Despite significant challenges, rural healthcare leaders are embracing population health as their future—not because it offers economic salvation (it doesn't), but because it makes perfect sense for their mission: to provide care for the community.
This article first appeared in the October 2015 issue of HealthLeaders magazine.
Population health management is being pursued by many healthcare leaders, but it's a hard strategy to manage when the population is small and spread out. That's the difficulty facing rural healthcare providers, who have long dealt with an older and sicker demographic, difficulty in finding physicians, and economic constraints, and are now pushed to the brink by healthcare reform.
Yet many rural healthcare leaders are embracing population health as their future—not because it offers economic salvation (it doesn't), but because it makes perfect sense for their mission: to provide care for the community.
Population health—like everything else in healthcare—is resource-intensive. Many of the requisites for population health are more easily found in urban areas, where there is more of everything: more primary care physicians and subspecialists, more money to spend on very expensive healthcare information technology, and greater economies of scale for purchasing and leveraging with vendors and payers.
Of course, an essential component in population health is ready access to a population. As obvious as that sounds, in large swaths of the United States that's not such an easy proposition.
Still, leading healthcare providers in nonurban and rural areas say they can make population health work for the people they serve—and for their organizations—despite the obstacles. Among the approaches: cooperation rather than competition among equals, clinical integration that emphasizes providers' strengths rather than weaknesses, local engagement with a community rather than local ownership of all the components of care, and a focus on primary care rather than specialty care.
The challenges facing rural America
About 60 million people—one-fifth of the U.S. population—live in rural America, a designation that covers 95% of the nation's landmass. For the most part, U.S. Census data show that the 2,000 or so rural and nonurban hospitals that serve this population treat a patient base that is generally older, sicker, and less affluent than their urban counterparts.
Jane Bolin, BSN, JD, PhD, senior editor of Rural Healthy People 2020 and director of the Southwest Rural Health Research Center at Texas A&M University, says specific challenges facing rural and nonurban providers, such as diabetes or heart health, can vary from region to region. She views these regional challenges more as symptoms of a larger health crisis that all rural providers face: access to quality care.
Rural hospitals have much more difficulty recruiting and retaining providers than do urban hospitals. Wide stretches of rural America are bereft of healthcare services. A survey released in May by physician recruiters Merritt Hawkins, for example, found that 147 of Texas' 254 counties, serving a total population of 1.8 million, have no obstetrician; 158 counties, with a combined population of 1.9 million, have no general surgeon; and 35 counties have no physicians.
Added to that is the very nature of healthcare reform, which appears to be more advantageous in urban settings with larger populations that help to control risk, and easier access to providers and specialists. Simply put, rural providers often don't have the money or the personnel.
"If you're looking for a linkage that sees a patient through an acute event, or stops an acute event through chronic disease management and prevention of acute events, you'll need good pharmacy; good home healthcare providers; a chronic disease prevention program, which is largely outpatient-based; and all of the education that is needed," Bolin says. "For a rural hospital system to have all of those services is nearly impossible."
Rural and nonurban providers struggle to treat this patient population with dwindling Medicare reimbursements that they can do little to control. Since 2010, 55 rural hospitals have closed, and 283 more are on the brink of closure, according to a July statement from the National Rural Health Association.
Dire financial straits have prompted many rural and nonurban hospitals to surrender some of their cherished independence in exchange for affiliations that provide economies of scale and access to capital and services.
"They have to link up and collaborate with external organizations in the community to provide all of those services for referral purposes," Bolin says. "That is key to getting that enhanced Medicare reimbursement. Then you spread that reimbursement pot around to everyone who participates. That has been the challenge for a lot of rural providers. In an urban area you've got everybody within four or five blocks."
Well care for a sicker population
Scrolling through U.S. Census data on Appalachia presents a demographic of peaks and valleys. The mountainous region is among the nation's highest for rates of unemployment, poverty, disability, tobacco use, and chronic health issues such as diabetes. It ranks near the bottom for income, educational attainment, and percentage of people with health insurance.
That difficult socioeconomic terrain and the healthcare problems associated with poverty and inaccessibility of primary and chronic care were apparent to Tennessee's Kingsport-based Wellmont Health System and Johnson City–based Mountain States Health Alliance.
This year, the rival systems confirmed that Appalachia was not immune from the pressures to consolidate under healthcare reform when they announced plans to merge. The health systems expect the regulatory process to continue through the end of this year. The unified system will include 19 hospitals, more than 15,000 employees, and scores of outpatient facilities across the region.
Bart Hove, president and CEO of Wellmont, says the two systems have demonstrated success on their own "despite the difficult challenges we have being a low-reimbursement area and an area highly prone to health problems and demographic problems.
"All of those challenges really drove a lot of the thought process by coupling and partnering our resources together and avoiding the excessive cost implications of the local competitiveness to channel those resources back into trying to improve the health of our region," says Hove, who will be CEO of the as-yet-unnamed unified system. "We have a vision that utilizing extensively the community resources, working with our various community agencies, and working collectively amongst ourselves, we can more rapidly move from paying for volume to paying for value and really have a definitive impact on the health of the population of the region. That is the underlying principle for seeking to pursue this merger of equals."
In fiscal year 2013, Wellmont reported net patient service revenue of $754 million and net assets of $515 million, and MSHA reported net patient service revenue of $933 million and net assets of $448 million. The nonprofit health systems together provide access to care in 29 counties in the heart of Appalachia, where the mountains weave through Tennessee, Kentucky, Virginia, and North Carolina.
The shift toward population health, with its emphasis away from volume and toward outcomes, preventive care, and value-based reimbursements, was a big motivator for both health systems to pursue the merger, with its economies of scale and other efficiencies that come with the combination of two health systems. A big selling point was eliminating redundant services that are done to address competition.
"We've gone for 60 years with a healthcare system with payers saying, 'Do more, build more and we will pay you for it.' All of a sudden everybody is saying, 'We want you do to less,' " says Alan Levine, president and CEO of MSHA, who will serve as executive chairman and president of the new entity. "We've got to find a more rational way to take all of these resources we have invested and all this capital and capacity, and find a way to better deploy it."
With volumes and reimbursements shrinking, Levine says the health systems' ability to subsidize rural hospitals in their networks is jeopardized when the systems cannot shed redundant capacity and the costs associated with it.
"Collaborating more closely under a merged environment allows us, going forward, to be more rational in our decision-making so we are not creating redundant spending of capital and redundant costs and instead we can redeploy these assets," he says.
As elsewhere in rural America, the population served by the two health systems displays distressing health indicators, despite using hospital services at a high rate.
"We run about 124 admissions per 1,000 [population in the 29-county area]. The national average range is somewhere between 70 and 110," Levine says. "So we've got to find a way to bring down the unnecessary utilization that may exist. By doing that, it means you have all this fixed capacity in the region, and so by coming together, as opposed to being apart, it allows us to more rationally address the issue of all this capacity."
Reducing admissions requires an emphasis on wellness and prevention, and that requires access to primary care. The unified system will have a research and recruiting affiliation with the Quillen College of Medicine at East Tennessee State University in Johnson City, which has a national reputation for placing primary care physicians in underserved rural areas.
"Part of our strategy is to develop a 10-year plan related to the health of our community," Levine says. "ETSU, in partnership with us, is going to do a deep-dive public health needs assessment of the region, defined as southwest Virginia and northeast Tennessee."
There will also be a push for research grants from the National Institutes for Health and other funding sources.
"We think this investment in research not only will help drive the economic growth in the region," Levine says, "we also think it will help us solve some of these unique problems, where we have one of the highest rates of diabetes. Tennessee is the fourth highest in the nation in Type 2 diabetes, and our region is among the top five counties in the state. That is pretty compelling when you think about the need to understand data and how we target efforts."
