Toxic Positivity in Healthcare: Dr. Sachin Jain's Call to Stop Normalizing the Abnormal

Welcome to Architect Health’s The Front Door Newsletter! In this newsletter, Architect Health’s Co-founder & CEO, Sohum Shah, interviews healthcare executives, founders, and experts on healthcare innovation, digital health, and preventative care. The goal is to identify pain points in these spaces and paint visions on how to address them, inspiring decision makers at traditional healthcare organizations.

Today’s twelfth interview features health plan executive and healthcare thought leader, Dr. Sachin Jain. Sachin provides his candid perspectives on toxic positivity in healthcare, the reality of digital health performance post-pandemic, and SCAN's historic lawsuit against the CMS.

Interview Key Takeaways:

• Addressing "Toxic Positivity": The healthcare industry suffers from excessive optimism about digital health, value-based care, and new technologies, leaving little room for healthy skepticism and addressing foundational problems.

• Need for Fundamental Change: Healthcare hasn't significantly changed in 20 years, calling for more honest conversations and fundamental problem-solving approaches instead of repeating the same discussions without progress.

• Digital Health Underperformance: Despite pandemic-driven potential, digital health solutions often increase costs and utilization due to poor understanding from payers on effective deployment and targeting the right members for improved care quality and cost reduction.

• Population-specific Products: Targeted Medicare Advantage products for specific populations (women, LGBTQ+, Asian Americans) address underserved segments and adapt to diverse needs in a challenging growth environment.

• CMS Lawsuit Impact: SCAN’s successful lawsuit against CMS, resulting in a reversion to 4 stars from 3.5, highlights the importance of fair rating methodologies and demonstrates how payers can challenge the status quo to better support providers and members.

Listen to the Podcast:

• Spotify

• Spotify for Podcasters

• Apple

Dr. Sachin Jain is CEO of SCAN Group and SCAN Health Plan, where he is charged with leading the organization’s growth, diversification, and emerging efforts to reduce healthcare disparities. SCAN’s revenues top $4.8B and the organization serves more than 300,000 members.

From 2015-2020, Dr. Jain was President and CEO of CareMore Health and Aspire Health, innovative care delivery systems with more than $1.6B in revenues, which serve 200,000 Medicare and Medicaid patients in 32 states.

Dr. Jain graduated with BA, MD, and MDA from Harvard University, is a contributor for Forbes and healthcare thought leader on LinkedIn and serves on the boards of America's Health Insurance Plans (AHIP), Advantage Healthcare Services, and The Paul & Daisy Soros Fellowships for New Americans.

Toxic Positivity in Healthcare

Sohum: Let’s discuss the current state of healthcare. You have previously brought up the term “toxic positivity” at AHIP 2024. What does this mean? Where are we actually in healthcare today? Why do we need to stop normalizing the abnormal?

Sachin: Toxic positivity is everywhere you go. People are wildly positive about digital health, value-based care, new technologies, and their impact. These days, everyone's toxically positive about AI. It's just how we talk about things. There's almost no space for dissent, no space for alternate perspectives, no space for healthy skepticism that actually drives decisions and thoughts to be more sharp and more precise.

I first heard the term "toxic positivity" applied to the culture of a large, well-known healthcare startup. It was the perspective that it was impossible to state a view contrary to the founders, impossible to reconcile the on-the-ground reality with the vision of the people leading the company.

How you define problems ultimately influences how you solve problems. We don't have a very sharp definition of our problems in our industry, in part because many people are doing super well, profiting off of this viewpoint that is ultimately grounded in toxic positivity.

Need for Change in Healthcare

Sohum: A key topic you also brought up at AHIP 2024 was how healthcare hasn’t changed in 20 years. What are your calls to action to the broader healthcare industry on how to improve? What part is SCAN taking in this?

Sachin: We need to think more fundamentally about how to attack these problems. How you define the problem actually influences how you solve the problem. And I don't think our problem definition is high resolution enough.

