#1: Instead of waiting weeks for doctor appointments or shlepping to urgent care centers, people need a new starting point to get care and it should be available to all, 24/7/365, from any place.
Traditionally, in order to understand what you need when you think you need medical care, you spend time and money on visiting a doctor in-person. Instead of first incurring cost to understand who and what you need, you’ve got to believe it’s much more convenient and cost-effective to see if treatment and ongoing management can be done exclusively online. If not, where exactly should I go, who exactly should I see, and when should I do it? If technology can enable a Lyft to arrive in 3 minutes, there’s no excuse to wait 2 weeks for a doctor’s appointment or spend a premium on urgent or emergency care. Starting online first and using in-person doctor visits as a tool of last resort prevents all the costs and inefficiencies of healthcare that have built up over the decades.
#2: Care at a fixed-rate is far better value than “bill as much as you can” fee-for-service.
Today, all in-person doctor and facility visits are designed to extract as much money as possible from both employees and employers. Those incentives pit employers & employees against doctors & hospitals. The fix is primary care available to all members anywhere in America for a flat rate for any Episode of Care. Ultimately, you’ve got to believe that a $100 Episode of Care to manage one ongoing situation over time is less expensive than the cost of billing as much as you can for every visit. Then, you’ve got to believe that a population, on average, uses a finite amount of primary care. Seven years of data consistently shows the average patient creates 2.7 Episodes of Care per year for a total cost of $270 per year per user.
#3: Eighty percent of everyday care can be diagnosed and managed exclusively online.
This is a stretch for most non-doctors to understand and in order to do so, you’ve got to understand how a doctor thinks, diagnoses, and manages conditions. Exceptional primary care doctors diagnose and manage 95% of typical primary care conditions (~1,500 of them) by:
- Asking you the right questions to understand all the details of your situation
- Visually examining something (in fact, photos, rather than memory, are best)
- If necessary, ordering the right tests to confirm suspicions, and
- Most importantly, frequently communicating with you over time
The old-fashioned physical exam is very rarely the missing piece of a diagnosis. But, by far, close, ongoing communication with you is the crucial piece of managing conditions online. That’s because doctors are reassured by knowing they can easily talk with you at any time (not just in the office) to understand if everything is resolving as expected or there’s new information from you that prompts a new strategy. This means 80% of Episodes of Care never involve an in-person visit into the Fee-for-Service system. The other 20% involve specialist (“I need a specialist’s expertise), urgent care (“I’ve got something serious and it’s time sensitive or I need a simple procedure”), and ER visits (“I’ve got a true emergency”).
#4: Primary care doctors have traditionally never taken the cost of referrals and orders into account. If primary care doctors could cost-effectively direct the far more expensive downstream care, primary care would easily pay for itself.
Primary care isn’t a huge cost-driver, but, when Virtual PCPs can strategically direct more expensive downstream costs, it could be a huge cost-saver. What does this look like in real life?
“This person needs an MRI. I’ll order this MRI at an imaging center that charges $700 instead of $3,000.”
“This person needs a knee replacement. I’ll instruct my team to coordinate the procedure at a surgical center that offers this procedure for a bundled rate at half the cost.”
“This person may need to be hospitalized for CHF. But I’ll instruct my team to check-in every day to get an update and a weight and we’ll reassess every day until we’re confident we avoided the hospitalization.”
“I could prescribe a Tier 3 $800 medication for this patient, but a Tier 1 $4 medication would be far less expensive.”
After being convinced of those four points, it’s just a matter of an employer or health plan agreeing to offer Sherpaa at no cost to members and signing a contract with Sherpaa. Then, every 30 days, Sherpaa’s platform adds up all the Episodes of Care created in the last 30 days and bills the employer or health plan. Maximizing Sherpaa usage means minimizing uncontrollable fee-for-service costs.