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Identify and Manage 'Newly High-Cost Patients' to Boost Health, Cut Spending

Analysis  |  By Christopher Cheney  
   August 28, 2019

The CMO of Cardinal Analytx shares the keys to addressing chronic illnesses, investing in social determinants of health, and reducing healthcare costs.

Chris DeRienzo, MD, wants to bend the trajectory of human diseases in a positive direction to improve lives and contain the country's unsustainable increasing healthcare costs.

As the American population ages with the maturation of the baby boomer generation, the prevalence of chronic conditions is expected to swell and exert upward pressure on healthcare spending, which is already approaching a burdensome one-fifth of the country's gross domestic product.

DeRienzo is the chief medical officer at Cardinal Analytx Solutions in Palo Alto, California, and an adjunct professor at the Stanford Medicine Clinical Excellence Research Center in Stanford, California. Cardinal Analytx is applying artificial intelligence to improve healthcare outcomes while containing costs.

The author of the book Tiny Medicine: One Doctor's Biggest Lessons From His Smallest Patients, DeRienzo specialized in neonatology after graduating from Duke University School of Medicine. Prior to joining Cardinal Analytx, he served in two roles at Asheville, North Carolina­–based Mission Health: system chief quality officer, and chief patient safety officer and vice president.

HealthLeaders spoke with DeRienzo recently to get his perspectives on treating chronic illness, cost containment, and healthcare reform. Following is a lightly edited transcript of that conversation.

HL: Why did you pick neonatology as your specialty?

DeRienzo: NICU was at first a hard choice but ultimately an easy choice. I started med school thinking I was going into adult cardiology. But as med school evolved and I went through different rotations, I struggled with caring for adult patients, especially those with preventable conditions. I looked for an area where I could work with patients who were as early in their condition as possible, so I went into pediatrics.

NICU stood out to me because you basically own anything that happens to the child. All of the harm that can occur in the NICU is potentially preventable.

HL: How can healthcare organizations improve the treatment and management of chronic illnesses?

DeRienzo: There are two parts to the equation.

The first is to identify the trajectory of disease as early as possible and try to arrest its downward spiral. For example, with someone showing early signs of kidney disease, the No. 1 area of focus is getting the healthcare system to do a better job of servicing them and connecting the person with a matched intervention that gives the best possible chance at fundamentally changing their trajectory.

You also have to acknowledge that there are many folks who have already progressed in their disease states—whether it's COPD, heart failure, or another condition. Sometimes, their progression is not reversible. For those patients, we need to focus at the minimum on maintaining the condition as it is for as long as possible.

In my current role, I look across health plan claims, and I have seen folks with a variety of COPD. Despite having significant chronic obstructive pulmonary disease, there are some folks who are consistent with their medication regimen, they have stopped smoking, they are seeing a pulmonologist once per year, they are engaged with primary care, and they are doing spirometry testing—that kind of care coordination with someone who has a chronic condition can maximally help them live their best possible life.

HL: Give an example of an area where there can be a relatively quick ROI for social determinants of health initiatives?

DeRienzo: Transportation is really important, especially for the Medicaid population, which often relies on public transportation. When I ran my own clinic as a resident, transportation was one of the primary drivers of patients and their parents not being able to come to appointments. Certainly, there is an ROI for transportation.

Once you get into things like housing, it gets to be more challenging. It has to be under the right risk-sharing or revenue model that allows those investments to drive improvements in health, reduce healthcare utilization, and be sustainable for everyone involved.

HL: At this summer's HealthLeaders Innovation Exchange, you discussed the concept of "newly high-cost patients." Why is it important to effectively manage those kinds of patients?

DeRienzo: One of the reasons why I joined Cardinal Analytx is that when I looked at the universe of managing cost in healthcare, it had previously been divided in half. There were many people who were generally well and generally low-cost. There were other people who were generally not well and generally high-cost. The thought process was that the people who were generally well did not need much engagement, and that the people who were already high-acuity and high-cost required the most interventions that we could give them.

The problem with conceptualizing people in those two halves is that some people rise in cost, then revert to the mean. And some people who look well are about to fall off a health cliff.

The concept of the rising risk of the newly high-cost patient is new, but it is just as real as the patients who rise in cost then revert to the mean.

With an AI-enabled solution to find those newly high-cost folks, we can try to understand why they are going to fall off a health cliff and why their health costs are going to rise. Then we need to connect them with an intervention that can change their trajectory. If we can do that, we are not only changing people's lives but also dramatically changing the financial sustainability of managing population health.

For example, you can have someone with COPD who has generated $4,000 worth of healthcare costs this year, then rises to more than $30,000 in costs next year. If we can connect with that person, understand what is going on in his or her life, and see that they have had COPD and have been to the urgent care twice, we can intervene. We can get them on a consistent medication regimen. We can engage them with primary care. And we can connect the person with interventions that we know work.

Instead of rising to $30,000 in costs next year, maybe the patient will only go up to $5,000, or even go down to $2,000. If we can replicate that process over and over across our country's population, we would have a huge bend in the healthcare cost curve in the short-term that would compound year over year.

The Innovation Exchange is one of six healthcare thought-leadership and networking events that HealthLeaders holds annually. While the events are invitation-only, qualified healthcare executives, director-level and above, will be considered. To inquire about the HealthLeaders Exchange program, email us at

Photo credit: Pictured above: Chris DeRienzo, MD, CMO at Palo Alto, California–based Cardinal Analytx Solutions and an adjunct professor at Stanford University, makes a point at this summer's HealthLeaders Innovation Exchange. (Photo: David Hartig)

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


'Newly high-cost patients' can appear well for years then experience a precipitous decline in health. Identifying them early with artificial intelligence creates opportunities for interventions and cost containment.

When investing in social determinant of health initiatives, transportation is among the areas that have the quickest ROI.

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