If the plan works, the unified system will have one of the nation's most aggressive wellness programs.
"We are talking about creating a population health model that has not been done yet," Levine says. "When you talk to most systems about population health, they're talking about how to manage diabetes better. This is about going upstream and understanding what causes the rate of diabetes. Let's use the research data we get to address that. These are the things we don't get paid for. These are things we have to invest in. In order to invest in them, we have to generate the synergies between our two systems. It's all linked."
Maintaining independence amid integration
The phrase rural Nebraska borders on redundant.
The Cornhusker State's land area of 76,824 square miles makes it the 15th largest state by area, but its population density is about 24 people per square mile, well below the national average of 87. To put that in perspective, New Jersey, a state about one-tenth the landmass of Nebraska, has 1,196 people per square mile. Obviously, these two states have different population health delivery challenges.
The relative isolation of Wheat Belt communities over the generations has fostered a fierce sense of independence and self-reliance, two traits that run crossways with healthcare reform's insistent nudges toward integration, collaboration, consolidation, and scale.
With that in mind, 66 healthcare organizations in western Iowa, northwestern Missouri, and Nebraska joined together in a strategic alliance called the Regional Provider Network, LLC. Formed in 2013, RPN relies on nine founding-member health systems across the region that provide hub-and-spoke specialty and tertiary care for the rest of the alliance, which includes smaller critical access and community hospitals.
"Our two main strategic goals are to guide clinical integration in each of our members and their surrounding regions, and also take advantage of our scale to help reduce some of our delivery costs," says RPN President and CEO Michael Hein, MD, an internist.
But the rationale for RPN is to maintain the independence of the members. "In our region, there is a strong sense of community, and of the local influence of these healthcare systems in their communities, and a sense for maintaining that independence," he says. "Autonomy and independence are among our founding principles."
RPN is "driven by the recognition that health and health outcomes are a local construct, that our health—as human beings—is determined by the communities where we live. And the people who are best positioned to create value for our patients—improve the quality of care and lower the cost—are those closest to those in the communities," Hein says. "It is anchored in this deep belief that, ultimately, healthcare is local, and an organization that is anchored on that principle should be able to create value in a superior way."
While some outlying critical access hospitals don't have to contend with many competitors, several of RPN's nine founding health systems remain competitive, Hein says, which adds a certain friction to the mix that is not necessarily a bad thing. Those members include Nebraska Medical Center and Nebraska Methodist Health System, both Omaha-based, and Bryan Health in Lincoln, Nebraska.
"An alliance of competitors is the gambit of the strategic alliance," Hein says. "At the core of their DNA is that inherent tension between what is in my self-interest as an organization versus what benefits the whole. What am I willing to relinquish to the whole for the greater good versus what my needs might be locally? That is an inherent tension to this type of organizational structure."
Even if the RPN members wanted a more formal top-down relationship involving consolidations and acquisitions, Hein says it wouldn't necessarily be an improvement.
"Our furthest east member to our furthest west member is about a 10- or 11-hour drive on the interstate at 75–80 mph," he says. "It is a large geography, and for many of these communities, the hospitals are the sole providers of inpatient services in their area.
"That geography creates these unique markets that are distinctly different from each other," Hein says. "A vertically integrated system across that tends to have a need to standardize across all members—across all processes and outcomes—and oftentimes that is a challenge when you have distinctly unique markets."
Robert L. Wergin, MD, is a member of the RPN and a sole practitioner at Memorial Health's Milford (Nebraska) Family Medical Center. He says that the network can improve care quality for patients, provide more leverage with payers and vendors for otherwise isolated providers, and also help with recruiting physicians, which has always been a challenge in rural America.
The key to success, he says, will be to demonstrate to independent providers the benefits of clinical integration. "As we move to value-based payment, data will be king," says Wergin, who is also board chair at the American Academy of Family Physicians. "Medicare by 2019 wants a value-based billing system, so you need to show that you're meeting certain standards. If you are in a onesie-twosie office, developing the resources or infrastructure is challenging. Collectively you might."
That reassurance and support that RPN could provide can give rural physicians a sense that they are not alone, and could also help recruiting efforts in Nebraska, Wergin says.
"We know workforce shortages are an issue in rural areas, and one of those barriers might be the sense of isolation," he says. "Networking and demonstrating that support to a new young provider who is tech savvy might be another way to get them to understand the rewards of practicing in a rural areas and being part of a community."
Hein says the first hurdle for RPN is clinical integration and addressing the "messenger model" physician hospital organization structure, which serves merely as a conduit for messaging payer contract terms and conditions to providers, who then decide if they will participate in that contract. The PHO does not negotiate terms on behalf of its members and does not serve as signatory for contracts on behalf of its members.
"In contrast," Hein says, "we are building clinically integrated networks with PHOs as the nidus for that work [clinical integration]. With those PHOs as the 'engine' for creating clinical integration at a community and micro-region, we envision being able to negotiate value-based contracts with payers region by region as they mature. Eventually, RPN in its entirety will be clinically integrated and able to negotiate terms and serve as a single signatory for regional and statewide contracts.
"For us, that is taking those nine founding members—each of them having a physician hospital organization that either is being created or has been a messenger model—that we're positioning so it can be a clinically integrated network in those communities. There is a forum we created that allows those providers to interact around community-based metrics where they demonstrate opportunities on cost and quality," Hein says.
"Ultimately, as we're moving those nine founding members' PHOs forward, we can see that our physician network would become a super-PHO and be able to negotiate contracts with payers for the entire provider network that those PHOs represent. We really see those PHOs as the foundation anchor for our RPN."
Critical access hospitals in the network that lie within the footprint of RPN's larger hospitals would join the PHOs.
"We create this hub-and-spoke footprint across our geography that is anchored around the hospitals of those nine founding members," Hein says. "We are in the process of standing those up and firming up participation agreements between the PHOs and RPN, as well as the providers that participate in those PHOs and how they would be defined as part of the RPN provider network."
On the population health front, Hein says RPN will start with the combined approximately 37,500 employees and dependents covered by the health plans of the nine founding members.
"We have secured the data capabilities to understand utilization and cost and quality patterns of those employees," Hein says. "The RPN clinical leaders are identifying opportunities within our population and working directly with their local PHOs to target the interventions that will move the ball on our employee health plan."
Ultimately, RPN wants to expand population health initiatives to private employers in the region by 2017 "if we can demonstrate to employers and payers that we are able to effectively manage a population of patients," Hein says.
Establishing the PHOs, defining the provider network, and other heavy lifting for the RPN should be completed this fall, while the health plan initiatives for employees has already begun. Despite the challenges of geography, Hein says RPN "can position itself to be successful in value-based care."
"That is our intention and our goal," he says. "The pace of how that occurs somewhat depends upon the external environment and our competitors in the marketplace, but also the federal framework and the pace of policy change. The whole healthcare system is moving in that direction, obviously, and moving a lot faster than people perhaps thought would happen a few years ago. RPN will position our member organizations to participate in that."
Finding advantages in being small
While the trend in healthcare is toward consolidation and scale, some providers see advantages in staying small and local.
"In some respects we have advantages because of our relationships with the community, and our size has an impact in terms of its ability to relate to the patient experience," says Todd C. Linden, president and CEO of Grinnell (Iowa) Regional Medical Center.
"Those can be advantages in a small environment. Obviously, there are disadvantages with the skill sets necessary to do value-based payments and the scale required if you are going to get closer to the premium dollar and to be part of population health," Linden says.
