Kevin Conlin, who announced his retirement as president of Horizon Blue Cross Blue Shield of New Jersey on Monday morning, has seen the health insurance landscape make dramatic changes during his nearly four decades in the industry. .
But despite everything that’s happened, particularly since the Affordable Care Act was passed in 2010 — a watershed moment for the industry, he said — Conlin believes the sector is still adjusting its place in the national landscape.
The main reason: it’s not just about health insurance anymore.
“I think we’re going to continue to see the blurring of lines between the roles of health insurers and those who have traditionally been health care providers,” he said.
“Health insurers understand that we can’t compete with other major health insurers if we don’t work more closely with providers to deliver the different outcomes we’re all looking for: lower costs; superior, objectively measured quality; and an improved member or patient experience.
Conlin said he sees four key trends:
- More collabs: Conlin thinks there will be more integration between providers and payers. Either as equal partners (he notes this is Horizon’s preferred approach) or by acquisition (he cites Optum Care, which is run by UnitedHealthcare, acquiring Riverside Medical Group. And, on a larger scale, CVS acquiring Aetna );
- Telehealth adaptations: Conlin thinks it was the genie that was released from the bottle. “I think it’s been shown to be effective, and doctors are now seeing that it’s a viable alternative,” he said. “And, because of some changes that we and other insurers have made in coverage, uptake has been very strong.” Conlin thinks it will also lead to increased monitoring of patients at home.
- Integration/acquisition of payers and pharmacies: Conlin notes the recent purchase of a specialty pharmacy by UnitedHealthcare – as well as other acquisitions. “It hasn’t had much exposure yet, but it’s coming,” he said.
- Integrated behavioral and social health: The idea of developing care around the social determinants of health will continue to grow, he said. “Payers essentially offer various strategies to address the social determinants of health,” he said. “We have had very encouraging results in New Jersey. I think it’s something that will be replicated by others here and across the country.
Conlin, before announcing his retirement, spoke with ROI-NJ on a number of topics. Here’s more from the interview, edited for space and clarity.
ROI-NJ: There are so many things we could cover here. Let’s start by learning more about the current state of the industry – it’s an industry that’s being bombarded with outside money, not only from private equity and venture capital firms, but also from big tech companies like Amazon and Apple. What impact does this have on the sector?
Kevin Conlin: There is certainly a lot more money going into health care. Not so long ago, most of us were only interested in what our direct competitors were doing in terms of strategic development. Now we are concerned about what is Amazon doing? What does Apple do? What is Uber thinking? Very non-traditional players in healthcare.
I think if you were to speak with (CEO of RWJBarnabas Health) Barry Ostrowksy, (CEO of Hackensack Meridian Health) Bob Garrett or (CEO of Atlantic Health) Brian Gragnolati, they would tell you exactly the same thing. They are now concerned about these non-compliant competitors that they did not deal with before.
And, just beyond these companies, there are huge private equity and venture capital firms that are ready to make money available to entrepreneurs who develop a solution. They will have an impact, positive or negative, on both health care providers and health insurers.
ROI: How has this changed how Horizon works?
CC : We have become much more diligent in scanning the horizon for what is happening in all of these different sectors. Where is the money invested by public companies? Where is the private money going? We think that’s a sign of where things are headed. And then we evaluate all of that in the context of our strategic direction – and we decide if there’s anything we need to be concerned about. And, if so, how soon do we have to react?
ROI: It looks like the pace of change will only accelerate. Is it true – and is it good?
CC : The sums of money invested in health care will certainly not slow the pace. This usually has the effect of speeding up your decision-making and the actions you take.
In the short term, it’s not much fun having to deal with this. But, I think when you take two steps back, it’s probably a good thing for health care to have this kind of disruptive investment that’s taking place, because I think it’s forcing everyone who’s currently a player in the field of health care to stand up and pay attention to some of these new developments.
ROI: New developments – this seems to be all we’ve gotten in healthcare in the past decade, starting with the adoption of the ACA. It was supposed to completely disrupt the industry. Looking back, right?
CC : Absoutely. Health insurance is no longer limited to having the widest network of providers and offering the lowest unit cost you can negotiate with other providers. It forced significant changes on the part of health insurers in how they participated in the exchange. This required a significant amount of change for virtually every health insurance company.
It also, bluntly, affected the earning potential in several of the lines of business by essentially requiring a minimum amount of premium that had to be spent on medical expenses – hence, the amount of profit that could be made in the region. .
This created a new form of competition. The ACA fundamentally changed the entire industry.
ROI: Of course, no matter how big the changes, people are always crying out for more – always saying our healthcare system is broken. As someone who has made a career out of the industry, is that hard to hear?
CC : It would be, if I only listened to the critics. We honestly take an approach where we have a way to gauge our member satisfaction. Thus, we have the ability to place criticisms in the proper context: they are opportunities for us, and even challenges for us, to resolve what caused that particular problem the member might have had.
It also allows us to differentiate between areas where we erred, we missed the opportunity to serve a member effectively, versus just the fact that there may have been something in the policy that they didn’t. didn’t like – and they weren’t quite familiar with when they took out the policy.
So we’re trying to distinguish between the kind of criticism we should accept and respond to, from what may not be the result of something that we, per se, failed to do.
ROI: Speaking of reviews, many people say New Jersey is a tough place to do business. As the head of one of the biggest companies in the state, what do you think of this?
CC : I have two thoughts. For starters, there’s something the Governor (Phil Murphy) always mentions, which I strongly agree with. We have a huge talent base in this state, with broadly represented areas of interest and very deep raw intellectual talent. It is something that we benefit from.
I have spent a lot of time in many other states with other companies. The talent pool here is remarkably strong. And it’s a sentiment that’s shared not just by myself, but by many other state CEOs.
The second observation is that this is a state that wants regulation – and believes that a strong regulatory environment is a necessary feature of the functioning of the state. It can be good. And it may not be so good.
But that’s part of what you get when you choose to start your business in New Jersey. And, again, that’s what New Jerseyans have made it clear they’re looking for. This can present some challenges when dealing with competitors who may not be based in New Jersey.
ROI: New Jersey is the smallest big state or the biggest small state, depending on how you look at it. Either way, most believe this means business and government are much more connected than in other areas – do you agree?
CC : I would totally agree with that. The level of communication and the level of engagement with elected officials, with other CEOs, with other leaders, is real. It is a dense state. There are a lot of people here. But, in many ways, once you get to know it, it feels like a relatively small organizational unit, because so many people know each other. We have the ability to pick up the phone and get in touch with each other on any given topic at any time. And, I think it allows for great efficiency in the way things are done.
ROI: Do things. It’s been your life for four decades. Now you are on retirement. We have to ask, what’s on your to-do list right now?
CC : That’s the honest answer: I really don’t know. I consulted a bunch of other people who were in senior management positions and who retired relatively recently. And, if I had one common piece of advice, it was this: Take advantage of the fact that you no longer have the long hours or a schedule that he sets for you. Stop, recharge your batteries, spend time with your family. And then, determine what happens next. It makes a lot of sense to me.
I know that I will spend more time with my family. I am proud to report a new grandchild who has been a ray of sunshine amid the pandemic. So I’ll make sure to see my granddaughter more than ever. I can’t think of anything better.
