Optum^® Revenue Cycle Performance Partnerships

And with that, what I’d like to do is welcome Robert Musslewhite and Chris Pass to the stage to have a conversation about these issues — and a bit more — over the next 20 minutes. Robert and Chris, join me on stage, please. Chris.

Chris Pass: Thank you.

Tom K: Robert. Thank you. Have seat gentlemen. So, thank you both very much for joining us today. Much appreciated. We have a fantastic audience as you could tell, probably listening backstage, very engaged, on the edge of their seats to hear what you have to say. This production is incredible, by the way. I’ve got to tell you, Robert, Chris, I don’t know if you were listening to some of the early comments this morning, I was sitting in — fantastic setup. I mean, kudos, to all the folk that pull this together. It’s impressive, right?

Robert M: Yeah. I really love the way it started this time, which was very human and it kind of reminds us why we're all here and why we're in this business. I thought this one was great.

Tom K: It tugged a few heartstrings. I mean, I found myself really genuinely feeling empathetic toward some of the stories that were being told. You heard some of those stories too, in fact?

Chris Pass: I thought the stories were fantastic. I’m a little bit biased. I thought the grand finale was probably one of the best stories.

Tom K: Those of you that were here for that might know what Chris is referring to, which is a good segue, by the way — thank you very much. Because in that grand finale, you talked a bit about what’s going on at John Muir Health. Congratulations to both of you, by the way, for the partnership that we’re going to talk about.

I mean, you doing some incredible, incredible things here. As you can tell, very passionate about them. But give us some background. How’d you end up at John Muir Health? And give some background on the story behind the story, kind of what led to this.

Chris Pass: Sure. I had come to John Muir Health back in 2008 and I was in charge of the revenue cycle, and we had the benefit of being one of the few end-to-end processes in health care that we could really sort of optimize for the outcome.

Tom K: Right.

Chris Pass: And so we did everything ourselves and it was time to think about, well, we’re not perfect at everything — maybe we should look at what some others are doing. And I, coming from consulting, I recognize that and I did not anticipate the value that we would bring from seeing it done hundreds of other places. And you didn’t see that when you stay sort of inside your four walls.

And so that sort of started the journey of, okay, what are we going to do? And then, as I mentioned this morning, we’re trying to lower the cost and be more affordable. And so we started on the journey to think about how do we work with partners, because your great companies don’t do everything themselves.

Tom K: So speaking of being a great company, I know for a fact that at John Muir Health you’re actually quite proud of your revenue cycle. You were doing a really good job of it and revenue cycle is a core piece of a provider’s business. But you were doing well. Why’d you pick that to smartsource on?

Chris Pass: Great question. And just to be clear, it was the revenue cycle team who was doing so well. I just sort of stayed out of their way and they really got to a point where we’re one of the top performing revenue cycles across the country. If we were going to take it any further — and we believe there’s always room — we needed to make investments and we needed to innovate and we needed to do things that, frankly, when you work in a health system, your capital goes to your core business and it’s hard to compete for we’re furthering care, we’re furthering innovation and clinical things — and so it becomes some of your last places to make investments. And so we knew that, through a partner where we could create value together and incentivize both parties, we had the opportunity to do something unique.

Tom K: And you actually used the term this morning, which I thought was wonderful. You talked about delighting the customer. I don’t think I've heard that word “delight” necessarily used in the context of a provider’s mission, but obviously it’s important to what you’re doing.

Chris Pass: It is. I mean we were in the East Bay of San Francisco, we have a lot of the biggest tech companies close to us, and there’s an expectation that customers want to be treated like a customer. And I think, in health care, we’re trying to make the switch from patients to customers. And that can somewhat be offensive to some, but I think it’s something that people don’t really want to be patients, but they like to be customers — and we like to make them well.

Tom K: So I want to come back to this theme and just a little bit, but Robert, I’m going to bring you into the conversation as well. We’ve talked a bit about some of the exciting things that are going on at Optum360. In your words, what’s exciting you as leader of the organization, and what you see happening with John Muir Health and in general with some of the activities that you’ve got going on?

