Approaching Population Health Management strategies with confidence

Trends in healthcare management

By James Proctor, Principal


17.5% of the nation’s Gross Domestic Product1.

$3.0 trillion dollars in 2014 – that’s the startling, unsustainable reality of healthcare spending in the U.S.1

I believe we have come to a national reckoning of sorts, where people understand change is inevitable. We have to do better. To that end, population health management (PHM) is one of the primary strategies for achieving greater value in healthcare.

At Philips we define population health management as, “The organization of and accountability for the health and healthcare needs of defined groups of people utilizing proactive strategies and interventions that are coordinated, engaging, clinically meaningful, cost effective, and safe.”

PHM suggests a paradigm shift. Triggered by industry’s move to value-based reimbursements, it emphasizes a ‘health’ delivery model as opposed to a ‘care’ delivery model. This demands a significant departure from the way care is delivered today – a position where you’ll be asked to take on risk for behaviors that happen outside of your current domain or influence.

At Philips, our approach is ‘Continuous Health’ – a way to better analyze, manage, and account for the health of individuals and populations across the health continuum.

Implementing a successful population health management program

Transitioning to a successful continuous health model requires implementation of a cohesive PHM program – a daunting task for any organization.

Before we explore what approach to take, it’s important to consider the interrelated aspects of PHM. In our practice, PHM experts leverage their insights, analysis, and process skills to scrutinize each element, helping you meet this challenge and put you on the right path.

A confluence of considerations 
 

The concept of PHM is reflected in the mission statement of many organizations. Critical to any decision to move forward is the requirement to responsibly evaluate risks and maintain financial stability. The importance of ‘timing’ for investment in PHM capabilities can mean the difference between success and failure.
 

Market analysis, risk assessment, program planning, and coordinated implementation must all coincide in an optimum fashion. Health systems should avoid engaging in a payer contract to manage health risks that they are not prepared to manage. It’s a complex issue. Incredible pressure on margins and reimbursements means organizational transformation must be handled smartly. You must stay ahead, but not too far ahead of the need for new services.


The health system that hasn’t invested properly may be woefully behind. Yet the health system that invested five years ago and has not seen an ROI may disband a program that serves an emerging need.
 

Establishing new capabilities at the right moment requires a clear, well-researched and well-articulated strategy, where risk acceptance is firmly outlined. This will allow you to be proactive rather than reactionary, to influence behavior instead of following it.

“What organizations need to do is build a capacity ahead of their need for it, but once demonstrated, they must be able to quickly contract with a payer so revenues match capabilities. That’s the critical timing challenge.”

Our approach can set you on the right path
 

Some health systems are driving the market toward PHM. They see the opportunity to lead as a clear competitive advantage and are building advanced infrastructure and risk management capabilities. Others are positioning themselves as fast followers. Yet, the level of planning and investment for a successful PHM program may overcome those that do not develop a sensible, well-paced approach.

I encourage you to consider how PHM can be a differentiator and establish your health system as market leader. Lead the transition to health delivery. Drive payer contracting with confidence. Invest in new capabilities at the right pace to achieve ROI. Philips can be your catalyst for change and your partner for capability development.

Take the first step

PHM requires unprecedented leadership and planning. It is imperative that your organization understand its unique starting point and how the path to your destination is defined.

 

To begin, you must to consider your organization’s current state of readiness, and re-examine your entire care delivery system in the context of new payment models. By mapping your organization’s position against nine specific, interconnected criteria, you can identify gaps and strengths, and develop an action plan to succeed.


Our team can assist you with this initial assessment – evaluating your capabilities in each of the criteria. For a detailed description of the criteria and our approach to PHM, download the white paper Implementing a population health management program, available here.

After the assessment, you’ll understand your organization’s strengths and weaknesses related to PHM and have a meaningful foundation on which your PHM program can be built.

Beyond the assessment, Philips can help build a sensible roadmap to developing capabilities across these nine competency areas and partner with you as you implement your PHM program.

Preparing for the future
 

Transformation from an institution for acute care to an organization devoted to preserving health and improving care for given populations is daunting. Not all organizations will take the same approach because the circumstances of each vary widely. While one may choose to work aggressively on building a connected and coordinated network of providers linked via a telehealth network, others may choose to first focus on building an effective data infrastructure or developing a strategy for handling and segmenting financial risk.

Whatever the case, to succeed in this changing world, health systems must understand and address this complex array of issues and opportunities for improving population health.

 

A recent study declared, “It is clear that population health management will occupy a significant place in the future of healthcare. It’s also clear that the journey, for many, is a formidable one2.”

I would argue that the winning health systems – those who are truly successful and confident in their abilities – will drive the market.

 


1National Health Expenditure Data, CMS.gov,
https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/nationalhealthexpenddata/nationalhealthaccountshistorical.html, accessed 5/6/16

2The State of Population Health: Numerof Survey Report, copyright © January, 2016, Numerof & Associates

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