Reconstructing Healthcare: Innovative Solutions For Employers To Lower Their Healthcare Costs - Reconstructing Healthcare: Innovative Solutions For Employers To Lower Their Healthcare Costs
EPISODE 67, 24th August 2020
In this episode, Michael introduces Jim Wachtel, the Executive Vice President of Sales and Marketing for Renalogic. Renalogic is dedicated to helping employers manage kidney disease in their employee population and reducing dialysis costs with preventive programs and pricing solutions.
Jim was inspired to enter the healthcare industry because he recognized the cultural issues around healthcare. He wanted to support a company that not only helps make treatment accessible to those who need it but also takes measures to prevent chronic illness in the first place.
With this mission in mind, Jim found Renalogic. Renalogic works to reduce the costs associated with dialysis — a treatment for End-Stage Renal Disease (ESRD) — and offers a Kidney Dialysis Avoidance Program for at-risk members. Kidney disease is known as “the silent killer” for a reason: It is estimated that 40% of people with kidney disease don’t know it. And if it progresses from Stage 5 to ESRD and dialysis begins, treatment is expensive — up to $1.3 million per year, per member.
Renalogic started with cost-containment solutions, but their goal is to actually put their cost containment business out of business and focus on prevention instead. They have had a 99.3% success rate of keeping people off dialysis and have, in many cases, helped members reverse their kidney disease. They do this with personalized coaching that empowers participating at-risk members to take charge of their health. This, in turn, creates a ripple effect in their families that inspires cultural change one household at a time.
As far as payment goes, Renalogic imposes payment on the dialysis provider and works to ensure Medicare is maximized for those who qualify, even before the age of 65. They have a proprietary way to re-price claims in a way that is fair and defensible. For their Kidney Disease preventive program, they have a pay-for-performance structure and only bill for employees that have signed up to work with their nurse practitioners/coaches.
Renalogic has an exciting future ahead that includes a data service that will allow better service for those at-risk for kidney disease. And with a big vision that includes a healthier culture through education, empowerment, and preventative support, we are excited to see how the trickle-down effects of Renalogic’s efforts play a role in the health of future generations.
Here’s a glance at what we discuss in this episode:
00:30 - Introducing Jim, Renalogic, and Jim’s background and education.
02:00 - He knew we had cultural issues around healthcare and that “the American lifestyle is wreaking havoc on chronic disease”.
03:30 - Jim became interested in working with companies that help combat chronic illness and disease.
04:45 - The problem is that the expertise required for solutions is hard to find; for employers, it’s hard to keep costs down while still providing quality care.
06:00 - A small percent of the population is a majority of the costs; this 5% needs to be addressed in a reactive and proactive way.
07:05 - They empower members to take charge of their health and don’t see people as a line item cost.
09:20 - A large percent of the population has some stage of chronic kidney disease and up to 40% of people who have it don’t know it.
10:35 - After Stage 5 of chronic kidney disease, you go into ESRD which is when dialysis is started; it costs up to $1.3M/ year per member, the 3rd highest flagged stop-loss claim.
11:45 - The dialysis marketplace is concentrated and the duopoly in the market doesn’t have an incentive to lower costs.
13:15 - They started with cost-containment solutions and have a system to re-price claims in a way that is reasonable and fair.
16:06 - ESRD makes you eligible for Medicare before age 65 so that becomes a second payer and becomes primary after the waiting period.
17:30 - They “impose the payment on the provider”; why using reference-based pricing with multiples of Medicare can be risky for an employer.
19:12 - When Medicare re-prices a claim, there are about 13 different variables they use and it’s hard to determine what they’d be; it’s arbitrary and capricious.
20:15 - They have good relationships in the stop-loss marketplace, brokers, and consultant community.
22:30 - People are getting sicker and sometimes go into emergency dialysis; it would be better for it to be a gradual process.
23:50 - They want to put their cost-containment business out of business by preventing dialysis from ever happening in the first place with clinical solutions.
25:18 - They’ve had a 99.3% success rate of keeping people off dialysis and have reversed kidney disease in many cases; they specialize in finding at-risk members.
28:40 - Of the population they identify, 30 - 40% participate; blood tests show if people are reversing the disease.
32:50 - They collect member stories and testimonials and offer a coaching-type relationship with members to fill the gap in the industry for that type of care.
35:00 - People need that human touch; they use tech to support the process, not to replace the actual connection or engagement.
36:05 - They have set-up fees and their Kidney Dialysis Avoidance Program is essentially a risk management tool until cost management is needed
39:25 - They’re working on data service and are using machine learning and A.I. to serve their industry better.
40:30 - Making cultural shifts in terms of health have a trickle-down effect; the next generations can learn how to be healthier.