The Truven Health Blog

The latest healthcare topics from a trusted, proven, and unbiased source.

 

Population Health: Economics and Leadership 101

By Truven Staff
Byron Scott imageIn a recent article in Healthcare IT News, the author did an excellent job of summarizing several key components of a successful population health program, illustrated by a short case study about how finance leaders at Legacy Health in Portland, OR partnered with physicians to educate them on the financial impact of cost drivers. When discussing population health, I find it helpful to remember the Kindig and Stoddart definition of population health from 2003: “Health outcomes of a group of individuals, including the distribution of such outcomes within the group.” This really helps summarize any framework and takes into account the end result of health improvement – how to monitor variability and the associated cost.

In order to have streamlined reporting, you need data. This sounds easy, but is often complex when extracting information from various health information systems (HIS) within a hospital or physician group. Many health systems have different electronic health record systems and having the tools and software to provide interconnectivity is essential. The data extracted must also be reliable, not only for clinicians, but for any other end user in the system that has a role in managing population health. Within hospitals, having this data will be essential when trying to reduce cost and variability in one key aspect of population health –  supply chain cost. In the article, the author mentioned reducing the use of more expensive implants in the operating room, but this is the tip of the iceberg. The continued streamlining of pharmaceuticals and other medical devices will be paramount in reducing overall cost.

As a physician, I believe partnering with physicians is essential. Some may call it being aligned, but I think calling it partnering is more collegial. Reducing physician variability requires reliable data that physicians can trust. Physicians are scientists and are often competitive, and if you provide them with trusted data, they will make improvements. However, it doesn’t just happen unless you provide physician leaders to guide them, and this requires investing in order to get a return. In other words, hospitals, health systems, and physician groups must continue to invest in physician leadership education and training to provide financially-astute leaders in the era of the Affordable Care Act.

Byron C. Scott, MD, MBA, FACPE
Medical Director, National Clinical Medical Leader

Hospital-Physician Alignment Key to Hospital Success

By Truven Staff
Byron Scott imageFinally, physicians come to the forefront as the connecting link that will help hospitals address and improve financial targets in the next three years. Physician-hospital alignment tops the list in the latest HealthLeaders Media industry survey, "Forging Healthcare's New Financial Foundation," and it’s noted as the most important area of focus and improvement, followed by cost reduction and care model direction. These three areas are key as we navigate from volume-based care (or fee-for-service) to value-based care. Physicians have significant influence on quality and the process of care improvement, since they are the delivery agents. Many definitions of quality exist, but every physician and hospital is constantly evaluated on quality by organizations such as the Centers for Medicare & Medicaid Services (CMS), in addition to independent rankings such as the Truven Health 100 Top Hospitals® study.

First, it’s crucial to make sure there are enough physicians. Current Truven Health  data shows differences in productivity by age cohort, and findings show that a retiring physician may need to be replaced by more than one new physician to see the same number of patients. Second, it’s essential to have enough physicians in the right structure.

In the organized structure, there needs to be the right performance-based contract and compensation in place to ensure alignment. Part of this structure includes having the physician leadership at every level in the organization. This includes medical directors, department chiefs, and C-suite physician executive leadership. Third, make sure that physician leadership is selected, trained, and resourced to make the leadership decisions for value-based care. Knowing the practice variation amongst the group and the group variation versus benchmarks helps us understand the drivers of each group and practice to implement changes to better support the practice and reduce variation. The key to this is having health analytic tools to extract the data to measure and compare. As Walter Deming once said, “You can’t manage what you can’t measure.”

Byron C. Scott, MD, MBA, FACPE
Medical Director, National Clinical Medical Leader

Physician Engagement...and the "Prenup"

By Truven Staff
Michael R Udwin imageFrom the hospital C-suite, physician engagement is commonly interpreted as ensuring clinicians are adhering to the strategic and operational objectives of the organization. Yet, engagement embodies so much more, as anyone who has taken vows of matrimony can attest.

Inherent in any interpretation and commonly overlooked by administrators is the physician understanding and expectation of this arrangement.  Perhaps at no other time has there been less certainty within the medical community regarding the physician place within the evolving landscape.  Specifically, this includes compensation, practice model, employment, lifestyle, and most importantly control. 

Of course, how do you codify these expectations?  No one relishes the thought of a prenuptial agreement. However, establishing clear qualitative and quantitative metrics that measure success ensures a shared vision for execution of and if necessary extrication from the agreement.  It is more than RVU's or account receivables.  It is about commitment to the community, participation in performance improvement, mentoring, continued education and collaborative efforts across the continuum of care.  Transparent cooperative dialogue can serve as a foundation and model for both defining these metrics and building required trust over time.

Like any marriage, physicians are seeking a "relationship" that provides security, stability and opportunities for growth as each party evolves.  Hospital executives who can not only speak in these terms but truly engage will find that physician alignment naturally follows.

Michael R. Udwin, MD, FACOG
National Medical Director

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