HealthChangers Podcast: Good Health is Good for Business

June 12, 2019

Time after time Americans have said their number one concern is health care. Especially the cost of health care. In this episode of HealthChangers, we'll hear from someone who is working to make health care more accessible and affordable for Americans. This innovator works for a company you might not associate with health care: it's Walmart. And his name is Marcus Osborne, Walmart's vice president for health and wellness transformation. We recently caught up with Marcus and Cambia’s CEO and President, Mark Ganz, who share a passion for making health care more consumer-centric.

Watch Video Highlights: A Conversation on Giving Health Care Consumers What They Want

The Future of Health care Looks a Lot Like Retail

Leslie Constans: Welcome to the HealthChangers podcast presented by Cambia Health Solutions, where we share real stories of health care transformation from those experiencing it, and those helping to make health care more personalized. I'm your host Leslie.

Marcus Osborne: The solution to the approach that we use today, that we think is the correct one is what I call the "balance interest paradigm" and it's very simple. The belief is that for you to create solutions that are effective, you need to make sure that all the key constituents have their interests addressed so the payers, the providers, the product manufactures and the patients, all have their interests addressed. Those who create solutions that work for all four of those groups are the best solutions.

And what I'm here to tell you today is, I think that is fundamentally wrong. At the end of the day, health care is like retail, it is a consumer only business, and the design principal we should use is the only person who matters is the individual, is the consumer, is the patient. It is the consumer only and always, and the rest of us are here to serve. As I think about that, and reflect on the reality today of health care in America, let’s talk about what is really happening. Consumers are angry in a way that is completely misunderstood and unrecognized by all of us in the system; particularly amongst political leaders.

“At the end of the day, health care is like retail, it is a consumer only business, and the design principal we should use is the only person who matters is the individual, is the consumer, is the patient.”

MO: Health care is the number one concern on the minds of Americans. It's not jobs, or the economy, or fear of terrorism, or if you believed everything that's in the press, it's not immigration. Some of those things are second or third, number one is health care. And frankly, it has been for decades. It has been one of the top concerns, if not the concern. It is consistently there. You say, well what is it that is really making consumers angry about the American health care system? It is five things. Number one, two and three, in rank, order in terms of what causes the greatest things, will sound very similar; because they are very similar. Number one, two and three are cost, cost and cost. Cost of medical care, cost of pharmaceutical care, cost of health insurance. Why is health care so expensive?

Four and five are a little bit of a departure, but they are also going to resonate. Four is why is health care so inconvenient? Why can't I get what I want, when I want it, how I want it? Why is it that I must travel so far? Why is it I must wait in a waiting room for 45 minutes? Why is it so wildly inconvenient for me? Why is it that the things that I need I can only consume when I'm having to work?

Then last, which you'll think is similar to convenience, but it is actually a very different point, it’s access. Why is health care so inaccessible? And it doesn't mean from a convenience perspective, what is meant here is, why is it so complex? Why does it feel like when doctors talk to me they might as well be speaking in another language? Why is it when my health insurer talks to me and sends me stuff in the mail, I have no idea what they're sending me? It feels intentionally more complex than it needs to be.

Watch Video Highlights: A Conversation on Giving Health Care Consumers What They Want

“Our business is simply to take care of people. We are in business to serve our customers. We are in business to bring forward solutions that address the challenges and problems facing Americans in their life and help them save money so that they can live a better, fuller life.”

MO: That is our mantra. When we say, "save money, live better" it's not "sell widgets at a lower price," it's "save money, live better." Well, save money on what? Everything that consumers need. We have our approach; we have a total focus on the consumer, and a very different sense of how that translates into returns. I would say, the way it has been very strange for me is I went to Harvard Business School and there's been several times I thought I was going to lose my degree; because, what they taught me about return on investment and discounted cash flows and net present value, is all about cash.

The orientation economically for Walmart wasn't that, it was something slightly different. It was this very different economic model, and I'll describe it to you.

It really comes in two steps. Step one is serve the customer. Help them get what they need, when they need it, where they need it, and how they want it. And step two is if you do step one well, and you have faith in that a virtual covenant exists with those you serve, then the returns that you'll get don't come from guarantees, they don't come from a contract, an obligation; but, they come from, frankly, a faith that comes from the service you provide in that relationship.

Put differently, that may seem a little too philosophical, but think about one of Newton's three laws. For every action, there is an equal and opposite reaction. Think about the Golden Rule, do unto others as you'd have them do unto you. So, there is this economic rule that says if you help a customer, they will help you. And in helping you, you will sustain, and continue to be around. That is our economic model. I'll tell you the times that I've seen Walmart when we've tried to do things where it was entirely about ROI, and we bombed. I mean really awful. But, there were times where we said "Hey, here's a problem that we are going to solve. I don't know exactly how I'm going to make money doing it, but let's just go solve for that problem and we'll figure it out."

Understanding and Responding to What Health Consumers Want

MO: Probably the greatest example of that was in the mid 80's when we said food is too expensive in America, and there are a lot of people who cannot get access to healthy produce and those kinds of things, we're going to go after food. People said, "What in the world is a discounter who sells laundry detergent and t-shirts talking about getting into the food business,” and by the way we got into it, and we created what is now, in hindsight, what we would call the super-center business. Walmart created the super-center model in the US, and­­ we had a lot of failures.

Today we sell a quarter of all the food in the United States, and it drives half of our sales in the United States from our stores. It is a wildly profitable business, because we figured it out. We serve people. What I would tell you at the end of the day, what defines Walmart, and defines our potential role in health care, or our merging role in health care, is we have a deeper understanding of the needs of consumers than anybody else in the traditional health care system. That understanding represents both our perspective and obligation, and an opportunity.

