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3 Physician Initiatives That Drove A $56M Turnaround

By Christopher Cheney  
   June 07, 2018

A physician group repositioned itself on firmer ground by implementing a plan that not only helped patients, but its bottom line.

Clinical care and access initiatives played key roles in a $56 million year-over-year operational budget turnaround at Atrius Health in Massachusetts.

The Newton-based physician group posted a $31.6 million operating loss in 2016 and a $24.4 million surplus last year, according to the President and CEO Steven Strongwater, MD, at Atrius Health.

Reasons for the weak financial performance at Atrius in 2016 included unsustainable staffing costs, he says.

There were three core elements in Atrius' turnaround plan: patient volume growth, cost control, and medical expense management.

1. Increasing patient volume

Increasing access to care was a crucial component of increasing patient volume, says Strongwater. "Our core approach is to improve access. We try to make ourselves available when and how our patients need us."

To supplement its primary care and urgent care clinics, Atrius has recently launched several telemedicine services, including dermatology, behavioral health, urgent care, and developmental pediatrics. At least 10,000 patients have used the telemedicine dermatology service.

"We like telehealth," Strongwater says. "We believe it should be incorporated into usual care within our practices as opposed to the big national firms like American Well and Teledoc. They are not your doctor. They are not accessing your electronic medical record. When you have a telehealth visit with us, we are in your record, we know who you are, we have access to prior treatment."

Atrius, which features 825 physicians practicing in 32 locations, plans to continue expanding telemedicine services. The next service set for launch is OB/GYN care for routine pregnancies.

There is significant potential for more telemedicine offerings at Atrius, he says. "Whenever patients can avoid an in-office encounter and get treated in the comfort of their own home, those are the ideal opportunities to roll out telemedicine. Almost every specialty has an application for telemedicine."

2. Controlling operational costs

Expense management efforts at Atrius included layoffs totaling 188 FTEs, supply chain cost cutting, and controlling site of service.

"It is more expensive to be treated in an inpatient unit than an ambulatory unit. We moved thousands of patients who would have otherwise been in a hospital unnecessarily to ambulatory units," Strongwater says.

Ambulatory surgery has been a prime area to generate site-of-care savings, he says. "We moved surgeries that were going to be done in hospitals to ambulatory surgery centers. We set up a program using our VNA Care in the home."

Atrius also has limited hospitalizations by bringing the hospital to the home.

"This allows us to move patients who traditionally would have been hospitalized—mostly medical patients but sometimes surgical patients—and set up a hospital in their home. We put a biometric patch on them, put telehealth in the home, and there is bidirectional video connected to a 'mission control,' " he says.

The home hospital service includes visiting nurse care.

"Our VNA goes into the home and provides care and services that are needed. We can provide pretty much everything except advanced imaging. We can provide antibiotics, we can provide fluids, we can do physical therapy and behavioral health, and we can deliver meals."

Patients are screened for home hospital suitability, Strongwater says.

"Patients have to have the right social environment at home. The patient has to be safe, there needs to be confidence that there will be electricity and other basic services, and the patient needs to be relatively intact cognitively," he says.

3. Medical expense management

Boosting population health capabilities was a primary strategy to control the medical cost trend at Atrius.

"Generally, about 5% of patients drive about 30% to 40% of healthcare spend. If you can manage those people, keep down their hospitalization rate, keep them out of skilled nursing facilities, and provide services in the home, their costs will go down. That is what we have been doing," he says.

Analytics have help boost population health at Atrius.

"We try to identify high-risk patients through risk predictors, then triage the information to the right people. It could be triaged to a VNA, a case manager, a population health manager, or a care facilitator. Then the appropriate intervention is tailored to the needs of the patient," Strongwater says.

Expansion of behavioral health services also has helped reduce medical expense at Atrius, he says.

"Behavioral health comorbid conditions increase total medical expense by two- to sevenfold. So, we have created new triage programs to get our sickest behavioral health patients seen quickly and get intensive therapy. Instead of coming in every month, we have patients come in every week."

At Atrius, behavioral health offerings are financially negative on a standalone basis, but it is money well spent, Strongwater says.

"We subsidize behavioral health—we don't break even on that service. We subsidize it because we believe it has a big impact on total cost of care. We also believe it's related to why our medical expense trends are lower than other physician groups."

To improve its behavioral health assessment capability, Atrius has adopted Patient Reported Outcome Measures.

"We are one of the earliest in Massachusetts to use PROMs in behavioral health," he says. "We tend to use PROMs more in surgical conditions like total joint replacement or back pain. In behavioral health, it's exciting. You can get a much better view of how the patients are doing by having the patients report it to you using these standardized screening tools."

Atrius has repositioned itself on firmer ground, Strongwater says. "We are better coordinating our clinical protocol across all of our sites, we are standardizing a lot of our clinical care, and we are improving access for patients."

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

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