Jim was an elderly patient suffering from emphysema. He lived some distance from the nearest hospital and couldn’t easily see a doctor, and he was rushed to the hospital once or twice a month when symptoms of his chronic lung condition flared up, putting a heavy strain on him and his family. Then Jim’s life was transformed: He became the beneficiary of a revolutionary approach to healthcare, and he could be tested and his condition monitored without ever having to go to a hospital.
American health provider Mercy Health put Jim on a new “virtual care” program, and care was brought directly to his bedside at home. Mercy used remote technology to carry out tests, monitor Jim and make sure any worrying signs were responded to before they became an emergency.
This example shows how care delivery is being transformed by modern digital technology. Jim’s care was managed by the Mercy Virtual Care Center, a “hospital without beds” that uses digital technology to enable remote care of patients at home.
Randy Moore, former president of Mercy Virtual, speaking at the Siemens Healthineers Executive Summit in Frankfurt, Germany in October 2018, recalled how Jim’s wife summed up the benefits of remote care. “She told us, ‘Our family had two years where I could leave the house, go shopping and not be afraid. Jim got to be at home. You gave us the best gift we could have,’” Moore said. Hospitals can be stressful for the families of patients as they are an unusual and often inconvenient setting. Relatives may prefer home-based care.
The Value-Based Approach
Modern healthcare is about more than simply caring for the sick, he added. “We have to be excellent if Jim shows up, but we also have to be in the business of health optimization. We can unleash that power and give 10 times the value we have in the past,” said Moore.
Finding more effective ways of caring for patients is essential to overcome the challenges facing modern healthcare. Aging populations have created a spike in chronic illnesses even as healthcare budgets are spiraling downward and costs spiral upward, and new treatments are ever more expensive.
Many healthcare systems were put in place a hundred years ago primarily to treat acute medical problems, at a time when most people didn’t live long enough to develop chronic conditions. Today’s health systems are often ill-equipped to cope with the rise in long-term care. Hospitals are paid for the number of operations they perform—the “fee for service” model—not for the long-term well-being of patients. Yet hospitals are an expensive way of caring for patients. This disparity is forcing the transformation of healthcare systems to achieve the most patient value for money spent by keeping hospitalizations to a minimum.
The new value-based healthcare approach is turning the care model on its head. It rewards health providers for prevention and long-term results, rather than one-off operations, often providing a fixed fee or “capitation fee” for each patient every year. This incentivizes care providers to prevent illnesses by educating as well as diagnosing and intervening early.
Value-based healthcare is also leading a sea change in the way care is provided.
Improving Access to Care
Expanding access to care is an important step to reduce the incidence and severity of illness and to treat conditions before they lead to hospitalization. This means greater use of ambulatory services to diagnose, observe and treat patients outside hospitals. Many chronic conditions such as diabetes and lung disease, including emphysema, lend themselves to this approach.
Oak Street Health is one U.S. organization that has pioneered ways of improving access to healthcare for ordinary Americans, primarily working with older Medicare patients and focusing on prevention and treatment in the community. Chief Medical Officer Dr. Griffin Myers, told the Executive summit that 80 percent of illnesses are related to social and environmental factors, such as poor access to healthy food and clean water, a lack of stable housing and neighborhood violence. Doctors tend to think such factors are not part of their job, but Myers disagrees.
“It is time for us as leaders in this space to take responsibility for those social factors because those are the things that determine how well our patients do,” he said.
Oak Street charges insurers a set fee for patients, and pays all their medical bills as well as costs related to social and other factors, such as transportation. “The value-based model is not theoretical. Our goal is to keep people happy, healthy and out of hospitals,” said Myers.
Oak Street has achieved a 40 percent reduction in hospitalizations largely by addressing social determinants. However, a drawback in today’s reimbursement systems for hospitals is that this approach may lead to a decline in hospitals’ income as they treat fewer patients.
Increasing Workforce Productivity
While demand for care is rising, the medical professionals needed to provide this care are in limited supply. To address this imbalance, health providers are looking for ways to improve workforce productivity.
In a value-based healthcare system, productivity is increased by organizing care around a patient’s medical condition with integrated teams collaborating to help the patient through all stages of care.
A good example of this is the Martini-Klinik in Hamburg, Germany which was established in 2005 to focus on delivering care for a single condition – prostate cancer. The clinic handles over 2,200 prostate cancer cases a year and claims better outcomes than any other organization. But the clinic doesn’t simply “cure” patients and send them on their way. The Martini-Klinik uses research and patient surveys to measure the long-term outcomes of its care and find ways of improving them.
The clinic has focused on boosting productivity through training and supporting staff. This has led to greater job satisfaction and staff loyalty with a low employee turnover.
The clinic uses a system where all physicians involved in treating prostate cancer are given joint incentives. This encourages them to work together, reducing difficulties with handing over information and losing data.
As Dr. Ghada Trotabas, Senior Vice President of Marketing and Sales at Siemens Healthineers, told the summit: “The complexities of medicine have by far exceeded the ability of the single individual. Today’s medicine needs to be practiced in teams.” She compared these teams to “pit crews,” the integrated group of mechanics who service race cars.
Today’s value-based care teams help the patient before, during and after treatment, and deal with side effects, complications and care throughout the process.
Like Oak Street Health, provider Kaiser Permanente, based in California, also uses a capitation model with a set fee per patient which creates incentive to improve the health of each patient and prevent illness. Kaiser promotes benchmarking of staff across the organization so everyone can see who the top, middle and lowest performers are in every area of care. Dr. John Mattison, Kaiser’s Chief Health Information Officer, told the summit that a workflow specialist regularly analyzes the company’s benchmarking data and helps recommend how clinics can achieve the best results. “We replicate that across the program, which requires integrated care and an ethos and culture, so you can transfer those processes and the system configurations from site to site very easily,” he said.
Mattison noted that too much emphasis has been placed on giving health providers incentives based on procedures, rather than outcomes. “The only way to change that is to change the cultural model—changing leadership, inspiration and motivation—as well as aligning the kinds of outcomes you want with pay.”
Managing Population Health
Value-based healthcare is also about managing health across entire populations. This includes public health information campaigns that promoted disease prevention and screening, as well as programs to identify chronic patients who will benefit from intensive programs and treatments.
Globally, managing population health will require a massive expansion of healthcare systems in developing countries. India has launched one of the biggest projects globally to put healthcare within reach of hundreds of millions of underserved people: Ayushman Bharat – also known as “Modicare,” launched in early 2018 by Prime Minister Narendra Modi, will bring health insurance and medical care to 500 million Indian citizens, cover healthcare costs of up to $7,800 for 100 million impoverished families and spend $188 million to create “health and wellness” centers.
“Healthcare was not on the political agenda of India like it has been in the USA,” Dr. Girdhar Gyani, Director General of India’s Association of Health Providers, told the summit. “Half of the money has been driven by the state government directly. But in the new scheme, we are pushing the insurance companies to drive it; the insurers will learn to make sure they put emphasis on preventive healthcare, and that is where technology will play a leading role.”
Modern advances in healthcare are designed to keep hospitalization to a minimum. As Kaiser Permanente’s John Mattison said, “An unplanned hospitalization for someone with a chronic disease is a system failure.”
Patients and their families are welcoming the transformation in care delivery, as illnesses are prevented, hospitalizations are reduced and the care workflow is improved. Hospitals may find that traditional income streams decline as a result of more efficient and remote care, but the clear aim is to keep patients out of expensive hospital beds and improve their quality of life.