Editor's note: This popular story from the Daily Briefing's archives was republished on Aug. 13, 2020.
As the health care industry moves toward value-based models of care, Intermountain Healthcare President and CEO Marc Harrison writing in Harvard Business Review offers his five principles to implementing a successful value-based care program.
1. Disease is the 'enemy,' and connecting science and care is key.
Harrison writes that the goal of value-based care should be to improve public health, rather than to score political victories. "[A]nd the ways to improve public health should be based upon and responsive to the best science we have to offer," Harrison writes.
Toward that end, Intermountain has formed a partnership with deCODE Genetics for their HerediGene Population Study, which focuses on discovering connections between genetics and human disease, Harrison writes. This project "will speed up the time between research and application, and it will look at a wide range of chronic diseases," Harrison explains.
2. The traditional for-profit model of drugmaking needs to be disrupted.
Addressing rising drug prices has been another area of focus for Intermountain, Harrison writes, citing notable price hikes in recent years, such as Turing Pharmaceuticals' 5000% increase on pyrimethamine, a drug used to treat a rare infection.
To combat price hikes like these, Intermountain, along with three philanthropies and several health care organizations, created Civica Rx, a nonprofit company aimed at keeping generic drugs accessible and affordable, Harrison writes.
Civica expects to have 14 generic drugs available to its participating hospitals by the end of this year and aims to have 40 drugs available by the end of 2020, according to Harrison.
3. Providers and insurers should be linked so they both benefit from improved public health.
Providers and insurers should work closely together "so that they share the risks associated with poor health and the benefits associated with good health," Harrison writes. He explains that, when it comes to keeping patients healthy, "a hospital will not benefit unless the hospital is closely linked to the insurance provider."
Intermountain is "developing a range of such collaborations," Harrison notes. For instance, the health system has set up its own insurance company, called SelectHealth, which works with the health system's 24 hospitals and 215 clinics, Harrison writes. SelectHealth has collaborated with providers to offer employers low fixed insurance rate increases, and in 2019, lowered exchange plan premiums for individuals by 2.7%, Harrison writes.
"Health systems do not need to be completely integrated with insurers," Harrison adds, "but they should develop strategies for sharing risks and benefits with them."
4. Health care costs need to be reduced while care is improved.
It may seem "counterintuitive" to say that care costs need to go down while care improves, but Harrison contends that it isn't. "Hospitals should benefit from better care rather than more care, and that is possible when providers share risks and benefits with insurers."
With that idea in mind, Intermountain has developed a team-based care model called "Reimagined Primary Care," which focuses on preventive care. The care model has led to a 60% decrease in hospital admissions, a 35% decrease in ED admissions, and a 20% decrease in per member per month costs, Harrison writes. Intermountain has also integrated mental health care into its clinics, which has made the care 3% less expensive and led to higher patient satisfaction, Harrison writes.
Intermountain has also increased access to lower-cost settings like urgent care clinics, physician offices, and telehealth visits, Harrison writes. A study of Intermountain's neonatal telehealth program found that it led to a 29.4% drop in a newborn's odds of being transferred from a community hospital to a newborn ICU, and saved about $1.2 million for affected families.
5. Providers must collaborate with the public to tackle social determinants of health.
A large portion of public health is influenced by preventable conditions, such as obesity, bad nutrition, smoking, a lack of exercise, housing insecurity, a lack of education, and limited transportation or technology access, Harrison writes. In order to improve public health, health systems "must engage the public in changing lifestyle behaviors and living environments."
To do that, Intermountain has established a collaborative called the Utah Alliance for the Determinants of Health that aims to improve access to health and decrease costs while also promoting health, Harrison writes. The Alliance involves community, city, county, and government organizations to improve health by focusing on the social determinants of health.
"We must revive the pioneering spirit that used to be pervasive throughout the nation," Harrison writes. "It will require us to look not to the corridors of Washington, D.C., but to each other and pivot to a new model of care. If we combine that pioneering spirit with goal-oriented practicality, our nation's future will be healthier and promising" (Harrison, Harvard Business Review, 10/23).