Frank Williams, CEO, Evolent Health
Last year, The Advisory Board and UPMC Health Plan jointly launched Evolent Health, an independent company that partners with health systems navigating the path to value-based care. Evolent provides a provider-driven, payer-agnostic platform that accelerates the population and risk management capabilities needed to make this transition.
As Evolent’s CEO, I have talked with many health system executives about their need for a sophisticated solution to a number of important market challenges, including:
- Shifting from volume- to value-based reimbursement
- Accelerating provider acquisition and consolidation activity
- New partnership models with payers, providers, and government programs
Getting Started: Staging Your Population Management Strategy
While these challenges drive opportunities for innovation in the marketplace, they also make the competitive landscape more complex to navigate. Many systems have responded by starting a migration to value-based care delivery, adopting a population health management strategy, and assuming risk for a meaningful number of lives.
The pursuit of such a strategy requires significant investment in capabilities outside the typical health system’s portfolio. Even so, the evidence suggests that health systems that take the driver’s seat in this migration will find themselves best positioned to take advantage of the opportunities presented by market transformation.
In our work with founding partner UPMC, as well as through conversations with other market leaders, we see six key arguments supporting this proactive response over a wait-and-see approach:
- Control over pacing and choice
- Adequate time for capability development
- Greater network attractiveness to payers and physicians
- Richer data and visibility
- Stronger patient and provider relationships
- Avoiding commoditization
Control over pacing and choice
The migration to value-based care requires a strategic and cultural shift for most health systems—one that can take years to complete. Systems that begin now will have greater flexibility to transition and evaluate opportunities at their own pace.
Consider Sharp Healthcare in San Diego, a system that has actively pursued and managed risk for over 15 years. Sharp has steadily grown its population management business through capitated contracts and its health plan. Taking a staged but proactive approach allowed Sharp to pace the transition in step with a clinical growth strategy and financial plan that strengthened its competitive position.
Other systems are now taking a similar, phased approach. For example, MedStar will use the Evolent platform to improve cost and quality outcomes for its own employee base and existing managed Medicaid plan first, then progress to multiple Medicare initiatives and future commercial shared savings partnerships. This staged approach will allow the system to start with a manageable population and move forward deliberately, rather than changing their business model overnight.
Adequate time for capability development
A successful population management approach requires investment in new tools and capabilities—in-depth analytics, stratification, workflow technology, targeted care management interventions and infrastructure, and scaled health plan operations—that lie outside the typical health system’s core competency set. As UPMC’s experience indicates, getting an early start on developing these capabilities provides the time and opportunity to understand each population, assess risk, and develop targeted engagement methodologies and interventions.
UPMC’s innovations for its Medicaid population illustrate why starting early makes sense. UPMC currently provides care management and education services for its Medicaid population through a patient centered medical home program. For those members who cannot access office-based services due to remote locations, immobility or other issues, the health plan provides at-home care management and monitoring programs. Both programs show significant ROI on financial and quality measures, but the capabilities necessary to design and execute them did not develop overnight. Rather, amassing the data and analytics, designing targeted interventions to meet population needs, and engaging patients in their own care required functional and cultural intelligence that UPMC acquired and scaled over time.
Greater network attractiveness to payers and physicians
Health systems that prove their capabilities with one or more populations will attract payers and employers looking to share risk on defined populations. This allows for greater opportunities to participate in narrow networks, downloaded risk contracts, and other value-oriented arrangements. In addition, it draws physicians looking to align with a health system and participate in value-based pay-for-performance arrangements, medical home programs, and the like.
By contrast, letting others get a head start on population health management could leave a health system excluded from some payer or employer networks, less-favored by physician groups, or losing leverage and control in pricing negotiations. We have seen this trend across the country—most recently in Harvard-Pilgrim’s announcement that it will exclude higher-priced providers from its network to lower premium costs to its members.
Richer data and visibility
The deep insight necessary for successful population management requires the aggregation and analysis of vast amounts of data from claims, PBMs, health risk assessments, lab screenings, clinical records, and care notes. This holistic view provides a superior method for identifying high-risk patients who will benefit the most from early intervention. UPMC Health Plan’s population management and workflow platform integrates all of the above data and more, identifying up to 50% more high-risk, chronically ill patients than typical disease registries and supporting earlier engagement to lower costs and improve outcomes.
Beyond identification and early patient engagement, the insight driven by population management analytics helps health systems see beyond the inpatient environment, expose care gaps, illuminate quality and outcomes improvement opportunities, and highlight opportunities for clinical service expansion.
Stronger patient and provider relationships
Leadership in the migration to value-based care affords health systems an opportunity to forge a closer relationship with patients and providers. On the patient front, the targeted services that make up a population management strategy provide education, coaching support, and conveniences that meaningfully improve patient health and engagement.
For providers, population management services provide valuable data across the care continuum to help the physician understand his patients holistically, and provide scaled resources and care extenders such as pharmacists, nutritionists, and embedded nurse care managers not typically available in a physician office setting.
For example, our population management approach embeds a nurse care manager with high-volume physician offices to handle patient education, medical reconciliation, and care coordination services. This enabled relationship has helped produce best-in-class provider and patient satisfaction and loyalty for UPMC.
In a world that will increasingly focus on value when making purchase decisions, health systems need to evolve beyond the traditional inpatient fee-for-service model or risk being commoditized. Developing a comprehensive strategy that looks at population health, network development, clinical analytics, care model redesign, and innovative contracting methodologies can serve as a road map for profitable growth across the next decade.
And that's the reason we formed Evolent: To help hospitals and health systems along these six dimensions, and support them to make these meaningful, essential changes.
For More Information
If you are interested in learning more about Evolent Health’s perspective on successful population management strategies, as well as UPMC’s successes, please join me for a webconference on July 18, 2012. Register now.