“So, there is this economic rule that says if you help a customer, they will help you. And in helping you, you will sustain, and continue to be around.”

The other thing we do represent is our mantra, "save money, live better." There seems to be an embarrassment within the health care industry to talk about price and cost. There is at times, too many discussions around abstract definitions of value, when customers just don't want to go broke trying to get the health care they need for themselves and their family. The other thing we have going for us is, at Walmart we're not embarrassed to talk about price. We talk about price all the time. We will be in rooms of people where the first thing we say is, and I'll talk about some of the things we've even described from price perspective; they want to steer the conversation away from price, and we will steer it back and say "No, what we hear from customers is that they want to talk about price, they want to figure out how to get these things they want at a lower cost, it's our job to figure it out, we're going to stay there."

Our understanding of consumers and our devotion to what they want: if they want us to talk about price, we're going to talk about price, and by we're going to fix it. That is the reality. That is what has driven us as a company to want to focus more on health care. What I'd also say is, it has been a journey. It's not one where we woke up and just said we want to be in health care. It's been a journey where it demanded reflection and understanding, but we find ourselves at an interesting point as a company, where the commitment to go bigger is completely there; because our customers demand it.

“Our understanding of consumers and our devotion to what they want: if they want us to talk about price, we're going to talk about price, and by God we're going to fix it.”

LC: That's Marcus Osborne, who works on health and wellness transformation at Walmart. After his presentation, Marcus sat down for some questions and answers with Cambia's President and CEO Mark Ganz.

What Large Companies Can Do for Their Consumers

Mark Ganz: Put on a mentor hat for a second, and mentor us for a moment. You know something about our company, you know something about our values and the direction that we're headed. What would be most important, give us your best, in terms of what you think would be the most important piece of advice you would give a company like us? Based on your experience, not just from Walmart but just in general around health care, what would you say?

MO: I would say probably the biggest advice I could give you is, as you think about how you engage with your members, and the individuals that you serve, I challenge people, based on you running your business, and when you identify these moments, in which you feel like you need to engage with a member around something. You are wanting them to do something.

Typically, you're wanting them to do something for you. Now, you think that you are wanting them to do something that is beneficial for them, but let's remember, if you feel compelled to reach out to somebody, the real reason you're reaching out to them is there's something you want them to do for you. Regardless of how you've sort of diluted yourself into believing that you are trying to help them. We've sort of challenged this, and we don't always get it right, but even if there is something you want to do for somebody, don't start there.

Look for opportunities to drive outreach where all you're asking is, "What can I do for you?" Maybe even driving outreach with no intention. The intention is you have something you are trying. How do you say, "Help me understand what you need? What can I be doing for you? How can I better serve you?” Even some of this we've attempted to institutionalize in our own customer service.

You are only asking what is that you need? What can I help you with today? Is there anything, and starting there, because when they tell you something, then as best you can go do that. Because when you go do that, when you call because there is something you want them to do, they're going to be more likely to do it. I think for us, what I would say is, it gets a sort of vanity about it, but I just don't think – I mean the data would indicate, and we sort of see this, as consumers we just don't trust the system.

We all say, "Yeah, I trust my doctor, but, not really." There's not really that deep trust. I trust this doctor graduated from medical school. That's what I trust. But I don’t really trust him in the way that I trust my mother. That is my challenge, to look for any opportunity to build that trust by having people tell you, “What is it you want me to do for you?” Then as much as you can, do that for them.

“Look for opportunities to drive outreach where all you're asking is, "What can I do for you?”

MG: I want to go over, I think what I heard you say. You talked about three things, but I heard four. You can correct me. One was, you are taking an existing platform that you have; which, are your stores, your digital, and you are taking some of the things that you've had in health care that you've tried with varying degrees of success. And your insight is, it isn't about a string of pearls, it's about how you integrate and use your platform to create an integrated experience. So that was kind of number one.

Two, was about being true to your values around pricing. And really, really, driving bold pricing that helps drive health care back to something that people can kind of grasp. And can afford. Maybe even without insurance.

MO: Yes.

MG: Third, you are focusing on, again on your platforms. Initiatives that reach out and engage people and start kind of, in a way that is non-judgmental, and not in a way that says I'm calling you because I want you to do something for me, but to invite them in.

And then four, it's about how you harness the tremendous wealth of data that you have. And really drive a more analytical approach to be able to accomplish the first three. Does that capture it?

MO: I think that's spot on.

MG: It's easy!

MO: It is easy. I think even on the pricing side, finding new approaches to sort of price things that make it easier for people to consume health care. I think that was the survey example of these kind of bundled approaches. What we're finding is people are saying, “Just give me a good price, but give me everything I want, at a good price and I'll do it.” So yes, it does feel on paper to be quite easy, but the devil now is in the details.

MG: Right. What I found was it totally resonates with what Cambia is about. Those four things are very, very similar to what we are about. We have a different platform than you, but it is really heartening to see that you are doing the good work that you are doing and your colleagues at the company are doing. I like your chances. I wish you well.

MO: Well, thank you.

LC: That's Cambia's President and CEO Mark Ganz along with Walmart's Marcus Osborne. That wraps up this episode of HealthChangers. You can find more information on more of our episodes at You can also follow us on Twitter @Cambia. Please subscribe to HealthChangers on iTunes or Stitch and leave a review. Thanks for listening.

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