PROVIDENCE – The bookshelves are still empty, for the most part, in Anya Rader Wallack’s office on the second floor of 1 Weybosset Hill on Broad Street, the headquarters of HealthSouceRI, where she is the agency’s new executive director.

The office has the appropriate look of a recently arrived new occupant, one in transition.

Wallack, one of the first appointments made by incoming Gov. Gina Raimondo, is part of the new governor’s efforts to reshape and shake up the bureaucratic leadership in Rhode Island’s state government.

Wallack replaced Christine Ferguson; former Lt. Gov. Elizabeth H. Roberts replaced Steven Costantino at the R.I. Executive Office of Health and Human Services; and Maria Montanaro replaced Craig Stenning at the R.I. Department of Behavioral Healthcare, Developmental Disabilities and Hospitals, among others.

On a recent cold January morning, ConvergenceRI sat down to talk with Wallack, one-on-one, about her plans for HealthSourceRI, an agency that has been in the crosshairs of a larger philosophical debate about the future of health care in Rhode Island – and the nation.

Wallack comes to the position from Vermont, where she had been managing the $45 million State Innovation Model. She had also been involved with Vermont’s efforts, recently abandoned, to create a single-payer system.

She is a resident of Little Compton, and she and her husband, Stanley, a professor at Brandeis University, run a consulting firm, Arrowhead Health Analytics, in Fall River, Mass.

Just Wallack’s association with Vermont was enough to have Mike Stenhouse, the CEO of the ALEC-backed Rhode Island Center for Freedom and Prosperity, hyperventilating to Kate Nagle at GoLocal, voicing his paranoid fears that Wallack’s appointment would mean that HealthSourceRI will become “a single payer socialist takeover for the entire health care industry” in Rhode Island.

When the New York Times reported on the relative success of HealthSource RI’s enrollment strategy, asking its customers to re-enroll and choose a health plan, it also precipitated the expected pushback from Sean Parnell of the Heartland Institute, another ALEC-backed group, which has also fought against tobacco regulation and against the idea of climate change. Parnell challenged the idea of HealthSourceRI’s success, a view that WPRO’s Gene Valicenti gave airtime to.

Wallack said she couldn’t comment on the attacks. “I don’t have enough knowledge about their motives and modes of operation to make a judgment,” she said, in a very politick answer. “I don’t know them.”

For Wallack, her task ahead is straightforward.

“Clearly, sustainability is one of our biggest challenges. How do we make sure that this [agency], when the federal funds go away, that it can continue to exist and provide value for Rhode Island,” Wallack said, in response to a question of the challenges she faces.

In terms of the larger list of challenges, she continued, “We need to get to the point where the exchange is a really well-oiled machine, providing excellent customer service. Providing value, retaining customers, attracting new customers.”

For those that question the value of HealthSourceRI continuing as a state-run exchange, Wallack, in her straight-ahead, no-nonsense, direct approach, with a strong command of the analytics behind the numbers, may prove to be a formidable opponent.

ConvergenceRI: How would you define health innovation?
WALLACK: I assume you’re asking about work that I’ve been involved with in the past.

ConvergenceRI: Yes and no. I have written about the idea of mapping health innovation – as a way of integrating health, health care and innovation into the broader conversation around economic development in Rhode Island.
WALLACK: To answer the question, I’ll go really broad. I think health innovation is about changing how health care is delivered, so that it’s more efficient and effective, but it’s also about trying to affect health, rather than just health care.

On one hand, if we were to have an excellent, high-performing health [care delivery] system, it would be focused on more broadly affecting the factors that influence the health of the population. Not just on how we do when a sick person shows up at the door of a hospital, and do we have the most efficient process of getting them in and out.

ConvergenceRI: Including investments in the front-end of the health care delivery system?
WALLACK: Within the health care delivery system, there are all [kinds] of evidence that there is tremendous waste and inefficiency. That’s one data point I don’t think anyone will argue with: there is significant waste and inefficiency and room for improvement in cost, quality of service, and patient experience. Working on changing the health care delivery system itself, whatever range of services it is providing, as well as cost, there is lots of opportunity [for improvement].

ConvergenceRI: In that context, do you think there would be value in mapping health innovation in Rhode Island, as part of the state’s economic development planning, moving forward?
WALLACK: Tell me what you mean.

ConvergenceRI: There is Blackstone Valley Community Health Care, which has the most sophisticated use of health IT at the point of care in Rhode Island, which has enabled it to bend the medical cost curve by $12 million over the past four years. There are health equity zones, an investment in the front-end of the health care delivery system, at the community level. There are efforts to establish guidelines for toxic stress, to identify it, to diagnose it, and to then refer patients for treatment. There is a stream of about $250 million a year flowing into the state’s academic research centers in the biomedical industry sector, helping to spur an emerging innovation ecosystem. For the most part, no one knows what is happening. It has not become part of the conversation.
WALLACK: One of the issues that you are pointing to, which frustrates me, is [the fact that knowledge] about innovation in health care is not diffuse. Because organizations exist in silos, or whatever metaphor you want to use.