GRMC is a private nonprofit 49-staffed-bed hospital located 54 miles east of Des Moines. In 2013, the organization reported net patient service revenue of $40.5 million and net assets of about $21.7 million.
The move toward population health at GRMC predates value-based care by more than a decade and was influenced, Linden says, in part by the facility's status falling between critical access and specialty care.
"We started about 15 years ago recognizing that as a 'tweener' rural Prospective Payment System hospital given some of the worst Medicare/Medicaid payments in the country—well below 75% of the cost in terms of reimbursement—the only way for us to be relevant to our community is to look at ways we can improve the health, even though we are not incentivized to do that," Linden says. "We opened our first community fitness center 17 years ago and partnered with the county health department, which is part of our organization today."
The process that led to developing a population health strategy also exposed potential problems.
"When we recognized many years ago that payment would begin to shift to population health, we believed it was important to begin to build skill sets that were not traditionally in the acute care hospital setting," says Linden. "These include programs like specific public health services, wellness initiatives, stress reduction, and integrative medicine services like massage therapy and acupuncture. These programs all put the focus on keeping the population healthy and will serve us as the flip from fee-for-service to value continues to evolve."
GRMC's independence is important, Linden says, but not to the point where it hinders the mission. Compromises have been made. For the past six years, GRMC has been affiliated with Mercy Health Network of Iowa and collaborates with Mercy Medical Center-Des Moines, which provides an array of support services for GRMC. In exchange for an annual fee to Mercy, which Linden declines to disclose, GRMC remains independent but consults with Mercy and its affiliated hospitals on quality, best practices, access to specialists, population health management, and HIT.
"I don't know that the notion of a local ownership is as important as local engagement, but we did find a middle ground and it's been extremely beneficial," Linden says. "Our partnership with Mercy offers a system of care, services, and support where GRMC is able to build the strongest local care delivery model while having access to national, statewide, regional, and local services and expertise."
In other words, GRMC enjoys most of the benefits of other hospitals in the Mercy network while remaining independent.
"The big difference would be if we were completely acquired or merged with the Mercy Health Network, there would probably be opportunities to participate in capital funding," Linden says. "The reasons we might consider a closer relationship would be likely two things: One is access to capital in the future because of our size and our financial position. If we are not able to enter into the capital market and have access to resources for major kinds of renovations or projects, that might be one reason to consider a closer relationship.
"The other is going to be what happens with the various networks for patients and employers if a tighter relationship is required to literally be part of a clinical network or some sort of insurance offering," he says. "That is likely another reason why one would consider having a tighter relationship. For now, we do enjoy most of the benefits of affiliation. It's proven very valuable for us for the past six years and is why we are continuously evaluating a closer relationship."
For example, GRMC has partnered with Mercy to retain legal services in a group purchase. "In addition, we are part of a Health Care Innovations Award from [the Centers for] Medicare & Medicaid Services with the Mercy Accountable Care Organization/Mercy Health Network," Linden says. "As a participation site for the Mercy ACO, GRMC will receive funding as it transitions to value-based care and helps create delivery models for the future of healthcare."
The affiliation with Mercy and HealthPartners, a nonprofit HMO and third-party administrator based in Minneapolis, has helped GRMC create a clinically integrated network for the combined 900 employees and dependents covered by the hospital's self-insured plan.
"About half of our medical staff have a direct employment or partnered relationship. The other half are in private practice. Having a clinically integrated network was vital to us to ensure that our clinicians have access to the information and data that would have been difficult under previous antitrust rules," Linden says.
"HealthPartners allows us to have access to information that we have never had: full access to claims data, full access to their care management and other kinds of services, deployed differently than the typical insurance company relationship where they tend to be miserly with that information," Linden says.
"Our clinicians are in a much stronger position to look at a population like our self-funded plan—our employees, their spouses and dependents—and use the biometric data that we collect through our wellness plan, use the claims data, [and] use their algorithms to help us not only identify the folks who are at most risk and who are consuming most of the resources now, but more importantly [to find] that group who, without some behavior modification or lifestyle changes, are going to be in that chronic disease state where they are going to have health and disability issues and also consume more resources in the future."
The results so far have been notable.
"GRMC has flattened our cost curve for health insurance costs, in essence spending the same amount per participant per year in 2014 as in 2008, which is unheard of today where most businesses are seeing annual increases of about 6% to 7% from 2008 to 2014," Linden says.
Using GRMC's self-funded plan as a petri dish, Linden says the hospital can leverage that experience to entice "other large self-funded plans in our community that will see the things we are able to do with our clinically integrated network and with the third-party administrator that we have teamed up with."
"We have invested in a health coach who we fund but works for HealthPartners, our third-party administrator, who can dedicate her focus to help our most at-risk members," Linden says. "Right now the person in this role is working closely on a regular basis with a number of employees who have chronic diseases like diabetes and hypertension, helping them with strategies to reduce their risks for complications and further illness."
Physicians who join the CIN must agree to best practices and other standards and protocols, as determined by a medical advisory board made up of other physicians.
"They agree to share data and participate in the kinds of things that make sure we can standardize the care and that people aren't falling through the cracks," Linden says. "Otherwise, I'd be forced to think about if I should create a narrow network for my own employees and dependents and spouses with just the physicians and advanced practice providers who are employed by us. With the CIN, I can keep it more pluralistic by allowing people to join the CIN, have access to providing services to my employees, giving employees full choice, but at the ame time creating a structure so we are standardizing the care and services that are offered."
While creating the CIN is a slog, measuring whether it's working is comparatively easy.
"We've proven we can control costs with our own health plan. The other metrics are going to be pretty straightforward things such as lost days and the numbers of employees who have chronic diseases," he says.
The limits of rural healthcare organizations
Although population health management is appealing for rural healthcare leaders, some providers say that limitations have to be acknowledged in the shift toward value-based care.
Richard Polheber is CEO of Benson (Arizona) Hospital, which is located 48 miles southeast of Tucson. He says care models that put his 22-staffed-bed critical access hospital at risk in a population health care continuum aren't realistic because the hospital board and the community insist on remaining independent.
"The infrastructure isn't there. Benson is 5,000 people. Our hospital district is 12,500, and it grows a little when winter visitors come," Polheber says. "There is just not enough base to keep specialists busy for a full-time practice, so trying to get that all coordinated becomes very problematic."
In fiscal year 2013, the hospital, which relies on Medicare and Medicaid for 75% of its patient mix, reported net patient service revenue of $10.5 million and total net assets of $4.9 million. The governing board at Benson Hospital has stated unequivocally that it wants to remain independent, which limits the options for a small hospital in the middle of the desert.
"Our board has made a decision that we don't want to merge with anybody else," Polheber says. "We think healthcare has a local focus and we are going to work to provide preeminent and quality care and do so through various alliances."
To leverage resources while remaining independent, Benson Hospital and three other nonprofit rural hospitals in the region joined with Tucson Medical Center in June to create the Southern Arizona Hospital Alliance, a loose affiliation that is expected to improve the hospitals' leverage with vendors and bring more physicians to the desert. Tucson Medical Center's executive director for network development, Susan Willis, is president of SAHA.
Polheber, who serves as chairman of SAHA, says Benson Hospital can tap into its community relationships to establish less-formalized population health programs that promote "personal ownership" through physical activity and diet. He's working with Benson's business community to bring in a local YMCA.
"The YMCA is working on this whole agenda of wellness and well-being with a raft of programs. In Tucson they have 90 different programs," Polheber says. "This moves us where the hospital doesn't own the wellness agenda but the business leaders in working with the YMCA and the hospital and the school district can make a meaningful difference. It's about finding niches."
The hospital is also developing a diabetes education program and support group with the hope that greater compliance toward a healthier lifestyle "will begin to nip away a little bit on the need for having these specialists," Polheber says.
