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HFMA Live: A PCMH Model

June 27, 2012
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Closely managing high-risk patients pays off at Adventist


Regardless of what happens with the Supreme Court decision on the healthcare law, provider organizations have the opportunity and responsibility to act today to improve care, according to James G. Lee, executive vice president and chief financial officer of Adventist Healthcare, Rockville, Md. In 2009, the health system started a primary care medical home pilot system for its employees.

Adventist consists of three acute hospitals, a behavioral health center and rehabilitative hospital, and has total annual operating revenues of $800 million. It is self-insured for the health benefits provided to its 7,200 employees and dependents, which it manages through HealthNet, with annual medical expenditures of $26 million.

According to Lee, from 2004 to 2008, HealthNet’s annual expenditures rose at 4.2 percent per year, which is lower than the national increases in cost. But in 2009, its claims expenditures rose sharply, by more than 12 percent. This led to a decision to test if better medical management would lead to better outcomes and lower costs.  A small number of its patients (6.3 percent) of 454 covered individuals accounted for 60 percent of costs. It made the decision to pilot the Primary Care Medical Home model in late 2009.

Objectives of the project were to help high-risk members improve their health and increase the efficiency of healthcare delivery for these members; support primary care physicians treating these members; and to meet these goals with a moderate health plan cost escalation.

The members fell into four groups: no known risk, low risk, moderate risk, and high risk. High-risk scores, usually multiple co-morbidities, were expected to account for 50 to 70 percent of the plan’s annual cost. Of the members who were considered high risk, 121 were “poly” users that saw at least 15 different providers in 2009 and had at least nine prescribing physicians. In 2009, 46 members entered the pilot, selected from the high-risk group. (The plan added 23 members in 2010 and 79 members in 2011.)

Each PCP in the pilot was assigned a personal health nurse, whose role was to work with the physician to establish a personal health plan for each high-risk member, which could include dietary counseling, baseline appointments for screenings, an exercise plan or pharmacy assessments. The nurse would also facilitate compliance to the healthy living plan and report the member’s progress to the PCP.

A physician portal, a claims-based record that discloses all diagnoses, procedures, inpatient stays, and prescriptions for a patient, allowed PCPs to access the personal health record of high-risk patients. This allows the PCP to easily review records, prescriptions, and activities between patient visits, and to monitor each patient’s health.

As a result, the number of high-risk members seen by PCPs participating in the pilot was reduced by more than 59 percent from 2009 to 2011. Most of those members moved into the moderate- to low-risk categories. The reduction in overall use had a direct impact on the overall plan per member per month performance. Pilot participants’ PMPM costs dropped 28 percent, from $1,981 in 2009 to $1,422 in 2011.

Adventist has now expanded the program. The number of individual physicians with high-risk members has shifted to practices with the whole population covering all risk factors. The program has expanded from four practices with seven physicians in 2009 to 25 practices with 114 physicians in 2011. Costs of the PCMH members declined by $1.8 million (14 percent) in 2011 compared to 2010; costs for non-PCMH members increased by $1.4 million (9.5 percent) during the same period.

Next steps include the adoption of EMRs and physician portal use by physicians; and to expand the use of tools and reports to measure clinical outcomes; compliance with evidence-based medicine; outcome comparative analysis; and specific management of major diagnostic and disease categories.

According to Lee, hospitals have to learn how to manage chronic care patients, given the reimbursement implications of readmissions. The easiest and best place for a hospital to start is with its own employees, and self-insured employee benefit programs are an opportunity to prepare for transformation of care, he says. Having physicians sign on is critical to success, as is having the right information and data. There are a lot of process changes that have to happen, and they require capital, he says, adding that there are payers that are willing to work with hospitals and patients.