Over the past few years, the shift to value-based care has slowed down as organizations struggle with leadership alignment around care delivery advancements. However, lessons can be learned from organizations that have successfully advanced value-based care – including how to position the organization for value-based success, how to build performance based contracts, and how to create strong physician incentives.
On this episode of Value-Based Care Insights, host Daniel J. Marino and Dr. Christopher Crow, CEO and Co-Founder of Catalyst Health Group, discuss how to make changes in an organization’s culture, finances, and operations to successfully transition to value-based care.
Key points include:
- Building a solid culture on trust is critical; it is all about physician alignment, performance outcomes, and transparency. A good trusting relationship makes it easier to align incentives over time.
- Understanding the infrastructure requirements to support value-based contracts allows for timely recruitment and effective operational change management. Focus must be on team development, operational and clinical workflows, and technology to achieve high-performance and desired outcomes.
- The cornerstone should be the physician-patient relationship - and these relationships take time and compound over time.
Daniel J. Marino
Managing Partner, Lumina Health Partners
Dr. Christopher Crow
CEO and co-founder of the Catalyst Health Group
Daniel Marino: Welcome to another episode of Value-Based Care Insights. I'm your host, Daniel Marino. In today's episode, we're gonna spend some time talking about provider networks and in particular, networks that have come together with the goal of shifting into value-based care. During my career, I've had the opportunity to work with numerous provider groups across the country, bringing them together in either a clinically integrated environment, helping them to reduce costs or just becoming more efficient with the goal of shifting them into value-based care. It's a topic that, of course, is near and dear to my heart if you've had opportunities to listen to us and the program. But over the years, what we've sensed is that many of our networks have done a great job of creating some strong capabilities, some strong outcomes. But it seems like, over the last number of years, we've lost a little momentum, a lot of the shift into value-based care may not have gone as quickly as we'd hoped. And in some cases, depending on the market, even the payers have been a little reluctant to move forward with stronger value-based contracts. With that being said, COVID certainly highlighted the challenges that we all experienced within fee-for-service. And if anything, it showed that delivering care differently in a value-based arrangement helps to allow us to serve the needs of our patients that are tracked outcomes and frankly, becoming more efficient. I'm very pleased today to have with us, a guest who has done an exceptional job of advancing his network and really positioning his independent providers for success. Dr. Christopher Crow is CEO and co-founder of the Catalyst Health Group, catalyst is the largest clinically integrated network in Texas, they have over 1000 PCPs and take care of well over 1.5 million patients. Catalyst, who I have known and followed for a number of years, has done a fantastic job of changing the care model, changing the culture, changing the dynamics and so forth, aligning with providers, and really a fantastic job of serving the patients within their northern Texas community. Dr. Crow, welcome to the program.
Dr. Christopher Crow: Thanks for having me. Appreciate the intro.
Daniel Marino: So Dr. Crow, when, as I mentioned, in my opening remarks, I've worked with a number of organizations around the country, and many of them, I think have experienced a certain level of success, I think, as they started to contract, as they've started to expand, others have been a little bit slow to move. What has been some of the things that have driven your success within Catalyst that has allowed the momentum to continue to advance in the name of value-based care, in support of your independent providers?