Robert M: Sure. Look, I think it’s been awesome coming into 360 and, if you think about the mission of what we do in 360, it’s really to think about reducing administrative complexity. It’s a lot of what you talked about earlier and trying to make the whole interface between providers and payers much more seamless and much more simple.

And I think that’s been the focus of the organization. It’s not an easy time to be a provider. I think everyone who is here from the provider’s side knows that. There’s a lot going against providers today in terms of regulation and reimbursement, pricing, payer mix, mix shift in terms of patients. I mean there’s a lot going on that that creates challenges especially on the bottom line.

And one of the great things is, given our focus, we can really come in and create a compelling value proposition and compelling return story — so, very tangible financial ROI in the work we do. That’s number one. It’s great to have those conversations because we can really address a key need.

And secondly, within the business, we have a technology business. A lot of you here today work with us through our technology business. And so what that means is that the technology we use for all of our work has to be sold and commercially validated and have to have customers who give us feedback on it and push us every day. And that’s really unique because that’s the same technology we would use in any of our managed service work or even in a strategic partnership with John Muir. We have to validate that that technology is good, and that’s the same technology we use in all of our work.

And then I think third is just an incredible team. When we talk about like the stories this morning, that’s what gets people excited. People really do believe that the work we do in reducing complexity and simplifying this interface does go to helping the mission of the organizations we serve because that’s where the extra dollars get spent. They get to go toward mission investments and toward creating better care and better patient, extreme consumer experiences.

Tom K: Yeah, I mean this notion of investing in the core is such an important part of what drives this kind of a partnership because it allows you to innovate where you innovate best, but also allows you to partner to innovate where they innovate best.

Robert M: Absolutely.

Tom K: On that point, I talked a lot about digital ecosystems, and this is an important construct I think going forward, but it requires technology innovation. What are some of the digital innovations that you see going on that you’re doing at Optum360 that are enabling this …

Robert M: Yeah, we drive a lot. One of the great things about Optum is we have incredible capabilities throughout the organization. It’s our job to apply those in useful ways for our clients. And so, the first is, we use artificial intelligence and our physician advisor solutions. So what that means is we can improve not only the efficiency, but the defensibility of utilization review. And what that means, is that physician advisors and case managers and our clients can focus on activity related to patient care. That’s one place where we’ve seen a bunch of innovation.

I think secondly, is we use clinically aware and natural language processing to take documentation and coding excellence to new levels. So, we’ll ensure that the right claim is supported by the right clinical information, which streamlines the payment process and really makes it, the whole process, easier on both sides. Especially for our providers. And that helps providers be more successful in value-based models as well as fee-for-service models.

Tom K: And that’s why those areas where those puzzle pieces come together. You’re …

Robert M: Absolutely.

Tom K: … supporting the clinical excellence of the organization, right? Through that.

Robert M: Absolutely. And it all starts with you getting the information to the right people at the right time where we can impact that. And the third is, and again this is the connection point between payers and providers, but we can take in the rules and policies that payers have, automate those and we’re building those upstream into the provider workflow.

And so a lot of the coolest innovations that we have underway, that really does eliminate the friction because instead of having to go across the transom to the payer to be adjudicated, come back to the provider with the injustice, we just build all that into the provider side.

And I think you heard from Laura on the main stage today that there’s a real vision around payers just going ahead and saying, “Well boy, if you guys have dealt with it, you have all the information.” We’ll just go ahead and pay it. We don’t need to go through our processes. And so you’ve taken down the cost on both sides and made it a much better process.

And again, we can take all these innovations and we build them through our products, but also through the services. If we provide a managed service or work in partnership with a John Muir, we bring all those innovations to bear.

