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Hello, everyone. This is Jacob Emerson with the
Becker's Payer Issues podcast.
Thanks so much for tuning in today where
we're joined by Curative's CEO, Fred Turner. Fred,
thanks so much for taking the time to
be with us on the podcast today. Thanks
for having me on.
So, Fred, before we dive into everything we
wanna talk with you about and we wanna
hear more about Curative, Can you tell us
a little bit more about yourself
and your background within health care?
Yes. I'm, British originally.
Born and raised in the UK, but been
out in the US for
over 10 years now. Originally got started in
health care in the in the lab industry,
actually doing a high throughput
STD testing and screening for antibiotic resistance,
in STDs.
And then,
that was my first startup company and, actually
was was trying to get out of the
lab industry and
into,
taking on risk in, in sepsis patients to
try to improve outcomes. That was the very
first version of Curative
at the very beginning of 2020.
Got sucked back into the lab world with,
COVID 19 testing and
helping scale up the COVID 19 testing efforts.
And that was, what we call curative 1
point o,
And then, obviously, now onto the the payer
side with the curative health plan.
Yeah. Absolutely. And, you know, some of our
listeners
might not be familiar with that transition journey.
So can you talk to us a little
bit more about that, the company more broadly?
When did you get started?
Can you explain the the transition from COVID
testing company to a health insurer? And then
who are you serving today? What kind of
membership do you have, and what are the
markets that you're in? Yeah. Absolutely. So we
actually when Curator was first founded in January
of 2020, we were, as as I say,
working on sepsis outcomes, and we had a
pilot set up with a hospital in Wisconsin.
And
we're kind of excited to to try and
move that forward. And we we managed to
do it for over about 6 weeks until
COVID hit and closed down,
any external clinical trial partners at that hospital.
And so we thought, you know, maybe we
can help with this testing thing for a
few weeks until it all blows over.
Obviously, it lasts a little longer than that.
We ended up scaling the company from 7
to 7000 employees in the 1st 12 months.
Ultimately, grew it to, to do about 10%
of all US,
PCR COVID tests.
We operate across all 49 states, 3636,000,000
tests. We're everywhere apart from Hawaii.
So it was
a very sizable business,
but, obviously, you know, it was a very
much a short term need. And we
serve that short term need, but then recognize,
you know, this is not a a long
term need. And so even from the beginning
of kind of 2021,
we were focused on what comes next.
And we looked at a a number of
different things, you know, some stuff in the
lab industry. We actually briefly looked at buying
a hospital,
kind of similar to what General Catalyst is
is now doing,
with their acquisition of a health system and
kind of trying to infuse it with tech.
Ultimately decided not to do that
and decided that there is a gap in
the market in the commercial health plan space,
where the other players are generally focused on
Medicare or Medicaid and not really on actually
trying to bring any innovation to the commercial
health plan space,
particularly on the fully insured side.
So the curative health plan, it's a large
group employers,
51 FTEs and up, that we serve.
Currently,
we work with employers that are headquartered in
either Texas, Florida, or Georgia.
Fantastic. So it sounds like massive growth during
the pandemic, then a switch to health insurance,
within these last few years.
Fred, you you you touched on,
the the lack of innovation, as you say,
within the commercial insurance space. And as you
know, this this industry is is very dominated
by a few powerful players, really only a
handful of,
companies nationally, and it's a very highly regulated,
a very difficult industry to enter in as
a new company. So talk to us a
little bit about what you're telling employers, what
you're telling individuals
about why they should choose and and take
a bet on Curative versus
some of these more ingrained health plans that
that probably offer, you know, much larger larger
provider networks and things like that?
Yeah. It really comes down to, do you
want to invest in actually keeping your employees
healthy
and maintaining the health of your population and
managing their cost long term?
Or you focused on,
you know, putting up the deductible and getting
a short term win when people skip all
of their preventative visits, but having ever increasing
health care costs long term and being hit
with a 20% renewal every year. You know,
and that's really what we're trying to fight
with the curative health plan. So
one of the the issues that we identified
in the market is the rise of high
deductible health plans,
and the effect that that's having on
the care that members are seeking. You know,
obviously, the idea with the high deductible plan
is that a member will be an informed
consumer, and they'll they'll go and shop for
the best prices, and they'll only get high
value care.
Unfortunately,
it it just doesn't really bear out in
reality.
And, generally, what happens is members actually just
avoid,
all
care, including and especially preventative care. They skip
their colonoscopy. They skip their mammogram. They don't
go get their checkup because you're charging them
money to go do that.
It's just one more excuse for them to
avoid that engagement that you actually really want.
And so
an increase in cost sharing tends to save
money in the 1st plan year because you
don't get those claims for those preventative services.
So you save a little bit of money
in the 1st year, but by the 2nd
year, you're already seeing that catch up with
you. What could have been a primary care
visit is now an emergency room visit. You
know, what could have been a specialist visit
is now a week long hospital stay.