"The problem is that the coordination of care requires a lot of resources, and I don't have the dollars to apply to that," he says. "That, to me, is the biggest challenge. I would love to own a population and say, 'We are going to coordinate the resources and make this all happen,' but I don't havethe money."
Benson Hospital's service area has only five primary care physicians and no OB/GYN. Polheber says he hopes the affiliation with SAHA can help bring more doctors into the service area. He says a strong primary care presence in Benson and the ability to refer complex patients to Tucson Medical Center makes the most sense, given the resources at hand.
"That's not necessarily a bad thing," he says. "Quite frankly, if you have a meaningful primary care delivery system, it takes care of a lot of issues, particularly if you create something in the community where the primary care docs aren't onesies or twosies practicing by themselves. The hospital can bring them together to understand best practices and what is going on in the industry. That could be very beneficial."
Can it work in the country?
Will all the affiliations, clinical integration efforts, and local engagement be enough to preserve rural healthcare organizations? Will the population health efforts improve the health of rural America's population, and of the healthcare providers who serve them?
Linden and other rural healthcare leaders concede that they won't readily know whether what they're doing will actually work in the long-term.
"All of this work around population health is going to play out over a number of years," Linden says. "There is not an immediate savings simply through providers moving to the premium side of the equation. But the long-term implications are clear. I've been a hospital executive for 25 years, and for the first time in my career the financial incentives are lining up more directly with what our true mission is, which is improving the health of our community."
Hein says the only way to find out is to plunge ahead.
"Some of my friends asked why I wanted to take this job," he says. "The honest answer is that I really do believe that healthcare is local, that our solutions for delivering the very best care are determined by local leadership, local providers, and community members working together.
"It's a compelling gambit and I think it is a model worth pursuing, particularly for our geography and where we are in the U.S. and our culture in our region," he says. "This is a model that may be superior, so I just wanted to put my money where my mouth was and see if I could join this bunch of other really smart, good people to make it work. I find it a compelling opportunity."
And if it doesn't work?
"I haven't really contemplated 'What if it fails?' " he says. "I think it will be successful. We'll give it our best shot, and if it doesn't work we'll find another way."
When it's operational on Jan. 1, 2016, Total Care will allow employees of large companies to access nearly 450 patient-focused care programs from 36 BCBS independent companies operating in 37 states.
The Blue Cross Blue Shield Association Tuesday announced the creation of Blue Distinction Total Care, a value-based national care network designed for large businesses with employees located in many different states.
When it's operational on Jan. 1, 2016, Total Care will allow employees of large companies to access nearly 450 patient-focused care programs from 36 BCBS independent companies operating in 37 states. The network includes more than 59,000 primary care professionals and nearly 59,000 specialty clinicians, with network growth expected to continue to in the coming years, BCBSA said.
Nearly 13 million BCBS enrollees already access Total Care in various local markets and this number is expected to grow as more employees of large multi-state businesses participate, said Maureen Sullivan, chief strategy officer for BCBSA, speaking by phone Monday.
"What's new is that national employers can now access it across markets," she says. "There is about $145 billion in spending going on now through value-based programs, so they are a significant part of the landscape, but until now national businesses with employees across the country could access this only by market-by-market. Now they have a national solution. This is a pioneering approach that provides a national network to that local market innovation."
The Total Care estimated savings range is between $6 and $9 per employee per month, or more than $840 million over traditional payment models on an annual basis, BCBSA said.
For Total Care to work, employers need to save money and their employees need to find value in the care. "Our criteria are built around those two outcomes," Sullivan says. The sales pitch to larger employers is that "for the first time you are going to have access to a national program that is patient focused that will provide more integrated care for greater savings and better long-term results. We think the employees are going to find it of greater value."
Sullivan says Total Care "will be monitored on an ongoing basis" to determine whether or not it's on track by the first or second quarter of next year. "If not, we will work with our local Blue Cross Blue Shield plans to adjust. We don't have a specific threshold for enrollment, but we want to see that it is growing."
The various local markets for Total Care plans have already showed savings through reductions in emergency department visits and reduced hospital admissions and readmissions.
Sullivan says the plans have demonstrated improvements in cholesterol and diabetes control, and higher screening and immunization rates. "Many of these started around a certain chronic condition. It's when you are in need of that integrated care that the gaps in our delivery system become most acute. That said, it's helpful for all of to have an integrated health system, but this has been built for people with chronic health conditions."
If Total Care takes off, BCBSA says there are plenty of resources for expansion with 700 locally designed, patient-focused programs in 49 states and Washington DC that include nearly 327,000 clinicians and 2,000 hospitals. BSBS plans now provide coverage for more than 42 million enrollees.
Patients "can't access the networks that their insurance companies are supposed to provide," says the chair of the American College of Emergency Physicians.
Seventy percent of emergency physicians say they routinely see insured patients in the emergency department who've delayed care because they can't afford high deductibles and copays, according to survey results from the American College of Emergency Physicians.
In addition, 73% of emergency physicians say they're seeing increased numbers of Medicaid patients who've delayed care because they can't find a physician in the narrow network provided by their health plan.
Rebecca Parker, MD
"The poll is a verification of what we are all seeing," says ACEP Chair Rebecca Parker, MD, an emergency physician in suburban Chicago. "As people are taking advantage of the Affordable Care Act, they are running into the barriers that we have been concerned about from the very beginning."
"I ask my patients who their primary care doctor is. I try to make sure they have access to care, and what I have seen is that their access to care is limited and at times their network is extremely narrow, even with the exchange patients," Parker says.
"I have seen that for years with our Medicaid patients, but our exchange patients are now facing high deductibles, high out-of-pocket expenses, and they can't access the networks that their insurance companies are supposed to provide."
ACEP's online poll of 1,433 emergency physicians and conducted last month found that:
60% of the doctors reported difficulty finding specialists for their patients because of narrow network plans that limit medical providers.
More than 80% reported treating patients who said they had difficulty finding specialists to care for them, because health plans have narrow networks.
65% said they are seeing an increased number of patients in the emergency department, in large part because health insurance companies are failing to provide an adequate number of primary care physicians.
73% reported seeing increased numbers of Medicaid patients because insurance companies were failing to provide adequate numbers of primary care or specialty physicians.
20% reported contemplating or knowing other emergency physicians who opted out of health insurance networks, and 90% of them say the reason was because health plans were not willing to negotiate reasonable market rates for services.
67% said primary care physicians send patients to EDs for tests or procedures when health insurance companies refuse to cover office visits
"It's concerning to us that our patients are trying to get the access to care that they are paying for and that insurance companies are not providing it," Parker says.
"If you look at what the average silver plans across the country started off with this year, their average deductible is $6,000. That is supposed to be the medium, reasonable plan. And if you look at what most Americans have in their savings for any emergency it's about $700. There is a disconnect. If you put on top of that the limits to access we are seeing with these narrow networks and the third piece of the equation the cuts of up to 70% for the providers and the physicians, it's the insurance companies that are the winners."
Critics Knock Survey
Clare Krusing, communications director at America's Health Insurance Plans, says the ACEP poll is flawed in its methods and findings. "They are not interviewing patients. They're interviewing their members. These doctors are increasingly charging higher prices to patients and leaving them in the middle," she says.
"Our biggest criticism is that they're not interviewing patients for their perspective, and they're not outlining the prices they are charging for their services and whether those are reasonable to start with."
Katherine Hempstead, director of coverage issues at the Robert Wood Johnson Foundation, also finds the ACEP survey lacking. "There are undoubtedly many areas of disagreement between payers and providers, but this study does not add much information to the debate," she says.
