Scouting Report: Vera Whole Health-A Holistic Value-Based Care Model
Recently, Vera Whole Health raised $50M from Morgan Health, the new healthcare-focused firm founded by JP Morgan Chase following the closure of the Haven joint venture. Founded in 2008, Vera Whole Health provides comprehensive coordinated healthcare services that are working to move employers towards value-based care and away from traditional fee-for-service models. Through employer-funded worksite clinics in 11 states, Vera provides care at a cost-efficient price point measured via optimal health outcomes to for employees. Vera Whole Health has raised over $95.5M and is backed by CD&R with other investors including Transformation Capital, Archimedes Health Investors, Leerink Transformation Partners, and Puget Sound Venture Club. With the closing of this new funding, Vera Whole Health has fostered a partnership with Central Ohio Primary Care Physicians Inc. to expand its services in Columbus.
Subscription services are more efficient, it costs physicians almost $100K/year just to bill for their services (JAMA).
According to STAT health, 8% of each U.S. health care dollar goes to administration, compared to 3% among comparable nations.
While value-based care has been around for a generation, a 2020 survey found almost ¾ of physician practices report over ¾ of revenue comes from FFS.
Employer-based coverage can be a retention tool with a 2018 AHIP survey finding “46 percent said health insurance was either the deciding factor or a positive influence in choosing their current job”.
Seattle-based Vera Whole Health provides value-based care that attempts to holistically treat patients and not just isolated symptoms by offering employers a fixed-fee model to enhance employee’s productivity. Vera operates their clinics either at or near an employer’s location providing primary care services extending beyond preventive care to include behavioral health services, occupational health services, pediatrics, physical therapy, and more. Driven to improve population health cost management and health outcomes, Vera Whole Health conceptualized an Advanced Primary Care (APC) model in 2012. The company states that the APC model contrasts against the traditional fee-for-service model by “delivering the essential 1:1 patient-provider relationship through informatics, referral management and care coordination, and integrated health coaching”. Applying robust informatics helps optimize care by empowering physicians to identify care gaps and quickly assess who “is in need of screenings or other preventive services” improving patient’s long-term health outcomes. Using the active care coordination aspect of Vera’s APC assures that the provider is able to guide patients through their treatment plan and refer to specialists which improves adherence and compliance to their care plan. Vera also deploys integrated behavior change coaches who help empower patients to commit to their health goals. The company has stated that “employers under contract with Vera have seen an average patient Net Promoter Score of 90, and improved health outcomes and utilization”.
As noted above, Vera is attempting to offer holistic value-based care which is seeking to help patients achieve their optimal social, behavioral, and physical health in a cost-efficient manner. By using a subscription-based model instead of a fee-for-service one, which operates on a fixed fee that is paid in advance, providers are incentivized to maintain and improve patient’s health by anticipating and preventing disease instead of being paid based on the volume of service. Vera claims they can reduce the employer’s healthcare costs by 21% and have over a 1.4:1 ROI in the first year their solution is deployed. Vera’s APC model also allows providers to improve care by connecting financial incentives to the quality of care and not to the volume of care or just the cost of services rendered. This enables providers to see fewer patients relative to a traditional provider and schedule what Vera refers to as “time rich appointments” since clinician’s schedules don’t have to be as tightly packed. Additionally, Vera’s APC model employs a broad care team that is made up of an allied staff including nurses, health coaches, and behavioral health experts. As a result of the increased employee engagement Vera is able to achieve by centralizing primary care, Vera has been awarded a Certification of Validation by the Care Innovations Validation Institute, an independent organization that evaluates health plans.
The Big Picture:
For approximately the last ten years since the passage of the Affordable Care Act (and many would argue, even before) the U.S. healthcare system has been shifting from one based on reimbursement for procedures volumes (fee-for-service) to one based on quality, outcomes, and satisfaction (value-based care). This is due as much as anything to the large amount of waste, inefficiency, and simple lack of results in proportion to over healthcare spending in the U.S. According to the American Medical Association, the U.S. spends over $3 trillion annually on healthcare, yet over half of American’s have one or more chronic conditions including heart disease and diabetes. Clearly, the system is unsustainable as it doesn’t prioritize preventative care measures since it’s more advantageous to practice defensive medicine, and patients and doctors are not incentivized to be proactive in their care. Programs like Vera Whole Health which are subscription-based can not only encourage more holistic care of patients but help reduce administrative costs which could account for 25-30% savings. In addition, by attempting to reach patients through the employer-sponsored insurance market (ESI) Vera can engage them early enough in their helathcare lifecycle to help prevent and effectively treat many of these conditions. Moreover, by working through employers, Vera is enabling employers to attract and retain new and existing employees in what is a very tight labor market effectively turning healthcare into a competitive advantage.
Vera Whole Health Grabs Morgan Health’s Interest—and a $50M Investment; Central Ohio Primary Care Bringing PE-Backed West Coast Startup to Columbus Employers; Fee for Service is a Terrible Way to Pay for Health Care. Try a Subscription Model Instead