In preparing for my trip from San Diego to San Francisco to cover the 33rd Annual JP Morgan Healthcare Conference, see: ‘JPMorgan Healthcare Conference 2015: 33 Years Later We’re Still Searching…’ I’ve been speculating about the broader investment themes that many in the life sciences, biotech and pharma investment banking space may NOT be pondering given prevailing quarterly or year over year EPS event horizons.
In the post Affordable Care Act (ACA) era and with the ‘repeal and replace’ crowd chants notwithstanding the strategic imperative has not – and will never – change. The ‘all in’ from a total cost of care perspective pursuit of the ‘triple aim’ (better care, better outcomes, lower per capita costs) MUST be the ‘holy grail’ of any and all relevant investment themes valuing the quest for a sustainable public/private healthcare economy. Unfortunately too many niche market ‘exit calculations’ still seek to extract returns from a collapsing, volume incentivized – if not ‘burning platform’.
Whether the ACA is repealed or not (highly unlikely) its underlying value basis with a focus on population health and accountable care – including all of it’s derivative expressions (patient centered medical homes, patient empowerment via digital health technologies, pricing transparency plays, etc.) will remain the forward operating vision and quest of the day – if not decade.
In 2013 I focused on one publically traded company Universal American’s (UAM) ‘Healthy Collaboration’ ACO business model, see: ‘Universal American: A Healthy Collaboration’ and followed that post in 2014 with ‘Universal American: A Sign of Things to Come?’. As a reporting company their operating results would be useful to gage the progress towards ‘accountable care’ from a representative national and for-profit operator.
Before scanning the agenda for JPM15 presenting companies, I tweeted:
Gregg Masters @2healthguru
Curious if Universal American will report #ACOs or MA plans at #JPM15. 2013 session here: bit.ly/1g4CKZ5 pic.twitter.com/cs8eXMCdn4
Then upon determining they were not on the schedule this year I reported the ACO Revenue result sourced from their Q3 10Q 2014 filing:
Gregg Masters @2healthguru
RE: UAM ‘ACO Revenue’ #JPM15 pic.twitter.com/pgnd8QzQBb
To wit, Fred Goldstein (@fsgoldstein) the principal at Accountable Health LLC and Executive Director at the Population Health Alliance (PHA) ‘sarcastically noted:
Fred Goldstein @fsgoldstein RT @2healthguru: RE: UAM ‘ACO Revenue’ #JPM15 pic.twitter.com/VcnxmEF1mn …. Not bad 10% achieved shared savings he said sarcastically..#ACO
So, what does it mean if anything? We shall see if this is an artifact or non-appearance for perfectly reasonable causes, i.e. perhaps as banal as UAM no longer banks with JP Morgan, or maybe it’s a purposeful retrenchment by UAM leadership to not have to explain away their inability to perform on the ACO strategy.
Your thoughts?
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