Tom K: You talk about these transoms, I would call them silos, whatever. But there are numerous that these are prevalent in every industry, but certainly in health care, these transoms. You talk about the fact that there’s added transparency in this sort of a partnership, which is almost counterintuitive, right? When I think of transparency, I think of holding the cards close to my vest. We’re transparent with those that are close to us, but you want to be transparent with the partner. Talk about that transparency and how that enables higher quality health care.

Chris Pass: Well, I mean, so the one thing I would say is, if you think about revenue cycle, people are surprised how much interaction you have with your customers through the revenue cycle. And so, as I think about just immediate innovations around transparency, it’s two things.

One, transparency with our patients that can be provided by their innovations to schedule more openly, make a reservation, if you will. It’s easier to make a dinner reservation than see your doctor and taking advantage of pricing transparency. I mean being able to understand, well I prescribe this drug or that drug and it’s going to cost you $5 or $10.

And so patients — one of the most frustrating things — they don’t know how much it costs. They don’t know if it’s going to be $1,000 or $2. And then, if you think about our partnership being transparent, as we can be aligned on what we’re trying to achieve and kind of create that value that you have in that smartsourcing van, we depend on that transparency. We can’t do it if we’re not working together.

Tom K: As a patient, which we all are at some point or another, I have to tell you that that administrative piece of the experience as part of that clinical experience, as far as I’m concerned …

Chris Pass: Yes.

Tom K: If I walk in already stressed, I’m compromised to begin with, and you’re adding your billing issues, claims issues, insurance issues on top of that. And then I’m getting hit with a bill for several thousand dollars I didn’t expect afterward. That is a clinical implication on me. Right?

So that is not divorced. It’s, we can say it’s administrative, but it still part of delivering high quality health care and effective health care from the patient standpoint. Correct? So I’m going to put on the spot here. I talked about core competency. What is John Muir’s core competency? How would you define that?

Chris Pass: I mean our core competency is caring for our community, caring for our patients, taking care of our customers and thinking about both their health and healing them. And fundamentally, we don’t want to cause any harm.

Tom K: Which is clearly the mission of many of these organizations today. Robert, can I put you on the spot, too? What about Optum360?

Robert M: In terms of core competency?

Tom K: Competency. Yeah.

Robert M: Well, I think what’s been great about Optum in general is we have a massive set of capabilities and a lot of places we’re investing a ton behind really improving the whole health system. And so, we take those capabilities and deliver them through partnership to our clients in ways that drive innovation and really help them focus on their mission. So, it’s a real partnership mentality in terms of what we can do.

Chris Pass: Yeah.

Robert M: And I think that’s been one of the most important core capabilities that we can bring.

Tom K: You know, you take the social partnership, I think, to another level though, because much of what you do is to create a malleable organization from the standpoint of Optum360 that fits the model that works for that particular customer, right? Because you can’t do this cookie cutter, this is not lift and shift. Each situation’s unique and you need infinite malleability to be able to work with that and you seem to have that as a core competency of the organization, part of the ethos of the company.

Robert M: I’d completely [inaudible] like when you talk about the old models of lift and shift, that’s really not our approach. Our approach is that middle part where you’re talking about smartsourcing. There’s a lot of different ways to work with clients to bring capabilities to bear that help them focus on their core business. Whether that’s through specific products and services that can provide a capability that lets freeze up people or resources to do other things or through a larger-scale partnership that, again, is not a lift and shift. It’s very much in collaboration with them, but it’s bringing capabilities to support improving the functions that might not be core capabilities to let them focus on the places where, you know, it clearly is their core competency.

Tom K: When I first wrote the book, one of the things that we used to talk about, and I hated this term, I still despise it, that was used in the industry was “Your mess for less.” I thought, what a horrible way to look at it. That’s not, no, this is a critical, right? Am I right? This is a critical part of my organization. I don’t want to jettison it. I want someone who’s going to pay attention to … it’s kind of like leaving your kids at daycare. I want to come back. I want my kid to be better and still be my kid at the end of the day. Right? These are things that enable my organization, so when I give this to a partner, I want that partner to take care of it as though it was her own, his own, right? I guess it’s important to the ethos of that relationship. So, I’ve got to say this: What you’re doing is pretty damn bold.

