Why Population Health Matters

Once focused on just healing the sick, the healthcare industry is undergoing a paradigm shift

Challenges like epidemic rates of chronic disease, evolving healthcare reform and the need to expand capacity to accommodate growing numbers of Medicare enrollees all make it clear that “business as usual” just won’t cut it. And as reimbursement systems move away from a fee-for-service structure under new healthcare legislation, organizations will be held accountable for both efficiency and quality of delivered care.

In response to these challenges, healthcare systems and physician groups are developing new programs aimed at improving population health as a whole. Population health management (PHM) is a systematic approach to addressing the preventive, high-risk and chronic care needs of patients, with a goal of minimizing costly interventions like emergency room visits, hospitalizations and readmissions.

Central to this new healthcare management model is regular interaction with patients across all risk levels, focusing as much on wellness as acute care. To that end, PHM employs a combination of individual, organizational and community interventions to improve patient outcomes and adapt to change in the healthcare system.

Interconnected Roles, Shared Benefits

Patient data analysis, robust relationships with primary care providers (PCPs) and the integration of services with public resources serve as the backbone of the PHM model.

Information gathered during annual health assessments and primary care visits provide PCPs with the data necessary to design care plans personalized to patients’ risk profiles and proactively engage patients in behavior modifications before larger health issues arise. Not only does this save time and money for the provider, but program participation often gives patients expanded benefits and cost savings as well.

The move toward improved portability of electronic patient data also means healthcare organizations can more effectively plan and target care to specific population health needs. For instance, utilization data can help organizations build facilities with multiple services under one roof, improving efficiency while creating a better patient experience.

In addition to proactive doctor-patient relationships and data-driven decision-making, community resources play a critical role in the population health model. A shortage of physicians means PCPs will continue to lead care teams of not just advanced practitioners and nurses, but also expanded social service providers such as public health agencies and community groups. These resources can prove instrumental in helping patients overcome non-clinical barriers to improved health while complementing available healthcare services.

“If I made rounds in a hospital anywhere in this country today, I would predict that 40-plus percent of all admissions are still due to smoking, unhealthy diet, lack of physical activity and alcohol abuse. Those are the kinds of challenges we’re facing.”
— David Nash, M.D., MBA, founding dean of the Jefferson School of Population Health at Thomas Jefferson University

For example, community health workers or resource specialists can help coordinate transportation options for patients, arrange for translation services or even provide mentoring programs to help people better manage chronic illnesses such as diabetes. Collaborating with community resources allows healthcare organizations to make a bigger impact on population health and ultimately serve more individuals.

Of course, developing the necessary infrastructure and technology to support PHM’s goals and objectives is no small task. However, the challenges of modern healthcare demand a new approach and population health is a promising model for meeting those challenges head-on. In fact, PHM programs can reduce costs, improve the quality and efficiency of care and expand system capacity to meet future needs—all of which are vitally important to improving public health over the long term.

Making Population Health a Reality

When it comes to population health management, there are few more in tune with the promise and challenges it presents than David Nash, M.D., MBA, founding dean of the Jefferson School of Population Health at Thomas Jefferson University in Philadelphia. Nash began his career as a board-certified internist, and then became involved in promoting quality improvement and advocating for policy change in healthcare. He founded the school in 2008 as the first U.S. academic institution focused on population health. Nash was a featured keynote speaker at the annual HealthTrust University Conference & Vendor Fair in August 2013. He spoke recently to The Source about healthcare reform from the angle of population health—and shared his strategies for moving from volume to value, especially in the supply chain arena.

Q: How did the healthcare industry get to the point where it needs to, in your words, “turn around the battleship in the Panama Canal”?

A. We first got into this jam by thinking more is better—we called for more catheters, more procedures, more parking spaces, more buildings. But that’s a failing strategy. We need to consider the value equation—what we’re getting for what we’re spending. The goal is to move from volume to value.

Imagine a medical administrator in a canoe poised between a fork in a rushing stream. One route represents “more is better” and fee-for-service. This is the route of no antibiotic stewardship, every prosthesis is stocked and we order what we want when we want it—all with little to no evidence about what we’re doing. The other route represents value-oriented care, with careful observations of why we’re making certain healthcare choices.

