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Kenan Institute 2022 Annual Theme: Stakeholder Capitalism
Market-Based Solutions to Vital Economic Issues
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Dec 14, 2018

Reimagining Healthcare: Three Keynotes from the Business of Health Conference

More than 400 academic researchers, private sector executives, public policy leaders and students convened at UNC Kenan-Flagler Business School on Friday, Nov. 9, for Business of Health: Collaborating to Rethink Healthcare. The conference, presented by the Kenan-Flagler Healthcare Club and the UNC Kenan-Flagler Business School Center for the Business of Health, and sponsored by the Frank Hawkins Kenan Institute of Private Enterprise, explored today’s most pressing issues in healthcare.

In addition to a full slate of breakout sessions, the conference featured three keynotes by Bryony Winn, chief strategy and innovation officer, Blue Cross and Blue Shield of North Carolina; Peter Marks, director of the Center for Biologics Evaluation and Research, U.S. Food and Drug Administration; and Howard Kern, president and CEO of Sentara Healthcare.

Marks began the program with an exploration of the FDA’s role in developing innovative medical products such as vaccines, blood products and gene therapies. While many people think of the FDA as a regulatory agency, Marks says the organization is increasingly involved in promoting and facilitating product development, providing incentive programs for companies to develop drugs in such often-neglected areas as “orphan” diseases (serious, yet relatively rare conditions); uncommon tropical diseases; rare pediatric diseases, and medical countermeasures – for example, drugs that can be used in the event of a nuclear attack.

In addition, the FDA has implemented a Regenerative Medicine Advanced Therapy (RMAT) designation to expedite the development and regulatory review of cellular and gene-based therapies. In the past 20 months, 28 products have been granted RMAT status.

Marks also walked the audience through an example of how his agency helps develop and review innovative products, from the initial meeting between the product sponsor and the FDA through final approval. With the agency’s new expedited guidelines, the average time from discovery to development has been cut in half, and the cost to bring such products to market is about a quarter to one half the cost of traditional drug development.

The conference’s second keynote address was given by Bryony Winn of Blue Cross and Blue Shield North Carolina. Winn presented some startling statistics, noting that the $3.3 trillion dollars Americans spend on healthcare annually equates to one of every five dollars spent. Twenty-six percent of Americans have reported having trouble paying their medical bills, in spite of the fact that more than 80 percent of them have healthcare coverage.

In light of such statistics, Winn said, “we have a moral imperative to improve healthcare.”

The root of the problem, according to Winn, is that the U.S. healthcare system is incentivized to value quantity over quality and outcomes. To shift the emphasis to value, BCBS is experimenting with value-based payment arrangements. The insurer is actively working with small independent practices, particularly in rural areas, to set up virtual Accountable Care Organizations (ACOs) with both a quality and financial component that provide performance incentives, provider engagement and technological and analytical support – in essence, providing these smaller practices with the same advantages enjoyed by large, hospital-based systems. The first contracts for these virtual ACOs will be ready for signing by 2020.

The final keynote of the day was given by Howard Kern of Sentara Healthcare. Kern told the story of how Sentara came back from a flagging performance rating to become one of the top 15 providers on the IBM/Truven list of top health systems. Kern said that Sentara was originally fragmented and siloed, lacking focus and attempting to do too many things. But with more than 1,000 in-network physicians, 500,000 plan members and more than 500 ambulatory care sites, turning the company around would take some effort.

In 2013, Sentara adopted guiding principles designed to reduce fragmentation, enhance their culture and decision-making tools and put the patient experience first. They developed a 55-member clinical leadership council to enable quick decisions, designed high-performance teams across divisions and stressed performance excellence and accountability.

The result was that Sentara moved into the upper right quadrant of the IBM/Truven graph, earning the highest levels for both performance and rate of improvement.

As Kern looked toward the future, he said that Sentara is on a journey to become a highly predictable organization, and is in pursuit of higher quality and lower total cost of care across the healthcare continuum. Recognizing that improvement requires continuous effort, he summed up Sentara’s endeavors with a quote from the late Sergio Marchionne, former head of Fiat Chrysler: “The true finish line the one always yet to come.”

Click here to learn more about the UNC Kenan-Flagler Business School Center for the Business of Health.

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