I mean it takes some communication skills. In terms of your community, in terms of your employees, in terms of media, how have you crafted that message? What do you say to your employees, to a community, to not just put them at ease but actually illustrate that there are opportunities here for growth, for value?

Chris Pass: It’s a good question. We had two years to figure out the message, and I think it was a couple of things. And we spend a lot of time with our board, which is community based. They have a drive to remain independent, they want to be locally governed and they view John Muir Health as an asset to the community.

And so, when we were starting to have this message, we spent a lot of time talking about our employees and, to your point, that they are near and dear to us. They’re like your children — you don’t want to send them to daycare, you want them back. I love the analogy and when you talk about outsourcing, it’s people usually lose their job …

Tom K: Right.

Chris Pass: And when we introduced the concept of, no, they’re not going to lose their job. They’re going to join a bigger company, and they’re going to join a bigger company that’s growing rapidly and they’re going to join a company that’s innovating and educating and the career path. And, so they were concerned. I can tell you that I am so proud of the employees at John Muir Health about how they’ve received this message two weeks ago, how the maturity they’ve shown and just really have stood up and leaned in and they’re trying to find out all about it and they’re excited.

And so, that was the employee side. And if anyone described that to me before this happened, I wouldn’t have believed it. And then on the other side is, the community understands how expensive it is. They’re frustrated by the lack of affordability. And they knew we had to do something. And when we looked at all of the opportunities and different options that we had, this was something that they were able to say, this is the best decision we can make for John Muir Health. And that’s why we’re here to do this for the community.

Tom K: Well, innovation is often bold. Change is something that we often resist. It’s just that — it’s our human nature. There are still people using Wite-Out on computer screens today. They don’t want to move into the future and that takes managing. But you have to be aware of that. You have to manage it, you have to communicate …

Chris Pass: Yes.

Tom K: … the opportunity in a way that makes it positive, I would say. So Robert, you’ve seen a lot of these situations, John Muir Health …

Robert M: Yeah.

Tom K: One of many. Talk about some of the others and what your experience has shown you in terms of benefits that can be realized.

Robert M: Sure. I came to Optum through an acquisition. A lot of my colleagues came to Optum at some point through acquisition. And so, I’ve seen it from the inside and I’ve seen it and that’s — in some ways — that’s the way we think about these relationships.

We have a number of relationships across the system that are strategic partnerships. Like the one we just for Muir is different in a lot of ways and new and different, which I know we’ve talked about, but we do have relationships through Optum360 with other places that we’ve smartsourced around rev cycle.

And what I’d say is, we treat those employees coming over as employees joining the organization just like we acquired a company and they’re now part of Optum.

Tom K: Yeah.

Robert M: That really is, I think, a differentiator for us in the market and something that we now have a lot of experience doing through the acquisitions that we’ve made as a company. And what that does is, it gives those employees a broader platform to operate in a career path that they might not have had within their institution. Maybe they did, but now you have it across a lot more opportunities and a lot of places where they can exert their skills and move up in the world.

And there’s a bunch of examples, but one that I’ll share is just, Dignity Health is one of our large strategic partners as well. There was a woman from Dignity who came into the organization. She was a patient financial services analyst at Dignity and came over and is now a business process analyst at Optum360 — doing a great job.

She took advantage of the training programs we have in 360. We have tuition reimbursement programs from Optum that she can use and she has a career path that wouldn’t have happened otherwise and is now a key part of our organization as we expand out to other clients.

Tom K: Yeah

Robert M: And interestingly, she’s participated in a program for innovators where she can propose new ideas and gets coaching and help on how to present those to executives. It’s really just a key part of our organization and there are a bunch of stories like that. So …

Tom K: I love that.

Robert M: … I think the value proposition for employees is actually a real positive one. It’s sometimes, like Chris says, you have to get past that first …

Tom K: Right.

