Population Health Management: Leveraging Data and Analytics to Achieve Value. White Paper. A Special Report

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1 Authors Carol Cassell CTG Health Solutions John Kontor, MD Clinovations Lisa Shah, MD, MAPP Clinovations Contributors Marla Roberts, DrPH, RN CTG Health Solutions Katie Stevenson Clinovations : Leveraging Data and Analytics to Achieve Value White Paper The United States, when compared to other industrialized nations, achieves some of the poorest health outcomes while producing the highest rates of healthcare spending. This trend has persisted for years, yet quality continues to lag while costs continue to rise. As stated by Albert Einstein, the definition of insanity is, doing the same thing over and over and expecting different results. The imbalance of quality and cost present in the U.S. healthcare system has prompted reform through government intervention via newly packaged reimbursement programs and regulations. These government initiatives and our current economic climate are creating an imperative for the healthcare industry to realign and coordinate care in new ways. Survival and success will require new and innovative thinking, incentive alignment, and novel approaches to care delivery. There will need to be a focus on wellness and the effective use of health information technology (HIT) and data analytics. Population health management (PHM) is one of the key strategies required to thrive in this new world. Built upon the concept of involving both organizations and individuals within a community, PHM is viewed as a promising model to not only improve health outcomes but also bend the cost curve. It is the cornerstone of accountable care and provides a foundation built on sophisticated business analytics and data governance. However, very few communities are equipped to begin building PHM programs. Beyond implementing HIT, providers, leaders of healthcare organizations, and patients must be willing to embrace the integrated care concept. A Special Report Copyright 2012 The material covered in this report is for guidance only. Application and implementation guidelines, advice, and consulting are available.

2 What is PHM? PHM focuses on the care of specific populations, coordinates care across the entire delivery continuum, improves disease management, and reduces costs in ways not possible before. Focusing on the health management of specific populations provides the ability to drive efficiency and effectiveness by enabling accountability and care transparency. New alliances are forming that enable providers to coordinate and manage care across the entire delivery continuum in order to drive improvements for specific diseases and to manage value in ways that have been previously challenging. Implementation of PHM requires Accountable Care significant commitment to business analytics and data management to identify Quality and analyze populations, Care delivery Value-based and coordination and payment apply appropriate care cost interventions, and monitor the results. Investments in electronic health records (EHR), health PHM has the ability to drive efficiency and effectiveness information exchange, and by promoting and supporting accountability and transparency of care related information technology (IT) with associated process improvement have been significant drivers for organizations in their quest to provide value. However, capturing data is not enough to justify the costs of HIT. Timely access and the meaningful use of data are required to enable value. An organizational approach leveraging data through innovative and collaborative leadership to drive a strategic agenda is required to achieve value. Organizations are capable of utilizing data to improve the health of individuals and communities as a whole. With the breadth, depth, and scope of the data becoming available through new IT infrastructure and shared-risk models, healthcare organizations have the power to shift their focus to managing an entire population s health by accessing data across the continuum of care. A data-driven approach has the potential to improve all facets of health in a given population by supporting proven interventions addressing behavioral, social, economic, cultural, and environmental determinants in differing communities. The ability to analyze historical data, assess current performance, predict future outcomes, and determine resource allocation are important for organizations to successfully manage the evolving healthcare market, using both innovative and strategic approaches. PHM also requires engaging collaborative, multi-disciplinary teams. Managing a population s health and wellness is made possible through collaborative efforts by stakeholders spanning 2

