CVS, Amazon Deals Might Be Good for Patients, Bad for Primary Care

Recent corporate deals to acquire primary care, home care and value-based care companies may not have much of an impact on primary care physicians in the short term, observers say. However, these well-resourced large corporations, such as Amazon and CVS, may intend to expand their acquired operations in ways that reduce the viability of independent primary care practices.

The two most striking events of the last month have been the announcement of Amazon $3.9 billion deal to acquire janitorial primary care company One Medical and CVS agreement to buy Signify Health, a provider of technology-enabled home services. While Amazon’s acquisition of One Medical is being examined by the Federal Trade Commission (FTC), there is no indication that the FTC will challenge the purchase.

UnitedHealth recently reached an agreement with Walmart have its Optum subsidiary provide analytical and decision support that will help Walmart’s burgeoning primary care clinics serve seniors under value-based contracts with Medicare Advantage plans.

All of these deals emphasize the role of technology in making healthcare more efficient and consumer-friendly. But observers point out that there is more to high-quality health care than that.

“Of course, technology is important, but chronic care and especially end-of-life care requires a human touch and not just someone who doesn’t know you. So we can’t forget that healthcare is not just about of technology,” Jonathan Weiner, PhD, professor of health policy and management at the Johns Hopkins Bloomberg School of Public Health, said Medscape Medical News.

Amazon faces a tough challenge

One Medical currently has primary care clinics in 25 markets. Its business model is to give patients better access to doctors and provide broader services, including telehealth, in exchange for an annual fee that a Los Angeles Times Article set at $199. Not surprisingly, most of One Medical’s clinics are located in more affluent areas.

a doctor has I recently lost a lot of money, and Amazon has offered to pay a high multiple of the company’s current stock price for the property. So why is the tech giant so interested in a janitorial primary care company with a dismal financial outlook?

According to ad of the merger deal, Amazon wants to “reinvent” healthcare and likes One Medical’s “technology-enhanced, human-centric approach to healthcare.” Amazon adds that it is driven by a “consumer obsession,” which aligns with One Medical’s approach to the patient experience.

But why primary care? “Amazon wants to get into primary care because it wants to get into healthcare, and it’s the bottom of the pyramid,” Weiner said. He touched on Amazon’s other healthcare investments, including Amazon Care, an in-person and virtual primary care company that recently closed.

David Blumenthal, MD, president of the Commonwealth Fund, is less optimistic about Amazon’s ability to reinvent health care using One Medical as a wedge.

“I don’t think you should assume this would happen easily or seamlessly or that they would ultimately be successful in scaling One Medical,” he said. “They have money, they take risks, and they’re good at technology, all of which are useful, but ultimately they have to build networks in all the areas they work in, which is very complicated and difficult to do, like IT companies. Insurance can inform you.

There’s also very little money in primary care, Blumenthal noted. “Primary care is essential. [to good outcomes]but the reward to [owning] primary care comes from its ability to influence hospital and specialist services”.

Therefore, he and a colleague held a recent Harvard Business Review Article that One Medical could become profitable only by changing its business model to one focused on taking the financial risk of health plans. While One Medical owns a primary care company called Iora that has venture contracts with Medicare Advantage plans, Blumenthal believes One Medical is more likely to pursue commercial venture contracts.

There are profits in the concierge model

Andrew Bazemore, MD, senior vice president for research and policy at the American Board of Family Medicine, sees Amazon’s strategy differently. The concierge model, also known as “advanced primary care,” is catching on, he said, as middle-class people with jobs and health insurance are frustrated by the difficulty of getting medical appointments and getting more than a few minutes of a doctor’s time. .

“Yes [Amazon/One Medical] can short-circuit that with shorter wait times, longer visits and better use of technology, there are a lot of inefficiencies that can be avoided,” he said.

On the other hand, he worries that if One Medical and other advanced primary care operations continue to grow, they will reduce access to primary care for people who can’t afford their fees and undermine traditional primary care practices.

“If it diverts the healthiest, wealthiest patients and doesn’t get to the places where the most vulnerable patients with the greatest need for primary care are, this deal doesn’t provide a boost, at least for that population,” Bazemore said. she said.

From the point of view of primary care practices, he noted, the problem is that concierge companies, along with urgent care centers, retail clinics and third-party telehealth services, provide more convenient care for medical conditions. minor acute cases that are the most lucrative cases for a fee. – primary care physicians on duty.

“Traditional practices will continue to care for the sickest and often poorest patients with the most complex medical needs,” he said. However, without the types of patients One Medical serves, these offices will find it increasingly difficult to stay in business, she noted.

Bypass HIPAA?

Another reason for Amazon buying One Medical, Bazemore suggested, is to use its patient data, as well as Iora’s, to target consumers with ads for health-related products they can buy on Amazon’s site. The Health Insurance Portability and Accountability Act (HIPAA) prohibits health care providers from sharing this data with third parties like Amazon, and One Medical has stated that its patient data will remain protected. Bazemore suggested that Amazon can find ways to use its One Medical ownership in product marketing.

“There are ways to ensure that when patients enter a health care setting, they can learn about the products that are available to them, even if they’re not directly personalized, and that can lead to data sharing,” he said.

Weiner agreed. “Amazon may try to reset things by offering a discount or a gym membership if the patient agrees to receive special deals on health products,” he said. “I’m sure they are looking for synergies.”

CVS/Synergy Agreement: Beyond Home Care

Although CVS also sells a variety of products in its pharmacies, its strategy of acquiring Signify Health for $8 billion (after turning down an offer from Amazon) seems markedly different from Amazon’s.

CVS owns Aetna, one of the largest health insurers; It has a network of Minute Clinics in its pharmacies; and has been built around 1000 HealthHub installations They offer a wide range of non-emergency care. CVS has been closing some of its pharmacies, so it appears to be transforming itself into a diversified health care player.

Signify Health focuses on home care, primarily for Medicare Advantage plans and Accountable Care Organizations (ACOs). It also owns Caravan, which provides infrastructure to ACOs for value-based contracting. Signify has more than 50 health plan customers, including the Aetna division of CVS, and a network of 10,000 doctors. These doctors not only provide home care, but also assess the clinical and social needs of their patients and connect them with follow-up care and community resources.

Bazemore sees CVS’s acquisition of Signify as another advanced primary care move. “CVS would tell you that Signify doctors spend much more time with patients than in a typical primary care office visit. You can imagine this competing with comprehensive primary care practices, whether their doctors are independent or employed by health systems”.

It’s unclear how many of these services primary care doctors would provide in their offices if firms like Signify didn’t exist. But there’s no question that home care takes a bigger slice of the pie as the population ages, more patients are discharged home from hospitalizations, and some health systems begin to develop hospital-at-home programs.

Blumenthal and Gretchen Jacobson, director of the Medicare program at the Commonwealth Fund, see other problems with deals like Signify’s. Said Jacobson: “A question that always comes up about home assessments is to what extent are they influencing and using care? Are they passed on to the patient’s primary care physician? Are they then used to get resources and supports for the person? that they might need? To the extent that they’re used in that way, they can improve the quality of care.”

However, Medicare Advantage plans that use home screenings don’t necessarily pass them on to primary care doctors, he said.

Blumenthal added that this information should also be communicated to specialists who manage chronic conditions.

“Household assessment could be very useful, but it has to flow along the many pathways of the health system and be integrated into the workflow of a fragmented system with highly distorted incentives,” he said.

Ken Terry is a health journalist and author. His latest book is titled “Physician-led Health Care Reform: A New Approach to Medicare for All.”

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