Dr. Christopher Crow: I think there are several broad things that probably most people would put in these categories, but then it's how you fill in each of those categories to create a strategy that I think differentiates us. We can talk about aligning economic incentives. Incentives drive capitalism. You have to think about that, and you have to be operationally efficient and effective. You have to make the impact that you want to make when we can talk about the things you do in value-based care. It's not a secret to most people in general. Where I think the biggest impact a difference makes is really around culture. And what's really, really, really important and for us, we talk about our purpose, and our core values, and generally, what is the alignment? What keeps us aligned outside of the operations and the financial incentives? What keeps us aligned? What's the tribe or the belief system that underpins everything we do? What makes that simple, powerful, and soulful not only in their mind and heart but in their soul? We think that really is a differentiator. It's soft. It's hard to measure. But you kind of feel it and know it when you have it. If it's done well and fed, it grows and can make you more powerful. To be specific, to click into that a couple of times here is we started with being primary care only. That's a choice that you make. And what that does is it allows you to move, you have a focused alignment right there. We don't have any private equity dollars in it. It's not a hospital Clinically Integrated Network. It's not connected. So you eliminate some other stakeholder incentives that wouldn't align necessarily with how PCPs take care of patients. So those two choices, right there are pretty important. The third choice we made is we were going to make sure we did value-based care for all of the physician's patient panel. People like to do just Medicare Advantage, an MSSP model to start. We actually started with a commercial, because that's where most of the patients were. We wanted our physicians to adopt a care model, and the easiest way to adopt it is for it to be attached to most of its patients. So few choices like that initially, strategically, have really propelled us. And then the culture that we aligned with the physicians is, why did you join? Well, of course, they joined because we promised that we think that we could make a better economy. But our mantra at Catalyst Health Group is we want to help our communities thrive. We get one spin around this earth, I grew up in a town that happened to have just three PCPs. And they did everything from the mayor, to the city council to the head of the churches and school board. They made a big difference before population health was a term. And I wanted to give back to my community that is in North Texas, and now expanding beyond. And I thought helping primary care physicians really do what they've been not only trained to do, but the promise of what study after study shows can happen when you have a long-term primary care relationship, or more primary care physicians, in a community, even in a fee-for-service world what they can do. So imagine if you can help them transition to being able to take on a little more risk and a little bit of responsibility and accountability with more tools and services, to really unleash the power of that ship. And so we talked about the joy, we talked about the ability to not only survive and thrive and what's been a crazy two decades. That's gotten harder and harder to operate. But at the same time, PCPs are more and more valuable. So that kind of calling card of helping them survive and not only survive, but thrive. And the idea of them being the hero in the hero's journey of helping a community thrive and really honoring how important our number one core value is that relationships matter. Because the PCP-patient relationship is why all the value-based care models are built around that. That's the calling card around our purpose and our core values. Then we add in some financial incentives and some operational efficiency that you have to do. But you wait, you get an alignment of heart, mind, and soul around those things. And you say we're together for the long haul. And you continue to walk the talk, and you make sure that all your activities are consistent with that or when they're not you explain why they may or may not be and you also have the ability to move it along. That all makes up culture to me and some of those decisions and strategies and purpose and core values and that is what we think our differentiator is. That's hard to replicate.
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Daniel Marino: Primary care these days is so challenging. When you look around the country, the independent primary care practice is really almost becoming a dinosaur actually in the same society. But that's really the case. Primary care physicians, due to some of the challenges with reimbursement and the costs associated with it, their compensation is not at the level that it really should be, given certainly the level of responsibility. Not to mention all of the work and the infrastructure that is required for primary care to be successful. So when I'm hearing you talk, it's going to come down to three things. It certainly comes down to economics. So you have to have the right economic incentives. It has to make sense, both to the primary care physician, but also to the payer. And we'll get into that in a second. You have to have the operational support because you cannot, if you're going to be successful, you can't ask the physicians to work harder. We have to give them the tools, we have to give them the resources for them to work smarter, and as I said, then it's the culture. And it's really that mindset, right of moving from fee-for-service to fee-for-value. So I want to ask a couple of questions to dive into that a little bit. When you started to have these conversations with the primary care physicians and then even as you continue to advance your network, how are you bridging the gap between the financial incentives, the operational support that you have to provide to the physicians to ensure that they're going to be successful, and instilling that culture of trust, and that ability for them to believe in you that you're going to move things forward and work in their best interest to not only support the patients but to support themselves and their practice.
Dr. Christopher Crow: You hit on an important word. When I tell you that our number one core value is relationships matter. What underpins great impactful relationships is trust. And trust is, is earned over time. And that's exactly what we've done. We don't lose physicians, and they stay with us and we grow. And I ran my own group and started my own group with a few doctors for about 12 years. So I did it myself for a long time I've performed at the highest level in our group. I have been in their shoes.
Daniel Marino: You have that credibility. Right off the bat, as I said, walk in their shoes.
Dr. Christopher Crow: Trust has reliability and credibility and transparency variables to them for sure. What we were doing over time at Village Health Partners, which was my first group, it's still in existence today. It is one of the two largest primary care groups in North Texas, that is still independent, and that are members of Catalyst. We just were experimenting a lot and trying to figure this out. I've been doing value-based care for 15 years. We were the first NCQA level three medical home in the whole central part of the US in 2008. And we've been working on this for a while and what that allowed us to do because we were playing for a long, we knew we weren't going to take investment, we knew we weren't going to sell to the local hospital. So we would just have to make irritative changes. And then we would reinvest capital back into the business because we didn't have anybody else we had to share it with.
Daniel Marino: So you kind of put it all back in and they see that you're reinvesting in your infrastructure.