The hapless administrator has three choices: He can sink in his canoe and call it a day. He can choose the route toward “more is better” because it seems easier, not knowing that 200 feet in that direction he plunges into an abyss. Or he can choose the harder route, making his way through some rough waters of reform before finally setting off into the population-health, value-based sunset.

Q. What should be the industry’s first step?

A. In all this conversation about reform, we’ve forgotten that medical error is the fourth-leading cause of death in our country. It’s a huge problem. We have to lick medical error before we can begin working on the value equation—reducing avoidable hospital admissions, coordinating care, practicing based on the evidence, reducing variation, getting doctors to hold the line on physician preference items, etc.

Q. How would you define population health?

A. David Kindig, M.D., Ph.D., emeritus professor of Population Health Sciences and emeritus vice-chancellor for Health Sciences at the University of Wisconsin-Madison School of Medicine, coined the term “population health” about 35 years ago. He was writing about the fact that population health has three core components:

Health outcomes, such as morbidity, mortality and quality of life
Social determinants of health, such as socioeconomics, education level and crime
Public policies and interventions that link these two

The main message is that the social determinants and behavioral components are critical. Healthcare inside a medical facility is only 15 percent of the story; 85 percent of healthcare is what happens outside the hospital. I’ll use the example of Philadelphia, where I live, which is the sixth-largest city in the nation in terms of population. Of the nation’s top 10 cities in terms of population, Philadelphia is the poorest, with the lowest per capita income. About 60 percent of our public school students are obese; 25 percent of our population smokes (5 percent above the national average). Despite five medical schools in the area, we have a huge population health challenge.

We have to reach outside the four walls of our hospitals to coordinate with community pharmacies, nursing homes, extended care facilities and the like, and link all of these care providers—from the hospital’s board of trustees to the folks delivering home infusion medication. It’s a big operational challenge, but we’re going to have to become a well-oiled, organized, value-generating team.

Q. You’ve used the phrase, “moving from sick care to healthcare.” What are some of your ideas for doing that?

A. We’ll need registries of patients, greater physician education and new relationships with our managed care providers. We’re going to have to find new ways of looking at how we’re delivering care at the bedside and in the community.

Maybe we need better measures of population well-being based on what reduces readmissions and overall admissions, such as smoking cessation and/or programs that reduce obesity and stress.

We’re going to have to think about the behavioral contributors to some of our major population health issues. A 2006 issue of the Annals of Internal Medicine asked this question:

What percentage of adult Americans do all of the following things?

Don’t smoke cigarettes or cigars.
Eat fruits and vegetables.
Exercise three times a week for 20 minutes.
Wear a seat belt.
Maintain an appropriate body mass index.

You may or may not be surprised to hear that only 3 percent of Americans do all of those things. We take our Lipitor on the way to buy a Big Mac. If I made rounds in a hospital anywhere in this country today, I would predict that 40-plus percent of all admissions are still due to smoking, unhealthy diet, lack of physical activity and alcohol abuse. Those are the kinds of challenges we’re facing.

From the public policy perspective, population health is still not on the radar screen of the National Institutes of Health and other federal agencies. Care coordination for chronic illness is where the money is being spent. But from a policy perspective, the biggest bang for the buck comes from behavioral change. For example, in 1972 President Richard Nixon declared a war on cancer. While billions of dollars has been spent, the No. 1 factor contributing to decreases in cancer deaths has been smoking cessation—a behavioral change.

We can begin practicing population-based medicine, but it’s going to take a concerted effort. To make the kinds of behavioral changes that are necessary, we’re going to have to align economic incentives, too.

Q. How is population health related to healthcare reform?

A. Healthcare reform is really about quality—and that’s where it connects to what we’re trying to do with population health management. Population health follows the same movement being pushed by the payers and purchasers of healthcare: toward evidence-based medicine, value-based purchasing, continuous clinical performance improvement, outcomes measurements, and increased transparency and accountability. I think we’re at a tipping point as more hospitals and integrated health systems are moving in the direction of managing the health of whole populations. That frontier is only going to expand.