3 the patient care spectrum. These efforts lead to improved care quality and health outcomes at the individual and community level. Furthermore, an environment of shared-decision making and community engagement has the potential to improve coordination across the healthcare continuum and create a patient-centric focus. How does a health organization assess and improve its ability to deliver on this opportunity? What is your organization looking to improve and how will it be accomplished? How will your organization measure its progress, learn from experience and share findings with the healthcare community? These questions and more will be explored in the following pages. Why PHM? Market forces have been set in motion by the health reform movement, particularly the Affordable Care Act (ACA) legislation and the resulting transformation from a healthcare system focusing on the volume of services delivered to one driven by value through improved quality, cost efficiency, and patient-centered care. The unsustainable growth of healthcare costs coupled with suboptimal quality in care has motivated legislators, insurers, and other stakeholders to advocate for PHM programs. The need for PHM capabilities is reflected in current industry initiatives, including: Transparency and benchmarking efforts Value-based reimbursement models driven by quality Alignment of providers, hospitals, and health systems in supporting accountability Emphasis on patient-centered care and shared decision-making Focus on comparative effectiveness research and standardization Consumer engagement programs supporting targeted outreach and information exchange Health insurance exchanges targeted for 2014 and new value-based insurance designs Table 1: Market Forces Demonstrating the Need to Manage Care and Outcomes of Populations Concept Description Examples Incentive programs Programs across the country offering financial incentives and subsidies to organizations and providers who participate in quality improvement, implementation of technology, and care coordination. Meaningful use incentives and penalties, Medicare eprescribing incentives and penalties, subsidies through Stark exemption (e.g., payers, health systems, labs), state incentive programs (e.g., Rhode Island, New York), pay for performance Patient/personcentered care Framework for providing comprehensive person-centered care by integrating a population s physical and mental needs. Incentives and grants are available to support new and innovative programs that address a population s care management needs. Patient-centered medical homes (PCMH), Partnership for Patients, HCAHPS, Medicaid Health Home, case payment, Medicare Independence at Home demonstration Value-focused care Accountable care Focused approaches to providing efficient (cost) and effective (quality) care to subpopulations of patients with common conditions, demographics, or plans of care. Models encompassing the basic need to collaborate/coordinate care among all service providers and community organizations (particularly high-risk or complex patients, with or without risk sharing) while maintaining transparency. The mantra for accountability among disparate providers is to integrate, standardize, and collaborate for patient populations. Bundled and value-based payments, Medicare Community-based Care Transition Program, comparative effectiveness research Accountable care organizations (ACO), gain sharing models, shared risk/pcmh, Centers for Medicare & Medicaid Services (CMS) Pioneer Pilot and Advanced Payment Programs 3

4 Health systems across the country are engaging in these initiatives and testing innovative delivery and payment systems, manifesting themselves through various examples across the current healthcare landscape, as illustrated in Table 1 on page 3. Realizing each of these initiatives and achieving healthcare value requires organizational commitment and investment. Health systems, large provider groups, payers, and employers are challenged to create a foundation for population health management supported by the core capabilities necessary to deliver efficient and effective services and care. For example, providing accountable and transparent care requires a solid governance structure and management process, well defined and well managed payer relationships, and business management reporting capabilities. Technology capabilities include clinical delivery network design, clinical integration adoption strategies, information systems selection and development, and data source management. Lastly, value-focused care requires building an internal capacity to achieve provider buy-in, support, and a culture adaptive to innovation and change. Population health management, once thought of as a public Subpopulation identification and description health initiative managed by government organizations, is now Predictive Patient Culture analytics and risk being recognized as a strategic engagement stratification initiative to provide efficient and Governance effective care to panels of patients. Health systems, physician Leadership Shared organizations, accountable care vision Data CDS and entities, and clinical and community health networks have many sharing guidance design Innovation of the tools required to engage Performance in PHM through their IT investments. Now these organizations tracking are faced with a need to focus on building a strategic vision and organizational foundation to foster the prioritized development of the core capabilities needed to transform their existing data into information that supports proactive management of their patients, clinics, and communities. What Capabilities are Required to Support PHM? In order to successfully manage large patient populations effectively and efficiently, health systems will be required to have several core functions derived from their HIT infrastructure. These core capabilities will ideally provide the ability to proactively manage patient panels in an individual practice or a health system s entire community. In order to support this type of proactive population management, requirements fall into two key domains: organizational requirements and functional capabilities. 4

