Humana Primary Care Clinics Boost Senior Patient Care Access

Humana’s subsidiary Partners in Primary Care is entering a joint venture with Welsh, Carson, Anderson and Stowe (WCAS) to give Medicare Advantage members access to care through value-based primary care centers.

“Partners in Primary Care is well-positioned to meet the health needs of the growing senior population with our integrated primary care platform. Our integrated, whole-person, value-based care model comprehensively and proactively addresses chronic conditions, wellness and social determinants of health. We bring a differentiated offering and experience to seniors, often in areas where access to primary care is limited,” said Renee’ Buckingham, segment president of Humana’s Care Delivery Organization.

The partners are investing $600 million in the new company, in which Humana will have a minority stake. While WCAS is the majority owner, the payer is on a five- to ten-year path toward full ownership.

Having WCAS as a partner will carry Humana through the J-curve, explained Brian Kane, Humana’s chief financial officer, on Humana’s fourth quarter 2019 earnings call.

“There's a significant J-curve in these clinics, meaning that for the first few years, they lose money. And then over time, they begin to make money and actually earn a nice return on investment,” he explained.

Capital from WCAS should help provide the funding to scale the model, Kane said.

Some question why Humana would choose a different path than its competitors, which buy out practices and turn them into primary care centers instead of starting new centers from scratch.

But Humana experts responded on an earnings call that trying to convert primary care centers into Medicare Advantage value-based care models is high risk. The Humana model has been successful in smaller markets based on the star ratings, they argued, and this new venture is about scaling up that success.

The centers are payer-agnostic and are particularly built to expand access to care for seniors.

Although some providers may come to the practice with their own patient panels, Humana anticipates that the care centers will mostly draw providers who are looking to adjust course toward a more value-based care model and will be starting from scratch.

While the providers may not have a full patient panel, Humana expects that they will attract a sizable consumer base by locating these centers in areas where Humana becomes the “community option” based on affordability and options.

With those limitations and advantages in mind, each clinic could draw anywhere from 1,500 to 2,500 risk members depending on the location, Kane projected on the earnings call.

Over the span of three years, the partnership will increase Partners in Primary Care’s footprint of 47 current senior-focused primary care centers to at least 97 centers. 

The partnership aims to simplify the patient experience in healthcare and increase connectivity. To achieve that goal, Humana will interweave its network of market-leading partners and its own primary care services.

“We are excited to accelerate our growth through our partnership with WCAS,” said Buckingham. “Together, we will be able to make this model available to more seniors and in more communities.”

Primary care centers like these, as well as retail health clinics, allow payers to control members’ out-of-pocket spending and expand access to care. Payers also say they turn to these models in order to simplify the patient experience through more integrated care.

Often, payers will join forces with a pharmacy that has a large footprint in order to get a foothold in hard-to-reach communities.

For instance, Humana’s Partners in Primary Care has also partnered with Walgreens in 2018 to design primary care centers that operated for Humana Medicare and Medicare Advantage beneficiaries. 

Similarly, in 2019 UnitedHealthcare started Medicare service centers that provided added benefits for UnitedHealthcare Medicare Advantage members. UHC’s service centers launched in collaboration with Walgreens and AARP.

While parallels can be drawn between Humana’s primary care centers and retail health clinics, it is important to note that the joint venture with WCAS would not be categorized as a retail health clinic. Not only is the model not tied to retail,  but it also serves a specific population in its focus on seniors, will most likely serve a broader variety of health conditions than a retail health clinic, and it is entrenched in a value-based care model, which is not necessarily true of a retail health clinic.