News & Insights
Interview with Dr. Ezekiel Emanuel, Venture Partner, Oak HC/FT
Why did you decide to expand your medical and academic career into the private sector?
Being at the forefront of change in health care in the U.S. means engaging with venture capital and the startups that are driving that change.
Academic research and public policy development have a tremendous impact, but we are now at a moment when the private sector is responding quickly and leading significant health care changes. The sector is at an inflection point, driven by recognition of the importance of chronic illness and the inefficiency and low value of much of health care, combined with important changes in payment.
The private sector is leading that response, and to be engaged and help shape change requires working in the private sector—specifically in venture funds. That’s what attracted me to Oak HC/FT, which has been at the forefront of innovation in health care for over 15 years and has a peerless team under the leadership of Annie Lamont and Andrew Adams.
What areas of healthcare are generating the brightest opportunities currently?
Fully 84% of all health care spending in the U.S. goes toward chronic illnesses. Within that, some of the most important areas of spending include behavioral health and end-of-life care.
For instance, behavioral health—care for patients with depression, anxiety, and serious mental health problems such as schizophrenia or bipolar disorder—is the fourth largest area of health care spending. Chronic care, behavioral health, and end-of-life care have traditionally been ignored by medicine, but they are among the most important areas of opportunity. So, the areas with the best opportunities happen to be the same areas that have been at the margins for the last 70 years, yet command some of the most health care resources.
What are some of the companies you are working with?
I work closely with Annie, Andrew, and the Oak HC/FT team across several areas, especially advising existing portfolio companies as well as opining on prospective investment opportunities.
Chronic care, behavioral health, and end-of-life care are the areas where I am particularly active, so I tend to spend the most time with Oak HC/FT portfolio companies within these areas.
Village MD, which provides primary care solutions, is a company I have profiled in my book, “Prescription for the Future,” and I serve on its Board. It has some important innovative practices other physician groups can learn from, such as its programs on rooming patients and home care.
Similarly, I am working with Quartet, a mental health company that is trying to develop what I think of as a virtual collaborative care model to link physicians and their patients with behavioral health specialists. Interestingly, it is also trying to bring performance evaluation to mental health, which has not happened previously.
I am also working with Aspire, a palliative-care company that is trying to put into place all the recommendations on improved end-of-life care that the medical establishment has never been able to implement. I started my career working on end-of-life care when it was not fashionable; not even a recognized area of research. Over the years, the field has developed important ideas on how to improve care for patient likely to die. For instance, focusing care on patients not just in the last days of life but beginning palliative care earlier to elicit preferences for end-of-life care and handling symptoms months, if not a year, before they die. This makes the transitions to the dying process much less abrupt and gives time for the patient to adjust and acclimate to dying at home. But such recommendations have rarely been widely implemented. Aspire is dedicated to bringing these optimal end-of-life care practices to patients. We are working with them to analyze and publish their data on quality and on cost savings.
These are a few of the interesting companies I am involved with through Oak HC/FT.
What is “Prescription for the Future” about?
The subtitle for the book gives a clear picture of the book’s subject: The 12 transformational practices of highly effective medical organizations.
The premise of the book is that the U.S. health care system is going to have to change to deliver higher-quality and lower-cost care consistently. So, I went about examining outstanding medical organizations—from smaller physician practices to larger multi-specialty groups to Medicare Advantage plans to whole-health systems—to elucidate what they did to deliver high quality and reduce cost.
We identified 12 different practices ranging from changing scheduling to chronic care coordinators to community health workers, which are key to transforming care delivery to consistently higher quality and lower cost. In the book, I delineate the specific steps medical organizations can take to implement these practices successfully. For instance, I found all groups that achieved successful chronic care management followed the same five basic steps. This leads me to be optimistic that over the next decade the U.S. can achieve much better care, especially for patients with chronic illnesses.
Importantly, we found that no single medical organization did all 12 transformational practices. So, even among the very best practices in the U.S. there is still room for significant improvement.
If you were to triage the industry, what would you prescribe as the most urgent and critical care priorities?
The single most important pre-requisite for transformation is payment change. Physicians, hospitals, health systems, and all the other providers need to be incentivized to change how they deliver care–to focus on higher quality and lower cost. This requires moving away from fee-for-service payment toward what are called alternative payment models, such as bundled payments for an episode of care or capitation. Fortunately, this is happening—especially through MACRA, the new health care bill that changes how physicians are paid, and through payment changes being implemented by private insurers.
A second important prerequisite is data on where physicians are using resources and the outcomes of their patients. One of the biggest changes since the managed care efforts of the 1990s is that the U.S. system has a lot more data on the performance of the system and physicians to guide transformation.
I lay out several other important pre-requisites in the book, such as leadership and governance. I note that no medical organization can implement 12 transformational practices all at once. So, I indicate a few tiers of practices.