And, so those kinds of really good innovations don’t diffuse out into the world. For whatever [reason], we’re not capturing the innovation and making sure that it spreads – whether it’s for understanding the impact to the economy and jobs or the impact on health care, or whatever metric you want to use.

ConvergenceRI: The latest numbers from HealthSourceRI on re-enrollment look great. Congratulations.
WALLACK: They are, but I can’t take credit for them, because I walked in the door at the end of the process.

ConvergenceRI: The latest numbers appear to support the idea that consumers, when supported with the tools and the necessary transparent information, can make really good informed decisions. Do you believe that’s true? Is that what the numbers show?
WALLACK: I’ll start at the end. Is there more to do? Absolutely. Do I believe that there is power and potential in providing information to consumers, structuring choices so that they’re clearer? Absolutely.

Anyone who has ever shopped for health insurance in the past… [Wallack pauses] Actually, in my [consulting business], I had a woman working for me when I first started up, who needed to get health insurance. She had a master’s degree in public policy. [I asked her], please assess all our options, and please bring me a sheet that assesses all our options.

Here we are: She’s well schooled in this stuff; I’m well schooled in this stuff. In the end, we look at it and both say, I don’t know what to do. You kind of [had] to make a random choice.

So, clearly, the way that we’ve structured information and choices for consumers in the past has tremendous potential for improvement.

Whether the numbers we see here at HealthSourceRI are a demonstration of people getting attracted to the exchange because they’re able to make choices differently, I don’t know yet. I think that’s something we’ll have to explore over the coming year: what pulls people in, what is it that makes this a good experience for them, what is it that will help us to retain customers.

ConvergenceRI: Will you be conducting research to quantify that?
WALLACK: I hope to, yes.

ConvergenceRI: An executive at one of Rhode Island’s insurance firms was quoted recently as saying that employees prefer not to have choices, that it’s better for employers to limit choices. How do you overcome that attitude?
WALLACK: A legitimate balance has to be struck between choice, which is good, and too much choice. There’s a lot of research around it, that if you give people a reasonable range of choices, and structure the information about their choices well, they become more active consumers, they make well-informed choices. If you overwhelm them with information, that often fails.

In the literature, you’ll find a lot of research on this. In Massachusetts, there was an interesting experience in the first year of their exchange. They had many more choices in the context of the employer side. Then they did research focus groups, to figure out how consumers actually felt about the choices that were presented, and they decided to skinny back on the number of choices people were presented with, because people felt it was too much.

Here in Rhode Island, in terms of the employee choice issue, it’s clearly very popular, with 77 of our employers choosing the Full Choice option, so clearly, they like it.

ConvergenceRI: What does that tell you?
WALLACK: I think what we know is that employers [that have enrolled through HealthSourceRI] are overwhelmingly in favor – in the context that we have something like 400 businesses [enrolled] in this. That’s still a relatively small number of businesses, but they seem to like the Full Choice option, the employees seem to like having choices. [I need to] work through and gather information about where do we go from here.

One of the things I would like to learn more about it this: what is the experience of employers, and what is the experience of their employees, in terms of choice options, and is it working out well for them.

ConvergenceRI: The new Rhode Island State Innovation Model calls for the hiring of a systems data analyst at $122,000 a year at HealthSourceRI. What do you envision that person doing?
WALLACK: The SIM grant isn’t housed here. I’m sorry to say that I have not been educated about that yet. I really can’t comment on that yet.

ConvergenceRI: What do you see as the future analytic targets for HealthSourceRI? What is the information you need to be able to make HealthSourceRI become more sustainable?
WALLACK: First and foremost, we are a customer service agency. We are helping people access insurance, making it more affordable, supporting innovation hopefully in the health care system.

What I’ll be looking for in terms of data and analytics is data that allows us to know if we’re serving people well, and to gauge whether we’re affecting the targets of affordability, overall control of costs in the health care system, customer experience and reducing the number of uninsured.

My focus will be on what data and analytics do we need to gauge whether we’re doing a good job.

ConvergenceRI: In 2016, the exchange’s market will change, moving from businesses with 50 or fewer employees to businesses with 100 or fewer employees. Will that, by definition, double your potential market?
WALLACK: It doubles the market, but it also changes it, because of the nature of larger businesses and their traditional relationship to the health insurance market.

It creates a much larger universe of employers and employees who might become our customers. But we also have to look at the fact that the five-person retail business that has been struggling to afford coverage is very different, not in the sense of struggling to afford health insurance coverage, but in terms of a 75-person manufacturing shop that may have had coverage through the same carrier for a whole long time, with very generous benefits because it’s a union shop. There’s just a different dynamic; we’ll have to deal with it, but it’s a different dynamic.

ConvergenceRI: How does bringing more people into the exchange to buy health insurance change your market power?
WALLACK: It changes our market; it makes our market bigger. Whether it changes our market power depends on whether we provide a product that those larger businesses are interested in. So, to the extent that it increases the volume of our customers, yes, it would increase our potential influence.

