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The Economics of Patient Focused Care

“Inpatient admissions were 5% higher, or favorable, compared to the prior year” reads a quote that appeared in a recent report for a nonprofit hospital. This sums up the fundamental problem with the U.S. healthcare industry; incentives of the system, providers and payers under a fee-for-service construct are not aligned with those of the most important person: the patient. While it’s noble for hospitals to care for someone during their time of need, a higher volume of admissions is not good for actual patients or the economy. The “healthcare” industry has in fact become a “sickness” industry in which medical costs and industry profits have spiraled out of control, while quality and health outcomes have severely lagged.

The challenge is: how do we create a system that aligns the incentives of patients, providers and payers while focusing on optimizing health?

A solution starts by changing the system from the ground up. Instead of operating under a fee-for-service structure, we need to invest in value-based primary care that puts an emphasis on keeping people healthy, rather than simply reacting when they’re sick. There are a few companies that are doing this and making a noticeable difference in this space – Iora Health is leading the charge and that’s what attracted me to join the company three years ago.

Iora’s high-impact, relationship-based care model is brilliantly and simply built around the patient and is tackling the enormous societal and economic problems of the U.S. healthcare system. By combining people, process and technology, Iora is able to save money, bring joy back to the practice of care, and improve the health of all patients (especially the most vulnerable – older adults).  

The first question people often ask me after learning about what Iora is working to achieve is, “How do you do this?”

It takes starting from scratch in built-for-purpose primary care practices that serve patients under value-based care arrangements with sponsors that share our vision of transforming healthcare. Rather than buying an electronic medical record off the shelf, we support these practices with our proprietary technology platform, called Chirp, that integrates population health workflows and clinical documentation. What you get is a care team and technology that support a care model that is built around people rather than billing codes.

The second question asked of me: “Is it working?”

Results have been amazing so far. Iora’s average Net Promoter Score for patients (a measure of customer satisfaction, with  a range of -100 to 100) is around 90, while the typical primary care doctor’s office hovers around 4. Our care teams love taking care of patients under this model, and hospital admission rates have dropped by 30-40% for patients who have had Iora’s care for a year or more. All of this shows that the Iora model is working by being able to keep patients happy, healthy, and out of the hospital.

This is the solution for the misalignment of incentives in today’s healthcare industry.  By spending more time and building deeper relationships with people, Iora is proving that we can educate and empower others to optimize their own health, while also encouraging health systems to follow suit. At the end of the day, we all want what’s best for people and that means focusing on the one part of the equation that matters most: the patient.

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