2014 - Recon Strategy

Shifting lines in the mobile health competitive battlefield: Aetna makes a strategic retreat while United digs in?

Tory Wolff November 24, 2014

The battle to own healthcare’s consumer relationship is being nowhere fought more intensely than in the mobile arena. Tea leaves suggest that Aetna has pulled back from trying to own this relationship in favor of a more collaborative “ecosystem” strategy, but United appears determined to lead. The thinking is speculative but I let me point out the emerging evidence and offer some guesses on what will come next. Strategy environment for consumer mobile health At the risk of oversimplification, let me offer six hypotheses regarding the strategic context for consumer

CIO Review Magazine: 20 Most Promising Healthcare Consulting Providers

wpadmin October 8, 2014

The “weaponization” of ACO narrow networks: Strategic destabilizers which compel their own replication?

Tory Wolff October 1, 2014

In theory, narrow networks built around a single provider or a network of aligned providers (“provider-orchestrated narrow networks” or “ACO networks”) can pose a much higher stakes threat to non-participating providers than ones assembled solely by payers (i.e., where the payer picks who is in based on cost and rates): They are more likely to achieve broad utilization reduction because participating providers can align on principles, build shared capabilities and coordinate management of specific patients consistently. As a result, discounts can play a smaller role in creating a compelling value

Ochsner and River Parishes: one type of endgame for managing redundant hospital capacity (updated)

Tory Wolff September 26, 2014

Please see update at end of post. If value-based care broadly delivers on its promise to reduce hospital admissions by providing more timely ambulatory care, a lot of today’s bed capacity will end up redundant and stranded. How can we navigate to a new equilibrium? Recent developments in the New Orleans area (whose population size still has not recovered from Katrina and is potentially therefore a model case of oversupply) may offer some window into future endgames for resolving the supply-demand imbalance. Acquire, unbundle, and selectively shut-down One approach is

Boeing’s model for creating product-based competition among providers

Tory Wolff September 4, 2014

Summary Boeing is creating a benefit design model which sets up providers to compete for their book of lives via provider-branded narrow networks By offering a choice among competing narrow and full network products, the model may make narrow networks more palatable for employees Narrow networks can produce a volume windfall for providers (e.g., share gain, leakage reduction) and profits from better care management and a risk deal Providers “pay” for the narrow network opportunity by being lower cost (often via incremental discounts) in hopes that these gains outweigh cannibalization

Apple HealthKit, provider partnerships and walled gardens: three observations

Tory Wolff June 9, 2014

A number of observers have noted that the Apple’s partnership with Epic on HealthKit could reinforce the role of “closed IT system” strategies in general and Epic’s leading position among EMR vendors in particular. Others have noted that prominent PHR failures (Google, Revolution Health) should add some sobriety to the hype around HealthKit. While I don’t disagree with these concerns, I have three other thoughts on the announcement that Apple has built a framework for collecting and presenting health data from a wide variety of consumer devices and apps. Providers

Can drug companies make drugs, AND money?

Nikhil Bhojwani June 3, 2014

In this morning’s New York Times (June 3,2014), Andrew Ross Sorkin asks,“DO drug companies make drugs, OR money”? That’s a fair question in the context of what I’ll call a “fee-for-product” reimbursement regime. Another way to look at this question is, “CAN drug companies make drugs, AND money”? Value has not been an easy sell As the U.S. healthcare services system moves from fee-for-service to a value-based system, the biotech and pharmaceutical (biopharma) industry should have an opportunity to capture more of the value it creates. But with drug costs only ~10%

Recon Strategy Opens West Coast Office

wpadmin June 1, 2014

Recon Strategy’s West Coast operation is to be headed by co-founder and Managing Partner, Tory Wolff. The new office is based out of Seattle.

Aetna not conceding the private exchange space to the benefits consultants

Tory Wolff May 16, 2014

Summary Aetna is stitching its inventory of ACO deals into a national ACO network and will offer them on its proprietary private exchange (PHIX) Linking ACOs and PHIXs is smart because PHIX’s defined contribution feature creates a strong consumer reward for picking a tighter network product Promising a national network of ACOs is bold: ACO deals depend on willing providers and opportunity in local care patterns; in many geographies, the delivery system isn’t ready or interested. If Aetna can create a national network, it should be attractive to major employers

Boiling the Ocean…or not

Nikhil Bhojwani May 6, 2014

We’ve all heard the term, “Boiling the Ocean” to refer to an approach that is broad and ambitious and generally leads to lots of work and very little insight. Historians will argue about whether it was Will Rogers or Mark Twain or someone else who first used this phrase but that’s besides the point. As the story goes: In 1914 the Germans were sinking U.S. ships in the North Atlantic. It was a turkey shoot because the Germans had the U-boat and we didn’t. Somebody asked the American folk philosopher

MA hospital relative prices by payer

Nikhil Bhojwani March 27, 2014

Here’s a quick look at relative prices in MA using CHIA data for you to play with. What you could do for instance is select Commercial and Medicare on the left (use CTRL key for multiple selection) and then on the right, check off say only BCBS. That wold show you the difference between TMEs for Medicare and Commercial just for BCBS. Can also filter by hospital system (on the right). Have fun. P.S. You may need to scroll to the right or re-size on your browser (CTRL -) to

Bring it on: Highmark brings in a long-distance ally to help compete vs. UPMC in cancer care

Tory Wolff March 16, 2014

Summary Allegheny Health Network (AHN), the major delivery system in Pittsburgh owned by Highmark, and Johns Hopkins Medicine have signed a MOU to create an affiliation between Allegheny and the Johns Hopkins Kimmel Cancer Center. Over many years, UPMC has established a very large network of cancer care throughout western Pennsylvania; AHN has responded in kind albeit much less broadly. At this point, there is very little independent cancer care left in the region. By partnering with a prominent UPMC competitor in oncology, the deal is likely designed to shore

Year: 2014

Recon takes an analytical look behind select developments in healthcare