"The survey questions were generally not objective, and were in many cases quite leading, and this may have affected the results. For example, the findings related to difficulty in finding a doctor are not consistent with results from other recent surveys, where consumers report much lower prevalence of having such problems."
While high deductible plans were designed to incentivize consumers to buy the most cost-efficient plan to meet their needs, Parker says that's not happening.
"There is certainly an argument for 'skin in the game,' but a $6,000 deductible is a lot more than just some skin," she says. "We want people to feel like they can access care when they feel they need it. Because we are the safety net, we're seeing that our patients are delaying their care because they are concerned about these high deductibles and that is not right."
Krusing says health plans aren't forcing consumers into high-deductible plans.
"Each consumer, when they shop for coverage, is making decisions on what policy is best for them based on more than just a premium," she says. "Our focus is to make sure consumers have a better sense of what they are spending per month on healthcare, what is their medical utilization, how often are they going to the doctors, do they want comprehensive drug coverage?"
And despite ACEP's criticism of inadequate networks, Krusing says "the report wants to ignore the fact that all of these networks have to meet state and federal requirements for network adequacy."
"It overlooks the importance of choice in the market. But consumers have a choice to pick the plan that works best for them. In many ways it discourages those individuals who are looking for a high deductible plan," she says.
"That might be the best option for them, but this report is saying we can't treat those people. I would go back this group and ask 'what are the prices you are charging and why did you choose not to participate in the health plans' network?'"
The stronger U.S. economy is having a positive impact on philanthropy and many nonprofit hospital CEOs are coming to understand that fundraising is part of the job description.
A steadily improving economy and more sophisticated fundraising strategies have help U.S. nonprofit hospitals and health systems raise $9.6 billion in 2014, according to the Association for Healthcare Philanthropy's annual Report on Giving.
Steven W. Churchill, president and CEO of AHP, says giving was up 4.5% when compared with 2013. Fundraising efficiency—measured as the cost to raise a dollar (CTRD)—was 25 cents, a 3-cent drop over the past year. Return on investment jumped 14% over the past year to $4.05 for every dollar spent on fundraising, a 50-cent increase over 2013.
"The trend has been steady since the downturn of 2008. The stronger U.S. economy is definitely having an impact on gifts received from philanthropic organizations in the healthcare arena," Churchill says.
"Also, we saw in the recession individuals who were prospects to make major gifts were less likely to make multiyear commitments. Some of those individuals who were concerned about the economy are now more comfortable and making more multiyear pledges."
The Better Business Bureau says the general benchmark for CTRD for all fundraising is between 25 and 30 cents, and Churchill says that healthcare philanthropy has worked hard to "move the needle so that those making the gifts can feel better about the efficiency of the organization."
"Obviously, organizations that have a sophisticated major giving program are generally going to have a lower CTRD," he says. "As organizations get more sophisticated, they get more folks in the bucket moving through the system. They are going to have more planned gifts and that is going to drive down the CTRD."
Traditionally, fundraising by nonprofit hospitals and health systems has lagged behind colleges and universities. Churchill says that the gap appears to be "narrowing."
"Healthcare reform has changed the way in which hospitals generate revenue," he says.
"Because of that, the CEOs of hospitals often for the first time are looking for other sources. At one time, the CEOs didn't pay much attention to their foundations or considered them icing on the cake. Now, they recognize that turning to the foundations is probably more cost effective than a new clinical application."
In addition, Churchill says, many nonprofit hospital CEOs are coming to understand that fundraising is part of the job description.
"If you work as a university president you recognize that fundraising is going to be a big part of your job to be successful," he says. "That has not been the case with CEOs of hospitals and healthcare institutions. Fundraising has not always been a part of their job description and for many of them it probably still is not. That is changing."
"Higher education institutions have been in the business of raising money for a long time. They are more sophisticated and they recognize that their president is their strongest ally in terms of asking for a gift," Churchill says.
"Healthcare institutions are very complex. The skills that an individual has to lead a healthcare institution may be much different from those of someone leading an academic institution. The expectations have not been there because the income model for hospitals was much different for hospitals 10 or 20 years ago than it is today."
When compared with one-star hospitals, which have higher risk-adjusted complication and mortality rates, patients at hospitals with a five-star rating have a 71% lower chance of dying, according to Healthgrades.
Healthgrades is urging consumers to "do their homework" before choosing a hospital.
A report released Tuesday, Healthgrades 2016 Report to the Nation, notes that since 2011, one-in-six Medicare patients got their care from a hospital that had earned a one-star designation from Healthgrades. Had many of these patients done some research, they probably could have found a higher-rated hospital nearby for their particular procedure, says Evan Marks, chief strategy officer at Denver-based Healthgrades.
"The real message to consumers is to try to avoid hospitals with a one-star rating, especially if they can travel to a place that is not too far away or inconvenient for them," Marks says, "where they can at least find a hospital that is rated three stars or ideally one that is rated five stars. By the way, three stars is not bad. That means a hospital is performing as expected."
When compared with one-star hospitals, which have higher risk-adjusted complication and mortality rates, Marks says patients at hospitals with a five-star rating have a 71% lower chance of dying, and a 65% lower change of experiencing complications during their stay. If all hospitals met the five-star ranking, Marks says, more than 222,000 lives potentially could have been saved since 2011.
"It's a difficult challenge because consumers think about hospitals from a reputational standpoint, 'Oh that's a good hospital. That's where I'll get my care,'" Marks says. "They don't often think about the fact that different hospitals have different outcomes for differ procedures and service lines and you may want to consider different options based on this information."
Healthgrades says it continues to find "significant variation in health outcomes" among hospitals throughout the nation, and in local service areas. For example, outcomes among hospitals in Denver, CO for hip replacement surgery showed that complication rates varied from 3.9% to 13.6%.
Not all hospitals are good at every procedure, Marks says, which could further confuse patients. In the Chicago area, 14 hospitals received a five-star rating for treating heart attacks, but eight of those same hospitals received a one-star rating for knee replacement surgeries.
Marks says it's becoming more important for patients to become better healthcare consumers now that they're shouldering more of the medical cost with rising premiums and high-deductible plans. He cited a Healthgrades-commissioned study showing that 85% of patients would pick a different physician if the patient were given "objective information" that included physician experience, patient satisfaction, and hospital outcomes.
"We urge consumers, especially for issues where the outcome is going to affect your life, and especially in cases where complications can be severe, to look for hospitals that have first demonstrated improved outcomes, i.e. low mortality, low complications, [and] find the doctor who has highest concentration of experience in that disease or procedure that treats at that hospital," Marks says.
"That is how we recommend patients go about seeking care. Not finding a doctor who you happen to like and find out that he may be practicing at a facility with worse-than-expected outcomes." There is no direct correlation between the number of hospitals in a particular area and the level of quality, Marks says. For example:
In Chicago, of 46 hospitals that perform coronary artery bypass graft surgery, only two have a five-star rating for the procedure.
In Houston, of 38 hospitals that treat chronic obstructive pulmonary disease, or emphysema, only one has a five-star rating for this condition.
In the Los Angeles area, of 41 hospitals that perform coronary artery bypass graft surgery, only six have five-star rating for this procedure.
In Philadelphia, of 34 hospitals that treat heart attack, only four have a five-star rating.
In the New York City region, of 102 hospitals that perform colorectal surgeries, only two have a five-star rating for these procedures.
Healthgrades based its hospital ratings on approximately 45 million Medicare patient records for nearly 4,500 short-term, acute care hospitals nationwide. It assessed the hospitals' performance relative to common in-hospital conditions and procedures for the Medicare population using Medicare Provider Analysis and Review (MedPAR) data from 2012 through 2014 and one condition based on All-payer state data from 2011 through 2013.