We say that we want to manage healthcare costs, but at the same time, we don't want to make the trade-offs that you have to make to actually lower healthcare costs. Something's got to give. We're not actually having honest conversations.

Many people go to conferences and say it's a big snooze fest. I don't actually go to panels anymore because it's the same conversation today as it was ten years ago, as it was 20 years ago. Eventually, they're going to stop inviting me to these conferences because I take so many shots at them. And that'll be okay because I don't want to go to a conference where most people are just spouting corporate pablum because it serves their narrow business interests to do so.

The State of Digital Health

Sohum: How has your view of digital health (eg., telehealth apps, virtual-first care, etc.) changed over time? Pre-pandemic vs post-pandemic? Looking at your crystal ball, what does the future hold in store?

Sachin: Two words: dramatic underperformance. The pandemic gave us a window into what might be possible for about five minutes. And we've largely gone back to business as usual. That has a lot to do with public policy, behavior, and the fact that healthcare is not best practiced through a series of transactional episodes over your phone or iPad.

What we need from digital health is continuous asynchronous engagement with patients around chronic conditions. And people aren't paying for that right now. What they're paying for instead is fee-for-service visits over video screens, which often lead to additional in-person visits.

Some of the best studies of digital health actually show that it increases healthcare costs because it increases the number of visits, increases consumption, increases utilization - some of which would be obviated with analog health.

We have a lot of analog people who don't know what questions to ask implementing these solutions in healthcare settings. They'll say, "Oh, 93% of people have downloaded our app." That's one of the things that people love to cite. And then you ask the next question, which is, "What's the utilization of that app? What's the persistence of the utilization of that app?". We haven't trained people to even ask these basic questions, which is one of the reasons why the work you do at Architect Health has the potential to be valuable. I like the problem space that you're operating in, because I think you can help make consumers of these solutions more sophisticated and better inform them how to use it.

SCAN’s Strategic Investments

Sohum: SCAN has made a number of strategic investments recently including: Arine, SafeRide Health, Guaranteed, Monogram Health, MedArrive, and SafelyYou. What is SCAN’s philosophy on corporate development? What is SCAN’s overarching thesis behind these investments and the vision SCAN is trying to achieve?

Sachin: We're not a venture fund, so we are not writing huge checks to entities. What we're doing is saying if we're going to partner with an early-stage startup, then we're going to be creating a lot of IP with and along those companies, because we're going to be giving them real-world data on how things work and how to improve their product.

We believe that if we create that kind of value, in addition to a customer relationship, we want to partner with these entities and actually ride the increase in value that we're creating. That's why we make small passive investments in entities that we partner with.

There's a tension that sometimes exists when you are running an operation like ours. Sometimes a vendor is not showing up the way they're supposed to and you're an investor in that vendor. Do you terminate that vendor and potentially impair the value of your investment, or do you smile and say, "Okay, we're a part owner in this thing and we've got to run long with this partner and actually help them get better"?

Point-solution Fatigue

Sohum: The concept of point-solution fatigue has been voiced consistently across payers, providers, and even patients, what approach is SCAN taking to address that?

Sachin: We deal with it by first streamlining the intake process of these point solutions. Our corporate development team is the single point of entry for the most part for these types of vendors and solutions. This creates a standardized channel that ultimately avoids the multiple door problem that a lot of vendors end up facing.

The other way we deal with it is actually honestly not doing. It takes a lot of work to make one of these vendor partnerships really, really work, especially if it's a new and emerging company. When you're doing too many things at once, it's actually really hard to know what's working.

One of my favorite responses to the value-based care conversation and every conversation about shared savings is "Get your hand out of my pocket." Why are you reaching in for dollars that I'm producing in shared savings and saying that you created it with your little widget or tool or technology?

I advise a number of different startups in the digital health ecosystem and I always say, please just do a basic fee for service or PMPM contract, even if you're selling to a value-based care provider. I know your investors are telling you to get a shared savings contract, but I can administer one shared savings contract at a time on a population, not two, not three, not four, not five, not six, not seven, not eight.

