Friends,

Our guest this week, Steve Nelson, takes us on a journey into a new category of company that is curating the collaboration between employers and providers. It’s an incredibly exciting adventure – actually a leap into the world of value-based care. The insights that he shares provides a lens into where healthcare is going – empowering patients & payers to navigate to healthcare that is appropriate, high quality and reliable. Into this mix are enabling technologies that contribute to the value proposition. It’s an incredibly enlightening dialogue – not one you’ll want to miss.

Steven Nelson leads the Contigo Health team as President. He was one of the leaders who initiated Contigo within Premier, a leading hospital supply chain company. Before joining Premier, he served as Vice President of Strategy and Planning and COO of Anthem’s diversified business group. Prior to joining Anthem, Nelson led strategy, product and marketing at Highmark Blue Cross Blue Shield and helped to build Allegheny Health Network, a provider entity consisting of seven hospitals, 2,000 doctors and various other facilities.

In this episode, we’ll discover:

One of the revealing insights that Steve shares during the interview is that the purpose of Centers of Excellence (COE) is not necessarily to drive costs down; but instead, to drive value up!  For years, I’ve heard the concern that bundled payments are a ‘race-to-the-bottom’. Steve reframes them as a ‘race-to-the-top’. The value of these COE’s is NOT that they provide a lower unit price for heart surgery or joint replacement. The value is that they don’t perform unnecessary procedures. They provide an overall bundle of care that is of higher quality, safety and legitimacy. I underscore this because we know that a significant percentage of procedures and surgeries performed in this country are unnecessary, thereby subjecting the American public & employees to unnecessary harm & costs. In fact, the Lown Institute just published a report demonstrating that over 60% of hysterectomies and nearly 25% of cardiac arterial stenting procedures were unnecessary. This was a 2-year Medicare study of 3100 hospitals which discovered that older Americans were subjected to over 1,000,000 unnecessary tests & procedures. Within that were 200,000 cardiac stent procedures that fell into the category of ‘overuse’.

Core to Contigo’s approach is that they convene and coordinate local collaborations between employers and healthcare systems. Not only are they convening, but they are optimizing care through: (1) standardized, high reliability, bundled pathways in specialty areas; (2) providing physicians with clinical decision support tools, best practice alerts and patient benefits information; (3) assisting employees in navigating to and accessing high quality care; and (4) using both clinical data, claims data, and advanced analytics to identify patients at risk. Contigo is also bringing health plans into this ecosystem, as well as in numerous enabling technology vendors.

What I find encouraging is that Contigo is not alone in creating a more integrated, seamless value-based system of care. While many healthcare systems across the country are hedging their bets and responding as if fundamental transformation is not around the corner, this movement of direct-to-employer curators & navigators is leading and catalyzing the transformation to assure that patients receive the right care. In 2020, over two-thirds of large employers were steering, or planning to steer, their employees to Centers of Excellence. There is little doubt that employers will continue to play an increasing role as a major market force pulling us toward value-based payment & care. As healthcare becomes less affordable for the majority of Americans, we are rapidly reaching a tipping point, or perhaps more like a boiling point. This does not seem like the type of bet any healthcare stakeholder should be hedging.

Until Next Time, Be Well.

Zeev Neuwirth, MD