Over the past 25 years, Richard Clarke has become the friendly, erudite and personable face of the Healthcare Financial Management Association, one of the nation’s most prominent healthcare groups. According to Modern Healthcare, he regularly ranks among the top 100 most powerful people in healthcare. Most people who know him aren’t surprised. He’s very intuitive in the area of healthcare administration and he’s a great communicator. I get the sense that he loves what he’s doing.

Richard Clark is CEO of the Healthcare Financial Management Association

“While healthcare reform is a key area for our group, we’ve found that the primary focus of hospitals today is on preparation for significant changes, not necessarily the method of payment.” He is referring to the fact that while payment systems are filled with conflicting incentives, (like getting paid more based on volume rather than quality), healthcare administrators are tightly focused on other areas like budget, organizing clinical relationships (aligning physicians with hospitals) and technology issues. “Clinical processes are being designed with the patient at the center then structures are being built around that,” he says. It’s reminiscent of the emerging “medical home” concept.

I’m hearing a theme on my tour about physicians becoming employed by hospitals. The current environment is too risky to go it alone so physicians are seeking stability. Dick adds a further dimension to this dynamic. “The days of the single standing smaller hospital may be numbered,” he suggests. “The environment is challenging, capital needs remain high and so I think we might see smaller hospitals joining bigger chains.”

He continues: “Our members are focused on three core competencies: true clinical integration that is measured based on patient outcomes not just physician alignment (did your treatment heal you?); risk management based on cost – a quasi-insurance function that could involve population risk (an idea that was discussed at a recent summit in California - “community-based healthcare”); and, better pricing for services. The biggest enabler for better pricing is information technology.” As the saying goes, you can’t improve what you can’t measure. Along these lines I ask him about bundled payment – is it coming? “In theory,” he replies, “yes…there are pilot programs out there like Prometheus that are showing promising results.”

Before I ask the next question, Dick blows off a little steam. “There is some residual anger at banks because of the difficulty hospitals have had accessing credit,” he says, “some continue to have this problem.” While it sounds ironic given how much time banks spend wooing hospital-clients, its true many have scrambled during the global economic meltdown. “This really has to be more of a partnership to work,” he adds.

His comments resonate. Many communities have two vital anchor points – the hospital, typically the largest employer, and the bank. They are often on each other’s Boards and they have a common interest to improve the quality of life in the communities they serve. If one institution has a problem both tend to suffer. A bankrupt hospital can spell disaster to a local economy. A bank that is tight on credit will intensify operating pressure on a hospital. I find that in many cases there is truly a community partnership between the two, and this vital community axis forms one of the key underpinnings of medical banking. Those that don’t understand this simply don’t get medical banking. At its core, its about community leaders sharing a common concern in their neighborhoods about quality of life issues. How the bank wraps it resources around this critical objective forms the content of medical banking dialogue.

When I interviewed some 125 banking CEOs, healthcare administrators and physicians in 1994-1995, I found that there was often times intense focus by bank CEOs on their hospital clients. Sure, there is focus on other businesses, yet I can’t imagine any that provide $30 billion in charity care each year (per the most recent HFMA report at the group’s Payment Reform Summit in DC where 100 top thought leaders met to dialogue solutions for reforming our healthcare payment system).

Bottom line: leveraging core competencies – one in clinical excellence (care providers) and the other in administrative excellence (banks) – provides a good framework for community collaboration for meeting healthcare needs. Banks are waking up to a much more global context for deploying their assets into healthcare…and I might add that there needs to be more dialogue between the groups so that mutual appreciation of resources and sustainable collaboration can occur. There are compelling reasons for linking banking and healthcare today in new ways, beyond credit and new transaction processing, especially as we switch gears into the “health-wealth” paradigm of the future. Good examples of this are Tenant’s recent partnership with a bank in southeast Florida, opening up bank branches to provide health and lifestyle training to consumers. Other banks in Massachusetts and Minneapolis are also advancing what I call the “advanced community care platform.”

I switch gears to ask about Dick Clark, the person. He’s been on my radar screen since 1994 when I had the pleasure of being a student in a class he taught in Denver, CO. I sense a degree of quiet and well-deserved personal satisfaction in his comments, managing such a vibrant professional association. “I’m constantly impressed by the deep level of personal attachment our members have for this organization,” he says. “They genuinely want to do everything they can to improve healthcare.” As I drive off I think that one good reason why they might is because he does. I’m glad he’s at the helm and working hard to avert the dark and ominous clouds that appear to be gathering in the healthcare industry. Until next post…

It took all of about two days before the board members of Rxaminer and DestinationRx started talk of combining firms after the Wall Street Journal posed a what if scenario about how to get the best drug at the lowest price – and that just about describes the core offering of today’s DestinationRx. So…what if you could go to a single website to find the best drug in the marketplace for your condition, and then find the lowest cost pharmacy to buy it from? Not a bad idea! Its this ability that has catapulted DestinationRx into one of the largest health information exchanges in the country, having enrolled over 9 million patients that use its site for better drug choices.

