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Tech Investment Is Just One Step on Path to Value-Based Payment

April 7, 2015
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Practice redesign must be data-driven, Continuum Health Alliance execs say at Population Health Colloquium

The 15th Annual Population Health Colloquium, put on by the Thomas Jefferson University School of Population Health in Philadelphia in late March, featured many exciting presentations on emerging trends, and my goal is to report on several of those over the next few weeks. One of the most powerful was by Christopher Olivia, M.D., president, and Michael Renzi, D.O., chief medical officer of the Continuum Health Alliance, an ambulatory care services company.

Dr. Renzi designs and oversees Continuum’s population health management service, including programs involving patient-centered medical care, IT and shared savings reimbursement models.

In a session called “Population Health Management 2.0: Real Value in Care,” Olivia and Renzi offered up some great insights into how healthcare organizations should think about transforming their care models to move to value-based payment, and particularly how they should think about the use of technology. And some of their observations may seem radical or counter-intuitive.

Olivia started out by saying that if you look at the ACO movement, many ACOs surpassed their quality hurdles. But three-quarters didn't receive shared savings payments. That suggests there is more to the game than just achieving Patient Centered Medical Home Level 3 certification and hitting all your PQRS metrics. “We believe that’s necessary, but not sufficient,” he said.

Just focusing on quality hurdles does not lead to reductions in cost of care, Renzi said. The medical home in and of itself does not lower the cost of care, he added. It has to be married to a cost of care strategy.

Olivia said in value-based care, you must keep your eyes on changes at the margin to understand if you are being effective. ”We look for ambulatory volume,” he said. “If you are closing gaps in care based on evidence-based medicine, ambulatory volume and cost of care goes up. If we don’t see that, we know the docs and nurses aren’t doing their jobs.”

He also said that technology investment does not lead to value-based payments: “We do not see tremendous transformation in medical process delivery from technology,” he said. Technology is important as an enabling tool, Olivia said, but when people start an ACO or build a clinically integrated network, the first thing they do is buy technology. “Wrong,” he said. “Technology alone does not change workflow. Does the EHR change work flow? Yes, it makes it worse. How many physicians love your EHR? We see EHRs used as word processors.” Continuum finds some organizations where only 5 percent of physicians are using it in work flow. “Doctors hate EHRs,” he said.  “Buying physicians EHRs does not lead to a successful quality program or cost containment program.”

Renzi noted that the ACO he practices in lowered emergency department utilization, drove generic utilization of drugs, managed high-risk patients, lowered readmissions and crossed several quality hurdles. “And the cost of care went up 6 percent. They did everything right and cost of care still went up,” he said.

So what happened? “We were shocked,” he said. It turns out there are multiple subgroups in patients getting admitted that need to be managed who are not getting managed. Renzi gave this tip for those working on ACOs: “Look inside nursing homes. You are getting creamed on costs there,” he said. “They won’t let you in for care coordination. It is a huge hot spots of spend.”  He said many patients in nursing homes are having terrible life experiences and “we are doing nothing but readmitting them over and over again.”

Olivia asked the audience if they knew who most commonly made decision about whether to send nursing home residents to the hospital. After audience members made a few guesses, he hit them with the stunning truth: It is the security guard. “Doctors don't see them; the nurses are busy. The security guard calls 911.”

So Continuum developed what it calls the security guard admission model. When nursing home patient hits the emergency department, the chances of them being admitted in New Jersey is 70 percent, regardless of diagnosis, Renzi said. “So we said to the nursing home, if the systolic blood pressure has three digits, take them to urgent care. We figured the security guard could figure that out.”  

To redesign how they deliver care, providers must control leakage out of their network, they said. With too much leakage you can’t have proper attribution and you can’t manage the population, they noted. 

“This process has to be data-driven,” Olivia said. Data ultimately helps you identify where you put resources.”

What about the role of hospitals in value-based care? “We don’t believe hospitals are going away,” Olivia added. “We just don’t need as many of them. We need them in a form that expands the ambulatory system around them enough to support one box — not one box in each community but a large enough clinically integrated network of providers in an ambulatory system using population health that appropriately admits to the hospital. That is the paradigm shift that needs to occur in the thinking, not hub and spoke and fill the box with volume.”

The focus, he said, should be moving things down into the ambulatory system. “Never do anything in the hospital you can do in ambulatory center, and never do anything in the ambulatory center you can do in physician office, Olivia said. “Never do anything in physician office you can do safely and effectively in home or on a mobile device.”