RosettaFest 2024: Decoding the Future of American Healthcare Through Open-Source Revolution
Andrew S. Gordon, LSW
Healthcare leader intersecting technology, transparency & policy
What is Health Rosetta?
Health Rosetta is a blueprint and ecosystem for high performing health benefits developed from the successes of hundreds of employers and unions who have simultaneously improved health benefits (e.g., superior primary case, eliminating deductibles) while lowering per capita spending by 20-50%. In addition to having a wealth of resources that combine to form a blueprint, the company has built a community of new-age advisors - and a series of technologies to support them - that are genuinely aligned with the employer clients they serve.?
The blueprint they have created can be likened to the globally recognized green building certification program known as Leadership in Energy and Environmental Design (LEED). This program consists of a series of ratings systems for the design, construction, operation, and maintenance of green building homes and neighborhoods. The key in all of this is that the ratings focus on creating owners and operators that are environmentally responsible and use resources efficiently.?
Just like LEED, Health Rosetta is focused on playing a pivotal role to usher in transparent, ethical and effective health plans for employers and the people they serve. With hundreds of trained advisors and more than thousands of employers who have implemented their blueprint, the movement is growing fast. Dave and company are focused on the responsibility and ethics as well as the financial efficiency of benefit plan design.?
Problems being addressed
Since inception, the Health Rosetta team has found that brokers who are compensated by health insurance carriers and PBMs frequently have a conflict of interest with the employer clients they serve. As you might expect, we answer to the entity or person who pays us. In this case, it’s not difficult to imagine that unfavorable contract terms for the employer can be baked into many health insurer agreements.?
The Health Rosetta team also found in talking with thousands of employers that over 95% don’t read into the fine print of the contracts they sign, often treating them like the terms of use or software update agreements that our favorite websites or phone manufacturers send us. In other words, everyone checks a box.?
One of the core problems they are addressing is misaligned incentives between brokers and employers. This has caused a lot of employers to spend far more on healthcare benefits that don’t perform as well as they’d like. By training advisors with a new approach, employers are directly paying Health Rosetta advisors to educate them and assist in the creation, design, and implementation of a LEED-flavored health plan that meets their needs.?
It’s all about responsible and efficient use of resources.
Traditional brokers and insurance carriers don’t have an incentive to lower healthcare spending. Why? Because their income is directly related to total healthcare expenditures. The more an employer spends on healthcare, the more the insurance company will make based on the principle of the Medical Loss Ratio. As the insurer makes more, the broker will share in that wealth.?
This leads into the larger issue of health spending and financial waste that is out of control.?
A 2020 journal article published by the National Institutes of Health (NIH) estimated financial waste in healthcare to be as high as $1.9T per year. Many notable companies like PwC have issued reports that put waste in healthcare between 30 and 50 percent of all spending.?
A 2016 WSJ article illustrates the increasing burden of medical costs on middle-class America. Healthcare spending has grown dramatically over the years as spending on other essential areas such as housing and transportation has declined.?
Healthcare spending has been increasing at rates far outpacing inflation, according to an article by the Kaiser Family Foundation.?
Last year I interviewed the founder of a pharma SaaS company who shared with me that she and her husband who own the firm had to forgo taking a salary one year in order to afford health benefits for themselves and their employees.?
The financial waste is a byproduct of overuse, administrative waste, opaque pricing, and missed prevention opportunities, to name a few. By creating a wave of advisors and the supporting contracts and technology to support them, Health Rosetta is aiming to address a hefty chunk of systemic waste.
So now we are left with the following question…?
If the mainstream insurers and PBMs aren’t helping to curb spending then who is??
Health Rosetta has built the bridge to a world of alternatives.
What’s the solution?
The short answer is high performing health plans. But what does this mean? It means getting the best value out of healthcare services possible. It means finding that sweet spot between price and quality in those instances where the two are actually aligned. It means giving your employees access to high quality care and incentivizing them to use it with minimal or non existent out of pocket costs.?
It’s extremely uncommon to have a high performing health plan in a fully insured arrangement.
Going back to the blueprint at the beginning of this article, the solution is a combination of things. You need aligned advisors, enabling technologies, independent and active plan administration, advanced primary care, transparent medical and pharmacy networks as well as established options for specialty and highly acute care. The final component is individual stewardship which is just as crucial as any other element - the employer and individuals on the plan must carefully and responsibly manage their healthcare design and journey, respectively.
With primary care doctors seen as the quarterbacks for healthcare, it’s crucial for employers to set up value-based primary care arrangements. Referrals can be costly when steered in a particular direction but especially if they didn’t need to happen in the first place.?
Prefacing all of these recommendations is the employer’s need to find a financially aligned advisor. Each benefit plan will be unique as it should be geared to serve the employer. The health plan savings won’t come from sticking to the status quo. Find that person you can high-five when you both hear that health spend went down while the value of the services delivered climbed.