SCAN’s Population-specific Products

Sohum: SCAN has recently launched 3 new products: Inspired - the first women’s product, Affirm - the first LGBTQ+ product, and an Asian focused product, as well. Why did SCAN take a population-specific product approach? Are there value drivers like improvement in outcomes and reduction in costs that are correlated to population-specific products? Are there any new products on the horizon?

Sachin: Growth is hard in Medicare Advantage, plain and simple. So you've got to unlock new segments and be able to speak to new segments. There are deep pockets of patients in the US healthcare ecosystem who are underserved, who don't look like everyone else, whose healthcare needs are different from everyone else, whose life experiences require a different approach to thinking about healthcare.

We have a tension in our industry between standardization and customization. One of the great things about the flexibilities of the MA industry is you can build these customized products. Think about an LGBTQ senior. We have a SCAN member named RG who came out late in life, had a lot of shame about being a gay man, a gay minority man. All of a sudden his health plan introduces a product that's specifically meant for him, that has features and supplemental benefits, and a provider network that specifically understands his issues and needs. That's a big deal. Health plans all across the country missed out on an opportunity to speak to a large number of LGBTQ patients, LGBTQ seniors, by actually offering them something that was tailored to their needs. This Affirm product has exceeded expectations by attracting nearly 1,000 members in its first year, far surpassing the initial projection of 100 members over 18 months.

SCAN's Inspired product, launched in 2023, is the first women-focused Medicare Advantage plan in the country. It caters to modern, active 65-year-old women in the "sandwich generation" who may be caring for both parents and children or grandchildren. The product recognizes that today's Medicare-eligible women are different from previous generations, potentially preferring Peloton to Silver Sneakers, and aims to meet their unique needs and lifestyles.

SCAN partnered with Astrana Health to create a joint product focused on the Asian American population, launching softly last year and planning a hard launch this year with product modifications based on learnings. This initiative revealed areas for cultural competency improvement, such as developing a SCAN name in Mandarin and Cantonese.

These population-specific products demonstrate SCAN's commitment to addressing underserved segments and adapting to diverse needs in the Medicare Advantage market.

SCAN, CMS, and STAR Ratings

Sohum: On June 6th of this year, SCAN announced that it prevailed in the 2024 Star Ratings Lawsuit against the CMS, reverting to 4 stars from 3.5, yielding a deserved $250M bonus. Briefly, walk us through your experience in this lawsuit, the impact of the Tukey Outlier Rule and the Guardrail Rule, and looking forward, how SCAN aims to continue improving on Star ratings.

Sachin: Let me make this super clear. The $250 million that landed with SCAN lands in the form of higher provider payments and more that we're able to spend on benefits for our members. The impact on SCAN's financials are actually very modest because we are mostly a fully delegated risk entity, meaning most of our revenue from CMS gets passed through to our at-risk providers.

We filed this lawsuit on behalf of our providers. The lawsuit was really a last resort. We have been, inclusive of this year, a four-plus star plan eleven years in a row. So when we projected our star rating, we projected a star rating of 4.0. And we were shocked when we fell to 3.5. When we started to look at what happened, we saw that our projections were wrong because CMS had implemented this Tukey outlier methodology to set the guardrails for some of the measures and set the cut points for some of the measures. The truth is that CMS did not signal that it was going to do that in the Federal Register.

We also found that there were a couple of measures where there was some doubt. One of them was a French foreign language phone call, which is frustrating to us because first of all, we don't have a ton of French members here in Southern California. CMS uses secret shoppers who follow a script. In this case, the secret shopper stumbled in some of their language and it caused a delay in the call. CMS judges you based on whether you answer a member's inquiry within a certain timeframe. We were 34 seconds off. And guess what? When we clocked the stumble, it was about 34 seconds.

We appealed to CMS on two fronts: the Tukey outlier methodology and this French foreign language call. The end result was that more than a billion dollars in payments would be paid in the form of bonuses. More than a million beneficiaries would benefit in over 60 plans from better benefits. It feels great. It feels like we did something important for Americans.

