Analysis: Humana to pilot plan based on virtual primary care

• The plan, called On Hand, allows Humana members to skip doctor’s office visits and obtain primary-care services virtually from a Doctor on Demand physician.
• Premiums for the plan are reported to be half the cost of Humana’s most popular products.
• The product will be piloted in markets in Florida and Texas.

Modern Healthcare is reporting, “Humana and telehealth company Doctor on Demand will launch a new health plan design allowing employers and employees to receive primary care predominantly through virtual visits. The plan, called On Hand, allows Humana members to avoid the doctor’s office and access primary-care services virtually from one Doctor on Demand physician, with access to urgent care, preventive care and behavioral health services.  When needed, patients would receive referrals to specialists in Humana’s network for in-person doctor visits. The plan’s average monthly premiums would be nearly half those of the company’s most popular purchased plan.”

Members would have no copayments for virtual care visits and a $5 copayment for common lab tests and prescriptions. They would also receive a medical device kit with a digital blood pressure cuff, thermometer and log. The spokesman said plan members would still be able to use their own primary care physician if they would like. Humana will pilot the plan to small businesses in Florida and Texas as a self-funded product starting in June. It is not available to members enrolled in Medicare Advantage, which is Humana’s largest line of business.” Read the full story.

Takeaway

Keep an eye on this. Primary care accounts for 7% to 8% of healthcare spending (at most) in the commercial population, so that’s not where the premium savings is coming from in this product. My guess is the projected savings, reflected in the lower premium price, comes from three places.

• First, better access to care will support coordination efforts and reduce potentially avoidable ED and inpatient utilization.
• Second, when members who use the tele option for primary care do need specialist services, an algorithm is likely to make the referral. If that’s the case, then in descending order the referral goes to:

                1) A Humana-employed specialist if available in the market.

                2) A non-Humana employed specialist who practices conservatively/efficiently and has good outcomes.

                3) Anyone else contracted by Humana. Very few patients are likely to trickle down to option three, with even fewer                      leaking out of the contracted network for this product.

• Finally, when patients need imaging services or other diagnostic testing, they’re going to be referred to the lowest-cost option that provides the service at an acceptable level of quality.

If the employers embrace the product, and it’s well received by their employees, this could be the beginning of a brave new model of silent tiering. My guess is Humana both employs providers in the markets where they’re rolling out the offering and has a deep bench of closely aligned high-quality, cost-efficient providers. I would also assume the markets are competitive for both diagnostic testing and acute-care service.

And, I believe, if UHC/Optum hasn’t already done something like this, it’s only a matter of time given their care-delivery assets.