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Analysis

5-Part Strategy to Create a Population Health Services Organization

By Christopher Cheney  
   October 30, 2019

In the New Orleans area, LCMC Health is making strides toward value-based care by taking a population health services organization approach to its new clinically integrated network.

A New Orleans–based health system has crafted a new clinically integrated network (CIN) as a population health services organization.

One of the major challenges in healthcare is managing the shift from the traditional fee-for-service model for delivery of medical services to value-based models. The primary goal of these efforts is to replace fee-for-service contracts with payers with value-based contracts such as shared savings arrangements that include financial rewards for reducing cost of care.

LCMC Health formally launched the New Orleans health system's new population health services organization CIN in January 2018 in a business relationship with St. Louis–based Lumeris. There are five essential elements in the initiative, says Meg Vitter Greene, MHA, vice president of population health and network development at LCMC Health.

"What is unique about building a population health services organization is that it is a commitment to building out the five components that Lumeris identifies as being part of a PHSO: governance and leadership, physician engagement, payer strategy, care delivery, and technology and analytics. Many clinically integrated networks may do one or two of those well, but they do not focus on all five. Without building all five and making sure that they all have adequate attention, I don't think you can be successful," Vitter Greene says.

Population health services organization CIN by the numbers
 

LCMC Health's population health services organization CIN, which is called LCMC Healthcare Partners, enjoyed a measure of success in its first year, generating $3.6 million in gains from value-based contracts based on quality metric performance and shared savings in 2018, she says. About $1.5 million of the total was shared savings.

"We had success in both categories. For the quality metric dollars, we receive them throughout the course of the calendar year. For shared savings, we have an annual evaluation as to whether we have reduced the cost of care. In 2018, we earned shared savings with Medicare Advantage payers, and we earned quality metric dollars across all types of payers, including Medicare, Medicaid, and commercial insurance," Vitter Greene says.

The LCMC Healthcare Partners network features all five of LCMC Health's hospitals: a safety-net academic medical center, a children's hospital, and three community hospitals. There are nearly 900 physicians in the network—about 270 primary care physicians split evenly between adult care and pediatric care along with about 600 specialty clinicians.

In January 2018, LCMC Healthcare Partners launched with about 65,000 lives managed in value-based contracts, and that figure could be as high as 90,000 by the end of this year, she says. "For now, about 70% of our patients are still in the fee-for-service world."

Vitter Greene shared some of the highlights of LCMC Healthcare Partners' five-part strategy.

1. Governance and leadership
 

The first big step in developing LCMC Healthcare Partners was educating the health system's senior leadership about the benefits of increasing efforts to shift from fee-for-service to value-based care, she says.

"Without that commitment, embarking on a long-term strategy like this just won't work. So, there was a lot of time and energy educating our leadership on the value of providing population health across our patient base and educating leaders about the movement to value-based care. We educated people about why this was better for our patients and physicians, why it would improve the quality of the care we provide, and why it would reduce the overall cost of healthcare."

The health system's senior clinical leaders were convinced that a value-based approach to population health would garner significant benefits, Vitter Greene says. "We have physician leaders and quality leaders throughout the organization who are focused on preventative medicine and focused on keeping patients healthy instead of waiting to treat them until they are sick. They are interested in improving the overall health of our patient population."

2. Physician engagement
 

LCMC Healthcare Partners has several physician engagement initiatives, including educational sessions at physician practices and large physician groups that are part of the network, along with identifying physician champions at employed and community physician practices, she says.

A significant component of the physician engagement effort is a "pod structure" to reach individual physicians in the network, Vitter Greene says.

"We have associate medical directors working over groups of practices who share information about performance and care gap closures with physician champions at the practice level. Then those physician champions get information down to the individual physician level. We think the pod structure will encourage physician engagement and healthy competition among our physicians to perform well in value-based contracts and take great care of their patients."

3. Payer strategy
 

LCMC Health has a diverse payer mix, including many patients covered through Medicaid who receive services at the health system's safety-net academic medical center and the children's hospital. As a result, LCMC Healthcare Partners' payer strategy involves seeking value-based contracts with a range of payers, she says.

"To build a clinically integrated network that can support all of our hospitals, we have to have an all-payer, all-population network. Oftentimes, clinically integrated networks will focus on Medicare such as a Medicare accountable care organization—managing one specific population well. We can't do that because the mission at LCMC Health is to take care of all patients. It's an ambitious goal, but we believe that we can build an all-payer, all-population model."

LCMC Healthcare Partners is striving to establish value-based contracts with as many payers as possible, which has impacted the network's managed care strategy, Vitter Greene says. "We are focused on a managed care strategy that straddles across Medicare Advantage, traditional Medicare, commercial payers, and Medicaid."

4. Care delivery
 

The health system's diverse population and payer mix has implications for care delivery such as case management, she says.

"We have our own case managers, but we need them to be diverse. We can't just have case managers who have experience in doing adult case management—we need case managers who have experience with behavioral health issues and experience in pediatrics. So, we're always looking to make sure we are being as thoughtful as possible in building out a case management team that can take care of the diverse population we serve."

5. Technology and analytics
 

Harnessing data is an essential function at LCMC Healthcare Partners, Vitter Greene says.

"We've been able to take claims data from all of the payers that we work with and marry it with data from our electronic medical record that we have at LCMC Health. Then we put all of that information in one population health tool, which analyzes and risk stratifies our patient population so we can prioritize patients for outreach. Through that identification of patients for outreach, our case managers can execute on their workflows."

Christopher Cheney is the senior clinical care​ editor at HealthLeaders.


KEY TAKEAWAYS

In its first year, LCMC Health's population health services organization clinically integrated network (CIN) generated $3.6 million in gains from value-based contracts.

About 30% of the health system's patient population receives medical services through value-based contracts.

Nearly 900 physicians are participating in the new population health services organization CIN, including about 270 primary care physicians.


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