Population Health: Adding Up Value in Healthcare

Value-based care, population health and social determinants of health (SDoH) are terms that seem to pop up everywhere for those who work in healthcare. But they aren’t just buzzwords or passing fads, they are sources of both true potential and frequent misinterpretation. As the healthcare industry shifts to value-based reimbursement models, many hospital leaders are reevaluating their strategies to better prepare for the transition—and many believe that focusing on population health is the key to success.

In his keynote address at XCHANGE 2019, Dr. Jon Hart, Vice President of Clinical Strategy and Population Health at Fort Myers, Florida-based Lee Health, explained the value equation—a simple equation that can be used in any consumer industry. 

Dr John Hart Equation

Take, for example, the food industry. “I’m driving down the road and feeling hungry, so I stop at a fast-food restaurant to get a chicken sandwich,” Dr. Hart explained in his analogy. “The chicken sandwich was less than $5, so the cost was acceptable. It tasted great, so the quality was a plus. When I ordered and paid for my food, the cashier had a smile on her face and carried on a conversation with me—so the experience at the restaurant was exceptional. When you put those factors into the value equation, you can determine that the chicken sandwich I ordered had great value.”

On the other hand, an overpriced entree of tiny portions at a five-star restaurant where the waiter forgets to refill your water glass would result in a poor value. “As consumers, we determine the value of that interchange based on cost, quality and experience. Value doesn’t necessarily mean cheap,” Dr. Hart said. “We’re willing to pay more if the quality is great, or we might agree to a product of lesser quality if the cost is low.”

So how does this equation work in the healthcare industry and the value-based care reimbursement? Dr. Hart explained how the three factors in the equation translate to healthcare:

hart value explained

Cost = Risk Stratification

Resources are limited, so it’s important to determine where to best apply those resources. That’s where risk stratification comes into play. There are multiple ways to risk-stratify patients, whether that’s by risk of readmission, risk of adverse events, disease-specific risks, behavioral health risks or even social risks, such as social determinants of health. 

Quality = Plan of Care

A plan of care is developed by a healthcare provider in all medical events. The plan of care is based on clinical evidence and best practices—research that has shown to have a significant impact on medical outcomes. Everyone that touches the patient or any aspect of the patient’s care is responsible for care management, Dr. Hart said. 

Experience = Longitudinal Coordination and Communication (Coordinated Care Across the Entire Patient Journey)

Healthcare often operates in silos, where communication between various providers and sites of care is broken or nonexistent. These gaps in care can lead to many patients falling through the cracks. In an ideal value-based care setting, a point person would be charged with coordinating care delivery and communicating to all members of a patient’s interdisciplinary team of nurses and clinicians. This can help ensure patients receive the care they need—and that they feel cared for in the process.

These three factors—risk stratification, plan of care, and longitudinal coordination and communication—are what Dr. Hart called the three pillars of value-based care, which should be set on a foundation of smart technology adoption and strong teamwork and relationships. Ultimately, value is relational, not transactional, Dr. Hart said.

Three Key Takeaways

  1. Everyone must be involved. The concepts of population health and value-based care must permeate every aspect of healthcare delivery. “We’re all managing the care of the patient,” he reminded attendees.
  2. Remember the three pillars. The plan of care, risk stratification, and longitudinal coordination and communication—on a foundation of relationships and technology—equal value for a healthcare setting, Dr. Hart said.
  3. Create value. Treat patients on an individual basis, Dr. Hart recommended. “Optimize patients’ health and well-being and smooth their transitions across sites of care in their health journey,” he said.