February 3, 2014

Accountable Care Organizations & Population Health Management

Mohan Balachandran
Mohan Balachandran

Datica Alumni — Former Co-Founder

I read this post by Jason Grais over at Triple Tree a few days ago and was really struck by it. So much so, that I wanted to expound on it some more. The key points in there that really struck me were that (and I’m paraphrasing here):

  • Provider organizations have the knowledge and experience to manage downside risk i.e. to manage “not-to-exceed” risk contracts or cost control. This would be done as much as possible via legal means (contract exceptions etc.), guidelines definitions and adherence, case management etc.
  • The flip side - maximizing profit while ensuring population health is not something that most providers in healthcare have any significant experience with. This combination of risk management, patient engagement, wellness management and adherence (guidelines, medications) is a difficult effort and needs (that overused maxim of) “a combination of people, process and technology”.

And therein lies the $500 million problem / opportunity (given the rate at which these risk based plans are being proposed / adopted). Which is also why population health management is hot right now with multiple companies - small, medium and large entering into the space, each with their set of buzzwords (big data, predictive analytics and so on).

Ask healthcare executives about their plans and what seems to come out is a combination of:

  • Pilots with vendors;
  • Struggling with two way EMR integration;
  • Expansion of case management teams: again in pilot deployments as the payments aspect is yet to be finalized broadly;
  • Creation of provider advisory groups to understand the impact on physician and nursing staff;

Our prediction? Look for partnerships and potentially mergers and acquisition activities as vendors look to get an edge in this burgeoning market.

What do you guys think?

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