthcare. “The beauty of Medicare for all is that you have quality and costs all aligned,” he responded; “but then there are challenges underneath it. Meanwhile, the beauty of Medicare Advantage is that it mimics the idea of Medicare for all,” and offers providers the opportunity to learn how to implement changes in a congenial environment, he added.

With regard to his current organization and payment innovation, Conway said, “We insure the majority of people in North Carolina, and in some markets, the vast majority. We’re in Medicare Advantage, and are going into Medicaid,” he said, noting that North Carolina’s state government, one of the last larger state governments to plunge into Medicaid managed care, is now moving forward with its plans in that area. What’s more, he added, “Of course, CMS is like no other organization, with 140 million beneficiaries. But Blue Cross North Carolina is big enough” to have an impact with payment reforms, “but we can move very quickly.”

Meanwhile, Lamont asked, “Isn’t it true that five large multi-hospital systems dominate the state?” “Yes,” Conway responded, “five systems have the vast bulk of the market. And we’re looking at a new model, where” patient care organizations can partner more fully with Blue Cross North Carolina. “We’re saying, you can take this alternative pathway with us. And we’ll jointly be accountable for the total quality and cost of care. And we want you to go into two-sided risk. And we’re wondering, should we turn off all prior authorization? And documentation other than for risk coding and STARS measures, we won’t worry about how you document. And for people in the audience, those kinds of partnerships are very exciting, because you’ve now got a provider and payer that are no longer locked into rigid rules, but where you can innovate on quality and customer experience,” he added.

How might the Blue Cross and Blue Shield Association be able to help facilitate healthcare system change among all the Blues plans, and beyond? Lamont asked. “I think the Blues system has a lot of potential, if we move past the traditional health insurance system,” Conway said. “The beauty is that we insure 100 million people—nearly as many as CMS. does And it’s mission-driven. And we have leaders like Mark Ganz [CEO of the Portland, Ore.-based Cambia Health, the parent company to four regional health plans] and Paul Markovich [president and CEO of the Sacramento-based Blue Shield of California], who really want to drive the system. The question is how you think about innovation, data and analytics, the customer experience, investments beyond the traditional ones, and think beyond being a traditional insurer.

“Who and who can you pay for social determinants of health?” Lamont asked. “We think about it in two major ways,” Conway replied. “One is, through our foundation, we actually gave $50 million last year, into social determinants, early childhood behavior, opioids, and a few other issues. And as we go into Medicaid, but also in commercial and Medicare, we want partners who address social determinants. So we’re looking at partners who can think about transportation, housing, food insecurity, etc. “

“You come in quickly and want change to happen fast in North Carolina,” Lamont said. “As you think about the things that can make the most change, I know you want to influence primary care. What are your thoughts about that” “I’d say a few things,” Conway said. “First, I’d reference our high-level goals as an organization: we talk about better care and outcomes, at lower cost, and with better service and experience. Buckets: working deep partnerships with providers, risk, etc. Second,” he said, “I’d talk about convenience: 24/7 access, telehealth-enabled, a real focus on higher quality and lower cost. And we’re like Medicare: we spend less than 10 percent of our costs on primary care, yet primary care physicians control most of the costs.”

“How do you do that—incent patients to show up in primary care?” Lamont asked. “First, there’s basic segmentation that has to take place in terms of Medicare, Medicaid, and commercial plan members,” in terms of thinking about how best to manage care and services for distinct populations, Conway said. And then, the providers who want to focus on discrete populations, are a factor as well, in planning, he said. “Some providers are involved in concierge-type care, which we’re looking at; other potential partners want to care for the sickest of the sick. There are different enablement capabilities,” and different levels of interest among different providers in terms of seeking to serve specific populations and sub-populations, he said.

“How do you define healthcare quality?” Lamont asked. “I was responsible for most of the measures from the federal government,” Conway said, “and always tried to move towards true outcomes measures rather than process measures, including patient-reported outcomes—process measures only if they have a real tie to outcomes measures. And then experience measures. I think healthcare, like other services, should have experience measures. And then I think about the total cost of care.”

What about the proposed mergers and/or business alliances involving CVS and Aetna, Walmart and Humana, and Amazon/Berkshire Hathaway/JP Morgan Chase, that have emerged in the past few months? Lamont asked. “What’s your perspective?” “North Carolina is an interesting market, we’ve got every major health insurer,” Conway noted. “On the integration point, they all vary a bit. CVS-Aetna—can you actually integrate well and get the full value out of that relationship? But it’s got a PBM play and an integration play to it. Interesting. Walmart-Humana—is it actually real? But I view all of these things as overall positive; [the very creation of disruptive new alliances] forces change. In terms of the Amazon/Berkshire Hathaway/ JP Morgan Chase announcement, my biggest take with that is, they’re so upset with the current system that they want to disrupt it; and my reaction is, we should listen. Because they’re identifying a real problem.”

“Do you have any last thoughts?” Lamont asked. “For the innovators in the audience, I come from this with the lens of a practicing physician,” Conway responded. “And in our workforce, we talk about treating every member, every customer, like family. And that is a very centering concept. We had a child who was not getting a drug that was lifesaving, and they needed it. We fixed that issue in less than 60 minutes, and we fixed the system so it wouldn’t happen again, and I called the parents personally” to explain the situation to them. I would say” to the innovators in healthcare, “please drive better outcomes and lower cost, because we’ve got to drive change, and we’ve got to go faster.”

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