King ruling won't change road to consumer-based health system

Bruce Broussard has served as president of Louisville, Ky.-based Humana since 2011 and as CEO since January 2014. Humana recorded $48.5 billion in revenue last year, making it the fourth-largest publicly traded health insurance company by revenue. The company is one of the nation's largest Medicare Advantage insurers, with more than 3 million Advantage members representing about three-quarters of the company's revenue. Broussard previously served as CEO of McKesson Specialty Health, and chairman and CEO of US Oncology Holdings. Modern Healthcare reporter Bob Herman spoke with Broussard at the recent Healthcare Information and Management Systems Society conference about his company's use of mobile health information technology to help providers manage patients' care, the movement toward greater consumer choice in healthcare, and recent CMS payment and policy changes for the Medicare Advantage program. This is an edited transcript.

Modern Healthcare: What is Humana doing to engage patients through mobile technology?

Bruce Broussard: We look at three parts of healthcare that need to change: One is around value-based reimbursement, the second is around consumer choice, and the third is around integration of information. Mobile devices play a key part in all three—whether it's engaging with the patient around a health outcome, being able to service them and give them the transparency of choice, or the ability for physicians to make a decision about care on the fly with a mobile device. We see all three of those as part of the mobile evolution we're undertaking.

MH: What is Humana doing to further those goals?

Broussard: Transcend Insight is a great example of an application that can help physicians manage their patients with a mobile device, iPad or mobile phone. They can see gaps in care and data analytics, allowing them to recommend the next best action for their patients. Transcend and Transcend Insights are geared toward physicians. It really gets down to helping the physicians with their workflow and care coordination, and ultimately helping them with population health.

MH: The CMS recently said it wants to move more payments toward value-based care. What is Humana doing on that?

Broussard: Today, about 55% of our members are on value-based payments. We want to see that continue to grow. We are excited about what HHS is doing in bringing population health and value-based reimbursement to the industry. We want to be a partner with providers. Transcend provides the assistance in allowing providers to transition from a fee-for-service to a value-based reimbursement.

MH: How much of that 55% represents capitation?

Broussard: We believe physicians and hospital systems need to walk before they run. So they start out with a reimbursement relationship with us that's around quality and cost bonus payments. Over time, that transitions to a full-risk capitation level. We have about 30% of our members today in a full-risk relationship with a provider, and we see that growing as people become more comfortable moving from a quality-bonus relationship to a deeper relationship around risk.

MH: How does Humana as an insurer coordinate care between the patient and doctor?

Broussard: We have a very strong Humana at Home platform, and we employ about 10,000 nurses. We assist people when they transition outside of the hospital to the home.

MH: How did Humana do in the second open-enrollment period of the Affordable Care Act exchanges?

Broussard: We continue to see growth there. But what's really important about the exchange is that it gives consumers the ability to choose a competitive product, and that drives innovation.

MH: Do you see the trend toward high-deductible plans on the exchanges continuing?

Broussard: There are high-deductible plans, but there are also low-deductible plans. The ability for an individual to choose what is most important to them as they consider their health status and their risk tolerance is a great opportunity.

MH: Does Humana have any contingency plans if the U.S. Supreme Court strikes down premium subsidies on the federal insurance exchange?

Broussard: We obviously have contingency plans and they are detailed in nature, but I don't think that's appropriate to share. I don't know what's going to happen, and speculating around that will drive you crazy. No matter what happens, this transition to a consumer-based healthcare system is the road we're on. It might change a little bit depending on what happens in June with the King ruling. But long term, you're going to see a continued involvement of the choice of the consumer.

MH: What does Medicare Advantage mean for Humana?

Broussard: It is a very important part of our business because Medicare Advantage encourages competition, value-based reimbursement and looking at individual members holistically. It's a perfect example of where the consumer is making the choice. Providers are incentivized around quality and cost, and that forces integration. We think about Medicare Advantage both as a growth sector and as an example of where healthcare is going.

MH: Is Humana using at-home technologies with its Advantage members to help them with better coordinated care at home?

Broussard: We're testing high-tech personal devices, whether it's scales, blood pressure cuffs or monitoring movement. Interactive voice response is an option where we communicate with members and are more proactive in responding to their needs.

MH: What's your reaction to the CMS' recent Medicare Advantage rate release for 2016?

Broussard: The CMS changed the rate a little over 2% between the proposed rate notice in February and the final notice in April. It really was around the cost trend, and it's just following historical information.

MH: What are your thoughts on the CMS' decision to update their risk-scoring methodology?

Broussard: We weren't too happy about that. The most integrated care is in markets that will be the most impacted by that change. We look at it as reversing where the progress has been. Those particular patients that are coded in those risk scores are probably the ones who are the sickest. So unintentional consequences could happen from the point of view of value-based reimbursement and integrated care for these sicker patients.

MH: The CMS said that this might lead to more accurate coding and that insurers have had a couple years to get ready for this.

Broussard: The CMS was very thoughtful and did give us forewarning. But it's still a large change for the industry, and no matter how much you prepare for it, it's still a change. I believe the coding accuracy was proper before, so I don't know if this helped in that.