Q. What are some of the challenges of implementing population health medicine?

A. To explain healthcare reform quickly, I often use the four-word phrase, “no outcome, no income.” But changing clinical practices to make this sink in is a much more involved challenge. Here are five things we’re going to have to do in the future:

Begin practicing based on the evidence—and tie payment to those outcomes. It sounds great, but it’s hard to do. Research tells us that clinicians make decisions based on grade-A evidence 18 percent of the time. That means about one out of five decisions has solid science behind it. The other four decisions are what we call the art of medicine. Therein lies a key problem—the payers of healthcare aren’t great connoisseurs of art. Doctors will tell you their opinions are right and to trust them. But you need proof to support those decisions. It’s a take on the old saying, “In God we trust; all others, bring your outcomes data.”
Reduce unexplained clinical variation. This solution really starts with supply purchasing. Stick with the four prostheses that your doctors have reviewed and approved. Don’t allow that fifth or sixth one if it costs four times as much and there’s no evidence to support a better outcome.
Continuously measure and close the feedback loop between physicians and the supply chain. Was it the right decision to buy those four prostheses for spine surgery? Do research and find the answer to back up future decisions.
Reduce slavish adherence to professional autonomy. You’ve got to give autonomy away to get to the transparency and public accountability that’s necessary in this age of reform. Ask questions such as: Are there clearly identified conflicts of interest? Do we have the value analysis to make this choice? Where is the evidence to back up the purchases we’re making? As the size of the pie decreases, and as bundled payments get cut into smaller pieces, our table manners are going to deteriorate. But we have to remember not to beat each other up and find a way to be accountable and transparent.
Engage with patients across the continuum. To change behavior, we’re going to have to communicate more than just at the yearly appointment. It’s important that we build the right kind of doctor and facility for the future. At your facility, can your patients make an online appointment with their doctors? Do your leading specialists email patients? What’s your blog like? What’s your Twitter handle as it relates to consumer engagement? It might frighten clinicians to consider, but we’re going to have to have social engagement with our patients in this new world.

Q. What are some ways to get health systems engaged in population-based care?

A. Here are some methods health systems can use to better manage the health of populations:

Engage in radical collaboration. Find out how certain organizations engage with their sickest patients—those who drive costs—and consider partnering with them. For example, 5 percent of the 14-plus million members of Humana (where I’m a board member) are driving 41 percent of total costs. We’re doing everything we can to lower these costs, including picking up these patients for their doctor’s appointments; surrounding them with nurses, care managers and care navigators; and sending caregivers to patients’ homes to make sure they don’t trip on a rug or fall in the shower. We’re doing whatever we can to coordinate the care of these 5 percent. Humana has the economic incentives to make this work—they know they’re going to get paid more to keep these folks healthy and out of the hospital.
Demand proof of better outcomes. Demand better economic evidence before you add that 10th beta-blocker to your hospital formulary.
Tackle behavioral issues. It might be something as radical as “no smokers can apply for this job” or something as simple as giving employees an economic incentive to participate in a wellness program.
Begin collecting and analyzing “big” data. When people leave Jefferson Hospital, they go home to approximately 42 ZIP codes. Our patients have thousands of pharmacists, none of whom are electronically connected to us. We’re going to have to push for online registries to make it easier to integrate care delivery among provider teams.

Besides these kinds of electronic records, find out more about those ZIP codes where your patients go upon discharge. Find out why so many people in this ZIP code go to the hospital every couple of weeks, while they go less in another five ZIP codes. That’s the kind of analytic support we will need in the future.

Q. What are the implications of population health management for the supply chain?

A. I strongly believe that supply chain leaders are going to play an increasingly important role in health reform. After all, they do the bulk of the purchasing and are on the firing line for having to demonstrate value for the money being spent. By becoming more efficient, by demonstrating value and by cutting waste, supply chain leaders are going to play a key role in making healthcare reform work.

I also strongly encourage the supply chain industry to invest in leadership training for clinicians of all types, especially physicians, nurses and pharmacists, as these clinical leaders make many decisions about supply chain purchases. This kind of education is not part of the training in medical school now, but in this new world it needs to be.