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InsurTech Ohio Spotlight with Kevin Schlotman

Kevin Schlotman is the COO of Flume Health, a digital platform that allows anyone to build a custom, targeted and repeatable health plan. Kevin was interviewed by Michael Fiedel, a Managing Director at InsurTech Ohio and Co-Founder at PolicyFly, Inc.

Kevin, what is the current consumer sentiment regarding healthcare?

“I'd have to say confusion at best and fear of bankruptcy at worst. The system has cowed people into blindly following the direction of healthcare providers that they barely know. Many times they see their physician for five to fifteen minutes at best, maybe two or three times a year. They're following the path that they prescribe for them simply because they think if insurance pays for this doctor and I stay in the system, my insurance will pay for the next doctor. They don't really have any insight into whether the orthopedic specialist within that practice or system is really the right person for what they need. That comes to life when we are able to identify alternatives for them to pursue relative to higher quality. When we call with advice, they think their insurance company is trying to get off on the cheap.

Self-funded plans - like most of ours - are built exclusively for the benefit of the participant - unfortunately, most people don’t understand the very significant difference between a self-funded and an insured plan. When we let people know about alternatives that will cost them less, or that may have higher quality ratings, they immediately think the insurance company is trying to get off on the cheap. Worse, it unlocks for them the fear or the knowledge that they don't really know where to find high quality care. They don't really know who they're taking their spouse or their child to. Are they the right person for what they need? There's a lot of fear and apprehension that's not just based on dollars and cents. It's based on whether or not they're getting what they need.”

To what extent should patients expect the industry to do better?

“They should demand better, but they don't know where to start. That's one of the things that we're working toward trying to do for our customers is give people the information that they need to make informed decisions. We want to give patients the tools that HSAs (Health Savings Accounts) were hoping to create back in the day and, to some extent, some of the transparency regulations that are coming online now, but those are mainly tied to costs. Providers generally have struggled with agreeing to quality standards or metrics that they're willing to embrace. The next frontier is how we can get more quality data into patient's hands, so they can make good choices.”

What technologies do you see advancing the value and capabilities of healthcare administration?

“We talk with a lot of different technology-focused, point solutions that are trying to bring unique solutions to employer groups, and many of them are very good. In fact, I've got a list, which I looked at the other day. It's over 110 unique solutions from mental health, behavioral health, musculoskeletal diabetes, elder care, etc. that want to work with employers and plans. Many of them are doing very good work, but the biggest challenge is trying to pull together solutions that are strictly complementary and don't overlap or manage the dissonance that can be created when there are similar services offered.

Patients will call us saying: ‘I know they said they do musculoskeletal, but they say they help chronic conditions. Which one does that mean?’ When that happens, you have people that will revert to what they know and drop back into the system, and then the tools aren't being used. That's the challenge. There are a lot of good tools out there, a lot of app-based programs that can deliver really good results and have demonstrated a return on the investment required. A continuing challenge with the industry is going to be coordinating those and making sure people understand what they need, at the right time, and getting them in touch with that solution. The second piece, and I don't think people are talking about this... One of the, if you want to call it a silver lining of the pandemic may be the acceptance and evolution of telemedicine.

It's really driven by Medicare's ability to reimburse telemedicine claims because of the pandemic. We didn't want people to go into the doctor's office - for obvious reasons. That presents a huge opportunity to leverage the acceptance from the patient's perspective of talking to a doctor via zoom. What we're working toward is identifying solutions to get the best provider and the patient connected, especially when there are very high cost chronic, catastrophic diseases that have been diagnosed. We're talking about cancer. We're talking about M.S. Why not fly the patient for a consultation to Los Angeles or Minnesota or Houston or New York to see the provider that specializes and is the best in the world at treating their specific condition? Then manage it remotely via telemedicine through physicians that are the right type of specialists locally to help them go forward. I think there's a huge opportunity to deliver fantastic outcomes for people that are untapped.”

What does the future of healthcare administration look like? Is there a way in which you and Flume like to characterize what healthcare administration should look like at a high level?

“I'll start with what may not be terribly insightful. We're going to continue to adopt new technologies to make our platforms more efficient. We're going to look to identify artificial intelligence tools that allow us to find errors and claims before payment, rather than pay and chase providers for mistakes. Whether that's using APIs, web hooks, or other ways, we can do that more quickly and efficiently. More importantly, the demands are starting to come from employers. What we're starting to see is demand for agile platforms that can do things differently, meaning that it can integrate with the point solutions that we discussed and truly bring those point solutions into the fabric of the plan operations so that people can leverage them.

If you don't get utilization of the solutions offered, then the investment is worth nothing, right? Health systems, and even insurers, are witnessing a movement coming from larger employer groups that want to do unique things relative to benefit plan design and relative to how they integrate with point solutions that exist in the market, but the legacy systems can't handle. The programs that are running on mainframes with spaghetti code cannot be flexible enough to integrate and deliver some of these targeted point solutions that may require plan designs intended to engage underserved populations or individuals with unique disease conditions. We can do all of that because we're focused on technology today, and we have a much quicker and more agile way to deliver solutions based on our technology that a legacy system just can't make happen in anything short of three years. That's where some of the interest is coming from. Large employers, maybe even public entities as big as states or counties, are looking for unique solutions because they've got the same problems as private employers. But, most of the legacy players are finding it difficult to deliver.”

Does Flume feel like the industry is ready for the strategy that you are driving toward, or is the industry still playing a lot of catch up even in its intention to change?

“It depends on who you talk to. There are plenty of people that are trying to drive change in the industry. They don't have market share; they don't have names behind them. What we are seeing is inbound interest from organizations that understand something has got to give and something has to change. We need to break the current model of networks and hospitals that claim to be fighting each other but really are working together to maintain the opaque system that exists. The short answer is, yes. The organizations that have market share that they want to protect will move more slowly. Things are changing because everyone acknowledges that they have to.”

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