Guest post by Abhinav Shashank, CEO and c0-founder, Innovaccer.
Former US President Abraham Lincoln once said, “Give me six hours to chop down a tree and I’ll spend four hours sharpening the ax.” After having a look at the efficiency of the US healthcare system, one cannot help but notice the irony. A country spending $10,345 per person on healthcare shouldn’t be on the last spot of OECD rankings for life expectancy at birth!
A report from Commonwealth Fund points how massive is US healthcare budget. Various US governments have left no stone unturned in becoming the highest spender on healthcare, but have equally managed to see most of its money going down the drain!
Here are some highlights from the report:
The US is third when it comes to public spending on health care. The figure is $4,197 per capita, but it covers only 34 percent of its residents. On the other hand, the UK spends only $2,802 per capita and covers 100 percent of the population.
With $1,074, the US has the second highest private spending on healthcare.
In 2013, US allotted 17.1 percent of its GDP to healthcare, which was highest by any OECD country. In terms of money, this was almost 50 percent more than the country on the second spot.
In the year 2013, the number of practicing physicians in the US was 2.6 per 1000 persons, which is less than the OECD median (3.2).
The infant mortality rate in the US was also higher than other OECD nations.
Sixty-eight percent of the population above 65 in the US is suffering from two or more chronic conditions, which is again the highest among OECD nations.
The major cause of these problems is the lack of knowledge about the population trends. The strategies in place will vibrantly work with the law only if they are designed according to the needs of the people.
What is Population Health Management?
Population health management (PHM) might have been mentioned in ACA (2010), but the meaning of it is lost on many. I feel, the definition of population health, given by Richard J. Gilfillan, president and CEO of Trinity Health, is the most suitable one.
“Population health refers to addressing the health status of a defined population. A population can be defined in many different ways, including demographics, clinical diagnoses, geographic location, etc. Population health management is a clinical discipline that develops, implements and continually refines operational activities that improve the measures of health status for defined populations.”
The true realization of population health management (PHM) is to design a care delivery model that provides quality coordinated care in an efficient manner. Efforts in the right direction are being made, but the tools required for it are much more advanced and most providers lack the resources to own them.
If population health management is in place, technology can be leveraged to find out proactive solutions to acute episodes. Based on past episodes and outcomes, better decision could be made.
The concept of health coaches and care managers can actually be implemented. When a patient is being discharged, care managers can confirm the compliance of the health care plans. They can mitigate the possibility of readmission by keeping up with the needs and appointments of patients. Patients could be reminded about their medications. The linked health coaches could be intimated to further reduce the possibility of readmission.
The current plight of America’s healthcare industry is not wholly unprecedented. In fact, it isn’t even unique.
American education — higher education in particular — is going through a parallel period of turmoil and scrutiny. It is really uncanny how closely the two industries actually reflect one another. Consider:
Both are critical industries whose public/private status is up for constant debate
Both serve an essentially captive market: everyone needs education to succeed in the economy, and everyone, sooner or later, will require some form of healthcare
There has been a historical tendency for both to treat the people they serve as customers, rather than as students or patients. It is more than semantics: it is a reflection of an underlying philosophy that can potentially compromise the mission of each type of institution
Both are going through a crisis of accountability, in terms of what standards are used to measure their performance, and to whom they must answer for that performance
Both have been very slow to adopt modern technology, and as a result are going through a rapid, disruptive catch-up period
In the race to modernize and reconcile many of these conflicts of purpose and identity, it appears that higher education as a whole may be slightly ahead. Because of this relative lead on the healthcare industry, behavior within the American college and university system can act as a rough preview for the health sector. So, what do we see upon gazing into this crystal ball?
All for One?
A helpful place to direct this gaze is the recent ASU GSV Summit. The name alone reveals much about what is happening in higher education, and needs to happen in healthcare: Arizona State University, in the interest of promoting innovation, collaboration, and evolution in the higher education sector, joined forces with Global Silicon Valley’s family of companies to create their joint summit.
The summit began in 2009, seven years into the tenure of ASU president Michael Crow, who has become one of the leading voices and actors in higher education’s 21st century evolution. The summit is just one of the many strategic partnerships Crow has helped organize through ASU. Aligning the school with everything from technology startups supporting the development of ASU’s online degree programs, to the Mayo Clinic Medical School to offer future doctors transdisciplinary education in fields like business or engineering, Crow is expanding the reach of America’s largest public university by strategically sharing its resources.
In American medicine, there is a clear need for a similar attitude toward strategic partnerships and mission alignment, especially with technology companies and developers. This need is most acute in terms of EHR interoperability. Despite all the rhetoric, the old mentality of siloes, competition, and proprietary ownership prevail, and information remains immobile.
This symptom has implications that extend into every other facet of healthcare.
Patrick Soon-Shiong, billionaire, surgeon and incorrigible optimist, has set his sights on curing cancer. Much like the Precision Medicine Initiative, Soon-Shiong’s approach to this challenge is a matter of getting more, better data from as many partner institutions as possible.
“Cancer is really a rare disease,” he explains. “Because of the molecular signature, because of the heterogeneity, no single institution will have enough data about any [single] cancer. So you actually need to create a collaborative overarching global connected system.”
The end result — better medicine, better outcomes — is something common to the mission of every clinical organization, and ever caregiver practicing medicine. But the means — large scale collaboration, facilitated by transparency and a suspension of select elements of competition — are seldom realized in the current environment. Reconciling the ends and the means requires organizations to think bigger than themselves, and prioritize the sort of partnerships that bring new perspectives, larger pools of data, and creative solutions where they are desperately needed.
Though many Medicare and private payer reimbursement programs that require practices to begin moving to value-based compensation already have set sail, most small practices are still treading water near the shore when it comes to this new wave of payment models.
While admirable in their care goals, these quality care-based reimbursement programs can pose some insurmountable challenges for small providers. In fact, they require a whole new way of providing care for some practices, as well as creating new documentation of integrated data analysis, development of care coordination with other providers, payer reporting applications, and often times new technologies that can support these new provisions.
What’s more, all this change also can be quite expensive for small practices and wreak havoc on current business practices.
Set the course
No doubt about it, though, the move to value-based care is on. According to the 2015 Physician Compensation Survey, conducted by Physicians Practice magazine, 63 percent of physician compensation is currently tied to productivity; 37 percent to value metrics and 29 percent to patient satisfaction scores.
The Centers for Medicare and Medicaid Services (CMS), however, has expressed its goals of having more providers participating in value-based plans each year, with a goal of 50 percent by 2018. And it has further incentivized physician participation by specifying increasing reductions in payments for non-participation that began in 2013.
So unless they want to start leaving money on the table, practices have no choice but to take the plunge into such new compensation programs.
Lift the Anchor
Before diving in and potentially draining money and resources to participate in such programs, physicians need to look around and assess their current situation to determine how the new reimbursement model might work in their practice. For example, they need to evaluate current technology, vendors, resources and physician support to determine what changes they need to make, as well as what internal infrastructure they can use.