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Altoona doctor Zane Gates' subscription-based Empower3 health care provider organization recently won an innovation award from a Pittsburgh employer-health care group against national competition, including a subsidiary of Google.
Empower3, co-founded several years ago by Gates and Buffalo insurance expert Patrick Reilly, provides primary care, labwork, radiology, drugs, cardiac and pulmonary testing, durable medical equipment, outpatient psychology and physical therapy to subscribers who pay a monthly fee -- and who also get access to an insurance plan to cover hospital stays and other extraordinary health care needs. All of this is a model the company says is unique in the nation, because of the extent of services covered by the subscription payment.
The key to the model's value is its coverage of approximately 80 percent of medical needs with a regular, fixed payment.
The remaining 20 percent is covered by insurance for unplanned, unpredictable events, like car and fire insurances do, but unlike regular medical insurance, according to Jordan Taradash, CEO of Spark360 of Pittsburgh, who helped with the Empower3 presentation to the Pittsburgh Business Group on Health, which conducted the contest.
The standard health insurance pattern is like car insurance covering oil changes, Gates has said.
Empower3 provides health care plans and Spark360 provides complementary health coaching through technological connections, Taradash said.
Both companies' efforts are designed around patient care, rather than revenue generation, according to Taradash.
The channeling of 80 percent of care, with an emphasis on prevention of problems, into a subscription plan, eliminating deductibles and copays, documentation, authorization, billing, rebilling, tracking of payments and various other clerical activities helps shrink administrative costs, according to Taradash, Gates and Jessica Brooks, CEO of the Business Group.
Such inefficiencies are part of the 30 to 50 percent of wasted health care expenditures, which also include inappropriate or unnecessary care and failure to obtain desired outcomes, Brooks said.
The U.S. health care system spends $1.1 trillion on administrative costs, said Gates.
"That's crazy," he said.
"Hospital administrative costs in the United States far exceed those of other nations," stated an article on americanprogress.org.
Those costs in hospitals are 25 percent of total hospital expenditures, compared to 12 percent in the most efficient of eight western nations studied, where administrative systems are simplest, according to the article.
For the semi-annual contest, the Business Group collected 30 "innovators," some based on suggestions from business members of the group, some based on consultants' recommendations, some based on innovators' applications, some identified when "we scoured the marketplace," Brooks said.
All but eight were eliminated by an initial 15-minute phone conversation, said Brooks.
At the contest "summit" in Pittsburgh, the group narrowed the field through successive 45-minute presentations to employers, brokers and consultants, 15-minute presentations to another set of brokers and employers, then a 15-minute presentation modeled on the "Shark Tank" reality TV show, in which entrepreneurs make pitches to potential investors, said Brooks.
"Empower3 is different," the group said in a news release. "(It) utilize(s) an innovative, new direct primary health care model that is disrupting and improving the way people experience care."
"We can make people's lives better," Gates said.
Mirror Staff Writer William Kibler is at 949-7038.