The linchpin in the adoption of - and shift towards - high performing health plans is the benefits advisor. They are the people who employers trust and go to for guidance. The change agents are the advisors who work with employers on a regular basis and who have been working with them for decades. This isn’t my opinion, it has come up in many discussions and podcasts that I’ve listened to.
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The open source shift - scaling standardization for the greater good
Health Rosetta is focused on developing open source resources in the areas of procurement, contracting, and data use.?
The following documents are going to be open sourced for the advisor and employer communities:
Let’s take a dive into each one.
High performing health plans start with proper protocols for healthcare procurement which begins with finding the right advisor and plan administrator partners. RFP questions will range from understanding the claims processing platform they use all the way down to the details like their ability to set auto adjudication thresholds, identify overpayments, and carve out J-code pharmacy claims.?
When properly designed contracts set expectations, ensure accountability and reduce risk for all parties. The Administrative Services Agreement (ASA) Checklist includes items such as compensation disclosure, prohibition of cross-plan offsetting, unit level price guarantees, no steerage restrictions, prior authorization notifications, and comprehensive audit right access to name a few.?
The ASA model clauses document consists of guiding language for group health plan and claim administrator responsibility, financials such as fees and rebates, data rights and ownership, audit and review rights, overpayment recoveries, medical plan rebates, and Employee Retirement Income Security Act (ERISA).
The data access toolkit outlines the Gag Clause Prohibition Compliance Attestation required by the Consolidated Appropriations Act (CAA) of 2021. It essentially helps to ensure that plan sponsors and participants have access to healthcare service cost and quality data.
Once you get a sense of where an administrator stands in response to your RFP questions, you can then decide if it’s worth investing the time in a live discussion. Get a sneak peek at Health Rosetta’s open source documents before the event by downloading them here.?
And on top of all these resources to help push a more thoughtful procurement narrative, there is also the CAA of 2021 which assigns fiduciary responsibility to self insured employers for the healthcare services they purchase.?
Breaking down barriers?
It’s impossible, until it’s not.?
Running a 4-minute mile used to be the bar to beat. Many thought it wasn’t possible. In 1863, William Lang did a downhill mile trial run in 4:02. It wouldn’t have qualified for record keeping purposes but it was the fastest mile on trial until 1943.?
Then on May 6, 1954 British athlete Roger Bannister broke the 4 minute mile record. A month and a half after that, a second person broke the 4 minute mile barrier. What’s notable isn’t just that the barrier was broken, but how quickly it continued to be passed after the world was shown it was possible. As of June 2022, the barrier has been broken by 1,755 athletes.
As early as 1991 Rosen Hotels started to branch away from the traditional healthcare setup after being faced with a 30% premium increase. Harris Rosen could no longer accept the never ending train of premium increases that were being delivered on an annual basis.?
Part of the shift involved the company transitioning to self funding, hiring a flexible third party administrator, and starting their direct contracting journey. The result - the company managed to spend 55% less per capita on benefits when compared to the average across their peers. To date, savings have accumulated to over $500M which has been graciously distributed back into the pockets of their people and the communities in which they live across central Florida.?
Outlier becomes the new norm
Harris Rosen’s transformation may have been an anomaly in the 90s but with the Health Rosetta framework in place today, this success story is one of many. Healthcare premiums and costs continue to spiral out of control. Luckily there are options for those employers who are willing to surround themselves with the right advisors and education which will lead to actions that make a financial and physical impact.
Another example is a small conglomerate of 24 firms in rural Georgia with 1,000 employees. Between 2000 and 2009 they cumulatively saved more than $29M when compared with what they would have spent following the status quo of the U.S. average premium trend increase during that same time.?
It’s not uncommon to see thousands of dollars in savings per employee per year.
Here are several more case studies describing the jaw dropping performance of what is possible with the right amount of guidance and grit.?
With hundreds of employers already deploying this new approach, I’d say we are sitting somewhere in the early adopters section of the Innovation-Adoption curve. And as awareness and implementation of the open-source framework becomes more prominent, it could serve as the catalyst that bridges U.S. employers into the early majority phase.?
Join the movement - ways you can get involved?
One of the best ways to familiarize yourself with Health Rosetta and begin to meet all the amazing people in their community is by attending RosettaFest which will take place in Washington D.C. from September 11-13, 2024.?
For those of you in the benefits advising and counseling space, if you haven’t already it might make sense to start reviewing what the steps are to become a Health Rosetta certified benefit advisor.?
Finally, with all the opportunities being created through their open source initiative, experts and thought leaders in the space are being invited to contribute feedback to the many pages of documentation that will pave the way for optimized, responsible, and accountable procurement of healthcare services.