Healthcare is becoming longitudinal instead of episodic. Post-acute and "pre-acute" care is where the money will increasingly be spent in healthcare. Provider organizations focusing on only one cog of the continuum may get left out.
If your organization is not involved in post-acute care beyond finding a place to send patients when their acute stay is over, you may not be relevant much longer. That's because healthcare is becoming longitudinal instead of episodic. That's a fancy way of saying that in a more capitated environment, those that are focused on only one cog of the continuum may end up on the outside looking in.
Don't think you won't ultimately end up in a capitated environment, by the way. State Medicaid plans are leading the way in many regions that have resisted capitation. More generally, it was evident even four years ago that risk was being shifted to the provider and the patient. If healthcare executives didn't feel capitation pressure then, you certainly do now, likely both as a patient and a senior leader in healthcare.
If you are an executive at an acute care hospital or health system, you must have a post-acute strategy that you think you can count on—and preferably a "pre-acute" strategy as well (more on that in a moment). I've heard it said that those in acute care view themselves as the quarterbacks of healthcare while viewing the post-acute care space as the equipment managers. That attitude will have to change.
At a post-acute care conference I recently attended organized by naviHealth, a Brentwood-TN based manager of post-acute care services that partners with hospitals, health systems, and health plans, I was reminded that patients no longer need to wait for care, so neither can those that provide them services. And patients increasingly won't stand for uncoordinated care, which is why developing that post-acute strategy is so important: it reflects back on your organization not only reputationally but increasingly financially, as both government and commercial payers move toward rewarding for outcomes versus services.
NaviHealth itself is evidence of this shift: it is the post-acute care benefit manager for more than 10% of the nation's Medicare Advantage beneficiaries. It's doubled in size in a year, and is itself backed by Select Medical, Ascension Health Ventures, BlueCross BlueShield Venture Partners, and other big-name private equity investors. Post-acute care represents up to 25% of the spending for Medicare beneficiaries, and with a fragmented and wasteful industry to reform, naviHealth has a lot of opportunity, as do other organizations that seek to improve transitions and better coordinate patient recovery from acute care stays.
As healthcare futurist Anders Sorman-Nilsson put it so well during his keynote speech at the conference, the healthcare customer—just like in other industries—is moving from analog to digital. "Healthcare needs to move into the space where the digitally enabled customer is; that is, move from focused episodes to a digital arc of information, helping people make smarter decisions," he says.
That shift to digital has big implications for how customers/patients will be making choices about where to receive their healthcare. They'll share data with those they think are working in their best interest, and that data is the key to improving the quality and the cost of the healthcare they receive. "The patient is tired of waiting and is taking their personal health plans into their own hands. Healthcare needs to be a fusion of the physical episode and the preventive digital arc," Sorman-Nilsson says.
Thus, winners in healthcare will have more communication with patients, not less-—but much of that communication will come digitally, in smaller and smaller bites. This shift applies to "pre-acute" care as well—that is, primary care. That's one reason why health systems are acquiring primary care physician practices left and right: it's a way to get an early connection with your future patients.
"Losers will be those who ignore the empowerment that comes from digital data flow," says Sorman-Nilsson. "Winners will curate a human-centric patient journey that is not just a physical event but a digital arc."
Think of banking, where customers used to have to visit a branch to get business done. Now, nine times out of 10, they're doing it from their phone, their laptop, or the ATM. We used to book trips with travel agents.
With a primary care patient relationship, healthcare organizations can build that early connection. Then, combining pre-acute care with a post-acute presence encourages patients to remain in with one provider organization for much of their lifetimes. Given trends in payment, that is what executives should want.
How you structure these capabilities as a business model is entirely up to you. You can build contractual relationships, build from scratch, purchase what you don't have, or do a combination of all three. What's important is that you're not myopically focusing on your own business segment within the healthcare industry, whether that's acute care or something else.
But make no mistake, post-acute, and even pre-acute care is where the money will increasingly be spent in healthcare. You'd be wise to make sure you can add value to that stream.
Philip Betbeze is the senior leadership editor at HealthLeaders.