Robert M: .. that storyline of the old-school “rip and replace,” or would you say rip …

Tom K: Your mess for less.

Robert M: … your mess for less — because it’s really not that; it’s really a great employee value proposition that …

Tom K: Right.

Robert M: … I think is true and real.

Tom K: I love that. It’s the exact opposite of sort of the classic colloquial characterization of outsourcing when you’re creating, inspiration, momentum. And by the way, you shared a story with me, if you don’t mind, I’d love to talk about it right now. I’ve had an employee that sent you a heartfelt letter that I thought was an amazing sort of illustration of how powerful this kind of a change can be.

Chris Pass: Yeah. So, I don’t mind sharing and I actually asked the individual if I could share and, as I said, I’m very surprised, pleasantly. I’m just appreciative of the handling of this situation. And we’ve gotten a lot of emails, no handwritten letters yet, but emails about patients or excuse me, employees who have looked at this and sent thank you notes.

And this individual sent a thank you note that I will paraphrase says, “Thank you for doing this. Thank you for considering all of us and making sure we could all be part of the administrative team. Thank you for thinking big, because I like to work for somebody who comes up with a go-big-or-go-home strategy for health care. I am so honored to be able to be part of the team that’s going to actually change and help fix health care in our country. If there’s anything I can do with the transition, please let me know.”

Tom K: Wow. Make no small plans — they don’t have the ability to fuel men’s and women’s souls, which is kind of what you're doing. But that’s a very [nice?] letter.

Chris Pass: Yes.

Tom K: We’re running short on time. Could I ask you both to, maybe, share with the audience one thing that you believe will be most important for them to take away from this session, and in general, that would help them when they think about strategic partnerships of the sort that we’re talking about today, Chris?

Chris Pass: So, what I would say is, somewhat echoed, when I started to work at John Muir, a colleague at a different health system told me that, “you’re working in finance, but make a difference.”

And what I would ask everybody in this audience to take away is — don’t underestimate your role in the organization and your role in being able to fix and change health care for the better. I think that some of us sometimes lean away from the clinical aspects of care, but there’s a lot of costs and a lot of opportunity in all that we do that we can really make a difference for patients.

Tom K: That’s a wonderfully inspirational message. Robert, your takeaway?

Robert M: I would come back to the theme of innovation that you hit on in your intro remarks, which is — I agree with everything Chris says, by the way, so, I love your mission focus. We really take it as we need to keep innovating and pushing forward to enable our partners to carry out the mission that’s so important to all of us.

And so, we invest a lot in innovation. We really want to create this denial-free system where they are seamless payer provider interaction, because that really does unlock a lot of — releases friction — and unlocks a lot of energy that can be plowed into other more important parts of the health system. And what’s great is, we build those innovations into our products and that then builds them into our work with our clients. We get innovations from partnerships like our partnership with John Muir.

Tom K: Yeah.

Robert M: We expect those guys to push us and teach us ways we should be innovating to help the overall system. And then we can take that out across the industry at scale, through our other partners and through the rest of the work we do.

So, I really see us as the scale driver for a lot of the innovation that we formed through these strategic partnerships. And, of course, you talked earlier about how there’s always a cost benefit from the work with us, but there’s also a real benefit in terms of revenue improvement, reduction of friction, improvement of resource allocation to the things that really matter. And that ultimately contributes to what we all care about, which is a better patient experience and higher quality care. And so, it all fits together in terms of the work we do through these partnerships.

Tom K: It is such a pleasure to share the stage with you folks and to hear the passion and the inspiration behind what you’re doing — and the fact that it’s being done. I mean, I wrote about it 13 years ago, but to actually see it in action is incredibly fulfilling and humbling.

And you are the ones that are building this, ultimately. I mean, this is your industry to build — you are the ones that are building the future, creating the future. Join me in thanking Robert and Chris for being here today. Thank you, gentlemen.

Chris Pass: Thank you, Tom. Thank you. Thank you.

Robert M: Thank you.