ConvergenceRI: Are there opportunities to include more innovative products on the exchange?
WALLACK: In terms of what we can actually do, I have a lot more learning to do, about what is possible in the near term around product innovation. In a more general sense, that’s what we exist for, to try and be a source of innovation in the marketplace.

A lot of what I’ve seen out there nationally in terms of product innovation doesn’t really knock my socks off, it’s still mostly focused on how do you have narrower networks and point-of-service price differentials for consumers. Not the stuff that gets at how do we change the health care system.

I’m very interested in talking with the carriers about we can truly do this – and not just shift costs around.

But I want to be practical. I think part of what’s wrong with the health care system is that we haven’t had a lot of true innovation. And some of that is because people tend not to purchase the most innovative things in the marketplace in health care.

Chris Koller [the former R.I. Health Insurance Commisioner] did a bunch of work on a more interesting than average product in the small group market, where there were incentives for wellness but it was still within the zone of traditional plans, with innovation at the edges. There was very little take up.

You look at the billboard that Blue Cross [& Blue Shield of Rhode Island] has up right now: wide network, no referrals. That seems to be what people are interested in buying. I think there is a tension there, between innovation and convincing consumers that the innovation is good for them.

ConvergenceRI: Do you think that the state of Rhode Island should consider having all of its employees purchase health insurance through the exchange, as something that would create leverage and sustainability, rather than just bid out the contract to an insurer?
WALLACK: That’s something we’ll definitely look at. I’m only at the beginning of understanding the complexities of that issue. I think that it’s something we’ll need to discuss with the Governor and leadership, and do much more research on how it would work and what the impact would be.

I’m just starting to get my arms around that, but it’s definitely on the to-do list.

ConvergenceRI: In looking at the costs of health care, and how they are quantified, do you believe that there is a need to develop a different economic equation, one that factors in the externalities, what some call the social determinants of health, or, for a more inclusive term, ROI, return on investment?
WALLACK: Yes.

ConvergenceRI: [laughing] My mistake for phrasing it as a yes or no question.
WALLACK: I think the state of the art around that [concept] is not very well developed. There has been a lot of research, focused on how do we look at the effects of the health care system, and health, much more broadly. And, on the effects of everything that affects health, much more broadly.

I think people are recognizing that the American health care [delivery] system has been focused on a very narrow strip. We spend about 90 percent of our resources on treating sickness in a very inefficient way. There’s definitely a way that you can broaden that lens.

How you turn that into a formula that tells you exactly what to do about it, I don’t know.

As people become aware of how much we spend, and how little return on investment we get from that, compared to other countries, yeah.

ConvergenceRI: What do you see as your biggest challenges, moving forward. How are you defining the landscape?
WALLACK: Clearly, sustainability is one of our biggest challenges. How do we make sure that this agency, when the federal funds go away, can continue to exist and provide value for Rhode Island. We need to get to the point where the exchange is really a well-oiled machine, providing excellent customer service.

Where people can use [the exchange] reliably, have a good experience and want to come back. [That we are] providing value, retaining customers, and attracting new customers.

That’s a key objective of mine: figuring out the sustainability, how we can afford this, how we can pay for it, how we can show it’s worth having here in Rhode Island.

[We want to continue] to have an effect on the affordability of premiums, and innovate more broadly, in whatever we can, to [produce] improvements in Rhode Island’s health care delivery system. And focus on continuing to reduce the number of uninsured people.

And, to provide benefits individual Rhode Islanders and to Rhode Island businesses.

I think there’s a lot that we can do to provide a service to businesses and entrepreneurs, to help innovators who are out there, trying to create jobs.

We can make the whole experience of finding health insurance much easier and more pleasant for them, and hopefully, have an influence on the price they pay.

ConvergenceRI: How do you plan to correct what appears to be a problem with the interface between UHIP and HealthsourceRI, which resulted in costs of about $10 million in the last year?
WALLACK: That’s been the bane of everybody’s existence. We just need to make the system work, whatever it takes to deal with the issues, to improve customer service and to get away from manual overrides and workarounds.

We have to do it. It’s a problem I inherited, but it’s a problem that I have to fix.

Part of fixing it, it’s really critical to our success, is working more closely with EOHHS.

It’s been a project that has been co-managed by HealthSourceRI, EOHHS, and the Department of Administration. I think we can do a much better job and make sure that we are working together across these agencies to manage the contractors and to make sure we get the best results.

ConvergenceRI: Would you recommending charging the contractors if they don’t deliver?
WALLACK: It’s too early to say. But, yes, other states had to do that, that’s one of the tools in our toolbox.

ConvergenceRI: Is there any truth to the rumor that HealthSourceRI will move under the auspices of EOHHS?
WALLACK: I think you’ll see us working together much more closely. Whether there will be a structural change I can’t say, it’s too early. Regardless of the structure, we’re going to work much more tightly with them.