Despite all of the attention healthcare reform has received over the past several months – and the differing opinions from both sides of the political aisle – it is important to take a step back from the latest headlines to understand that when the dust settles, there will still be numerous healthcare delivery and financing issues that need to be improved, regardless of the decisions made about how to provide insurance coverage.
There is broad agreement that healthcare is too expensive in this country. The U.S. spends more on healthcare per capita than any other developed country. Last year alone, Americans spent more than $9,500 per person on medical expenses and overall health spending now tops $3 trillion a year. And yet, despite significantly higher spending, Americans are no healthier.
So, the question is this: What can be done to improve healthcare for most Americans?
The current fee-for-service model of healthcare in the U.S. is unsustainable because our system provides payments for the volume of healthcare services provided, not the quality of health outcomes. The current model is one of the major drivers of high costs because it encourages the use of more services, yet it allows us to fall short in terms of access to care, affordability and care coordination.
What’s truly going to stimulate the evolution of healthcare lies in the adoption of population health models that enhance patient access to care and leverage data to improve quality and ultimately reduce cost. When we align actionable data and access with new reimbursement models, such as value-based care or pay-for-performance, we have a huge opportunity to bend the cost curve and improve healthcare across the board.
It will take big strides to move healthcare in the right direction – and a willingness to reimagine how healthcare is delivered. But, we are seeing a shift towards the value-based, population health mindset. The Department of Health and Human Services (HHS) set a goal of tying 50 percent of payments for traditional Medicare benefits to the value of care provided by the end of 2018, and many organizations are adapting and evolving to accomplish this goal.
Furthermore, population health services organizations such as Tandigm Health are being established to support the shift to value-based care. Operating in Philadelphia – one of the most expensive healthcare markets in the country – Tandigm Health is positively disrupting the movement towards value-based care by providing the tools and resources to a network of over 460 primary care physicians that enable them to deliver high quality care while reducing costs.
What makes the Tandigm model unique is that it takes on full financial risk for the patients, and then works with its network of primary care physicians to manage the entire spectrum of costs –inpatient, outpatient, professional and pharmacy. In turn, Tandigm’s network of primary care physicians are provided incentives for supporting the population health infrastructure and are rewarded financially for providing high-quality, cost-effective care. Tandigm Health’s results validate the viability of pay-for-performance models. For example, Tandigm’s network reduced hospital admissions by eight percent for Medicare Advantage patients and ten percent for Commercial patients in 2016 by prioritizing the delivery of proactive, coordinated patient care. With a focus on access – or providing care in the right place at the right time – Tandigm reduced the number of days that patients needed to spend in skilled nursing facilities by 38 percent for Medicare Advantage patients and 16 percent for Commercial patients in 2016.
The Tandigm model – and other similar population health models – prove that a combination of actionable data, access to care, and a willingness to adopt alternative payment models can drive positive change and improve both care quality and cost. Regardless of what happens with healthcare legislation in the coming days, it’s increasingly clear that there needs to be an alignment of data and access to quality care in order to help primary care physicians and patients make more informed medical decisions, thereby driving the delivery of high quality care while reducing costs.