Podcast 134: ENCORE Shifting the PBM Paradigm From Volume and Cost Savings to Customer Alignment, with Karthik Ganesh
Today on Health Care Rounds, we are rebroadcasting a conversation with EmpiRx Health’s CEO, Karthik Ganesh, that was originally uploaded on September 11, 2020. Karthik explains why treating the concept of value the same in health care as in a traditional retail model has led to a generally accepted volume-driven approach among PBMs — and why employers should expect more from their PBMs. He shares how EmpiRx Health, the industry’s only value-based PBM, has experienced success by focusing on alignment instead of volume and by tailoring the company’s financial proposition based on client satisfaction.
In this episode
Karthik Ganesh is the CEO of EmpiRx Health, the industry’s only value-based PBM, with a clinically focused, technology-enabled approach to bending the Rx cost curve. Prior to EmpiRx Health, Karthik was the founding operations leader of CareAllies. He is a senior health care executive with a solid track record of comprehensively scaling, transforming, and maximizing value at tech-enabled health service companies while driving dramatic before-and-after results across all facets of the organization. Karthik is recognized as a thought leader on health care, leadership, and resilience. He is a published author and has been featured in leading industry journals.
John Marchica is a veteran health care strategist and CEO of Darwin Research Group, a health care market intelligence firm specializing in health care delivery systems. He’s a two-time health care entrepreneur, and his first company, FaxWatch, was listed twice on the Inc. 500 list of fastest growing American companies. John is the author of The Accountable Organization and has advised senior management on strategy and organizational change for more than a decade.
John did his undergraduate work in economics at Knox College, has an MBA and M.A. in public policy from the University of Chicago, and completed his Ph.D. coursework at The Dartmouth Institute. He is a faculty associate in the W.P. Carey School of Business and the College of Health Solutions at Arizona State University, and is an active member of the American College of Healthcare Executives.
5:49 – 5:57 Karthik: “Just getting more drugs out there isn’t improving health care outcomes or reducing costs, but that’s the volume game.”
13:43 – 14:14 Karthik: “You’ve got employers who feel the health of their employees, and the cost of their benefits, is an either-or situation. … It shouldn’t be.”
17:53 – 17:59 Karthik: “Who’s holding the payer accountable for a value-based contract? No one is.”
20:52 – 21:19 Karthik: “Health care should be about cost, access, and value. … As an industry, we haven’t created that consumer, or the buyer’s imperative, to have a value-oriented conversation.”
27:03 – 27:09 Karthik: “Condition-oriented clinical programs have not been the right answer for a really long time.”
28:10 – 28:19 Karthik: “It’s about getting to a healthier person at the lowest price point, while making sure they feel well taken care of. Clinical, financial, service.”
33:37 – 33:45 Karthik: “In our model, if we are able to drive down volume to the most cost-effective therapies, it’s a win.”
About Darwin Research Group
Darwin Research Group Inc. provides advanced market intelligence and in-depth customer insights to health care executives, with a strategic focus on health care delivery systems and the global shift toward value-based care. Darwin’s client list includes forward-thinking biopharmaceutical and medical device companies, as well as health care providers, private equity, and venture capital firms. The company was founded in 2010 as Darwin Advisory Partners, LLC and is headquartered in Scottsdale, Ariz. with a satellite office in Princeton, N.J.