Most health economists would agree with the truism that about 5 percent of patients in a given populations account for about 50 percent of costs. There are a number of variations on this hyperbolic Pareto principle scenario, but they all point to the fact that a small minority of patients is driving excess costs in healthcare. In the long run, everyone will benefit if these costs are contained.
The primary driver of these costs is the care of the chronically ill, and in the short run, as an accident of coincidence, our fee-for-service reimbursement model encourages increased costs. It is human nature that individuals who are paid on volume will generate more volume. Not only that, but we have been in a fee-for-service environment for at least the last 50 years, so every employee in a healthcare setting has had his or her workflow maximized to generate income in a fee for service market.
To bring healthcare costs under control, payment reform is needed, and payment models that do not encourage volume will be required. A variety of new payment structures are in discussion and testing. The most prevalent, although still unusual, is pay for performance, where physicians are paid bonuses for reaching quality targets. Other examples of payment reform include case rates, where physicians – and hospitals too, usually – are reimbursed a flat amount for care of patients with a given condition (this is most commonly used for certain procedures). The granddaddy of payment reform methodologies is full capitation, where doctors are paid a flat rate for a year’s worth of care for certain individuals.
The common thread holding all of these together is that physicians and healthcare institutions are paid more when a population of patients reaches a certain quality metric. Policy makers and payers alike hold out great hope that achieving quality targets will result in lower costs as inefficiencies are wrung out of the system.
The biggest challenge to moving from fee for service to any kind of population health payment model is changing healthcare employees’ workflow – remember their workflow is now maximized for a fee-for-service environment.
Connected health is a process of care innovation that uses monitoring and messaging technologies to bring care to where the patient is, when the patient needs it. The benefits of this approach are improved patient self-awareness and self-management; better adherence to care plan and care that is “just in time,” as opposed to scheduled around the availability of the doctor. Here are some examples being implemented through the Partners HealthCare system.
Congestive heart failure remote monitoring. In a collaborative study between the Center for Connected Health and Partners Home Care, 85 congestive heart failure patients were followed for two months after they were discharged from the hospital. Each day, patients transmitted their weight, blood pressure and oxygen saturation, using small user-friendly devices designed for home use, to a telemonitoring nurse. The nurse evaluated the data and placed a phone call to each patient, as needed, to share the data and ask scripted disease management questions.
The Connected Cardiac Care program demonstrated a significant impact on efficiency of care, while showing decreased hospitalization rates. Study participants required 40 percent fewer nursing visits to the home and experienced a 50 percent reduction in re-hospitalization rates. Additionally, patients reported an improved quality of life and appreciation for increased involvement in their care. As a result of this study, Partners Home Care implemented telemonitoring for all of its eligible congestive heart failure patients, and it has expanded the program to include patients with chronic obstructive pulmonary disease, renal failure and more.
Diabetic monitoring. A dozen or so diabetes patients are being treated at a practice at the Massachusetts General Hospital are participating in a pilot program to monitor their glucose levels from home. Glucose readings are automatically routed over a patient’s phone lines to the hospital’s system, where it is catalogued. The data is analyzed and presented in near-real time to the patients. Patients get educational information and are encouraged to fill in relevant information about medication, diet and exercise in a journal. All of that information is made available to a nurse practitioner who manages this population of patients.
The feedback to date from both the patients and the nurse practitioner has been quite positive. In the near future, more patients will be enrolled, and their clinical progress will be documented to see if improved quality of care can be achieved as evidenced by lower hemoglobin A1c.
There’s an economic driver at work here, too. The physician side of the organization is held accountable through contracts with local health plans, to keep hemoglobin A1c below a certain level for diabetic patients. There is millions of dollars at risk for this outcome. Using tight connectivity between patients and providers as a strategy, the organization is optimistic that it will be able to achieve these goals.
SmartBeat (hypertension self-management). An innovative program with EMC Corp. seeks to study how employees diagnosed with hypertension can better manage their health through proactive monitoring and education. EMC, one of the largest employers in Massachusetts, is the first company to participate in SmartBeat, designed by the Center for Connected Health, which uses a wireless blood pressure cuff and communicator and an Internet-based feedback system, to help employees self-manage their high blood pressure. Approximately 400 U.S.-based EMC employees with hypertension or pre-hypertension are volunteering to participate in the SmartBeat pilot program.
According to EMC, the SmartBeat program is a natural extension of the company’s employee health management strategy to promote a healthy workplace and drive innovation and the adoption of new healthcare technologies. At the same time, EMC employees participating in the program have indicated that, because of increased awareness and education about how day-to-day lifestyle choices can affect blood pressure, they are better able to manage their hypertension through diet and exercise.
The common themes of connected health are monitoring, messaging, coaching and physician integration. There is value to be added in each of these components. More importantly, however, is that each of these connected health programs enable us to see how the connected approach emphasizes population care vs. individual volume.
Each of these projects illustrates an approach that is gaining traction in the marketplace now. But as payers gain traction with alternate payment schemes, those organizations that have mastered the connected health approach will have an edge in efficiency that will assure continued patient access and quality of care.
Joseph C. Kvedar, MD, is founder and director of the Center for Connected Health at Partners HealthCare System, Inc.