The Strategy Catalyst Dispatch
The Strategy Catalyst Dispatch brings healthcare strategy professionals into the room with leading health system executives to explore how innovation, clinical leadership, and enterprise strategy intersect. Designed for strategy executives, physician leaders, and healthcare innovators, the podcast offers actionable takeaways to help organizations drive both clinical and financial impact.
The Strategy Catalyst Dispatch
The Strategist in Brief: November 8, 2024
This episode covers breaking news about Republican gains in recent elections potentially giving the GOP unified federal government control, which could impact healthcare policy on site-neutral payments, ACA reform, and public health initiatives. The episode also discusses Elevance Health's $2.7 billion acquisition of home health company CareBridge, the Sanford Health and Marshfield Clinic merger creating a $10+ billion system, and insights from the Health 2024 conference including PBM business model criticism and new AI standardization efforts.
This is the audio version of the strategist and brief for November. This week's edition begins with some breaking news coverage. Of the recent election results. While control of the house of representatives remains. And outstanding question at the time of writing. The Republican party could be poised. To gain unified control of the federal government. Republicans love a stronger. Hand in the upcoming lame duck session of Congress, which will likely stall any significant. It changes. A narrow Senate majority gives the GOP control of. Spending an appointments. But a potential narrow house. Majority could make governance difficult. It's hard to predict Republican policy priorities, but we could. Imagine action on site neutral payments, ACA reform, abortion, public health. Now our first market scan. Elephants health plans to acquire home health company care bridge for 2.7. Billion dollars. The company takes risk for Medicaid and dual eligible. Patients with physical or intellectual disabilities who are receiving home and community. Based services. Cambridge tout savings in the high single digits. Low double digits with hospitalizations 23% lower. And skilled nursing facility days, 16% lower. Access. Yes to elephants as capital could help care bridge grow more rapidly. The high acquisition price suggests the payer sees the company as a growth vehicle. Cambridge sees a$120 billion total addressable market. For home and community-based patients. With half acquirable through major. For payers that has already worked with. The question is if other payers will want to see this business. Moving on to our next market scan Sanford. Health and Marshfield clinic health system signed a merger agreement. If the merger. Closes, the combined system will have more than$10 billion in annual revenue. 4,600 providers and 425,000. And members across two integrated health plans. Marshfield needs a financial. Naturally stable partner with deep pockets capable of absorbing its recent steep. Steep operating losses and Sanford could be a good match given its healthy operating. Operating margin. Sanford might benefit from greater geographic diversity. given its reliance on more rural areas. Greater scale. And improved payer mix. And value based care, knowledge transfer. The merger is a test of the continued viability of non-contiguous mergers to pass regular. Our final market scan covers our favorite. Insights from this year's health 2024 conference in Las Vegas. During a panel executives with Amazon pharmacy, Walgreens blue. Blue cross blue shield of California and pharma criticized the PBM business model. And call it on the industry to find better ways to align incentives. If. Congress addresses PBM reform. It could threaten the flywheel business model. And pursued by the major providers like United health group and CVS, Aetna. Separately, the coalition for health AI revealed. The draft template for its AI model card, a standardized summary of product capable. Capabilities that the organization hopes will function like a nutrition label for AI. Healthcare use cases. Chuy's efforts could help streamline. AI adoption and give health systems better tools to evaluate safety. But healthcare organizations will still need to retain their own AI talent to make. Smart decisions about AI products. Microsoft GE healthcare. Care new Vidia and other tech vendors presented a variety of new products at the conference. But the industry as a whole seems focused on irrative and incremental improvements. That concludes our summary of this week's strategist. Just addition. Be sure to check out the full version on the web@hmacademy.com.