The goal of population health management (PHM) is to keep a population as healthy as possible. It is well known that about 5 percent of patients’ use 50 percent of healthcare resources and 10 percent use 70 percent of those resources. So, while PHM’s goal is to take good care of every person, organizations must pay special attention to these high-risk patients in order to lower population health costs to the maximum extent possible. Many organizations that are beginning to manage population health are focusing on the top 5-10% as a beginning strategy.
But keep in mind that this is the “tip of the iceberg”. As was learned by the disease management industry and emphasized in a recent publication by Ian Duncan, this could be a mistake. Below the waterline, so to speak are other cohorts of individuals with varying degrees of health risk and cost that will be the next individuals in the top 5-10%.
Beyond High-Risk Patients
So while PHM focuses partly on the high-risk patients who generate the majority of health costs, it has to systematically address the preventive and chronic care needs of every patient. Because the distribution of health risks changes over time, the objective is to modify the factors that make people sick or exacerbate their illnesses.
According to the Healthcare Risk Adjustment and Predictive Modeling by Ian Duncan, the implication of the analysis for predictive modeling may be seen in the transition of members between cost groups.
The first point to note is that the overall cost distribution remains relatively stable. Healthy members count for 69.5 percent of all members in the baseline year and almost 67.6 percent in the subsequent year. Within the Low cost category (67.6 percent), however, 85 percent of members (57.4 percent of the total 67.6 percent) were previously healthy, and 15 percent regressed from Chronic or Catastrophic categories to Healthy. Conversely, Catastrophic cost members were 1.8 percent of the population in the baseline year and 2.2 percent in the subsequent year. Fewer than one-third of these members (0.6percent of the total 2.2 percent) were previously catastrophic.
Importance of Intervention for All Risk Levels
This and other research has demonstrated that there is considerable movement between cohorts. Understanding that and being able to effectively and efficiently intervene is crucial. Or said another way, managing, outreaching and providing care and education to what is beneath the waterline is critical to success.
Leveraging Technology and Automation
Such an approach requires the use of automation. Not only are there not enough providers and care managers to manage every patient continuously, but PHM also involves a large number of routine tasks that do not have to be performed by human beings. Bringing modern information technology to bear on these tasks saves time and money and makes PHM economically feasible. Automation also allows organizations to better assess population needs and stratify populations based on geography, health status and utilization, and demographics.
So in the end:
- You have to accept that there is a roll for managing the complex patients with the highest costs at the top but if you don’t manage the patients across the population, you will fail in managing cost across the whole population.
- Being able to stratify the population by health risk and clinical care gaps is critical to be able to mange with limited resources.
- You need both a high-performance team as well as technology automated wherever possible to achieve the goals of population health management.
Learn More
Read a white paper on Population Health Management.