5 Organizational Requirements An organization s PHM requirements are built on a foundation supported by a strategic commitment and shared vision for innovation, strong and active leadership, a well-developed governance structure, and a culture continually striving for improvement. Strategic alignment: Achieving strategic alignment is critical to a healthcare system s ability to realize its desired transformation. For a system to be aligned from both an organizational and community perspective, being able to define, communicate, and report measurable goals is a key capability. Organizations must support physicians, providers, and community members to ensure a collaborative approach to healthcare. A culture of accountability must be created to foster transparent approaches to aligning incentives and delivering patient/person-centered care with quality improvement and engagement by all. This includes developing management expertise to ensure the intellectual, clinical, and financial capital necessary to accept various levels of risk. Care accountability must be aligned to the value-based payment models and underlying PHM programs to succeed. The four essential components of the organization s alignment strategy include: Shared vision: A shared vision has been described by Peter Senge as A force in people s hearts, a force of impressive power.... At its simplest level, a shared vision is the answer to the question, What do we want to create? 1 A common vision of healthcare delivery model transformation is required to achieve value. Leadership: Clarity and communication of purpose, progress, and challenges are integral to achieving strategic alignment. Healthcare leaders will be required to empower and engage stakeholders within and outside the health system to successfully execute a vision in order to achieve measurable results. Governance: An organization whose leadership has created a common vision requires a governance structure supporting the strategic mission. Governance should incorporate service coordination, data analytics and reporting, and drive shared decisionmaking and accountability among key stakeholders. Culture: An organization s culture promotes its values and the behaviors required to achieve its shared strategic vision. A culture of change can be extremely challenging to instill within an organization, especially in the midst of such significant ongoing modifications to the practice and healthcare delivery. However, investments in infrastructure, resources, and relationships with the greater community are not likely to succeed without engaging all stakeholders. Creating this culture requires leadership and governance to effectively communicate and disseminate the organization s strategic mission, values, and vision while building the trust required to share risk. Innovation: Given the complexity of change, it is essential for an organization to have a foundation entrenched in a culture of innovation and change. Through this creative and improvement-driven culture, an organization will successfully engage providers, patients, consumers, and other healthcare stakeholders in leveraging the system s inherent capabilities and strengths. Business intelligence and knowledge management: An organization s business intelligence and relevant strategies to govern and manage data and information are essential components for successful PHM. Knowledge management is a corporate asset that may be leveraged by all stakeholders through informed decision-making and data-driven improvement. This includes understanding how to take data and transform it into both information and knowledge to improve care efficacy. 5

