How Do We Engage Members? (with Rob Gelb)

This video provides an in-depth exploration of the challenges and solutions surrounding member engagement and cost containment within the self-funded healthcare ecosystem, featuring Rob Gelb, CEO of Valenz. The discussion centers on Valenz's evolution from a collection of point solutions to an integrated health plan option for small to midsize employers (150 to 1,000 lives). Gelb emphasizes the need to "simplify the complex" and overcome "point solution fatigue" by creating a cohesive, platform-based solution that offers smarter, better, and faster healthcare.

A core theme is the necessity of building "muscle memory" for healthcare consumers. Gelb argues that the industry has failed to condition members to respond efficiently in moments of crisis, often leading them directly to high-cost settings like the emergency room without considering cost or quality. Valenz aims to be the "digital front door" and the first point of contact, providing navigation tools, transparency data (leveraging the acquisition of Healthcare Blue Book), and options for care that optimize cost, quality, and utilization. The goal is to give members what they want, when they want it, through an omni-channel design (app, phone support) to guide them toward appropriate care settings.

Gelb also details Valenz’s unique approach to network building and pricing. Recognizing the limitations of traditional reference-based pricing (RBP), Valenz developed "Market Sensitive Repricing." This model moves beyond solely using Medicare as a proxy, instead triangulating reimbursement rates using multiple data sets (UCR, Rand study, bill charge averages) to determine a fair and reasonable price accepted by providers in specific geographic markets. This approach significantly reduces friction and balance billing, leading to a growing segment of "Valenz-friendly providers" who accept the reimbursement without a contract.

Finally, the conversation delves into corporate culture and the strategic role of private equity (PE). Gelb outlines Valenz’s "foundational four" culture points: simplify the complex, get comfortable being uncomfortable, spilled milk (learn from mistakes), and "yes, and" (a mechanism for inclusion and ideation borrowed from improv). Regarding PE, Gelb views it as essential capital to accelerate a vision, enabling strategic acquisitions like KISS Surgical Bundles and Healthcare Blue Book to quickly scale the integrated platform and compete effectively against larger carriers and consolidating health systems. He advises leaders seeking PE investment to focus on articulating a clear vision and strategy for capital deployment, rather than just focusing on short-term returns.

Detailed Key Takeaways

• The Problem of Point Solution Fatigue: The self-funded market often relies on 12 to 15 different point solutions, creating a management nightmare and a lack of cohesive experience for members. The strategic imperative is to integrate these solutions into a single, streamlined platform that functions like a unified health plan.
• Creating Healthcare Muscle Memory: The industry must actively train members to think differently about healthcare consumption. This involves providing simple, accessible tools and information at the moment of need (the "digital front door") to steer them away from high-cost, inefficient care pathways (like the ER) toward cost-effective, high-quality alternatives.
• Valenz's Market Sensitive Repricing (MSR): Valenz avoids traditional RBP, which relies heavily on Medicare plus a margin. MSR uses an algorithm that triangulates multiple data sets (including UCR, Rand study, and local market bill charges) to determine a fair and reasonable reimbursement rate, minimizing friction and balance billing risk.
• Strategic Use of Transparency Data: The acquisition of Healthcare Blue Book provides Valenz with the "gold standard" in transparency data. This data is crucial for prospective use (member navigation and cost prediction), concurrent use (claims processing), and retrospective use (reporting and comparative analysis), allowing for better cost control and quality measurement.
• The "Smarter, Better, Faster" Value Proposition: Instead of simply promising "cheap care," the focus should be on delivering superior value. "Smarter, better, faster healthcare" emphasizes efficiency, quality, and speed, resonating more effectively with employers and members seeking optimized outcomes.
• The Power of "Yes, And" Culture: Borrowed from improvisational comedy, the "yes, and" philosophy fosters inclusion and vulnerability within the organization. It encourages employees to contribute ideas without fear of being shut down by "no, but" or "however," leading to more robust ideation and solutioning.
• Agreement vs. Alignment: A critical distinction for leadership is understanding that agreement (the what and the why) must be coupled with alignment (the who, how, and when). Successful execution requires both parties to agree on the goal and align on the implementation process.
• Private Equity as Vision Accelerator: Private equity provides necessary capital to scale a business quickly and realize a large vision, such as building an integrated platform solution. Leaders must select PE partners who share the mission and are willing to support the long-term strategy, not just short-term financial returns.
• The Future of Competition in Healthcare: Consolidation among health systems and carriers is limiting competition. This trend necessitates the infusion of capital into innovative startups and platforms (like Valenz) to provide necessary choice and competition, ultimately benefiting employers and members.
• Focus on Foundational Four for Culture: A strong, consistent culture is built on simple, repetitive principles. Valenz’s foundational four (Simplify the Complex, Get Comfortable Being Uncomfortable, Spilled Milk, Yes and) are intentionally repeated to ensure boring consistency and clarity across the organization.

Tools/Resources Mentioned

• Healthcare Blue Book: Acquired by Valenz, recognized as the gold standard for healthcare transparency data and pricing.
• KISS Surgical Bundles (KISS Card): A specialty care solution integrated into the Valenz platform for high-cost procedures.
• Rand Study (Gloria Sa): A data set utilized by Valenz for triangulating fair and reasonable reimbursement rates in their Market Sensitive Repricing model.
• Veeva CRM: Mentioned as a leading platform in the pharmaceutical industry (Contextual relevance to IntuitionLabs, not Valenz).

Key Concepts

• Market Sensitive Repricing (MSR): Valenz’s proprietary method for determining fair and reasonable reimbursement for non-contracted claims, utilizing multiple data inputs beyond just Medicare rates to reduce friction and balance billing.
• V-Rated Stop-Loss: Valenz’s stop-loss underwriting capability (via their MGU) that offers a discounted premium (decr benefit) to plans that fully integrate Valenz’s cost containment and clinical solutions, proving the effectiveness of the integrated platform.
• Foundational Four: Valenz's core cultural pillars: Simplify the Complex, Get Comfortable Being Uncomfortable, Spilled Milk (learn from mistakes), and Yes, And (inclusion/ideation).
• Claim Cost Arc: The three phases of claims management: Prospective (before care is sought, focusing on navigation/transparency), Concurrent (during care, focusing on case management/utilization), and Retrospective (after care, focusing on payment integrity/auditing/reporting).