April 8, 2024

Eighth annual study by Numerof & Associates highlights healthcare executives’ perspectives on population health and alternative payment models

ST. LOUIS – APR 8, 2024 – Numerof & Associates, a leading healthcare strategy and implementation consultancy, today released The State of Population Health: Eighth Annual Numerof Survey Report, which provides the industry’s most comprehensive look at the progress of U.S. healthcare delivery organizations in integrating population health principles into routine operations.

This series of surveys has focused on participation by hospitals and health systems in contracts for the delivery of care in which their compensation is linked to the cost and quality of care. The latest survey results show that participation in such contracts has broadened to include nearly all responding institutions, and the extent of participation as measured by the percent of revenue obtained through such contracts has increased significantly over the last survey. That said, such risk-related revenue remains a small component of health systems’ overall business, despite growing general agreement on the importance of population health.

Numerof & Associates surveyed nearly 100 C-suite healthcare executives on their attitudes toward and adoption of population health management principles. The survey was conducted between May 2023 to November 2023. Almost all respondents – 99% – reported some participation in alternative payment models, up substantially from 80% in 2021, and the median amount of reported revenue that flows through risk-based contracts was 25%, up from 10% in 2021.

“It’s promising to see this increase in the number of providers willing to link their compensation to the cost and quality of the care they provide, though the overall level remains too low,” said Rita Numerof, PhD, the firm’s president. “Many issues, from the constantly increasing cost of care to the less than optimal outcomes too often achieved are a function of a broken reimbursement model. Until we get serious about linking provider compensation to the outcomes that matter to patients across the continuum of care, we will continue to pay too much and receive too little.”

Survey analysis shed light on the three primary reasons executives consider compensation models linked to outcomes. The leading reason was the potential for performance-based financial incentives (28% of respondents). A close second was that adopting such a model was helpful in controlling clinical cost and quality (26%). The third most frequently cited reason was that the linkage to cost and quality was consistent with organization mission and culture (22%).

On the other hand, the threat of financial loss continues to be the leading obstacle to implementation of population health (23% of respondents). That is consistent with the fact that more than half of respondents rated their organizations’ ability to manage variability in cost of care as “average” or “below average.” Numerof’s data suggests that relatively few organizations have engaged physicians – who are the leading driver of utilization costs – in efforts to establish reasonable standardization in clinical practice patterns.

“Numerof & Associates envisions a realignment of the healthcare industry to deliver better care at lower cost. Too often in the industry, talk about achieving this goal is considered a satisfactory deliverable,” said Michael Abrams, managing partner of Numerof & Associates. “This report showed a surprising jump in the number of providers willing to be accountable for the cost and quality of care. This spike may be an anomaly, but it could also be a promising, bold step from healthcare administrators who see the industry creeping towards disaster if it continues to ignore calls for lower cost and higher value.”

Healthcare systems have increased their commitment to addressing social determinants of health in recent years, but work on these aims seems to have stalled, according to Numerof’s new report. Recent surveys have shown organizations broadening their services to address challenges such as food insecurity, housing, and transportation needs since 2016, but progress in these areas appears to have peaked across the board in 2021. The percentage of institutions offering services that address housing and community development needs decreased from 35% in 2021 to 22% 2023.

Numerof’s collaborator in this population health research has been David B. Nash, MD, MBA, Founding Dean Emeritus of the Jefferson College of Population Health. Asked for his perspective on the current report, Dr. Nash said “As Population Health and Value Based Care continue to evolve, there is no better single source of truth than the annual Numerof & Associates Survey. Look no further to better understand the current landscape and to help build your strategy for what comes next”.

The full report is available for download at: https://nai-consulting.com/numerof-state-of-population-health-survey/

 

Methodology
Approximately 14,231 individuals were invited to participate in the online survey, which was fielded from May 2023 to November 2023. Numerof, working with Dr. David Nash, received 98 surveys, corresponding to a response rate of 0.69% of individuals and 3.7% of institutions. Respondents included C-suite executives across the entire U.S. in urban, suburban, and rural areas. They represented stand-alone facilities, small systems, and IDNs; for-profit, not-for-profit, and government institutions; and academic and community facilities.

 

About Numerof & Associates
Numerof & Associates is a strategy consulting firm that develops customized, market-based solutions for the strategic and operational challenges of organizations in industries undergoing significant transition. Working globally across the healthcare industry with clients in pharmaceuticals, medical devices and diagnostics, payers, and healthcare delivery, Numerof brings a unique cross-disciplinary approach to a broad range of engagements designed to sharpen strategic focus, increase revenues, reduce costs and risk, and enhance customer value.

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Media Contact:
Mallory McDonald
Senior Account Manager, Pinkston
302.853.5344
numerof@pinkston.co