Healthgrades adjust for risk factors that include age, gender, specific procedure performed, and co-morbid conditions, such as high blood pressure and diabetes. The outcomes reflect clinically based measures, including in-hospital complications or in-hospital and 30-day post-admission mortality.
"Much of what we measures, in terms of mortality and complications is not directly attributable to your physician," Marks says. "It has more to do with the overall care team at the hospital. Any one of them can make errors that result in complications or death, and it's choosing the hospital team, essentially, that is the most important thing, and then finding the doctor who concentrates on that particular disease or procedure."
Carriers didn't anticipate the volume of claims they saw after the implementation of the Patient Protection and Affordable Care Act.
Health insurers spent on average 92% of premium dollars from individual health plans on patient care or quality improvements in 2014, far exceeding the 80% threshold for medical loss ratios mandated by the Patient Protection and Affordable Care Act, according to a study by the Urban Institute and the Robert Wood Johnson Foundation.
Before the PPACA was implemented in 2010, the average MLR in 29 states for all insurers was below 80%. By 2014, every state had an average MLR at or above 80%. That percentage, however, can vary significantly from state to state.
Kathy Hempstead
Most states had an average MLR between 80% and 89%. Ten states and the District of Columbia had an average individual plan MLR of more than 100%, which means policy holders in those states could face a significant premium increase this year, said Kathy Hempstead, director of coverage issues at RWJF.
Hempstead spoke with HealthLeaders Media about her study. The following is an edited transcript.
HLM: Are your findings an endorsement of the PPACA mandates on MLR?
Hempstead: It's a bit of a mixed message. You could liken it to someone who needs to lose weight but they lose too much weight and you're thinking 'you don't look so good.' It's clear that some of these MLRs are pretty high. In fact, some of them are over 100%. That's a little too much of a good thing.
HLM: How did that happen?
Hempstead: It's called carriers losing money. That's easier for some carriers to deal with than others. It's not good for any carrier in the long run.
HLM: What's a good 'fighting weight' for MLR?
Hempstead: Most people feel like 80% to 85% is pretty good. When you start getting up into the mid 90s that's a place where it is really hard to see carriers making a living. You have to have people who are selling insurance if you want the market to work.
HLM: Health plans are sophisticated business organizations. How could they miscalculate to this degree?
Hempstead: The carriers have said they didn't anticipate how many claims this population would have, especially with the use of expensive pharmaceuticals. They did not anticipate how much utilization this population would have. They underpriced in the first year and they didn't even quite figure it out in the second year and some of them had even lower prices in the second year and now this is a big adjustment.
HLM: Should we anticipate a significant premium bump in the next year or so, and a leveling out after that?
Hempstead: You should imagine this to be a one-year adjustment because coverage has expanded. This is a one-trick pony. You can't keep seeing this because a lot of this population is now enrolled in coverage. Cruising at a higher altitude maybe the way to think about it; leveling off at a higher level of claims and a different experience with the population that people weren't pricing for.
At the aggregate level, healthcare spending is driven by increased utilization which is sort of what we are talking about with the ACA. The increased utilization is coming from coverage expansion. It's not coming from the covered person using more healthcare, except for people who just became insured. That is affecting the ACA plans, but not the employer-sponsored insurance.
Then there is the drug issue, which affects everybody, but maybe it affects ACA plans a little bit more if they have more people on specialty drugs. Healthcare service prices are not rising much. Hospital prices, and doctors' prices are increasing at a moderate pace. If that holds true and they make this one-time adjustment to account for the higher level of utilization and the higher use of prescription drugs, then you are at a situation where you would not expect to see continued big increases.
You would see increases reflecting changes in health services prices and maybe other changes with new drugs coming onto the market.
HLM: Why is the MLR fluctuating from state to state?
Hempstead: It has something to do with the markets in the different states. In some markets there may have been more of a price war. Some of these carriers knew they were pricing pretty low and there was some downward pressure in some markets, and a lot of people looked at the co-ops as injecting that into the market.
Some people said that some carriers priced really low because they thought 'I'm going to be OK with these risk corridor payments if things don't go that well.' That leads other carriers to price down there too. There could have been differences in the populations and differences in utilization. It might be interesting to look at the differences between states that expanded Medicaid and states that didn't because there is a whole segment in the (qualified health plans) in the non-expansion states that weren't there.
HLM: MLRs have tightened tremendously in four years. Is that simply because of an ACA mandate, or is something else in play?
Hempstead: It's because the product itself totally changed. The products that were on the market in 2010 (with a couple of states as an exception) were completely not comparable with the products on the market in 2014. They were weren't covering 10 essential health benefits. They were medically underwritten in a lot of states. They weren't necessarily offering super comprehensive coverage. They weren't the things that we today would define as health insurance. It was a funky market before the ACA and it wasn't the same in all states, but definitely it would be very hard to compare those products.
It looked like they were more profitable for insurers, for sure, in the pre-ACA times. On the other hand, they had much less volume. Now it looks like the carriers blew by the MLR requirement. That wasn't their problem, keeping it at 80%. The problem was keeping it under 99%. It was more the population and the market and the claims experience and the price competition and the whole dynamic of the market that priced optimistically and had low margins. I am sure a lot of carriers anticipated that 'yeah we want to get out there and get customers and stake a piece of the market' and they are willing to price aggressively to capture part of that market. If you do that you are going to have an MLR that satisfies the requirement and then some.
HLM: What do you anticipate over the next couple of years?
Hempstead: Probably some small carriers are going to have a harder time in this market than others. The individual market is not as profitable as the group market for obvious reasons. You don't have the economies of scale and there are more administrative costs per policy.
But the plans feel like it's this part of the market that is going to grow over the next several decades so I understand why everybody wants to be there. And I do feel that this is a one-time adjustment. But the market does favor larger carriers that can be more efficient in their own administrative costs and more importantly can leverage lower prices.
An expert in geriatric medicine calls for a more mindful and measured strategy that takes into consideration the physical and emotional needs and values of patients who are in their last years of life.
People live longer thanks to modern medicine. However, care providers can sometimes fail to account that people living to an advanced age are often coping with multiple chronic illnesses and likely do not fall under a standardized treatment regimen. It's a stage in the final years of life that more people will pass through as our demographic ages, yet providers often don't make the distinction.
Joanne Lynn, MD, a geriatrician, hospice physician, and director of the non-profit Altarum Center for Elder Care and Advanced Illness, is the lead author of a commentary this month in The Journal ofThe American Medical Association, which calls for a more mindful and measured strategy that takes into consideration the physical and emotional needs and values of patients who are in their last years of life.
Joanne Lynn, MD
Lynn elaborated on her JAMA commentary in an interview with HealthLeaders Media. The following is an edited transcript.
HLM: How did this disconnect develop between the patients' values and the care regimen?
Lynn: We inherited a healthcare system that was thought of mostly as a fix-it model. You get a gall bladder attack and you get your gall bladder out. You break a bone, you get it set. For most of history, the reason to go to a doctor was to get something fixed. That is a very good thing. If things can get fixed let's do it.
If things can be prevented let's prevent them. The upshot of doing that well is that we have changed how we come to the end of life. For the first few years in the 1900s people were mostly healthy until they died. The person had something devastating happen, an infection or an accident or childbirth, and then died very quickly. Now, those things will all be averted and you will live with progressively weakening body systems and we need a very different care system for that part of life.
A lot of the time people who are sick are getting their care in the emergency room, they're getting their care from a hospitalist for this three days, and then they're moved to a skilled nursing facility for eight days. They feel that they are on a conveyor belt and things are being done to them with nobody getting to know their hopes and fears, and their capabilities and resources and limitations.
