Specialist
Former director at Oak Street Health Inc
Agenda
- Recent trends and developments within the primary care physician value-based care market as it pertains to Oak Street Health
- CVS Health’s (NYSE: CVS) acquisition of Oak Street and potential headwinds
- Organisational transition capabilities from Medicare fee-for-service to MA (Medicare Advantage) plans
- RAF (risk adjustment factor) scoring processes, highlighting strengths and weaknesses concerning CMS’s (Centers for Medicare & Medicaid Services’) increased scrutiny in risk auditing
- Q3 2023 growth outlook and potential expansion opportunities
Questions
1.
Are there any major trends and developments you’ve been following in the primary care physician group or value-based care market over the past 6-9 months or so that you would like to highlight?
2.
Could you expand on the challenges you experienced with sustaining relationships with new and legacy payers, as you mentioned, growing Oak Street Health’s network from six to 30-plus health plans?
3.
You mentioned that with Oak Street operating as payer-agnostic, it doesn’t necessarily change the fact that the company might not get higher-quality data from Aetna. What friction do you foresee stemming between Aetna and Oak Street? Do you think there are useful measures that Oak Street could use to mitigate potential upcoming issues with data quality?
4.
To what extent do you think we could see CVS Health try to marry up its MinuteClinic delivery model into Oak Street’s entrenched value-based care model to try to create further touchpoints with seniors? Do you foresee that as a possibility or is it better to keep them separate?
5.
Could you discuss the similarities you see between Oak Street and ChenMed’s value-based care delivery models and the respective contracts for seniors? What might be the similarities and how might they be differentiated in terms of approach, specifically within the MA [Medicare Advantage] space?
6.
Oak Street noted in its full-year 2022 earnings report that it cares for roughly 159,000 risk-based patients out of a total of 224,000 patients, making the risk-based population roughly 70% of the total population. How should we be thinking about the company’s ability to transition more MA [Medicare Advantage] lives to risk-bearing agreements by the end of 2023?
7.
Are there certain geographies where Oak Street could be more or less successful in converting that ACO [accountable care organisation] patient to risk?
8.
How well-positioned do you think Oak Street is to handle the 2.5-3% reimbursement cut on the Medicare side or general reimbursement cuts in the long term? Is anything unique to Oak Street’s business model that might make it better-positioned than other players in the space?
9.
In CVS’s recent presentation on the Oak Street acquisition, the company projects over USD 2bn embedded in Oak Street adjusted EBITDA by 2026, which roughly comes out to USD 7m per centre. What’s your take on CVS’s ability to accelerate Oak Street’s patient growth as well as the profitability timeline piece?
10.
Can you discuss the strengths and weaknesses of Oak Street’s UM [utilisation management] capacities in its partnerships with health plans and provider groups?
11.
How capital-intensive would it be for Oak Street to fully invest in its own UM system?
12.
How transparent was the sharing of data between Oak Street’s members and health plans, appreciating this depends on the specific health plan as well as the provider group? What is important for us to understand about UM delegation arrangements with health plans?
13.
Could you discuss how Oak Street has refined partnership strategies with both legacy and new payers? How would you describe the dynamics of these two relationships, considering you built out the health plans from six to over 30?
14.
You mentioned that revenue generated wasn’t necessarily Oak Street’s biggest challenge, it was more managing expenses as well as patient retention that could be tricky. Could you expand on the challenges Oak Street has faced in patient engagement and retention, perhaps tying in your thoughts on how it could potentially improve its approach?
15.
How would you assess Oak Street’s RAF [risk adjustment factor] scoring process and clinical documentation capabilities amid increased scrutiny from CMS [Centers for Medicare & Medicaid Services]? Specialists in previous Forum Interview have noted certain companies are more conservatively approaching RAF scoring to prepare for the audits. What are your thoughts on this?
16.
What’s your 1-1.5-year outlook for Oak Street, tying in the integration period with CVS and highlighting any additional factors we didn’t cover that you think might be important to monitor over the next year?
