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Peter Hayes is the CEO of the Healthcare Purchaser Alliance of Maine.
Many of you have likely heard about the recent dissolution of Haven Healthcare, the joint venture by J.P. Morgan, Berkshire Hathaway and Amazon that sought to transform our healthcare system to drive value for employers and patients. Led by Atul Gawande, one of America’s most well-known physicians, Haven represented a turning point in American health care to many who saw these jumbo employers as our best chance to realign market incentives and push entrenched stakeholders to reexamine their business models. Alas, after only three years, Haven discontinued its efforts.
There have been countless articles written about the reasons Haven was unable to succeed — from incompatible cultures, to lack of vision, to conflicting business interests among the partners — Berkshire Hathaway has ownership in Davita, the largest dialysis company in the U.S. — but few market analysts seem to recognize that reforming our health care system on a national scale without the broad, regional support of key constituencies like plan sponsors, state government, and local health systems was always going to be a losing proposition.
As our recent member meeting speaker, Dave Chase, often says, “health care is local.” We are only going to be successful by starting in our communities and creating a movement among local purchasers and other stakeholders that drives health care value.
My takeaway from Haven’s failure is not that employers lack the power to change health care, but that change must be driven from the ground up.
I think this is at the heart of why state purchasing alliances like ours are such an important part of our health care ecosystem. Local alliances are the boots on the ground for employers in a given region, and they provide localized knowledge, data and solution sets. There is rarely a one-size-fits-all strategy in this business, and national organizations lack the insight into particular market dynamics that is necessary to be successful. Instead of change being driven from the top down, I believe it will come from multiple state alliances like ours working collaboratively to advance solutions that work both locally and nationally.
Just in the last couple years, we’ve seen that this transformation model can be successful. The actions of Maine purchasers have led hospital systems to offer bundled payment for surgeries that include warranties, and the utilization of consumer shopping tools has encouraged high-value providers to expand their services in markets where there were previously only high-cost providers. These may seem like incremental steps toward transformation, but they represent real movement in the market and show that purchasers can indeed change how health care is delivered and paid for in their communities.
For anyone who feels frustrated with how our health care system operates and wants to take an active role in advancing health care value, you can join your local purchaser alliance.