We need to measure that care system differently because it is trying to provide different things. What I want is a care system that has continuity and that is concerned about my hopes and fears, and tailors a set of services to what I most need, rather than assuming that they're going to come in and fix it.
HLM: How is our healthcare system failing to address the needs of people who may not require hospice care, but who are often in the last years of their lives?
Lynn: This idea that you can do special things for these people who are neatly labeled 'terminally ill' is now one of the things that is in the way of doing a good job for people who are just living with the ravages of old age.
For the person who is living with advanced illness but without a predictable timing of their death, we need to be able to provide long-term supports. We know they are in the shadow of death, that it could happen relatively quickly and at any time, but the person could live a long time. We haven't redesigned the care structure around that sort of person.
HLM: Are you seeing this disconnect first hand?
Lynn: I take care of very sick people and see that the quality measures that are commonly in use are very much a misfit for a population at this stage in their lives. This part of most lives is not governed by the usual rules. A personal living with multiple chronic illnesses and serious disabilities and who will likely die within the next few years, there is not much sense in putting him through a colonoscopy.
But on the other hand there might be a tremendous value to learning if this patient wants to finish the great American novel or to get right with God or to avoid spending the family savings. People have very different priorities as they get toward the ends of their lives.
It really matters what are your hopes and fears, but we don't measure any of that. We measure in terms of professional standards. The cardiologist says you ought to be on these three drugs, and the oncologist says we need cancer screenings for people of this age. For the usual person at this age, yes. But what about a person who is facing a really serious illness?
HLM: What are patients telling you?
Lynn: Patients usually don't actually know to complain about the quality metrics. It's the doctors and social workers and nurses who say 'this is crazy! Why are we doing this to this person who either cannot benefit or wouldn't want it if they realized why we are doing it?'
There are some patients who are asking 'why am I still getting a mammogram when I am dying of kidney cancer or leukemia?' And everybody will stop and say 'Oh yes. Of course.' But most people will go along with it because the doctor ordered it and they don't think it through.
HLM: Isn't this something that could be measured through patient satisfaction scores?
Lynn: No. Most patients tend to be unduly satisfied. The majority of people make peace with what they have. There are some people who you can't satisfy no matter what you do. So, the variation is within a small range that is actually sensitive to the care that the person got. Plus, real charlatan care can be satisfying to the patient. You wouldn't want to measure only what the patient was satisfied with.
We should aim for a higher standard, and that should be that people really feel they got the best chance they could of living meaningfully and comfortably on their own terms as they get to the end of their lives.
Most of us now will live for a few years with serious disability and we haven't learned yet how to judge that piece of time. We talk about 'let's see if we can keep you from getting a pressure ulcer,' but that's not a reason to stay alive.
It's more 'can you maintain your role in the family? Can you do things that are satisfying for you? Can you attend to your spiritual issues? Can you avoid impoverishment?' For many people, they would like to stay in their own home as long as possible. Did people try to do that rather than put them in a nursing home at the first opportunity? There are a number of things that lots of people would say are important. And there are the idiosyncratic ones. The person who has an unusual preference—that is terribly important to that person.
HLM: How would you measure patient values?
Lynn: I would love to ask patients and families if they feel their care team is trying to help them achieve what matters most to them. It could be a five-point scale, and work toward having patients say 'yes. Of course!' When you talk to people about the experience they've had living with very serious illness with a family member, lots of people tell you how they felt blindsided.
The people who got a good deal will very tellingly say 'weren't we lucky my sister was a nurse, or my neighbor was a doctor.' Or they'll have some reason why things were lucky. We don't say we were lucky that the obstetrician caught the baby. We expect the obstetrician to catch the baby. I would love to get to the point where people expect to feel well supported through this period of their lives, where they are in a care system that is reliable, where if there is a mistake it's an unusual event, rather than what is expected.
The weekend effect is linked to reduced hospital staff. But there are five fixes, available even to small community hospitals, starting with EMR systems.
After years of research and dozens of studies, most people in healthcare accept that the "weekend effect" is real. What has remained in contention is what causes patients to suffer worse outcomes when they require hospitalization between Friday afternoon and Monday morning. Now a new study nails down why the weekend effect happens, and shows how hospitals—including small community hospitals with limited resources—can overcome it.
The study, by researchers at Loyola University Medical Center in suburban Chicago, provides more evidence that patients who undergo emergency or urgent surgery on the weekends have longer hospital stays. Study co-author Anai Kothari, MD, a general surgery resident at Loyola, says it makes sense "intuitively" that the weekend effect is linked to reduced hospital staff, rather than any characteristics of patients hospitalized on weekends.
Anai Kothari, MD
"You're working on the weekend with a smaller staff, and the resources aren't as readily available," Kothari says. "So, despite having maybe equal patient characteristics on the weekdays and weekends, the things in the ecosystem surrounding the patients on the weekend are different."
Kothari and his colleagues say that five resources can mitigate the weekend effect. They are increased nurse-to-bed ratio, full adoption of electronic medical records, inpatient physical rehabilitation, a home health program, and a pain management program.
The study, which appeared this month in Annals of Surgery, examined more than 126,000 emergency/urgent surgeries for appendectomies, hernias, and gall bladder removals that were conducted from 2007 to 2011 at 166 Florida hospitals. Using length of stay as the metric over the five-year span, the study found that 41 hospitals experienced a weekend effect for all five years, 87 hospitals wavered between having a weekend effect one year and no weekend effect the next year, 21 hospitals developed weekend effect during the study period, and 17 hospitals overcame the weekend effect using the five resources identified above.
"To us, the most striking thing was that the weekend effect is not inevitable," Kothari says. "A lot of people say the weekend effect exists and permeates throughout everything, but really there are hospitals that have it, there are hospitals that don't, and there are things you can do to avoid it. Understanding that it is a hospital-dependent feature was totally surprising to us."
As expected, the study's finding suggest that nurse-to-bed ratios play a role in the weekend effect; the higher the ratio, the lower the weekend effect. However, the biggest single factor reducing weekend effect was the adoption pf electronic medical records. Hospitals with full EMR systems were 4.7 times more likely to overcome the weekend effect. Only 12.2% of hospitals that had persistent weekend effect had fully adapted EMR, compared with 40% of hospitals that overcame the weekend effect.
Kothari and his co-authors "spent a lot of time talking around the table about why that would be," he says. "Our hypothesis is that a lot of this is influenced by care coordination. It's the same with ancillary or supportive services that have the same ability to look into the EMR and see what's been going on with that patient. So you have continuity of care even if you don't have continuity of personnel. We are trying to study that going forward to see if there are parts of the EMR specifically, whether it's clinical support systems, electronic medical reconciliation, or what pieces of the EMR are influencing the weekend effect."
One reason why the weekend effect has been so difficult to solve is that it is not universal, Kothari notes. "That is both encouraging and concerning in the sense that you first have to evaluate locally do you have the weekend effect or not. Then, once you are able to accept that, it's a prime target for intervention because it can make a difference without, hopefully, major changes."
If you want to measure the weekend effect at your hospital, Kothari says the answer might already reside in your EMR. "To us it seems like a ripe place to start," he says. "There are a lot of people who study the weekend effect in different ways. Some people ask, is our mortality higher on the weekend versus the weekday? But oftentimes if you don't have enough patients, it's hard to see the difference, or if there is high-risk surgery being done in both settings, it is hard to see a difference. We focused on length of stay for that reason, because it's easy to see differences in length of stay. The things that you can potentially influence can impact length of stay. That is a straightforward way for a smaller community hospital."
