As the healthcare industry moves toward reimbursement models that reward value, providers cannot ignore patients with mental health and substance abuse issues.
This article first appeared in the June 2015 issue of HealthLeaders magazine.
Gregory Pagliuzza Jr.
Patients with behavioral health diagnoses present a particular challenge for health systems and hospitals that are trying to rein in the cost of care. Such patients tend to be heavy utilizers of expensive healthcare resources and have higher-than-average rates of emergency department visits, hospitalizations, and readmissions—all of which hospitals are trying to curb as they work to retain their margins under population health and risk-based payment models.
Some provider organizations are embracing this challenge and are implementing strategies to deliver more effective care to this subset of patients. As a result, they are improving care coordination and lowering costs.
'A financial imperative'
It's becoming "a financial imperative" for hospitals to find ways to provide behavioral health services that truly meet patients' needs, says Gregory Pagliuzza Jr., chief financial officer at UnityPoint Health-Trinity, a four-hospital, 584-licensed-bed integrated delivery system based in Rock Island, Illinois. The system is part of UnityPoint Health, headquartered in West Des Moines, Iowa.
"As the cost structure gets tighter, we have to manage patients with behavioral illnesses more effectively. The old model—where we outsource behavioral health patients elsewhere—is not going to work anymore. It's not going to be funded, and it's not going to be financially successful. As reimbursements get tighter and tighter, the reality is the model is going to have to change to be effective," Pagliuzza says.
In 2009 UnityPoint Health-Trinity began working with the state of Illinois on a three-year Donated Funds Initiative to reduce the utilization of services and readmission rates for patients who have both behavioral and medical diagnoses. The results were significant. Over a 10-quarter period, emergency department visits among this group dropped 50%, which reduced Medicaid payments by 65%. Additionally, psychiatric admissions dropped 54% in the same time frame, cutting payments by 73%.
Rene Letourneau is a contributing writer at HealthLeaders Media.