Wedging Out: Improving Quality and Reducing Costs of Caring for Expensive, Niche Populations

The following is a guest article by Adam Sabloff, CEO and Founder, VirtualHealth.

*Photo Credit: Marcela Nowak

Health plans, accountable care organizations (ACOs), medical homes, and other risk-bearing entities are at a critical juncture: they must achieve “value” at a time when healthcare is facing enormous challenges.

Rising healthcare prices, an aging population, and a rapid increase in costly complex and chronic diseases are driving up healthcare expenditures. Adopting value-based care is key to managing these expenditures as effective value-based strategies support higher quality care, lower costs, and a better patient experience.

The same drivers responsible for increased healthcare expenditures—which the Department of Health and Human Services projects will make up almost 20% of the U.S. economy by 2027—are also shifting the balance of resources these organizations must employ for care management, disease management, managing transitions in care, and care gap interventions. In this environment, healthcare organizations must find innovative ways to slow the increasing cost curve and retain their customers.

For a growing number of healthcare organizations, the solution is applying a “wedge” strategy to address the needs of the 5% of patients who incur approximately 50% of an organization’s total spend.

Struggling to Navigate Needs

Healthcare organizations have long recognized that patients requiring critical, complex, and chronic care are the heaviest utilizers of medical services. In fact, many are already navigating the complexities of these operational paradigm shifts as they respond to increased demand for long-term services and supports (LTSS). Encompassing care provided to the elderly and individuals with disabilities either in the home or in facilities such as nursing homes, LTSS can include help with eating, bathing, taking medications, and a host of other support services.

The wedge strategy means that these small groups of patients are “carved out” and surrounded with a comprehensive ecosystem of care. This ecosystem, however, requires systems and processes that enable proactive management of the delivery logistics involved with enhanced care for these niche populations. The strategy relies upon a technology-enabled, patient-centered solution that equips care managers with a full view and the right toolset to eliminate the traditional boundaries between health siloes. It is especially effective at managing the unique needs of LTSS and other critical care populations under value-based care because it considers both the clinical and social needs of patients and avoids the inefficient use of healthcare resources.

Over the past decade, many players in the industry responded to the need for improved care management workflows with the introduction of large-scale, enterprise-wide technology that coupled care and disease management with utilization management functions for all their patient populations. These platforms were deployed to cut costs by reducing the amount of administrative work, especially surrounding pre-certification for procedures. Although utilization management should be a part of an overall strategy, it has proven ineffective at significant cost reductions. Meanwhile, a growing body of evidence demonstrates that a comprehensive and tailored care management approach can achieve the overarching goals of lower overall spending on care, improved care quality and outcomes, and enhanced patient engagement and satisfaction.

Investments in enterprise solutions are ultimately wasted if the deployed platform cannot specifically address the needs of the small percentage of populations that represent the heaviest utilizers of care. Increasingly, healthcare stakeholders are finding that broad, traditional approaches to care management are not designed for the segmented needs of complex, high-cost populations. Many of the health IT systems currently in place are simply incapable of bringing together the disparate data and analytics necessary to have a measurable impact on outcomes.

The Right Tech Tools

Having recognized the shortcomings of traditional technology tools, some innovative risk-bearing entities are implementing platforms capable of supporting the wedge strategy. These specialized platforms keep care managers informed of a patient’s complete clinical history which helps them fully understand needs and identify care gaps. They also enable the care team to identify non-medical (social) barriers, such as lack of access to nutritious food, inability to afford prescriptions, transportation limitations, and take the necessary actions to reverse them.

In other words, comprehensive technology tools must be able to do it all—automate administrative tasks, pull in data from multiple medical and non-medical sources, and analyze that information to identify gaps in care and necessary interventions.

On the coordination side, today’s platforms for complex and critical care ensure that communication is fluid across the care continuum, enabling shared decision-making and ensuring access to appropriate medical attention from proper providers. While the primary care provider may be best positioned to coordinate care, make referrals, and schedule appointments, technology can keep care managers, caregivers, and the patient seamlessly connected.

In fact, when dealing with critical and complex care populations, patient engagement is crucial to success. For instance, individuals dealing with multiple health conditions may be prescribed treatments that, while adhering to evidence-based guidelines for each individual condition, can lead to adverse interactions or create an undue compliance burden. Involving patients in discussions about the benefits and risks of specific treatments helps avoid these issues and allows patients to share their needs and preferences. Having a system that tracks these conversations and makes them easily accessible to all parties creates transparency and an opportunity for setting goals with the patient. Achieving this optimal level of patient engagement necessitates an infrastructure that comprehensively addresses the concept of a proactive care ecosystem.

Positioned for Success

Deploying platforms designed specifically for management of critical and complex patient populations not only arms care teams with the right tools for the job, but also allows health plans, ACOs and other organizations to overcome the challenges they face adjusting to value-based care.

Whereas traditional technology tools for care, disease and utilization management, and population health are designed for administrative processes and function largely in siloes, platforms designed to manage complex and critical populations feature the interoperability necessary to bring together and analyze data from disparate systems and sources. This lets everyone on the care management and coordination teams make properly informed decisions. These platforms are also more flexible than their legacy counterparts, streamlining any updates or enhancements necessary to keep pace with the evolving and expanding market and related policies and regulations.

One of the nation’s fastest-growing health plans, part of leading integrated delivery system, is discovering the benefits of marrying a care management platform to its existing legacy system. Having identified opportunities for care tailored to complex populations, the health plan is in the process of transitioning a cohort of its patients to two platforms: one specifically designed for value-based care, and their legacy platform intended for their entire patient population. By integrating inputs from its legacy system into the care management platform, the health plan can deploy the wedge strategy by carving out its complex and critical care populations and targeting them with more proactive care.

“Wedging out” this population will drive down costs by optimizing utilization of healthcare services while improving health outcomes through early interventions and better management of chronic and other conditions.

Time is Short

There is an urgent need to rein in the high costs of caring for complex and critical populations. As adoption of value-based programs continues expanding, failure to reduce costs of complex and critical care programs will put ACOs, medical homes, health plans and other risk-bearing entities on the path to unsustainability.

Time is of the essence for these organizations to get out in front of evolving trends and retool existing support systems by adopting platforms and processes specifically designed to manage the care of these smaller, yet more costly, patient populations.

The wedge strategy will only work if an organization is willing to take the path of innovation. Failure to do so will ultimately result in the inability to right-size care utilization and expenditures, and likely the need to exit what could otherwise be a lucrative market.