The 42nd annual J.P. Morgan Healthcare Conference wrapped Thursday after 3 1/2 jam-packed days of company presentations, meetings, meals and networking across San Francisco’s Financial District.
Fueled by a near-endless supply of coffee, attendees shuffled between events discussing some of the industry's hottest topics, from artificial intelligence to payer reimbursements and expansion opportunities. The conference drew more than 400 health systems and companies but as the week progressed, crowds dwindled due to early departures, some of them likely tied to winter storm forecasts ahead of the long weekend.
Related: 5 CEOs considering acquisitions—and 1 who's not
Read additional coverage from Modern Healthcare reporters here and catch up on any days you may have missed.
Looking for a primer on who said what? Here's a rundown of healthcare themes that emerged as top-of-mind with some of the industry's leading CEOs.
1. Ambulatory care is the way to grow
Healthcare systems are looking to expand their footprint for outpatient services.
Many providers continue to build hospitals and add patient towers as populations grow in some markets and patient demands rise, but they see the most potential in reaching more consumers through out-of-hospital care. Investments in ambulatory services tend to be less capital-intensive and serve as a lower-cost care option for patients and providers.
Executives at Chicago-based CommonSpirit Health, for example, said they plan to expand the system's outpatient network in core markets such as Colorado and Arizona.
Sacramento, California-based Sutter Health is investing roughly $800 million to open 25 ambulatory care centers in the next three years to house primary and multispecialty services. In October, Sutter acquired Sansum Clinic, an outpatient provider.
2. Patient volumes rebound, straining capacity
Many nonprofit health system CEOs said inpatient and outpatient volumes are exceeding pre-pandemic levels, straining workforces already stretched thin. The use of technology will extend nurses’ and physicians’ reach and reduce their workloads, executives said.
Inpatient and outpatient admissions at Ohio's Cleveland Clinic, for instance, have grown roughly 6% from 2022 to 2023.
To meet that level of demand amid a tight labor market, health systems like Intermountain Health are using telehealth and automation. Salt Lake City-based Intermountain Health is using telehealth-capable cameras in patient rooms so physicians and nurses can monitor patients from a remote station, CEO Rob Allen said.
3. Health systems were light on AI specifics
Nearly all health systems touched on using AI to improve diagnostic accuracy, streamline billing and coding processes and limit physician and nurse documentation. But few offered much detail on implementation and expectations for how AI could augment operations.
San Diego-based Scripps Health said it is partnering with Epic and Microsoft to create an AI tool to answer questions submitted through patient portals, after a physician screens the responses. Boston-based Mass General Brigham said it has been working with GE Healthcare to commercialize algorithms that expedite disease detection in radiology.
The lack of detail on healthcare AI applications may signal that health systems aren’t ready to embrace the relatively untested and unregulated technology.
4. Digital Health companies got more specific about AI
Companies such as Teladoc, R1 RCM, Veradigm and Talkspace all touted their use of generative AI.
Telehealth company Teladoc said it was using generative AI and advanced analytics to improve engagement and enrollment rates among their employer customers. It's partnering with Microsoft to improve email communication with consumers and use condition-specific language to boost engagement.
Revenue cycle tech company R1 RC said it partnered with Microsoft to build large-language models into its system. CEO Lee Rivas said it has access to data derived from more than 500 million patient encounters through its approximately 500 health system and other provider customers.
Talkspace mentioned its algorithm used during text-based patient encounters to identify people at risk of suicide among those patients.
5. Health systems decry insurer denials
The contentious relationship between health systems and insurers was on full display as providers criticized insurers for denying claims.
“I know denials are up across the country, but I have never seen [the rate of denials] like we’re experiencing here in California,” said Dominic Nakis, Sutter's chief financial officer.
6. Insurers manage star ratings, risk adjustment changes
Medicare Advantage insurers and risk-bearing providers are dealing with the fallout from star ratings and risk adjustment changes. For-profit primary care provider Oak Street Health said it is updating its technology to help mitigate the risk-adjustment hit, and Centene is centralizing its operations and focusing on enrolling dual-eligible special needs patients to mitigate star ratings drops. On the flip side, Alignment Healthcare said it’s going to benefit from changes it said will normalize the industry.
7. PBMs prep for policy changes
Pharmacy benefit managers are updating their pricing models and diversifying their revenue streams ahead of potential congressional action. Lawmakers are close to passing legislation that would require PBMs to disclose what they pay for drugs, de-link compensation from drug costs and ban spread pricing. CVS Health Caremark in December unveiled a transparent pricing model that adapts some of these principals, and company executives at the conference reassured investors the PBM will still profit from its TrueCost program. Cigna Group executives said they are developing care delivery programs for patients who take specialty drugs as a way to diversify the company’s revenue streams and protect their margins in advance of congressional action.
8. Healthcare disruptors remain eager
Retailers such as CVS and Walgreens are not backing away from their healthcare services strategies.
Walgreens CEO Tim Wentworth is making big changes to make the healthcare services division profitable, including a $1 billion cost-cutting initiative. He made it clear that he has high hopes for healthcare services and how it could enhance Walgreens’ overall healthcare strategy.
Amazon announced a program to help consumers navigate their digital health benefits, starting with chronic care management company Omada Health’s 20 million employer and health plan customers.
Meanwhile, CVS continues to tout its expansion plans for Oak Street Health, a primary care chain acquired in May.
In an interview, Intermountain CEO Rob Allen said retail disruptors are forcing traditional health systems to rethink care strategies, but health systems still have the market on specialty services.
9. Finances remain a rough patch
Most of the big health systems that made presentations reported improved financial results in 2023. But labor challenges and reimbursement pressures have not fully subsided.
Jefferson Health, based in Philadelphia, has struggled to stay in the black in recent years, and executives updated conference attendees Tuesday about their efforts to correct that. Chief Financial Officer John Mordach said Jefferson reduced its losses by about $117 million year-over-year in fiscal 2023. Mark Whalen, chief strategy and administrative officer, noted the system is looking for opportunities to diversify revenue, including in ambulatory care and its health plan.
In an interview, executives with Renton, Washington-based Providence Health and Services who attended but did not present at the conference said they were making similar moves, including an initiative to offer the system's health plan in more markets.
Multiple systems referenced their efforts to attract more talent through higher wages and partnerships with universities.
10. Medicare Advantage utilization remains high
Medicare Advantage members are scheduling more doctor’s visits and elective surgeries than in recent years, and some insurers did not anticipate the increased medical expenses.
Cigna Group, Centene and Alignment Healthcare executives said private Medicare enrollees’ utilization remained high in the fourth quarter and they were prepared for the additional costs. CVS Health’s Aetna, meanwhile, said Medicare Advantage members seeking more care than anticipated will drive its medical expenses ahead of projections for 2023.
“We’ve continued to see [financial] pressure,” CVS Chief Financial Officer Tom Cowhey said during the conference.