Ep 62 – The Role of Direct Primary Care in the Value Movement, with Dr. Gaurov Dayal

What this episode covers

Employers are on the frontlines in the battle against rising healthcare costs. Legendary investor Warren Buffett said that rising health care costs, not the tax system, are the number one problem that American businesses face. “If you go back to 1960, or thereabouts, corporate taxes were about 4% of GDP. And now, they’re about 2% of GDP,” “At that time, health care was 5% of GDP, and now it’s about 17% of GDP.” In Buffett’s view, this says a lot of what’s playing a bigger role in hindering business activity in the economy. He is famously quoted as saying that “medical costs are the tapeworm of American economic competitiveness.” Direct Primary Care (DPC) is a unique solution for employers to win the “race to value.” Our guest this week is Dr. Gaurov Dayal, the President and COO for Everside Health and a nationally recognized physician leader, who, in 2019, was selected as a finalist as the Director for CMMI to replace Adam Boehler. Everside Health is tackling employer healthcare costs head on by offering direct primary care services to employers. Their DPC model redirects health care from fragmented care sites such as inpatient and outpatient settings, specialists’ offices, ER and urgent care clinics into the optimized primary care setting. In the longer term, Everside works to deliver cost savings by diagnosing, treating efficiently, and managing the health of a covered population across 32 states with 350 health clinics located at or near the facilities of its employers, unions, and other benefit sponsor clients. Episode Bookmarks: 02:25 Dr. Dayal shares his recent “once-in-a-lifetime” experience traveling to Iceland! 03:30 Recent APM delays and pullbacks from CMMI – what does this mean for the value movement? 05:05 “The progression to Value-Based Care is a fairly bipartisan issue.” 05:45 Is the COVID-19 pandemic detracting from the current health policy focus on value? 06:45 The deficiencies of the healthcare system highlighted by COVID-19 08:30 Dr. Dayal reflects on his experience interviewing for the Director of CMMI position in 2019to replace Adam Boehler 09:45 “There is a lot of passion at the federal level to push ideas that can improve care for the US population.” 10:40 The challenges of balancing stakeholder interests in the political process and the need for more clinical leadership and influence 13:45 Is capitation truly needed to have value-based care?  Or can you pay for outcomes in a FFS model? 14:45 “The linkage of the payment to the delivery system creates value-based care.” 15:30 Dr. Dayal discusses the capitalistic model of healthcare and how FFS domination prevents large scale change 17:00 “In the history of companies, very few companies are able to successfully transform themselves from one business to another.” 17:30 “We are entering an era of new providers disintermediating in value-based care, rather than old incumbents successfully bridging the gap.” 18:00 Dr. Dayal discusses disruption in the Medicare Advantage space (e.g. ChenMed, Oak Street Health), employers collaborations (e.g. Everside) 19:00 The germination of specialty-focused companies in VBC (e.g. renal care, oncology, orthopedics) 19:30 Dr. Dayal compares the “race to value” to the automobile industry transitioning from combustion engines to electrical power 21:00 Referencing legendary investor Warren Buffett’s position on rising health care costs as the number one problem that American businesses face 22:00 Everside Health’s Direct Primary Care (DPC) model operating in 32 states with 350 health clinics located at or near the facilities of its employers 22:45 The average family spends $20k on healthcare at a time when working Ame...