The Road (to Accountable Care) Less Traveled
With apologies to Robert Frost, I could not help but recall his poem “The Road Not Taken” when I read about the successful efforts of a health system here in my own backyard of Utah.
A Kaiser Health News article, “Retooling Hospitals, One Data Point at a Time,” describes the University of Utah health system as “one of a handful in the nation with a data system that can track cost and quality for every one of its 26,000 patients.”
I admit to using the term accountable care loosely, but the University of Utah is accomplishing accountable care end goals of lower cost and sustainability in a way that most health systems are not.
Typically, providers’ top HIT priority for accountable care is population health management. The idea is that by keeping patients healthy and outside of the hospital, providers will lower the volume of demand for costly healthcare services. Providers will then receive a portion of the savings that health insurers ultimately gain.
This seems like an ideal way to lower costs while improving patients’ health, but patients are difficult to engage, progress is difficult to track, and so far, success has eluded many. According to The Brookings Institute article, “Year One Results from Medicare Shared Savings Program: What It Means Going Forward,” results from the first group of Medicare ACOs shows that only 29 of 114 qualified for shared savings bonuses.
Contrast this with the less traveled path the University of Utah has taken to lower the cost of the supply of healthcare. They use data to manage costs at a detailed level and thus become more efficient. According to Kaiser Health News, “In the first year, the system shaved nearly $2.5 million from a $1 billion budget, and officials say they’re in a better position to negotiate with insurers because they know precisely how much it costs to perform a particular procedure.”
It’s interesting how the University of Utah is reversing roles so the provider is the one offering shared savings to the payer.
So why haven’t more health systems trod this same path? Because it’s hard. Information systems for patient accounting, medical records, ERP, and so forth weren’t designed, implemented, or integrated with this in mind. Data warehouses and analytics tools can help bring it all together, but they are expensive and time consuming. Furthermore, some of the leading enterprise BI vendors are having trouble transitioning from being generic tool-set suppliers to being guiding partners in solving healthcare-specific problems.
On top of all that, the financial incentives that would make investment in data systems worthwhile are uncertain or lacking. In today’s fee-for-service (FFS) world, much inefficiency can be made up for with increased patient volumes. In addition, most accountable care reimbursement schemes still have FFS at their core, and shared savings bonuses are based on the payer’s bottom line, not the provider’s.
In the meantime, we are fortunate that the analogy of Frost’s poem does not apply in one sense: healthcare providers are not at a single either/or crossroads that will lock in their fate. Rather, most will travel and re-travel both population health and cost analytics paths along with a growing network of other trails. The important thing is to rack up the miles.
You can benefit from your peers’ experiences by accessing the following reports.
- Healthcare Analytics Perception 2014: Analytics for Value Based Care—A New Paradigm
- Healthcare Analytics:Making Sense of the Puzzle Pieces
- Population Health Management 2013: Scouting the PHM Roster
- Physician ACOs 2014:Variations on the Accountable Care Theme
- Accountable Care Timing 2013:Migration from Volume to Value Speeds Up
- Accountable Care Payers 2013:Partners in a Changing Paradigm
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