Numerof & Associates 2022 “State of Population Health” Survey Report Finds Population Health Adoption Remains Marginal as Executives’ Expectations Fail to Materialize

When it comes to the progress that healthcare delivery organizations are making on their journey from a traditional fee-for-service model to population health management, it is still very much a “Tale of Two Cities.” A new report released today by Numerof & Associates found that more than 80% of C-suite healthcare executives surveyed continue to say population health will be “critically” or “very important” to the future success of their organization. However, only 25% felt “very” or “completely” prepared to transition to a financial model linking payment to patient outcomes and utilization. The threat of financial loss (21%) remains the biggest obstacle standing in the way of moving toward a population health-based approach.

“Healthcare delivery in the United States is failing and has been for a very long time, thanks in large part to a fragmented and inefficient fee-for-service model that incentivizes providing more services to patients without any link to resource management, patient outcomes or experience,” said Rita Numerof, Ph.D., President of Numerof & Associates. “While the Covid-19 pandemic highlighted some of the system’s gaping holes and accelerated the need for an organizational course correction, institutional change is incredibly difficult. Entering the population health waters has unfortunately been more of a toe dip than a real commitment for many health systems.”

For at least 5 years now, respondents to Numerof’s annual survey have predicted that a population health approach will be a critical component of healthcare delivery moving forward. Yet this seventh annual “State of Population Health” Survey Report continues to show that we are not there yet. Respondents in the 2019 survey predicted that a median of 30% of total revenue for their organizations would be through risk-based contracts. As in years past, the 2021 report found that the median amount of reported revenue flowing through risk-based contracts was only 10%. With respect to capitated contracts, more than half of those surveyed said their organizations had none. And, while 85% of respondents said their organization was in at least one agreement with a payer that included upside gain and/or downside risk, just 32% of respondents reported that their organizations received more than 20% of its revenue from risk-based contracts.

“Clearly, the road toward population health management has been a bumpy one, with adoption and progress slower than executives’ expectations,” said Michael Abrams, Managing Partner of Numerof & Associates. “However, the report does show significant progress being made by providers in a number of key areas, including doing more to address social determinants of health (SDOH) and expanding their presence across the healthcare continuum. But until there is more transparency and accountability for cost and clinical outcomes, we expect further challenges to widespread adoption of population health.”

Other key finds of the survey include:

• 60% of respondents agree that at-risk contracting will increase post-Covid, up from 39%.
• Asked whether the pandemic will accelerate acceptance of capitated models, 38% now agree, up 2% from 2020.
• 31% of those surveyed said controlling clinical costs and clinical quality is the primary reason for pursuing population health.
• Surprisingly, only 1% of respondents felt adding predictability to their revenue model was a reason for pursuing population health.
• While 71% of respondents believe their organizations are slowly improving in their ability to manage variation in clinical quality at the physician level, more than 60% believe their organizations’ ability to manage variation in clinical cost at the physician level is “average” or “below average.”
• Healthcare organizations are offering more services to address SDOH, including: food pantries/nutritional programs (55%), transportation (57%) and housing/community development support (35%). These numbers are significantly up from 2016 findings.
• Nearly 80% of respondents said implementing more joint efforts with payers to apply population health practices was at least somewhat probable for their organizations post-covid, up from 10% last year.
• In a new high for the survey, 41% say payers are reportedly “very” or “completely” willing to enter into agreements with payments tied to outcomes – up 10% from 2020.

“Once again, Numerof & Associates has delivered on their promise to provide us with the most timely snapshot of the largest and most important industry in our nation—the healthcare industry. It is all here, including updates on VBC, SDOH, the future of Medicare, and the vision for a system that might promote health instead of just delivering services. As I have written in my most recent book, HOW COVID CRASHED THE SYSTEM, our industry must not let one million deaths be in vain, but rather, use this unique time in history to find our true north and to contribute to making our nation healthier and safer,” said Dr. David Nash, Founding Dean Emeritus of the Jefferson College of Population Health and collaborator with Numerof on this survey.

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