6 Functional Capabilities The complementary core processes and functions enabling successful organizational strategy can be challenging to achieve. Many organizations have some elements of these core capabilities in place. However, to effectively and efficiently manage populations of patients, these functions are all necessary and will build on one another to enable proactive patient management, accountability, and a culture of transparency. Subpopulation identification and description: Leveraging robust information systems is essential to identifying relevant patient subpopulations requiring targeted care in order to ensure effective chronic disease prevention and management. Once these patients have been identified, it is necessary to perform specific queries and use electronic registries to examine and manage patient subpopulations. The analysis, construction, and deconstruction of patient groups will reveal any gaps and core opportunities. Predictive analytics and risk stratification: An organization s ability to conduct health risk assessments and use predictive modeling on patients who represent the highest clinical risk and drive the greatest costs are necessary to achieve value. As healthcare continues to try to move away from an encounter-based approach to a patient-centered one, it will be even more important to stratify patient populations and make predictions for given patient groups in order to help guide the most effective interventions. Transforming the Discharge Transition Clinical decision support and guidance design: Evidence-based content, structured The Bon Secours Virginia Medical Group (BSVMG) is dramatically documentation, and alerts can be used to reducing hospital readmissions through the use of a PHM strategy. help patients and providers more effectively manage an individual s (and popula- Through automated readmission risk quantification, use of a registry tool, and risk-stratified care management, BSVMG has been tion s) care. Supporting the decision-making process allows providers and patients to able to reduce their 30-day all-cause readmission rates to less than ensure that the highest quality, safest care 3 percent. is consistently delivered. Performance tracking: Health systems, These transformational results are not achievable without organizational commitment to the PHM approach, major workflow re- will be required to track performance in this group practices, and individual providers value-based care landscape. It is critical design, and use of the right technologies, said Robert Fortini, vice that health systems have the infrastructure president of clinical operations at BSVMG. Fortini s teams are now to support regular performance assessments, and providers are educated in working on applying similar methodologies to the care of patients gaining a granular understanding of how with diabetes, CHF and other specific high-risk populations. outcomes and patient satisfaction compare to national and local benchmarks. Data sharing: The ability to disseminate and exchange data with external providers, health systems, and other stakeholders enhances care coordination and care accountability. Data liquidity with complementary analytics enables insights from technology to support improved outcomes for patients, particularly in care models grounded in accountability, transparency, and shared risk. Patient engagement: Supporting patient empowerment and shared decision-making allows a health system to ensure increased patient satisfaction and to support a fully patientcentered approach to care management. Mobile, connected, and interactive providers are essential to ensure a thorough, holistic, and transparent approach to patient engagement and shared decision-making. 6

7 The above capabilities are all required for an organization to achieve improved outcomes, lower costs, and increased efficiency of care. However, an organization s specific market situation and strategic goals should guide prioritization of the development of selected functions. An effective PHM plan has three primary requirements: Clear understanding of clinical, operational, and financial goals Assessment of current organizational core PHM capabilities Development of a prioritized roadmap derived from this knowledge Early efforts should be focused on core functions that can provide short-term clinical and operational benefits, as well as those providing long-term value that are likely to require a longer time for successful adoption. Where is PHM Being Used by Leaders in Healthcare? Leading physician practices, health systems, payers, and communities are engaging in a myriad of population health management initiatives related to quality improvement, care coordination programs, consumer engagement and emerging reimbursement models. These initiatives are bringing leaders together around a shared strategic direction supported by key stakeholders collaborative, accountable governance structures. An ACO Model Based on Global Risk and Quality Performance Atrius Health has been participating in the Blue Cross Blue Shield of Massachusetts Alternative Quality Contract (AQC), a reimbursement model based on the assumption of global risk and significant financial incentives for meeting a large number of outcomes-based quality targets. Within the first year, Atrius enjoyed substantial improvements in its quality scores in pediatrics and adult medicine and managed a large, complex patient population effectively and within budget. The transformation from volume to value requires the development of new infrastructure and processes, but culture change is most essential and cannot be achieved without a clear vision and absolute commitment on the part of senior leadership, clinical leadership, and operational leadership throughout the organization, said Tom Denberg, MD, PhD, FACP, Vice President, Quality and Patient Safety at Atrius Health. Of note, Atrius Health was recently selected by the Center for Medicare and Medicaid Innovation as a Pioneer ACO, deepening the organization s engagement in an intense and necessary journey towards a new model of care. An example of such initiatives are programs aimed at reducing hospital readmissions through financial penalties from Medicare for readmissions within 30 days for the same condition at the same health facility. Clinical and financial teams with patient and family input are working together to understand root causes by clinical condition, social determinants, and population segment with targeted interventions, including care transition programs. Similarly, tracking and monitoring of specific populations of patients with a chronic disease is occurring to ensure preventive care and treatment adherence. Bundled payment methodologies for certain defined cardiac or orthopedic episodes of care are bringing physicians, hospitals, subacute care facilities, therapists, and patients together in defining clinical practice along the continuum of care with consumer engagement and in sharing collectively in the risk. 7

