VālenzONE: A Deep Dive Into Optimized Healthcare | with Rob Gelb

This video provides an in-depth exploration of VālenzONE, a "health plan optimizer" designed to address the complexities and rising costs within the self-funded employer healthcare market. Rob Gelb, CEO of Vālenz, discusses the company's evolution from a collection of acquired point solutions to a fully integrated platform, emphasizing a proactive, data-driven approach to healthcare management. The conversation highlights the critical need for innovation in a system often perceived as broken, advocating for a shift from reactive "sick care" to early engagement and comprehensive risk management.

Gelb details Vālenz's journey, starting with its foundation as loosely affiliated acquisitions in out-of-network negotiation, care management, and a unique payer/provider technology business (Zebu Compliance Solutions). The company recognized "point solution fatigue" among its customers, who were struggling with integrating multiple vendors. This led to a strategic pivot to become a unified "platform and chassis," integrating diverse solutions to offer a single, cohesive ecosystem for employers, TPAs, and carriers. The core vision, "simplify healthcare," aims to make the system easier for all stakeholders by improving data sharing, integration, and member experience, ultimately driving down costs.

A significant portion of the discussion focuses on the philosophical underpinnings of VālenzONE, particularly the concept of "engaging early and often." Gelb argues that traditional healthcare is largely "sick care," reacting to acute situations rather than preventing them. VālenzONE seeks to reverse this by proactively educating members about their healthcare options, benefits, and cost-quality equations, even during open enrollment. The company leverages tools like the acquired Healthcare Blue Book (now Vālenz Blue Book) and outbound member engagement teams to guide individuals toward smarter healthcare choices, including surgical bundles and Centers of Excellence. The conversation also touches upon the broader societal issue of public health, linking obesity to chronic diseases and advocating for a focus on creating healthier human beings to reduce overall healthcare system interaction.

The video also delves into the critical role of stop-loss insurance, reframing it as a financing option that should be integrated with plan design and risk management. Gelb criticizes the current approach where stop-loss is often considered after plan design, arguing that understanding claims data and proactively managing risk should inform stop-loss decisions. He introduces the "four Ps" framework—Payer, Provider, Patient, and Plan (Employer)—emphasizing the need for balance and alignment in cost, quality, and utilization across these stakeholders. Looking to the future, VālenzONE is presented as an alternative that could eventually lead to the "dissolution of a network" model, leveraging publicly available data and AI to direct care to cost-effective, quality providers, and advocating for collaboration with large carriers to modernize the system rather than fighting it.

Key Takeaways:

• Addressing Point Solution Fatigue: The healthcare market suffers from a proliferation of disconnected point solutions, leading to integration challenges and administrative burden for payers and employers. A unified platform approach, like VālenzONE, consolidates services to offer a more cohesive and efficient solution.
• Proactive vs. Reactive Healthcare: The current system is largely "sick care," reacting to health issues after they arise. Innovation is needed to shift towards proactive engagement, preventing catastrophic situations through early intervention and member education.
• Data-Driven Cost Containment: Leveraging millions of data points is crucial for identifying cost drivers and implementing effective cost-saving solutions. Analyzing claim data allows for targeted interventions that significantly reduce health plan spend for self-insured employers.
• The "Claim Cost Arc": Effective healthcare management requires engaging members prospectively, at the front end of their healthcare journey. Failing to do so leads to increased retrospective spend, pushing costs "up and to the right."
• Early Member Engagement is Key: Tools like engagement apps and outbound member engagement teams are vital for educating members during open enrollment and guiding them to understand their benefits, cost-quality equations, and available care options (e.g., surgical bundles, COEs) before they make healthcare choices.
• Redefining Stop-Loss: Stop-loss insurance should be viewed as a financing option integrated with plan design and risk management, not an afterthought. Understanding claims data and actively managing risk should precede stop-loss decisions to optimize financing.
• The Four Ps Framework: Balancing and aligning the interests of the Payer, Provider, Patient, and Plan (Employer) is essential for creating a functional and equitable healthcare system. Discontent arises from disconnect and misalignment of incentives among these stakeholders.
• Evolution of Network Models: The traditional contracted network model may be reaching its utility limit. Future healthcare could involve the "dissolution of a network," with care directed based on publicly available cost and quality data, potentially parsed by AI, allowing members to access any provider.
• Pharmacy Benefit Management (PBM) Challenges: Pharmacy costs, driven by high-cost drugs like cell and gene therapies and GLP1s, are a major concern. Solutions like 340B programs and greater transparency/integration of data with PBM partners are critical for cost reduction.
• Risk Management in Healthcare: Commercial group health often overlooks proactive risk management. Employers and consultants should prioritize strategies to drive down the group's health risk profile, as this directly impacts stop-loss pricing and overall plan costs.
• Innovation through Collaboration: Rather than viewing large carriers (BUAs) as adversaries, the industry should seek partnerships to modernize existing models. Collaboration can help integrate innovative solutions into broader healthcare offerings.
• Culture and Talent Attraction: A strong company culture built on purpose, pride, transparency, and psychological safety is crucial for attracting and retaining top talent. Empowering employees with "room to roam" fosters innovation and commitment.
• Embracing Discomfort and "Spilling Milk": Innovation is an iterative process that involves making mistakes and learning from them. Partners willing to "get comfortable being uncomfortable" and collaborate through trial and error are essential for driving progress.

