News and Insights
Getting to Population Health
Healthcare delivery organizations are in the midst of a broader industry shift that is forcing all stakeholders – providers, payers, and manufacturers of drugs and devices – to reduce the costs associated with care delivery, and to improve its quality. The pressure comes in part from recognition that the current rate of increase – from 7.2% of GDP in 1970 to 17.9% in 2009 – is unsustainable. At the same time, Americans’ average life expectancy and the efficiency of our healthcare system are ranked near the bottom of countries with advanced economies. In short, our nation spends significantly more than average on healthcare services, but gets significantly less than our national peers.
The Patient Protection and Affordable Care Act (PPACA) of 2010 introduced many measures intended to address both increasing costs and lagging quality. While the long-term efficacy of these reform measures is still being evaluated, stakeholders across the industry are implementing programs in response. Providers are faced with shrinking reimbursements and financial penalties intended to discourage unnecessary and uncoordinated care (e.g. readmissions penalties and “never events”). There are also a host of CMS programs (e.g. bundled payments, ACOs) to incentivize new payment and care delivery experiments, offering providers the opportunity to share upside savings, and in some cases, downside risk. All agree that these reforms reflect broad dissatisfaction with the current expensive and inefficient healthcare system. As the government’s share of this cost burden increases, how we pay for and deliver healthcare in this country will have to change to move toward better health outcomes at lower cost.
In many respects, PPACA has served as an impetus throughout the industry to develop innovative collaborations and care models to address changing demands in the healthcare market. One approach that has garnered broad interest is population health management. This is a term that means different things to different people, and we are far from consensus on how a healthcare system should be involved in managing the health of a population. There is a general acknowledgement, however, that a new approach that places greater emphasis on the continuum of care will facilitate better care coordination, improved outcomes, and lower total cost to treat.Read More
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