8 Infrastructure Process Quality Financial VALUE Value-based reimbursement models are beginning to evolve from pay-for-performance to bundled payment and shared-savings programs. Meaningful use continues to be a key program supporting utilization of technology and quality improvement outcomes with incentive payment. Medicare continues to introduce new reimbursement models, such as naming 25 ACO Pioneer Pilots. State budgetary challenges are resulting in movement towards accountable care programs. Commercial health plans are both acquiring physician practices as well as partnering around ACO models, all with the goal of improving value for defined populations. Each of these population health management and value-based reimbursement programs are dependent on the mature organizational and functional capabilities referenced above. Physicians and health leaders are working with Accountable Care Strategic Roadmap cross functional multidisciplinary teams to Interventions understand variations in clinical practice of care, root cause analysis, opportunities Value-based for improvement, and the development of FFS revenue Expense Capital revenue optimization management management optimization clinical best practice. These collaborations will lead to new or enhanced interventions for ongoing value improvement in Population health management health status, quality, and cost. This effort is highly dependent on the availability of Quality/clinical Strategic Experience analytical tools for predictive analytics best practice engagement and risk stratification supported by clinical process improvements and data gathering Care Consumer ICD-10 and sharing for informed decision-making coordination engagement and performance measurement. Clinical process Physician/hospital Revenue cycle improvement alignment Healthcare executives are leading their organizations in two worlds: fee-for-service Technology Business Workforce with a transformation to value-based Implementation intelligence Training & optimization payment for defined populations. The Analytics and skill of EMR Data governance development figure to the left represents a process of Interoperability Data architecture Soft skill Portals development strategic mapping aligning and balancing interventions with measurable goals in a disciplined approach to ensure there is strategic alignment of leaders, key stakeholders, and employees to deliver value. Organizational Program/project management Change mgmt. Organizational development Unlike previous efforts to improve care among health systems, PHM is not a single quality improvement project, but rather an iterative process towards transforming an organization, a community, and a culture. Through this transformation, data analytics provide knowledge that may be leveraged to effectively deliver value in healthcare. The call to action is clear, and the opportunity to lead with purpose, accountability, and transparency is ours to deliver. 8

9 About the Authors Carol Cassell serves as a Client Service Executive, Accountable Care and Analytics at CTG Health Solutions. She has over 30 years of strategic, financial, operational, and organizational leadership experience in the healthcare industry from the provider perspective as a CFO, COO, and interim CEO, and from the payer perspective as Executive Vice President of a large health plan. Her comprehensive background includes provider/network contracting, development of patient-centered medical homes, healthcare information management, implementation of dashboards for specific quality improvement programs, and reimbursement programs aligned to accountable care supporting the U.S. health reform agenda of transformation from volume to value. John Kontor, MD, is a Partner at Clinovations. John has extensive experience implementing and evaluating HIT and EHR strategy at large health systems across the nation. Previously, John was the Chief Medical Information Officer of the Bon Secours Health System. At Bon Secours, he led their 14 hospital clinical transformation efforts and Epic clinical information system implementation. Additionally, Dr. Kontor led Bon Secours IT-enabled quality improvement strategy and development of its standardized order set, care plan, and physician documentation tools. Dr. Kontor leads efforts with health systems and other private and public sector entities to achieve their clinical, operational, and financial goals through the effective use of health IT, data analytics, and workflow redesign. Lisa Shah, MD, MAPP, is a Senior Manager at Clinovations and an internal medicine/pediatrics trained physician. Her expertise is in delivery and payment reform, particularly bundled payment, accountable care models, and care coordination. Dr. Shah is also a clinically practicing hospitalist. Through combining her clinical expertise and deep health policy knowledge, she helps entities design innovative and strategic approaches to providing effective and efficient care to individual patients and populations. For more information, contact: Carol Cassell John Kontor, MD Lisa Shah, MD, MAPP Senge, Peter. The Fifth Discipline. CTG Health Solutions 1501 LBJ Freeway, Suite 250 Dallas, TX Phone: Fax:

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