Dr. Christopher Crow: Then you look after 15 years, and you've learned a lot of things, and you've advanced the ball along the way. And in any given year, you might say, man, we didn't do that great that year, but you look up after 10 years or 15 years, and you're like, wow, look at how far we've come. When you're doing that consistently, trust actually grows and builds. And so when you really start to push the operational button or the technology button, or into new payment models, things that you could never just walk into a room and talk to a physician into, you now are like whatever they're bringing we know that they would never bring us anything that they don't think is going to make us better in either financial, clinical, time, or how our patients are going to feel about their experience with us. Now, we don't always get it right. But that's how you learn and we learn and that's how we evolve. When we say we're sorry, here's what we missed. But here's what we learned. And so we think we'll do better this time. You have that pattern over and over again, through a good relationship, like anything we have in life and then all of a sudden you align the incentives correctly over time. That's its own story. You learn what works to actually move the needle on the total cost of care and quality metrics and what doesn't over time with trial and error, and then you get to a point where you get you to get pretty good at it. You're willing to take on more risk, which changes the compensation model. And its super fun.
Daniel Marino: I have said to organizations time and time again, this is a journey. And you've had to take little steps you move along the way. You have to celebrate the successes, and you're going to have a few challenges. And you need to know that going in because it's not going to be 100% Perfect, but you learn along the way, and you get a little bit smarter the next time as you're either moving into that next contract or working through managing a certain cohort of patients or tracking a certain level of outcomes. You just get smarter along the way.
Dr. Christopher Crow: No doubt.
Daniel Marino: One of the questions that came to me as you were talking and this is often challenged by many organizations. How are the payers? How did the payers respond as you started to move into value-based care and some of these contracts? I know in some of the markets that I had negotiated with and even some of them I negotiate with now, some of them are scared of clinical integration. They don't necessarily understand the value of the network and they feel like bringing the network together. The only reason the organization is doing that is to negotiate from an area of strength based on size, not necessarily theory, outcomes. How have you overcome that?
Dr. Christopher Crow: You're right that before the provider in negotiations with payers have all been on brute strength and around size. And that's why you've seen the consolidation in the private equity world. So I wasn't in the right place at the right time, my group had become the PCMH (Primary Care Medical Home), first in Texas, and so all the payers were needing to get a notch in their belt, so that they have a primary care medical home contract. And so we got one of the first ones in Texas with all the major payers when I was still practicing. And we learned some things pretty quickly and made a little money. And so what was also happening in my market is a lot of independent physicians were, you have to remember when this was, 2007-2010. So in that time, you have a recession, you have Obamacare, a lot of uncertainty, and so a lot of physicians panicked. And you saw a mass consolidation in the hospitals. Our two main hospital systems were growing, and costs were skyrocketing. And so the payers said, hey, you've done this little PCMH thing with 20 doctors and 20,000 lives, can you scale it to 400-500? And I said, Sure, but I'm not going to use the employment model, because that's what is in the market right now. I want to look different, and I said we'll use the ACO, the clinically integrated network model. And we'll wrap up all the independents, so you'll have a balancing mechanism in the market against the large hospital players, and they all love that right. And so they helped us get started. And I said I would not start until all of the four major payers had given us a value-based contract that allowed us to recruit, and allowed us to have care management dollars to build an operating system. And not just dollars to give to the doctors and tell them to please do better. Literally, build infrastructure, and ultimately if we create value, then we'll get to share in that. And so we did, we built that we got your ACT certified as a clinically integrated network and care management and transitions of care, and now even pharmacy, and then we performed. And so then we look up, and we start to grow, and they want us to grow because they want us to protect the market. So ever since we started in 2015, the market share of the hospitals versus the independence has been stable. It had skyrocketed from zero to nearly half employed in about a 20-year period, we came along. And we've kept it that way.
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Daniel Marino: That's fantastic. And that says a lot about what you've done in supporting the independence because I'll tell you it in probably 80% of the markets, you've seen such a consolidation into the employment model, it really says a lot about what you've been able to accomplish.
Dr. Christopher Crow: Yeah, and currently we're even seeing some out. We've taken as many as close to 100 out over the last few years. The new employment model around the national consolidators were the public companies or the private equity firms. That's a little bit of a new thing and the hospital, and we stabilized that when you perform. What I always told the payers, I said, I don't want to negotiate from a point of size, although size matters, and we want to have a decent size. We want to perform, we want to show you we perform and we want to earn it. But when we do perform, we then want to be compensated for it. We've had nice increases with that. Then of course, the Medicare and Medicare Advantage, those programs continuously reward you for good work, no matter your size. It's different. It's not like contracting with the payers on the commercial side. So it's been a very nice run. And we continue to because we don't have any private equity and we're wholly owned privately, we just push dollars in, over and over and over every year. When you're not having to give 20% margins to somebody else and you can reinvest it, you actually get to go faster.
