Searching for a business case for quality in Medicaid managed care

An iron triangle ROI model for health care

Objective

Few, if any, return on investment (ROI) analyses of health programs make systematic considerations of patient access, instead focusing principally on gains related to cost and quality. The objective of this study was to develop an open-source model that adds an estimation of gains in patient access to a traditional ROI analysis. A classification system for quantifying gains in patient access is proposed.

Materials and methods

An Excel-based ROI model was built that not only incorporated traditional ROI considerations – cost savings and patient cases avoided – but also addressed changes in patient access. The model was then applied in a case study using New Mexico Medicaid data and two proposed initiatives – a statewide health information exchange (HIE) and a community health worker (CHW) program that focused on chronic disease patients. Savings, Health, Outreach, and Access estimates were derived from the literature. ROI estimates were produced that also incorporated relative gains in patient access.

Results

Combined, the HIE and CHW programs are predicted to generate a positive ROI by the fourth year, growing to 45% by the program’s tenth year. Total estimated cumulative cost for both programs after 10 years is $9,555,226. Total estimated cumulative saving for both programs after 10 years is $11,332,899. Access-related costs begin moderately in year 1 at $122,766 and grow to $1,858,274 by year 10. The model estimates an Access score of 19 in year 1. This figure grew to 380 by year 10.

Conclusion

Our model shows that a rough estimation of gains in to patient access can be incorporated to traditional ROI analyses. The results of our case study suggest that a CHW program and statewide HIE can generate a positive ROI for the state’s Medicaid program.

Pediatric Specialty Care Model for Management of Chronic Respiratory Failure: Cost and Savings Implications and Misalignment With Payment Models

OBJECTIVE

To describe program design, costs, and savings implications of a critical care-based care coordination model for medically complex children with chronic respiratory failure.

DESIGN

All program activities and resultant clinical outcomes were tracked over 4 years using an adapted version of the Care Coordination Measurement Tool. Patient characteristics, program activity, and acute care resource utilization were prospectively documented in the adapted version of the Care Coordination Measurement Tool and retrospectively cross-validated with hospital billing data. Impact on total costs of care was then estimated based on program outcomes and nationally representative administrative data.

SETTING

Tertiary children's hospital.

SUBJECTS

Critical Care, Anesthesia, Perioperative Extension and Home Ventilation Program enrollees.

INTERVENTIONS

None.

MEASUREMENTS AND MAIN RESULTS

The program provided care for 346 patients and families over the study period. Median age at enrollment was 6 years with more than half deriving secondary respiratory failure from a primary neuromuscular disease. There were 11,960 encounters over the study period, including 1,202 home visits, 673 clinic visits, and 4,970 telephone or telemedicine encounters. Half (n = 5,853) of all encounters involved a physician and 45% included at least one care coordination activity. Overall, we estimated that program interventions were responsible for averting 556 emergency department visits and 107 hospitalizations. Conservative monetization of these alone accounted for annual savings of $1.2-2 million or $407/pt/mo net of program costs.

CONCLUSIONS

Innovative models, such as extension of critical care services, for high-risk, high-cost patients can result in immediate cost savings. Evaluation of financial implications of comprehensive care for high-risk patients is necessary to complement clinical and patient-centered outcomes for alternative care models. When year-to-year cost variability is high and cost persistence is low, these savings can be estimated from documentation within care coordination management tools. Means of financial sustainability, scalability, and equal access of such care models need to be established.

Making the Case for Addressing Health Disparities: What Drives Providers and Payers?

Purpose: The creation of the Centers for Medicare & Medicaid Services Office of Minority Health placed increased emphasis on federal efforts to address health disparities. Although the literature establishes a social justice case for addressing health disparities, there is limited evidence of this case being sufficient for businesses to invest in such initiatives. The purpose of this study was to better understand the “business case” behind an organization's investment in health disparity reduction work.

Methods: We conducted six case studies (44 on-site interviews) with diverse private-sector provider and payer organizations.

Results: While providers and payers cited business rationales for initiating disparity-focused efforts, their motivations differed.

Conclusion: As federal entities address health disparities, and payment models shift from volume to value, engaging private stakeholders with the leverage to move the health disparities needle is of principal importance.

Economic Evidence for US Asthma Self-Management Education and Home-Based Interventions

The health and economic burden of asthma in the United States is substantial. Asthma self-management education (AS-ME) and home-based interventions for asthma can improve asthma control and prevent asthma exacerbations, and interest in health care-public health collaboration regarding asthma is increasing. However, outpatient AS-ME and home-based asthma intervention programs are not widely available; economic sustainability is a common concern. Thus, we conducted a narrative review of existing literature regarding economic outcomes of outpatient AS-ME and home-based intervention programs for asthma in the United States. We identified 9 outpatient AS-ME programs and 17 home-based intervention programs with return on investment (ROI) data. Most programs were associated with a positive ROI; a few programs observed positive ROIs only among selected populations (eg, higher health care utilization). Interpretation of existing data is limited by heterogeneous ROI calculations. Nevertheless, the literature suggests promise for sustainable opportunities to expand access to outpatient AS-ME and home-based asthma intervention programs in the United States. More definitive knowledge about how to maximize program benefit and sustainability could be gained through more controlled studies of specific populations and increased uniformity in economic assessments.

Implementing quality initiatives in healthcare organizations: drivers and challenges

Purpose

– Various quality initiatives seem to have successful implementation in some healthcare organizations yet fail in others. This paper sets out to study the literature trying to understand drivers and challenges facing quality initiatives implementation in healthcare organizations then compare findings from literature with those of a structured questionnaire answered by 60 representatives from 18 hospitals. Finally it proposes a framework that mitigates challenges and utilizes drivers to ensure best implementation results.

Design/methodology/approach

– Literature regarding implementing various quality initiatives in the healthcare sector was reviewed. Representatives from several healthcare organizations were surveyed. Results from both approaches are compared to highlight the key challenges and drivers facing implementers.

Findings

– This research reveals that internal factors related to leadership and employees greatly affect quality initiative success or failure. Design and relevance play a major role in successful implementation.

Practical implications

– This research offers healthcare professionals greater success when implementing certain quality initiatives by taking success/failure factors into consideration. A general framework for successful implementation in the healthcare sector is provided.

Originality/value

– This article uncovers reasons behind success or failure in a comprehensive and practical way. It also explores how most popular quality initiatives are applied in hospitals.