The Managed Care movement dramatically transformed healthcare in the 1990s. For the first time, our industry discovered increased margins by conserving the services we provided. Now, Population Health Management (PHM) is on the brink of transforming healthcare yet again—and perhaps in a more dramatic fashion. The transformation is already underway, with industry-wide consolidations between hospital networks, physician practices, and even insurance companies; government reforms targeting cost and quality controls; and new breeds of health organizations, professionals, and technologies.
Today’s PHM movement presents the same cost benefit as healthcare’s traditional models with a greater focus on health outcomes. The philosophy behind PHM is that healthcare providers and organizations will save money and improve care by identifying and stratifying patients with high, medium, and low risk for developing chronic conditions. Once patients are assigned a level of risk, care plans are then developed and deployed to treat them appropriately. For high-risk patients, strategic interventions are provided that reduce hospital admissions, readmissions, and complications. For low-risk patients, preventative care is offered to maintain health and avoid costly conditions. The PHM model requires broad-scale data collection, analysis, and transmission between healthcare entities—the latter not yet possible with the lack of integration between electronic health record (EHR) systems. PHM also calls for redesigning processes, discovering gaps in care, and extending patient-provider interactions beyond clinical events to encourage healthy life behaviors.
In order to reach the level of data collection needed for successful PHM, healthcare organizations must first adopt their EHR. Doing so makes it possible to intercept data, analyze it, and transform it into useful clinical information delivered to the point of care. Without EHR adoption, the most foundational elements of PHM cannot be supported: We cannot efficiently discover gaps in our current care, identify and stratify at-risk patients treated by an organization, or improve our processes to lessen the new financial risks of value-based care. EHRs are so central to PHM that overlapping incentives for both initiatives were proposed in November 2011 by the Centers for Medicare & Medicaid Services (CMS). The technology is also a necessary tool for Accountable Care Organizations (ACOs), which are a form of PHM. The Agency for Healthcare Research and Quality (AHRQ) published an interview with Dr. Stephen Shortell, a Distinguished Professor of Health Policy and Management at the University of California, who outlined aspects of EHR adoption as being essential to the success of ACOs.[“The State of Accountable Care Organizations.”The Agency for Healthcare Research and Quality. http://www.innovations.ahrq.gov/]
Our research at The Breakaway Group (TBG) points to four crucial components needed to adopt an EHR for PHM. Strong leadership must inspire continual engagement from users to embrace the EHR as a tool for positive change. Targeted and effective education—creating system proficiency in role-based tasks—must also be established before and after the EHR go-live event. Performance must be gauged, measured, and analyzed to enhance EHR use and establish governance measures. And with the evolutionary nature of the EHR, all optimization efforts must be sustained and refreshed to meet new challenges, such as application upgrades and process changes.
Although the PHM movement is relatively new, there are numerous examples of the model’s success. ACOs enrolled in CMS’s Shared Savings and Pioneer ACO programs have generated $380 million in savings.[“Medicare’s delivery system reform initiatives achieve significant savings and quality improvements – off to a strong start.” US Department of Health and Human Services. www.hhs.gov.] One Pioneer ACO, Partners HealthCare, has established patient-centered medical homes that employ Care Managers specializing in customizing patient care plans.[“Patient-centered Medical Home: Role of the Care Manager.” Partners HealthCare. www.partners.org.] While Partners HealthCare is not employing true PHM in the sense of sharing information with other healthcare entities, it is large enough in size to perform broad-scale data collection that can help better manage health populations. This example demonstrates the potential effect of PHM on our industry when data becomes transferrable.
EHR adoption is an essential feat we are capable of achieving now. Doing so is the first step toward learning more about the populations we serve, how we’re not serving them, and how we can adjust our processes to succeed in a value-based model. Yet to manage populations effectively, more is required from us, including being willing to work together in our pursuit of a better, brighter healthcare system. If we can overcome these hurdles now, then we will arrive ready for when our industry is capable of embracing true care coordination.
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