Company Thinks It Has Answer for Lower Health Costs: Customer Service

Virginnia Schock seemed headed for a health crisis. She was 64 years old, had poorly controlled diabetes, a wound on her foot and a cast on her broken wrist. She didn’t drive, so getting to the people who could tend to her ailments was complicated and expensive. She had stopped taking her diabetes pills months before and was reluctant to use insulin; she was afraid of needles and was worried that a friend’s son, a drug addict, might use her syringes to inject them.

She was, however, able to make a phone call. And one day in October, in the offices of Iora Primary Care in Seattle, Dr. Carroll Haymon and Lisa Barrow, a “health coach,” huddled around a speakerphone, talking to her. Ms. Schock had recently become a patient of the practice, and the three discussed her problems — personal, financial, logistical — for nearly 45 minutes. At one point, Dr. Haymon asked why Ms. Schock had stopped taking her diabetes medication. The pills, Ms. Schock said, were too big, and they stuck in her throat.

“We can talk to the pharmacist,” Dr. Haymon said, gesturing for Ms. Barrow to add that to her list of follow-up actions. Ms. Barrow did and was able to find a version of the drug in a smaller size.

That kind of small change can make a big difference in a patient’s health — what good is the perfect drug if the patient can’t swallow it? — but the extra-mile work it took to get there can be a challenge for the typical primary care practice in the United States. Harried by busy schedules and paid on a piecework model, many doctors rush from visit to visit, avoid phone calls and emails that don’t generate payments, and often fail to address the complex social issues that hamper people’s health.

This misalignment of financial incentives is a huge problem for patients, who often can’t get the care they need. But it’s also a big economic problem. The United States has the costliest health care system in the world, even as many patients suffer from preventable illnesses and die younger than their peers in other countries. The system is so full of inefficiencies that Americans are often sicker even as everyone — patients, insurers, the government — ends up spending more money on care.

Iora thinks it may be able to solve both problems and make money doing so. Its business model is meant to keep patients like Ms. Schock out of the hospital by improving service while earning a dividend on the expensive care it was able to avoid.