And so you actually start to see your
claims cost go back up again. And then,
generally, by the 3rd year, claims cost will
be actually above where they would have been
if you hadn't put that cost sharing in
place.
The problem is 3 years is kind of
a long time horizon. So you get to
end of 3 years, and employers say,
what did we do last time our health
care costs increased?
Oh, we put up the deductibles. And that
worked last time, so we should do that
again. And you kinda get caught in this
spiral of just passing more cost off onto
members,
driving, greater and greater patterns of care deferral,
and getting the population
basically sicker and sicker because you're not getting
that engagement. You're not managing chronic conditions.
You know, you're not getting members into care
at the appropriate time. You're waiting for something
to go catastrophically
wrong and then paying for the hospital claim.
So we're trying to do that very differently
with the curative plan.
All members have no out of pocket cost
for the first 120 days.
And then during that 120 day window, they
have to complete what we call a baseline
visit.
It's a mix of an onboarding to the
health plan with a preventative,
health visit. It's done with our staff. It
takes about an hour. And as long as
you complete that baseline visit, you continue to
have no out of pocket cost for the
whole plan year. So no deductibles, no co
pays,
no coinsurance,
$0 out of pocket for any in network
services. You can see your PCP. You can
have a baby. You can get cancer care.
It'll be $0.
But if you don't do your baseline visit,
on the 100 and 21st day, you will
revert back to a $5,000
deductible and 20% coinsurance.
So it's a big $5,000
carrot and stick to actually engage just once
a year
in your own preventative health. And we find
that is very effective at driving member engagement.
We get about 98% of our members
actually engage and complete that baseline visit.
And that's really the first step in their
journey to reengaging with the health care system
and actually managing their health proactively.
And so through that, we're able to
significantly
reduce,
those unnecessary and preventable hospital visits.
We actually
are running about 30% below a Milliman well
managed benchmark in terms of inpatient admits and
inpatient bed days.
And all of that comes down to engaging
members early, getting them into primary care, getting
them to take their medications,
all of the basic stuff that we know
works. But doing that scale across 98% of
your population,
you can actually keep people healthy and decrease
your long term health care costs as an
employer.
Wow. I mean, that's fascinating to hear hear
you take us through that in some of
these numbers you're seeing, especially around the the
baseline
visits.
I imagine no co pays, no coinsurance, no
deductibles is is very enticing,
to to many employers. So fascinating to hear
about, Fred. And and how many total members
are you at now with the company?
We're at about 55,000 members now. Wow. Amazing.
So you you just announced an expansion
into Georgia in August.
What's the strategy behind that? Why are you
going into Georgia, and and where are you
operating right now?
Yeah. So right now, the majority of the
business is in Texas. That was our first
market. We launched in Florida at the beginning
of this year. So we are now starting
to see some really good traction,
in Florida and seeing a lot of growth
out of that market. For us, you know,
we we want to be a national payer.
We want to, you know, eventually be across
all 50 states.
Obviously, we wanna grow
at a responsible pace.
And so, you know, it's gonna it's gonna
take us some time to be, to be
national,
but it's really for us focusing on where
our employer is headquartered.
We already have members across all 50 states.
You know, we have members everywhere,
who work for employers that are headquartered out
of Texas or Florida. So for us, Georgia
was the the logical next step
where, you know, there are a lot of
employers based there.
And
for us,
the speed to, to launch was, was relatively
quick. Sort of a similar regulatory framework to
what we see in Texas and Florida.
Sure. Absolutely. And are are you finding that
employers are coming to you,
wanting to offer health benefits for the first
time, or are a majority coming to you,
having a traditional health plan with some of
these big players and and wanting to reduce
their costs? What's kind of the shake up
there?
Yeah.
Most of the time, we're replacing, like, a
Blue Cross or United, right, a Bruker plan
that they're currently
offering. Understood. Makes sense. Alrighty, Fred. Well, what
else are we missing? You you have the
ears of a lot of health plan executives
from all over the country right now. So
any final thoughts or or bits of advice
you'd wanna offer before we go today?
I think, you know, one of the the
biggest things is people need to be willing
to to try something new if we wanna
get a different result. Yeah. This is one
of the biggest things we face with employers
is
they
are upset when the deductibles keep increasing and
they get a 20% rate increase every year,
but they're not willing to do something different.
Right? If you I think Einstein's definition of
insanity, right, was doing the same thing again
and again and expecting a different result.
If we want to change the outcome, we
have to be willing to change what we're
doing.
Fantastic.
Fred, thanks so much for taking the time
to sit down with us, and for sharing
your insights with our listeners. We truly appreciate
it. Absolutely. Thanks for having me on. If
you'd like to listen to more podcasts from
Becker's Healthcare, you can visit beckershospitalreview.com.