The healthcare industry shifts toward population health management and value-based care will likely create more incentives to identify and reduce the weekend effect.
Kothari says these efforts are overdue—and that the problem goes beyond weekend variability.
"It's not just the weekend effect; it falls under this larger umbrella of temporal patterns of care, where some people talk about the July effect, or the seasonality of care," he says. "It's all these things when you are talking about population health and value-based care that have to be considered, especially when you are structuring policy."
Aria Health CEO and President Kathleen Kinslow says finances are not the driving factor, rather, the deal is about "how can we be effective with population health and moving from volume to value."
Jefferson Health as entered negotiations for the acquisition of Aria Health System in a deal that could be finalized by mid-2016, the two Philadelphia-area health systems have announced. A non-binding letter of intent was signed last week and now the two non-profit systems will begin a 90-day due process period.
Kathleen Kinslow
This past May, Abington Health and Jefferson Health System merged into a single system that became the second-largest in the Philadelphia area. The new system now includes five hospitals, 19,000 employees, 13 outpatient and urgent care centers, and physician practices across Philadelphia, Montgomery and Bucks Counties in PA, and Camden County, NJ.
The Aria acquisition would add three acute care hospitals totaling 485 beds, nearly 4,000 employees and a medical staff of more than 1,000, along with a network of outpatient centers and physician offices in Northeast Philadelphia and Lower Bucks County.
Aria Health CEO and President Kathleen Kinslow says the deal would be a membership substitution that would not involve an exchange of cash, although the new system would take on Aria's assets and debts. "The only cost is going to be the legal and consultant fees," she says. "We have very little debt. Our debt-to-cap is only about 16%. We have a very strong balance sheet and little debt."
Kinslow says Aria began its strategic review two years ago to determine if it needed a partner. "At the end of that process it was determined that because of changes in the Affordable Care Act and movement across the country in the consolidations we were seeing that it would be optimal for our organization, to be able to live our mission, that we should seek a partner as well."
Finances were a factor, but not the driving factor in determined whether or not to seek a partner, she says.
"We had a troublesome year in fiscal 2013 and 2014. Most of that was based on revenue cycle management," Kinslow says. "We did a financial turnaround plan and we were able to improve the efficiencies of operation as we entered a revenue cycle process. We opened a new emergency room so we have been able to reverse that trend. We saw an increase in market share of about 8% and our volume year-over-year has been up 5%, which has certainly improved the financials."
The decision to find a partner, Kinslow says, "was more about how can we be effective with population health and moving from volume to value, the infrastructure changes you need, the IT systems. Being able to partner with a great academic medical center like Jefferson will give us those opportunities to serve our population."
Kinslow says Jefferson also has a strong sense of mission and "shares a similar culture to ours and we thought we could meld very well with them." As the two systems head into the 90-day due diligence period, Kinslow says she believes they're on the same page. "I have every confidence that as we go forward there will be no surprises," she says.
Regulatory snags are not expected. "Our research suggests we are in a good position," she says. "We don't have much overlap on the zip code analysis, so I feel very hopeful that we should not have problems."
To ensure some measure of local control, Kinslow says the structure will allow for a local board that would continue to manage and monitor quality in the organization and work with the physicians to ensure that clinical programs are moving forward.
"What makes this relationship very different from the traditional academic medical center and community hospital, is that Jefferson has been very willing giving two community health systems, Abingdon and Aria, authority on the governing boards, not just for the clinical enterprise, but at the university as well. You don't often see that and it's something that was very appealing to us. It allows us to continue to serve our community, yet have that strong academic base that will allow patients to have the best of both worlds."
FL, GA Systems Form Regional Alliance
Jacksonville, FL-based Baptist Health, Flagler Hospital and Southeast Georgia Health System have formed a regional alliance called Coastal Community Health that is designed to share best practices, improve outcomes and achieving efficiencies of scale.
"This is a very important affiliation and an opportunity to position ourselves to thrive in the future as a highly integrated network of community-based, locally governed health systems," Baptist Health CEO and President Hugh Greene said in prepared remarks. "Together, we believe we can expand access to healthcare services in our regions and further our mission to improve the health and well-being of the communities we serve. That community focus is our common core."
Hugh Greene
The three health systems serve separate, but contiguous markets spanning from Brunswick, GA, to Jacksonville, to St. Augustine, FL. and will continue to operate independently as locally governed, community-focused health systems. Greene will serve as initial CEO of Coastal Community Health. Joe Gordy and Michael Scherneck will serve as executive vice presidents of Coastal. All three will maintain their roles as CEOs of their respective health systems.
The Coastal board of directors has 12 members, three each from Flagler Hospital and Southeast Georgia Health System and six from Baptist Health.
Collaborative workgroups from each of the three health systems are looking at various initiatives to improve population health, including: enhanced child health services, telehealth, disaster planning, and care coordination.
Weill Cornell Medicine Changes Name
Weill Cornell Medical College has changed its name. Effective immediately the New York-based college is now called Weill Cornell Medicine.
In a media release explaining the name change, the college said "the brand succinctly unites Weill Cornell Medicine's three essential principles—to care, discover and teach—and underscores how patient wellbeing motivates the entirety of its ambitions."
Laurie H. Glimcher, MD, dean of Weill Cornell Medicine, said in a media release that the "name now fully encapsulates the strength and totality of our mission—keeping the patient at the center of everything we do."
When weighted for enrollment, more than 70% of MA-PD enrollees are in contracts with four or more stars, a nearly 11 percentage point in increase from 2015, CMS said. But six health plans that have received fewer than three stars for the past three years face termination by Medicare.
Nearly half of the nation's 369 Medicare Advantage plans with prescription drug benefits (MA-PD) have earned four stars or higher in the Centers for Medicare & Medicaid Services five-star scoring scheme, up nine percentage points from 2015, CMS's reported Thursday.
When weighted for enrollment, more than 70% of MA-PD enrollees are in contracts with four or more stars, a nearly 11 percentage point in increase from 2015, CMS said.
As has been the case in past years, non-profit plans continued to outperform for-profit plans in the 2016 Star Rankings for MA-PDs. Approximately 70% of non-profit plans received four or more stars, compared with only 39% of for-profit MA-PDs. Similarly, 63% of non-profit PDPs received four or more stars, compared with only 24% of for-profit PDPs.
CMS said the length of time that a particular plan had with Medicare Advantage was another key indicator of success. For example, more than 60% of the 202 MA-PD plans that earned four or more stars have been involved with the program for more than 10 years. None of the 44 MA-PD plans with five years or less experience in Medicare Advantage earned five stars, while 43% of earned three or fewer stars.
The 12 highest-performing (five-star) MA-PD plans:
Low Performers
It was not all good news. Six health plans that have received fewer than three stars for the past three years face termination by Medicare. These so called "death row" plans include:
The annual release of the Star Ratings, in place for nearly a decade, prompts an avalanche of self-congratulatory press releases from plans that have earned four or more stars. There is more at stake than bragging rights, however, because CMS has also attached financial incentives to the ratings for plans earning four or more stars.
The Star Ratings measure scores of quality and performance measures in the various Medicare Advantage plans that take into consideration outcomes, intermediate outcomes, patient experience, access, and process.
For the 2016 Star Ratings, CMS said outcomes and intermediate outcomes continue to be weighted three times as much as process measures, and patient experience and access measures are weighted 1.5 times as much as process measures.
CMS said it assigns a weight of 1 to all new measures. The Part C and D quality improvement measures receive a weight of 5 to further reward contracts for the strides they made to improve the care provided to Medicare enrollees. CMS said it will continue to lower the overall Star Rating for contracts with serious compliance issues, defined as the imposition of enrollment or marketing sanctions.
