Manage population health for low-risk, high-reward outcomes

Reti-AlejandroIn our past posts, we shared how Billy Beane transformed the Oakland Athletics baseball team into a perennial contender using data and analytics. The now-famous “Moneyball” strategy has allowed the A’s to field players who bring the greatest reward (wins) for the lowest risk (wasted budget).

As health care organizations continue their journey toward value-based business models, they too are looking for high-reward outcomes that minimize exposure to financial and performance risks. This becomes particularly important as more revenue is derived from risk-based contracts. As Beane discovered more than 15 years ago, the secret of success lies in a data-driven approach to management and strategy.

Today, most organizations can achieve a margin of safety on risk-based contracts by paying attention to proper coding, at least for contracts paid on a risk-adjusted basis. However, the window of opportunity to compete this way has all but closed in Medicare Advantage and will be likely be short lived in other Medicare and commercial markets. Going forward, providers will need to understand what kind of patients they can manage effectively and become proficient at projecting their future performance.

A key part of this strategy will be the development of specialized programs and capabilities. For example, direct-care delivery organizations have developed ingenious approaches for managing visit and medication adherence in Medicare populations that include regular visit scheduling, co-pay elimination and in-house pharmacy dispensing. Organizations with experience managing Medicaid risk have similarly evolved to build up behavioral health resources co-located with their primary care delivery network. Ongoing data analysis is a prerequisite to determining where performance gaps lie and the extent to which care approaches are working in disparate populations.

Ultimately, providers need to stop seeing themselves solely as purveyors of medical services, but as facilitators of health and well-being. Groups with the best patient satisfaction and outcome metrics will be preferred medical homes for their local population. Patient choice drives assignment, and assignment (lives under management) is becoming the dominant measure of success in some markets.

For more information on how to leverage data and analytics for your organization, download Optum’s Moneyball Analytics eBook by clicking here.


About the Author:

Alejandro Reti, MD, MBA
Chief Medical Officer, Optum Analytics

With responsibility for the Office of the CMO, Alejandro is accountable for the clinical integrity and relevance of Optum Analytics’ provider solutions and contributes to thought leadership and clinical product innovation for the organization. Alejandro came to Optum from Premier, where he served as Vice President, Population Health Products with general management responsibility for Premier’s organically developed population health suite. Prior to Premier, Alejandro served as Senior Vice President, Clinical Informatics at Verisk Health, where he led development of a provider analytics solution that achieved top 4 in market share nationally. Previously, Alejandro held positions of increasing responsibility at Avalere Health and The Advisory Board Company. Alejandro received a bachelor’s degree in Psychology from Amherst College, magna cum laude and his MD and MBA degrees from Yale University.

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