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What’s Healthcare’s Greatest Rising-Risk? Chronic Disease!

August, 2016

NOW is the time to move to value based healthcare, Time has run out for “ifs” or “whens””. Health systems are preparing for impending change in their revenue streams, now at the precipice they must make the decision to lead, follow or be laggards and resist the transformation at their own peril.

Pioneering health systems are already partnering with value-based payers and creating innovative shared and full-risk contracts.  A new breed of leadership focused on Population Health Management (PHM) is essential to success under the new alternative payment models that reward maintaining a healthy population.

Critical to staying competitive, health systems must continue the acquisition of value-based care payer contracts.  These contracts also include the acquisition of significant financial risk. However, PHM’s task is to identify, track and manage the real drivers of costs across their populations and in doing so, manage and harness the risk.

Risk, Cost and Revenue

Chronic diseases are overwhelming our health systens. According to the Centers for Disease Control and Prevention (CDC), chronic diseases are responsible for 7 of 10 deaths each year, and treating people with chronic diseases accounts for 86% of our nation’s total healthcare costs.1  Even more astonishing is the new data from the Agency for Healthcare Research and Quality (AHRQ) highlighting that the staggering concentration of healthcare spending is being compressed as chronic diseases progress along the care cost continuum.2   Health systems have no choice but to react quickly to chronic disease progression as:

·        The top 1% of persons ranked by their healthcare expenses accounted for 21.5% of total healthcare expenditures with an annual mean expenditure of $95,200

·        The top 5% of the population accounted for 48.7% of total healthcare expenditures with an annual individual mean expenditure of $43,253

·        The top 10% of the population accounted for 64.9% of total healthcare expenditures with an annual individual mean expenditure of $28,808

·        The top 50% of the population ranked by their expenditures accounted for 97.1% of overall healthcare expenditures with an annual mean expenditure of $8,619


The Population Health Management (PHM) Care Model

Population Health Management (PHM) enlightens the value-based care evolution underway. PHM has become a critical concept for health systems who are working to rebuild their historical, legacy  operations to address the growing challenges of value-based care payment models and accountable care.


The ability to sort a defined population into clearly labeled buckets – well, low-risk, rising-risk and high-risk – is a fundamental step towards creating and implementing standardized, comprehensive care and to changing the health behavior framework necessary to address the high costs of chronic diseases, reduce preventable readmissions, and connect chronic disease population groups to community-based resources they need to live healthier lives.

With high risk/acute patients costing 2-5x more than other buckets of populations, the ability to offer cost effective care management solutions is key.  However, even with the best care management practices, the constant influx of rising-risk population groups migrating into the high-risk will offset efforts to maintain or lower costs. Healthcare resources and dollars must now be re-directed to improving lifestyle and behavior.  The overall goal of population health management (PHM) centers around finding solutions that can combat the rising tide of populations with multiple chronic diseases.

Chronic diseases appear gradually.  If unmonitored, the illness eventually becomes life threatening.  This model of illness is fundamentally different then that of acute illness, and healthcare has yet to grasp that difference.  A chronic disease is not like a raging house fire.  It's like a smoldering fire in a pile of leaves that slowly reaches aflame.  Healthcare has designated staggering resources to addressing the life ending fire at the cost of ignoring 90% of the smoldering chronic disease progression that is steadily increasing population risk of health and cost. 

Today, almost 88% of U.S. healthcare dollars are spent on medical care:  access to physicians, hospitals, procedures, drugs, etc.  However, such care accounts only for roughly10% of a person’s health.4 Other determinants of a person’s health:  their lifestyle and behavior choices, genetics, human biology, social determinants, and environmental determinants – account for approximately 90% of their total health outcome.

What's Next? Chronic Disease Progression Firewall

Now health systems must plug the rising-risk surgingalong the care continuum into the high-risk groups.  Care costs grow exponentially whenmoving along the continuum after chronic disease diagnosis.  Given this dramatic rise in financial risk, a new standard of care needs to be created, that will function as a “firewall” between the rising-risk and high-risk.  This “firewall” or “intervention” needs to address population groups with one or more chronic conditions, and work to slow, stop and even reverse the progression of those diseases.

The rising-risk chronic disease population group usually represent 20-30% of a defined population, and due to their numbers, can surprisingly account for a greater total healthcare spend than the high risk.  In addition, about 18% of rising-risk population group can become high-risk each year.3 Unlike the high risk populations, PHM can target the risk factors and behaviors that underlie multiple chronic diseases, not just diagnose the disease states themselves. This enables health care managers to target the root causes of multiple conditions to slow, stop or even reverse the progression of chronic disease.

Health Systems Can’t Wait

As a matter of survival for health systems, acquiring value-based care contracts cannot wait.  Most chronic diseases are not curable, but can be managed.  Changing health behaviors can slow, stop or even reverse the progression of a chronic disease, particularly from the point where symptoms emerge until a life threat exists.  Rather than curing chronic illness, health systems are learning to manage their progression.  Systems need to reach across the aisle to community resources to fill this gap in care.

As patients are diagnosed and populations stratified, clinical care teams will transition chronic disease groups to community care teams for intervention program participation in more accessible, lower cost settings.  This is the “firewall” program and new standard of care that health systems must have to reduce the migration of the rising-risk into the high cost category.

 

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Phil Trotter, B.S., leads the Exercise is Medicine® (EIM) on-the-ground team to integrate physical activity as a standard component of intervention, prevention and care management programs that support the implementation of Community Care Collaboratives and the necessary resources for community-based delivery of healthcare to payer, patient and underserved populations. Phil is a Community Care thought leader and Collaborative subject matter expert consulting with health system leadership and population health management executives and their teams.

Felipe Lobelo, MD Ph.D., is an associate professor of Global Health at Emory’s Rollins School of Public Health and directs the EIM Global Research and Collaboration Center (EIM-GRCC). The EIM-GRCC is the academic hub in charge of leading the evaluation of the EIM initiative, in collaboration with partnering health care systems, community organizations, and fitness and technology companies.

Ashley John Heather, B.A., co-founder of Off The Scale ® a turnkey, chronic disease intervention platform. www.OffTheScale.com

References

1 Chronic Disease and Prevention and Health Promotion. Centers for Disease Control and Prevention (CDC). http://www.cdc.gov/chronicdisease/. Accessed May 24, 2016.

2OPEN MINDS Daily Executive Briefing {internet}. Monica E. Oss. The IRS Turns Its Attention to ACO’s. April 12, 2016. Available from:  http://us3.campaign-archive2.com/?u=ba359ce1c416ea9db3b26a100&id=2d39ef63b0&e=0e330104f9

3Advisory Board Care Transformation Center Blog {internet}. Hamzan Hasan. Population health managers, meet the three patient types central to your success. October 23, 2013. Available from:  https://www.advisory.com/research/care-transformation-center/care-transformation-center-blog/2013/06/three-care-delivery-models

4What Makes Us Healthy vs. What We Spend on Being Healthy. Bipartisan Policy Center. http://bipartisanpolicy.org/library/what-makes-us-healthy-vs-what-we-spend-on-being-healthy/. Published June 5, 2012. Accessed May 24, 2016



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