Toby Rogers, who founded Rxaminer with his father in Chicago in 1999, is quiet and focused. “We think banks could positively impact their asset base in health savings account programs using our technology,” he says. The Medical Banking Project, now HIMSS Medical Banking Project, convened disparate stakeholders around the convergence of healthcare and banking in 2001. By 2003, some companies were joining to promote the adoption of HSAs yet this was mostly a byproduct of a larger trend of technology convergence that MBProject was seeking to facilitate in the marketplace. HSAs and other account-based programs like HRAs have emerged to become an area of focus in the medical banking movement.

Later, Jim Yocum, Executive Vice President at DestinationRx, pops up a power point to explain the value proposition. “We have multi-year data now that shows a compelling story for users of our technology,” he says. My eyes get wide listening to the DestinationRx story. Its an excellent case study with concrete evidence showing savings of over $8 million in one scenario when helping a group of patients to switch to cost effective drugs – not just to generic drugs but to the most appropriate drug with long term benefits.

So…what if you could extrapolate those savings across the bank’s HSA base of customers? Sure banks earn fees on the exchange rate when funds are spent, yet retaining deposits is also a goal for longer term profits in asset management. It all adds up to an extraordinary value proposition – one that we should be talking about more in medical banking circles. Imagine making this tool set available for online banking customers, whether tethered to an HSA program or not (why should that make a difference?). It seems like “just what the doctor ordered” for the bank, employer, payor and consumer – a win-win for everyone, including the sellers of prescription drugs.

Perhaps northeast-based clothier Sims says it best: “an educated consumer is our best customer.” We are entering a health-wealth transformation point in society that involves educating consumers about more wholesome and productive lifestyles. Well established and trusted brands like Wells Fargo, US Bank, HSA Bank and BNY Mellon can get in front of the curve and profit long term. The asset potential could parallel 401ks and early signs suggest that’s the case. Jim shows me the relative value positions of 401k growth versus HSAs and its quite astounding. I ask him to create a white paper on the topic and send it to peer review for presentation at our next Institute.

Toby and Jim provide a great case study of what’s in store for the Point & Click generation. DestinationRx pioneered the first electronic enrollment utility for Medicare in 2004. They will manage medication enrollment electronically for some 1.4 million lives in 2009. Truly they are on the forefront of bringing healthcare online. Leveraging their technology for plan comparison and enrollment (there are 4600 plans available in the government plan that they manage for CMS Part D), banks may be able to capitalize on a great opportunity to increase yield on assets that will not only make their customers happier and healthier, but could add great returns to the bottom line! Until next post…

News…

The Journal of AHIMA found out about my tour and decided to run an article in their November - December 2009 issue. Now there’s a group that can identify with what we are trying to do! We appreciate their support! Check out the article here.

I haven’t talked about the HIMSS acquisition of the Medical Banking Project in my blog yet. Earlier I spoke about a personal experience that put my blog on hold — the acquisition wasn’t the issue but more on that later. Let me talk about the new HIMSS Medical Banking Project.

First of all, its one of the most exciting times of my life. Stephen Lieber, CEO, HIMSS is a dynamic guy and for those of you who have built companies from scratch you know exactly what I mean by saying its hard to let go sometimes. You need a lot of trust, alignment and sympatico. Its not just about business for a social entrepenuer, especially for a firm that was as small as MBProject. If you asked me why I did it I would tell you its because of Steve. He’s a dynamic guy who is often quiet and unassuming. And he studies his subject well. He was able to walk me through the process. He didn’t need to sell me on where HIMSS could take MBProject. I already got that…and now I’m in charge of it - humbling. As he started to introduce me to his team it got even more exciting. I already knew Pam Matthews, who really formed my first very positive perception of HIMSS. I met Norris, COO, HIMSS, department heads and my fellow SVPs. For being such a large organization, it is very agile. They focus on communicating well, organizing and employee satisfaction seems to be a big area of interest as well. I really like what I’m experiencing right now.

Over the years I became convinced that if we’re going to globalize our message, HIMSS would be the right organization. I truly believe this is an incredible thing for the membership and for the advancement of the medical banking industry. We have a positive contribution to make to society by leveraging banking and financial institutions to improve global healthcare. There are multiple areas of opportunity - privacy and security, compliance, cards, lockbox, credit, branch systems, mobile banking, microfinance and many other areas. With HIMSS we have a global platform and we already have plans to leverage this in a powerful way, transforming the marketplace around a key issue - the “Healthcare Financial Network of the Future”.

What is this network? What does it look like? Will it remove inefficiency from the healthcare system? Will it liberate data that can be used to populate PHRs that are tethered to 55 million online banking accounts? Will it help to educate the emerging medical consumer and help people to live healthier lifestyles? Now that’s thinking outside of the box. My view? The answer to all of these questions is a resounding yes! We already see signs of this happening in the marketplace, many documented here in the Tour blog.

I want to challenge banks, financial institutions and healthcare groups to become part of this grand movement that will usher in the new “health-wealth paradigm”. Its a great vision that is global in scope, and with HIMSS we will gather the stakeholders that can energize and facilitate the adoption of medical banking principles everywhere. So yes, I’m bully on the acquisition. Its great to be part of the HIMSS organization! I truly believe we can, and should, create a better world. We need to start somewhere, and with multiple efforts already well underway HIMSS MBProject now adds another key building block that can enable society to reach a new reality, where we don’t have to talk about a healthcare system that is on the brink of disaster. Imagine that! And if you’re not asking that question, the real question is why aren’t you?

Let’s make a difference! Until next post…