Daniel Marino: You're a little bit more nimble. And you're not having to check in with anybody. I love what you had described with the payers because when you're able to negotiate from a position of outcomes, of a position of efficiency, of a position of being able to really manage the patients in a different manner than just having them churn through the office on an encounter basis. It is such a different conversation. And it sounds like you really moved into one of collaboration with the payers, which reminds me of a comment that years ago when I was setting up a clinically integrated network and we started to get into our first pay-for-performance contract. Up until then, there was such an adversarial relationship between this health system and the payer. Once we established a clinically integrated network, and we were starting to track our outcomes, and we came together with the payers with some common goals, that was such a different level of conversation, I'll never forget what the CEO said to me. He says, for the first time, in my 30 years, I actually had a conversation that was collaborative with the payer, as opposed to adversarial where we were throwing daggers at each other from across the table. And that's just such a better position to be in, as you're having that conversation. And as you're truly advancing the care and the outcomes that you need to provide for the patients in your community.
Dr. Christopher Crow: Our number one core value is relationships matter for a reason. And that means all relationships and relationships between providers and catalysts. And the payers are huge. I mean, we don't have, I mean, we don't have disagreements. But in the end, we're just human beings who happen to be in this momentary construct of a certain job in a certain company, and that changes over time, people change over time. And so if you can, kind of take the identity and emotion of whatever your W2 is, and just talk to the human to human and find all the things that are similar about each other and then work on things that are important to each other, like you said, what's important for you, what's important for me, let's find win-wins. That's served us well.
Daniel Marino: When you've worked with the primary care models, talk a little bit about that, how do we use technology? How have you used outcomes and so forth, to advance the care models to say, even innovate primary care whether it's with the use of telehealth or virtual health, or whether it's incorporating care management? How have you used some of those outcomes to really enhance the care model to provide that better care be able to track the outcomes, obviously, reduced costs and so forth?
Dr. Christopher Crow: Yeah, so our care model is one that is team-based, and augmented by technology is how we describe it. And again, at the cornerstone of everything we do is the physician-patient relationship. And so our operating model is to surround them with a team and technology to help them to the outcomes that they both want. The third in the trinity is whoever's paying for it, they have to get value too. So the contracts are set up for but then you got to serve the physician and the patient. And so what we do is we understand that relationships compound over time. We take a long view of having very much proactive versus the reactive type of care model, again, relationally, not transactionally, and then long-term versus short-term. And then we build teams where physicians know who their care coordinator is, their pharmacist or pharmacy tech, there are all kinds of acumens below that, we probably have 200 clinical people on our team, that are helping the physician virtually, inside their EMR, inside their workflow, helping them be their eyes and ears on patients continuously, based on their needs to make sure the care plan that they've chosen that enact together is actually implemented over time. Someone who's healthy probably doesn't ever interact with his care team, someone who's got multiple chronic diseases or in an episode obviously gets a little bit more of that. And so COVID, because of the telehealth, we had to get everybody on telehealth in about 10 days, 98% of our groups got on in 10 days. That really helped our care model get adopted even more. It has always been there. But fee-for-service was still the predominant payment type. And so that doesn't allow for a lot of innovation. Even though they had this tool to help them. They couldn't, they couldn't attach the game share payment 18 months later to what they were doing in the moment until they got it into COVID. And we really took off even more because we started to utilize, Hey, let me get my pharmacist on right now. Because it'd be like you and I talking right now and go, Hey, hold on, let me get my pharmacist on with you. And they started to appreciate it so you come back into the office and now they're used to utilizing the character and they know how to use these new tools and services and technology. They understand the value of tracking their patient, rather than doing it with the technology we use. Rather than giving them a tick sheet or business card on how valuable that information is to help, It really changed the market. Our technology of just tracking referrals has changed the market from specialist visits going from nearly a month out to about two to three days and getting information back from the specialist 10% of the time to closer to 70% of the time. And all that accrues to the better experience of the patient. And if you believe that it's quicker to diagnose and quicker to treat. That creates what we call total cost of care improvement and experience improvement. Everyone's winning in that scenario. We've been doing that for four or five years. Then all of a sudden they can see the value of it now, which is really helpful.