The top priorities and most urgent transformational practices to implement are: 1) open-access scheduling; 2) chronic care management and co-locating chronic care coordinators with physicians; 3) performance measurement and improvement, so physicians and other providers can see how they are performing relative to national benchmarks and their local peers from whom they can learn; and 4) site of service to create referral relationships with other higher value specialists and hospitals.
Can transformation occur despite the current political impasse and efforts to repeal the ACA?
As I note in the book, almost everyone in the health care system thinks transformation is inevitable. For one thing, private payors and the public are demanding more affordable care regardless of the status of the ACA. This will drive transformation.
Much of the drive or pre-requisites also go beyond the ACA in terms of changes in government payment to physicians through MACRA, the Medical Advancement, and CHIP Reauthorization Act. MACRA abolished the failed Sustainable Growth Rate (SGR) formula for adjusting Medicare payments to physicians. It was replaced with payment that incentivizes physicians to shift off fee-for-service payment to more alternative models. Regardless of what happens to the ACA, MACRA will stay and push the transformation I described.
What is high value care and how do we achieve it?
High value care is composed of two parts: higher quality of care and lower costs. We achieve it by improving the health care delivered to patients and lowering the costs of delivery.
As I mentioned, 84% of all health care spending is devoted to chronic illness. In addition, 10% of patients with chronic illness account for nearly two-thirds of all spending. So, if we want to improve quality and lower the cost of care we need to improve the care of patients with chronic illnesses. That means we must prevent the exacerbations of chronic illness: prevent patients with congestive heart disease from gaining too much fluid and developing extreme shortness of breath; patients with chronic obstructive pulmonary disease—emphysema—from becoming short of breath; patients with diabetes from developing infections and gangrene; mitigating the side effects cancer patients develop from chemotherapy.
This is the key, and the key to achieving this is identifying the high risk 10% of patients, having chronic care coordinators co-located with physicians actively reaching out, and managing these patients by ensuring they are taking their medicines and following other recommended interventions. It also requires standardizing care so patients are receiving the best care as defined by the best physician experts on these diseases.
Medical organizations that follow these and other care practices can achieve high value care, typically by lowering visits to the emergency room and hospitalization rates by up to 40%.
What are some of the most notable advances you are seeing around care delivery and patient experience?
What makes me optimistic is that there are so many advances being tried and constantly improved by different medical organizations.
One critical improvement is open-access scheduling. This means physicians start every day with between 20% and 50% of their appointment slots open—i.e. unscheduled. So, if a patient develops a problem they can be seen in the office that same day and treated by someone who knows them and their entire medical condition, instead of being sent to an emergency room where they are treated by someone who does not know them or their medical problems. This also enhances patient satisfaction.
Another important advance is for patients with high social needs and few social supports–poorer patients often on Medicaid. Having effective community health care workers is a huge advance. These health care workers find out what these patients need and want, and then help them obtain services and social connections. They help patients get housing, food, job training and jobs, or just find activities, like bowling and sports, that connect them and bring them some joy and happiness. These community health workers become social supports for the patients. And this frequently reduces use of the health care system for what are otherwise social support problems—lowering hospitalization rates and other uses of the system.
Similarly, adding behavioral health to regular medical care is a fundamental advance we will see more of in the next few years. Patients with chronic illness who have co-morbid depression or anxiety are so much more expensive to care for. Important advances are efforts to provide these patients mental health services that are integrated with their regular care. When done well, this helps patients overcome their depression or anxiety and thereby lowers their use of health care services and costs. It is a classic win-win situation.
I could go on and on because the book is filled with scores of these advances being implemented by different medical organizations.
How do you escape work and clear your mind?
I don’t know about escaping work and clearing my mind. I find that when I am relaxing I am often thinking about work on another level.
I love to run, bike, and kayak. Recently, I spent three days navigating 50 kilometers by kayak in the Norwegian fjords around Alesund. The area has some of the most magnificent scenery in the world. Two weeks later, I biked 65 miles from Harper’s Ferry to Washington D.C. I learned a lot about the John Brown raid of 1859 on that trip.
I am about to embark on another fun project: making a world-class chocolate bar. I am partnering with a chocolatier and we are traveling to Madagascar to procure beans, and then will go into the lab and make a fantastic chocolate bar. That will be super fun.
I also love to cook. A few years ago, I was a chef at a pop-up brunch restaurant. That is hard work but fun. I love to throw dinner parties and make new dishes.
I am also an avid reader. My brother, Rahm, and I trade titles we have read. We both love history books as well as great novels. I just finished “The Good Lord Bird” by James McBride about the John Brown raid. I am reading John Steinbeck’s “East of Eden”, and just started the book about Winston Churchill, “Hero of the Empire”.
One day I want to write a history book of a great, but forgotten American physician and revolutionary war hero, Joseph Warren.