What’s Next for the Business of Healthcare

Easily the biggest, most important and most impactful business in Birmingham, healthcare is also among the most complex industries in the world. We gathered together panelists from all aspects of the industry to help us make sense of the future.

With that in mind, BHM BIZ put together a panel of experts to discuss the state of the industry in the Magic City.

The panelists were Scott McGlaun, senior vice president and chief information officer at Blue Cross and Blue Shield of Alabama; Dr. Sameer Ather, president and CEO of XpertDox; Whitt Israel, CEO of ICONN Orthopedics; William W. Horton, attorney with Jones Walker; and Sae Evans, CPA at Warren Averett.

Dr. Sameer Ather is Assistant Professor (Hon.), University of Alabama at Birmingham; Staff, Cardiology Section, Birmingham VA Medical Center; and  CEO of XpertDox

XpertDox, which is located in Innovation Depot, leverages big data to improve patient access to health care and accelerate patient recruitment into clinical trials. Enabled by a proprietary algorithm, XpertDox has mapped more than 6,000 diseases, 4,500 hospitals, 18,000 clinical trials and one million doctors in the United States, all to help patients find the best care for their disease.

Scott McGlaun is Sr. Vice President and Chief Information Officer, Blue Cross and Blue Shield of Alabama; Interim President, Healthcare Business Solutions, LLC.

McGlaun joined Blue Cross and Blue Shield of Alabama in 2008 as Sr. Vice President and Chief Information Officer. McGlaun’s technology and leadership roles provide strategic vision for the company’s information systems operations. His areas of responsibility include all application and database development, infrastructure and operations, systems data and information security, IT project management office (PMO) and systems architecture.

Sae Evans is a CPA with Warren Averett. Evans is a member in the firm’s Healthcare Consulting Group and specializes in working with medical practices. He serves physicians in matters such as compensation and incentive plans, merger and acquisition transactions, business advisory and personal income tax planning. Evans also has expertise in medical real estate issues including feasibility analysis, cost segregation studies and tax planning for purchase/sale transactions.

William Horton is a partner with Jones Walker. Horton maintains a national practice representing healthcare providers and other business enterprises in mergers, acquisitions and joint ventures, securities and corporate finance law, regulatory compliance, and corporate governance matters. Prior to joining Jones Walker, he served as general counsel of one of the nation’s largest publicly traded healthcare providers. He currently serves as head of the firm’s Birmingham office and is a nationally recognized speaker and author on healthcare, corporate and securities law, and professional responsibility topics.

Whitt Israel is co-founder of  ICONN Orthopedics, LLC. Israel  earned an undergraduate degree in Biomedical Engineering from Vanderbilt University. ICONN exists to provide products for surgeons that allow them to treat their patients with cutting edge technology while making a significant financial impact on the healthcare industry. ICONN believes that device costs can be cut by at least 50 percent across the board, while not just maintaining the quality of care, but improving it.

Here are some of the insights offered by the panelists into this critical aspect of our economy.

A Challenge of Access

Scott McGlaun, Blue Cross and Blue Shield of Alabama

There’s a bit of a myth that rural healthcare equals inadequate or poor quality healthcare.

We don’t really see that in the data. We see an equal level of quality in rural and urban facilities across the state. What we have is a challenge of access. In a rural county, you don’t have hospitals like a UAB. You tend not to have the same level specialization as in cardiologists or oncologists.

But I don’t think we should allow that to be an excuse  for individuals who live in rural counties to not have adequate healthcare, or access to the same level of care that we have in our urban population centers. We can accomplish that through things like tele-medicine or even  a mobile clinic on wheels.

No matter what business you are in, including healthcare, everything is moving to mobile. It’s important to our customers, even down to the question of who should I go see? Do I need to go to the emergency room or to my primary care physician or an urgent care center?

What’s the cost going to be? What level of quality will I see in those providers I’m contemplating? Answers to all of that help simplify their access to the healthcare delivery system, especially when it ends up in a little thing we call the phone.

The amount of innovation that we can point toward the friction points and the complexities in this industry are immense. I’d like to see us as a community take greater advantage of those assets, like UAB and Innovation Depot, that we have and continue to drive innovation.

Misaligned Incentives

Dr. Sameer Ather, XpertDox

Healthcare has too many moving parts, and too many misaligned incentives. At least two of the incentives, the payer and the employer, are aligned, so from that perspective it may bring some efficiency.

What we have done over the past 20 or 30 years is to go from a very low-tech, low-efficiency and low-cost system to building all these devices and technology which are very expensive and have increased the cost of healthcare. But at no point have we addressed the access of patients to healthcare

That’s a big problem that remains, and rising costs have only worsened it.

We need to leverage data and technology, and we need to improve patient access if we are going to bring down the cost. Patient access in Alabama remains very poor and tele-medicine and the Internet of things can help.

Bumps in the Road

William Horton, Jones Walker

Healthcare is a difficult beast to tame. There are a lot of things in the system that are designed to make change slow and difficult. If you’re talking about changing the way to deliver healthcare to your employees and if you are a large multi-state corporation, you have to deal with the fact that the providers are still operating under 50 different state systems. The payers that you’re going to be dealing with are still regulated by 50 different departments of insurance. There are just a lot of bumps in the road.

A lot of us still have this vision of the hometown doctor who you could go see about anything and at any time day or night. That’s not the way the world has worked for a long time, and I think it’s going to be even less so as individual physician practices continue their path to becoming parts of larger organizations and become governed by a more complicated set of goals

Private Equity

Sae Evans, Warren Averett

I don’t have the solution to America’s healthcare problem, and that is not why clients come to me. They come to me and ask me how I can help them address their problems so that we focus on what we can control. And that is what our physicians are doing in their practice. We look at questions like, do you have the best staff? Are your staff trained optimally to take care of the patient?

When a patient goes to see his physician today, if they’re in the practice for an hour or two hours depending on what they’re having done, they may only see the physician for 15 minutes. The entire rest of the experience is dealing with technology or other staff in the practice. How do we make that experience something positive for the patient so that they walk away thinking this is the best care, best experience, they could have had?

Private equity groups and investors are starting to move into Alabama. They are talking to a number of our clients and what that means is you are no longer going to have a practice owned by a hospital or the physicians themselves, you’re going to have corporate medicine.

I think we are in the front wave of this. They are beginning to dip their toe into Alabama and we may see it pick up steam as we go along. Will it be successful in running practices? We’ll have to see.

The Issue Is Cost

Whitt Israel, ICONN Orthopedics

The biggest issue in the U.S. healthcare system is cost. Where it is right now and where it’s going is not sustainable,  and there has to be something done to address it. Everyone is trying to figure out how do we deliver the highest quality care to the most people in the most efficient manner possible.

I think the Amazon Berkshire deal is good because it puts a big spotlight on a huge issue.

When you have three of the biggest companies in America deciding that they’re going to help put together a plan to solve the U.S. healthcare crisis, that’s a good thing. ∞