Daniel Marino: The evolving care model is something that is so important, but it is really predicated on the providers using the tool, but also your organization setting up that right level of infrastructure so that it's in place. And as you said, that level of disruptive change really forced them to use the tools, but it really created the new norm of primary care. By the time of the end as we are going back into the office, like you said, they were used to using it. It is fantastic because then you're focusing on continuing to advance, not having to go back to what was the norm two or three years ago.
Dr. Christopher Crow: That's right. To summarize kind of where we are, you start with the culture and all the choices you make at the beginning. You set the operations up. And the thing that we've been wanting to have for the holy grail to actually make primary care be the best it could be, is how it's financed. What you haven't really heard me talk about, for the last two years we've been the Pied Piper for prospective payment. To pay ahead of time is more like a subscription. People used to call it capitation, but they get scared when I say that word, so I call it a subscription and have the PCP be the quarterback. Once physicians, they are really liking it on the Medicare and Medicare advantage side, once they realize that money is coming in, and they're not having to think about volume, the only way I can do better today, pay my mortgage, I have to get more volume. That is just been ingrained in them. Once they can back away from that, which they did during COVID because they couldn't use their exam rooms. They started saying, okay, who needs me today? And prospective payment allows them to think about that. They already have the teams and the technology built. So we have the culture, the team, and the technology and operating model. And now finally the financing is switching. As more and more of the prospective payment comes on board, you get more and more adoption of the operating model, which is then creating more and more outcomes. Now you start to have a flywheel effect of being able to continuously help our communities thrive. Help physicians not only survive but thrive and have patients get better outcomes. So whoever's paying for it is happy too.
Daniel Marino: The economics just build on one another and like you said, it sort of supports that underlying engine that really creates a lot of momentum. Dr. Crow this has been fantastic and I know many organizations, as I said, have struggled with really advancing their network. It's been great to hear from your perspective on where a mature organization can go. And also hearing what you see in store for your group, as you continue to move into value-based care. In closing any piece of advice, any final thoughts you might give to some of our listeners, especially those that maybe are struggling with advancing their network.
Dr. Christopher Crow: One of my favorite words around here that people know is alignment. Are all the stakeholders actually aligned? And if they're not, then it's gonna be really hard to advance. If there's one of the stakeholders that's rowing in a different direction. This is why hospital-based CINs are not working as well, which is why you sometimes see the private equity groups have trouble. Because there's not necessarily an alignment of incentives. And if you don't have that, you're gonna have a hard time long-term.
Daniel Marino: I couldn’t agree with you more. And I've said that time and time again, alignment is key. Alignment of finance, alignment of culture, alignment of outcomes, and alignment with how you want to serve your patients. I couldn't agree with you more. Dr. Crow this was fantastic. I really appreciate you taking the time. Love hearing your story, love hearing the journey that you and Catalyst Health Group have gone through. If some of our listeners want to learn a little bit more about Catalyst Health, any thoughts on where we can direct them?
Dr. Christopher Crow: You can go to the website catalysthealthgroup.net. We also are on all the social channels, myself included, on LinkedIn and Twitter. I'm semi-active on Twitter with opinions about healthcare. Those are probably the best places.
Daniel Marino: Well, thank you again, this was wonderful. I'd love to have you back some time down the road. Maybe we can spend a little bit of time talking about some of the economic incentives and the economic alignment as we move into more and more value-based care. I think as we see more organizations certainly shifting into Medicare Advantage, that is becoming increasingly important. So thank you again for your time. I really appreciate it.
Dr. Christopher Crow: You bet. Thanks for having me.
Daniel Marino: In closing, as Dr. Crow said, many organizations are certainly, not only struggling with how to advance, but they are having a little trouble getting traction. And yet you have a few organizations such as Catalyst Health Group that have gained a lot of traction and have had some real successes. They have created some strong incentives for the physicians and supported their physicians, as well as positioned their organization for success in value-based care. At the end of the day, as I've said, time and time again, it's the right thing to do for our patients. So in closing, I want to thank you for listening. Until next time, I'm Daniel Marino, have a great day.
About Value-Based Care Insights Podcast
Value-Based Care Insights is a podcast that explores how to optimize the performance of programs to meet the demands of an increasingly value-based care payment environment. Hosted by Daniel J. Marino, the VBCI podcast highlights recognized experts in the field and within Lumina Health Partners.