The shift toward population health as a model for healthcare services delivery is moving, but moving more slowly than healthcare organizations anticipated two years ago, according to a new survey of more than 500 C-suite executives and open-ended interviews with selected participants by consulting firm Numerof & Associates.
"At its core, population health is about managing the health of a defined population by providing the right intervention for a specific patient at the least costly point in the care continuum," the survey report stated. "This is newly charted territory for most healthcare providers. Many have questions about how to initiate the journey, and most importantly, how to ensure a successful transition."
Only 60 percent of survey participants said their organizations were at least moderately prepared to handle the cost and quality of care, a finding that is unchanged from 2017. Also unchanged from 2017 were executives' assessments of how well their organizations were equipped to handle variations in cost (a 4 out of 7, or average, rating) and quality (5).
Fewer than half of executives stated that their organizations use a process to identify cost and quality outliers at the physician level or were prepared to address variation when it occurred. Moreover, fewer than 40 percent reported that their organizations base compensation for at least some of their clinicians on performance in the cost and quality arenas.
Still, the survey showed that healthcare executives believe that population health is the model of the future. Ninety-four percent of respondents rated population health as moderately (12 percent), very (42 percent) or critically (40 percent) important. And virtually all participants (99 percent) predicted that their organizations will have some revenue invested in models with upside gain and/or downside risk within the next two years.
While participants agreed that the shift to population health management is one that must be made, and few are certain of how to get there, many believe that the development of a central organizing strategy offers a solution. As one executive stated in the report, "We must focus on what is common across our whole system while understanding what is market-specific. Our next step is to deploy a central strategy with elements that are specific to individual markets."
The survey revealed that, at this point, most healthcare organizations are only experimenting with risk-based agreements. Although approximately three-fourths of executives surveyed reported that their organizations participate in one or more agreements with a payer that incorporates upside gain and/or downside risk, these organizations have limited exposure to such agreements, with two-thirds of respondents in this group reporting that less than 20 percent of their organization's revenue is at risk.
Further, nearly one-third of respondents (31 percent) whose organizations participate in risk-based contracts said their contracts provided only the possibility of a bonus if goals were met or exceeded.
Major concerns regarding the move toward population health among executives included the potential threat of financial losses (23 percent), difficulty in changing the organization's culture (14 percent), issues with internal systems, such as information technology (14 percent) and uncertainty regarding when to make the transition (11 percent).
Concerns regarding financial losses could be partly due to uncertainty about how population health management will affect margins, the report surmised. "It seems that many are unable to meaningfully assess the implications of payment models that incorporate financial risk related to cost and quality and their bottom line."
Many healthcare organizations have begun working to address the social determinants of health, including poverty, homelessness, mental illness, substance abuse and food insecurity, the survey found. Nearly three-fourths of respondents said they link patients with community organizations and follow up with patients to discuss adherence to discharge recommendations.
The survey also revealed that partnerships with and acquisitions of healthcare providers across the continuum of care, including urgent care centers, home health services, rehabilitation facilities and telehealth programs, are the cornerstone of providers' success, so far, in population health management.
Overall, "we hear a growing acceptance of the inevitability of population health models," the report concluded. "Yet organizations broadly remain in a holding pattern—waiting for a tipping point in the market before increasing their population health efforts."