Long-term Enrollment

Sohum: You published an article on Forbes last year about value-based care and the issue of frequent member base changes. You credited BCBS Massachusetts's Former CSO, Sukanya Soderland, on the concept of long-term enrollment. Tell us more about your perspectives on how long-term enrollment can drive value-based care and how a future shift towards that system could be approached and what it might look like. How is SCAN tactically approaching this?

Sachin: Look, value-based care is a euphemism today for coding. If you actually want to do real value-based care, you actually have to move health outcomes over years. Most health plans measure things actuarially, in terms of actuarial impact in a year. There's very few health outcomes you can actually move meaningfully in a year. You can move some admissions, some readmissions, certainly move coding, but you can't really change the arc of someone's chronic disease within an annual lifecycle.

I believe that we have to think longer term. Health outcomes are produced over longer term horizons. We have to meaningfully move the needle on outcomes over the long haul, and the only way we do that is if we own the patients for long periods of time. I think longer enrollment in health plans will unlock more investments in biologics, pharmaceuticals, digital health tools and technologies, and primary care, because the value-based care horizon will be three to five years.

Sukanya's proposal was brilliant. She said we have to get into commercial products that are three years, four years, five years. I thought we should do something similar on the MA side. I'd love to see it come to life somewhere.

Evolution of the Payvidor

Sohum: The parent organization of SCAN Health Plans is the SCAN Group. Additional initiatives include Homebase Medical, Healthcare in Action, Welcome Health, and myPlace Health (in partnership with Commonwealth Care Alliance). What is the thesis behind these medical groups? How does that fit in with the SCAN Group and Health Plan’s mission? Is there a world in which SCAN starts to structure itself as a payvidor or integrated care network?

Sachin: Yeah, and we are a payvidor. I mean, that's exactly who we are. At the same time, our clinical assets have been built in a way that's payer agnostic. All of those entities are contracted with other health plans, because what we're trying to build is world-class clinical assets, and we'd like those clinical assets to be available to anybody who wants them, even if they don't want to be a SCAN Health Plan member.

The real unlock, and I saw this from my time at CareMore, is the close alignment of payer and provider. There's something special you can do when the payer and the provider are under the same roof, and there's a degree of integration, degree of seamlessness that is completely impossible when organizations are primarily aligned through a contractual relationship.

Upcoming Healthcare Trends

Sohum: What are you most looking forward to for the rest of 2024 into 2025? What are some changes or trends in healthcare you are most excited to witness?

Sachin: Look, let me say the following. I am on a mission right now to try to get our industry speaking the truth, speaking in plain language. It's what I try to do on LinkedIn every day, stop normalizing the abnormal. And I think it's catching on. I feel like people are finally starting to get it a little.

I think a lot about moral clarity as the framing piece of it. We have to operate with a higher degree of moral clarity, and that means that there is right and wrong. And I think the problem is we've kind of convinced ourselves that a lot of wrong things are right. And I'm hopeful, very hopeful, that we're turning the corner and we're starting to see solutions where we previously saw only problems, or where we didn't even see the problems at all. So we're starting to define the problems more clearly, and then as a result, we're going to start to get to some more solutions.

Architect Health is a digital health aggregator, navigator, and vendor manager that makes it easy for health plans and their members to access virtual-first care solutions. Architect optimizes health plan RFP processes in a consolidated and comprehensive platform, reducing admin burden and costs. This helps health plans realize digital health cost savings opportunities - up to a 7x ROI. Architect's Digital Health Quality Index has vetted and scored thousands of telehealth solutions on efficacy, company reliability, and health equity. Co-founders Sohum Shah and Sidd Hariharan have deep expertise working with health plans and have built care management programs and aligned technology for Humana and BlueCross BlueShield. Architect Health is backed by Drive Capital, Entrepreneurs Roundtable Accelerator (ERA), Cherrystone Angel Group, Plug and Play Ventures, Service Provider Capital, and strategic advisors.

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