Specialist
Former VP at Cano Health Inc
Agenda
- Key trends and developments in the Medicare Advantage value-based primary care market, highlighting overall market growth and value-based healthcare adoption
- Cano Health (NYSE: CANO) financial update – balance sheet analysis and divestment opportunities
- Value-based contract breakdown and ROI dynamics
- Patient engagement strategy to realise superior outcomes on risk capitation arrangements
- Scaling effort, staffing challenges and further consolidation trends
Questions
1.
Could you lay out the state of primary care adoption of value-based models in the market today? How do you see this trending industry-wide over the next couple of years, perhaps focusing on the Medicare Advantage demographic, where risk capitation arrangements are more widely penetrated?
2.
How should we be thinking about the major players in the Medicare Advantage value-based primary care market and their relative positioning? How would you compare large omnichannel entities such as CVS's Oak Street Health services arm, for example, Humana's CenterWell, and independent upstarts such as Cano Health, or even Devoted Health, which has Devoted Medical Group?
3.
Could you talk about the provider recruitment strategy for rapidly scaling organisations? What efforts are players using to grow their provider networks and find qualified doctors with value-based care experience?
4.
What's the different level of compensation between the full-fledged clinicians and mid-level providers?
5.
How saturated is the pool of primary care providers at the moment? Perhaps we'll talk about the fully licensed clinicians. Has this created any bidding wars or pressures on incentives to win over a smaller pool of doctors?
6.
Could you outline the typical contract structures for Medicare Advantage primary care value-based providers with payers? How are these arrangements designed, considering how the bundled payments are contrived, and any performance guarantees or quality metrics on managed populations?
7.
What are some of the specific outcome metrics or KPIs that are evaluated to determine success in value-based healthcare arrangements? How are factors such as reduction in inpatient admission rates, prescription costs, equipment utilisation, etc, weighed relatively against each other?
8.
What's been the appetite currently to go towards full-risk contracts? I understand Cano moved fairly quickly towards full risk, which came with some detrimental consequences to performance. How do you see the percentage of partial-risk vs full-risk capitation playing out within the space over the next few years, and why?
9.
Within the contracts, what is the percentage of savings generally kept by the providers vs kickback to insurers and other parties? Could you help us understand the profitability dynamics in these arrangements?
10.
Looking over at risk adjustment, what are the major barriers in terms of getting accurate riskcoding data on managed populations, and what strategies are being explored to utilise virtual care or social determinants of health in order to better contain medical costs?
11.
How are companies seeking to better engage with historically underserved or lower-income demographics, for example, dual-eligible patients, which can have an outsized impact on healthcare costs? What are some of the major challenges there?
12.
You mentioned some of the limitations of virtual outreach as patients generally like to see their providers in person. Have there been any other significant barriers to engagement with seniors more generally?
13.
What kind of churn are some of the players generally seeing in managed populations on a yearly basis? What are the key drivers of patient attrition, and how are players looking to mitigate these issues?
14.
What role do you see provider-focused value-based care software platforms such as Privia, Aledade and Agilon playing in the space over the next few years? Could you talk about their relative value add to independent provider groups in terms of taking on value-based arrangements and realising shared savings?
15.
Could you discuss the shifting dynamics within the Medicare Advantage demographic going forwards and what this means for coverage of seniors in outcomes-based arrangements? The overwhelming membership today exists on an HMO [health maintenance organisation] plan, which may restrict access. As baby boomers start to dominate PPO [preferred provider organisation] plans, how do you think value-based healthcare providers and payers will adjust to this shift?
16.
What's the potential opportunity for Medicare Advantage shared savings programmes and ACO REACH [Accountable Care Organization Realizing Equity, Access, and Community Health] to merge down the road, and how much of a tailwind could that be for value-based care providers in such a scenario?
17.
What's the risk of CMS [Centers for Medicare & Medicaid Services] stepping in longer term and capping or slashing bundled Medicare Advantage payments to payers or groups who are realising lucrative profits on managed populations? Essentially, is there anything stopping it from eroding the profit margin if proof of concept has been established?
18.
Could you talk about the expansion strategy for some of the primary care providers in terms of building new clinics, given the existing macroeconomic backdrop and higher cost of capital? Walgreens, for example, shut down 60 VillageMD clinics as it looked to execute on USD 1bn in cost cutting. How might the high interest rate environment decelerate the pace of growth or expansion for primary care clinics industry-wide?
19.
What's your updated perspective on Cano Health's operating challenges and restructuring measures? How much further cost rationalisations or divestments can feasibly be made to free up capital to remain solvent?
20.
Where do you see the Cano Health story heading from here? The company is looking for a strategic buyer. How likely is it that an entity comes in and buys it, and if likely, who might be a likely suitor?
21.
How do you anticipate further consolidation trends to evolve in this market, irrespective of Cano Health? What acquisitive moves are you expecting from large payers, such as Amazon or Walmart, looking to increase their value-based care footprints?
22.
If you look at Walmart's customer base, it appears the company may have more synergy or more overlap with Medicaid populations. What are your thoughts on the viability of value-based arrangements outside of Medicare Advantage? Could you discuss the opportunity in Medicaid and even commercial? When might we see models extend into those reimbursement channels?
23.
What is the most attractive geographic opportunity to expand into next for some of the players in terms of Medicare Advantage geographies? South Florida or Texas are fairly saturated at the moment. What might be some of the more emerging geographies of focus?
24.
Going into 2024, what do you think is the biggest surprise we may see for the primary value-based care industry? Do you have any contrarian thoughts or opinions that you'd like to prognosticate on?
25.
Is there anything additional that might be especially important to highlight to tie together our Interview?