Tools/Resources Mentioned:

• Zebu Compliance Solutions: A technology business acquired by Vālenz, focused on payer and provider side billing, licensing, and credentialing.
• Healthcare Blue Book (now Vālenz Blue Book): An acquired company providing real-time member engagement to help understand cost-quality equations and care options.
• Engagement App: A proprietary application used by Vālenz to touch members sooner and provide healthcare information.
• 340B Option/Solution: A program offered by Vālenz to help drive reduced pharmacy expense.
• Saiia (Self-Insured Institute of America): A conference mentioned where Rob Gelb engages with customers and scans the market.

Key Concepts:

• Point Solution Fatigue: The overwhelming challenge faced by employers and payers in managing, integrating, and maintaining multiple single-purpose healthcare vendors.
• Platform and Chassis: Vālenz's strategy to integrate various point solutions into a unified system (platform) that can also layer on new capabilities or partner solutions (chassis).
• Aspirational vs. Perspirational: A Vālenz internal vocabulary distinction, referring to what the company wants to be (aspirational) versus what it does today (perspirational). The goal is to talk about the future to inspire innovation.
• Wayne Gretzky's Dad Analogy: "Go to where the puck's going to be," meaning anticipating future needs and positioning the company to solve them.
• Simplify Healthcare: Vālenz's vision to make the complex, messy, and convoluted healthcare system easier for everyone through better integration and data sharing.
• Claim Cost Arc: A conceptual model illustrating that if healthcare costs are not managed proactively at the front end, they will inevitably rise retrospectively.
• Cardio-diabetes and Cardio-obesity: Terms used to highlight the interconnectedness of obesity, diabetes, and cardiac issues, emphasizing the need for holistic health interventions.
• The Four Ps: A framework (Payer, Provider, Patient, Plan/Employer) used by Vālenz to ensure balance and alignment in the cost, quality, and utilization equation of healthcare.
• Frenemies: The concept of collaborating with competitors in certain areas where there is mutual benefit, even while competing in others.
• Room to Roam: A Vālenz internal philosophy encouraging employees to have the freedom and time to explore ideas, connect, and contribute beyond their immediate tasks.

Examples/Case Studies:

• Vālenz's Acquisition Strategy: The company's initial foundation was built on acquiring businesses like United Claim Solutions (out-of-network negotiation), Inetico (care management), Zebu Compliance Solutions (payer/provider tech), and NX Health Networks (high-performance network contracting).
• RBP (Reference Based Pricing): Discussed as an example of an idea that moved from curiosity to adoption to widespread acceptance, but then revealed "spilled milk" (problems) that now require further innovation.
• Homeowners Insurance Analogy: Used to illustrate the over-insurance of routine healthcare costs, comparing it to using homeowners insurance to pay for utility bills or lawn care, which drives up premiums unnecessarily.
• Coca-Cola Analogy: Used to explain transparency and competition, stating that while all ingredients are listed on a Coke can, no one else can replicate it exactly. The differentiator is "how you do it," not just "what you do."