session #11: health care’s micro-macro dilemma · new business model . . . that will ......

Session #11: Health Care’s Micro-Macro

Dilemma

Speaker: Matthew Anderson

Date: Saturday, Jan. 10

Time: 1:30 – 2:30 p.m.

Matthew Anderson

Matt Anderson is senior vice president for policy and strategy for the Minnesota Hospital

Association. His work focuses on health care policy and reform topics, including issues

associated with the Affordable Care Act, payment and delivery reforms, health insurance

exchanges, state health care reform initiatives, community benefit activities and health needs

assessments. He frequently presents to hospital and health system boards and leadership

teams, as well as community and health care stakeholder groups. Matt’s career has included

service in the Minnesota Attorney General’s Office, the Hennepin County Attorney’s Office, and

Minnesota State Colleges and Universities.

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Health Care’s Micro-Macro

Dilemma

Matthew AndersonSr. VP of Policy & Strategy

Minnesota Hospital Association

January 10, 2015

The Dilemma for Health Care

� “2015 Environmental Scan,”

American Hospital Association

• “Health care is moving toward a

precision-based model – or

‘personalized medicine.’”

• “[T]he U.S. health care system has a

new business model . . . that will

emphasize community-based care.”

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Factors Impacting Health Outcomes

20% - Access to and quality

of health care

80%

• Social and economic

factors (40%)

• Health behaviors (30%)

• Built environment (10%)

Adapted from <http://www.countyhealthrankings.org/our-approach>

Health Care:Macro

� Population Health

• Invest in public health initiatives to influence health

indicators of population as a whole

• E.g., large scale wellness programs

• Environmental design, city planning

� Advantages of population health

• Many known causes of health care utilization

• Large scale interventions often more affordable than

costs of treating individual outcomes in the long run

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Health Care:Macro

� Requirements for success in population health

• Community engagement(especially employers, schools, local government)

• Reliance on new professions (community health worker, community paramedic, community nursing)

• Multi-stakeholder, cross-sector activation

• Early, continuous investment

� Current challenges

• Reimbursement, payment models (ACOs close, but transitional and insufficient)

• Most “savings” is long-term and speculative

Health Care:Micro

� Patient-centered care

• Health Care Homes

• Individual care plans;

individualized care

• Physician-led,

team-based care

• Genetic-designed

interventions,

pharmaceuticals

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Health Care’s Micro-Macro Dilemma

� The laws of delivering high-quality, individualized

care (micro) do not translate into delivering

effective and efficient population health (macro)

• Different workforce

• Different capital investment

• Different marketing, community engagement

� Trying to use our current care system to deliver

more individualized care to larger numbers of

people is not population health

Science and Scale

Field Macro Micro

Physics Gravity;

Newton, Einstein

Quantum; Higgs

Economics Macro Micro

Health care Population Patient-centered

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Physics:Macro

� Laws of gravity, space, relativity

• Predictable, measurable, reliable . . .

on macro-levels

• Mapping of comets, planets, stars, etc.

• Ways we use macro laws of physics:

Satellites

Lunar landings

GPS

Physics:Micro

� Laws of quantum physics

• Proton/electron motions

• Building blocks of matter

• Macro laws of gravity do not hold true or allow for reliable explanations

• Ways we use micro laws of physics: LasersMicrowavesCellphones

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Economics:Macro

� Laws of Macroeconomics

• Reliable and predictive on large scales

• Supply and Demand

• Growth, inflation,

• Outcomes:

Monetary policy

Tax policy

Predictive analytics

Graphs

Economics:Micro

� Laws of Microeconomics

• Attempts to apply macroeconomics

to individual/family decision making

• Assumes rational individual decision

making

• Forces of incentives/rewards and

pressures of penalties

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Economics:Emergence of Behavioral Economics

� Microeconomics attempts to apply macro theory

to micro level decisions and . . .

fails to accurately describe actual individual

decision making

� So, how do people make decisions?

Irrationally

Behavioral Economics:Promise of Future Gains v. Fear of Loss

� Obama (June 30, 2003): “I happen to be a proponent of a single-payer health care program. . . . And that’s what I’d like to see.”

� Obama (June 28, 2012): “If you're one of the more than 250 million Americans who already have health insurance, you will keep your health insurance.”

� Obama (June 30, 2003): “I happen to be a proponent of a single-payer health care program. . . . And that’s what I’d like to see.”

� Obama (June 28, 2012): “If you're one of the more than 250 million Americans who already have health insurance, you will keep your health insurance.”

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Behavioral Economics:Overvaluation of one’s assets, knowledge

Behavioral Economics:Paralysis of Choice

�

54 plans ranging from $130 to $288

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Can we find the 1:1.618 formula for individual care and population health?

Southcentral Alaska Foundation:2004 – 2009

� 55,000 enrollees (10,000 in remote

villages accessible only by plane)

� Costs per capita = $3,700

• Minnesota = $8,000

• US = $8,800

� Improvements over 5 years

• ER use <50%

• Admissions <53%

• Specialty care <65%

• Primary care <36%

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Southcentral Alaska Foundation:2004 – 2009

� Performance metrics

• Almost guaranteed same-day

appointments

• Calls answered in <30 seconds

• Best-evidence care for . . .

Child with asthma up from 35% to 85%

Immunizations by age 2 = 90%

Diabetics with controlled blood sugar: top 10%

Patient satisfaction: 93%

Employee satisfaction: 90%

Health Care:Searching for the Golden Mean

� Build from existing strengths

• Health care home/primary care + emergency/trauma + acute care + long term care continuum

• These services will be necessary and expected in both individual and population health systems

• Leverage existing services, relationships, infrastructure to build foundation for community engagement

o EMR

o Relationships with employers, local government, social services, public health

o Community health needs assessment and community benefits

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� Seek financial arrangements that offer enhanced reimbursement for preventive, wellness or community health initiatives

� Relentlessly pursue efficiencies, cost savings in existing service lines

• Shift from individual to population health will be greater challenge if existing system carries higher costs

� Examine recruitment and retention strategies that seek cross-trained or multiple competencies

• Bilingual

• Community health education, training or activities (e.g., community paramedic certification)


� Forge joint ventures, pilot projects, or other collaborations with community/population health partners

• Aim for building institutional experience, community stakeholder trust and understanding, engagement of organizations and individuals

• Local public health

• Social service agencies

• Long-term care, assisted living

• School districts

• Strive for projects that align with your organization’s community health needs assessment

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� Seek initiatives that serve multiple purposes.

Example 1: Reducing hospital’s energy use

• Cuts current expenses without harming revenues

Reducing average hospital’s energy expenses 10%

increases its operating margin 16%

• Increases resiliency during power demands

• Opportunities for building relationships with

local utilities, environmental groups,

schools (projects for students)

• Improves public health

• Offers marketing/PR stories


� Seek initiatives that serve multiple purposes. Example 2: Improve hospital employees’ health

• More likely to have chronic conditions, including asthma, depression and obesity

• 5% more likely to be hospitalized

• 9% higher health care spending than national average for insured employees

• Consistently less likely to be tested/screened for cholesterol levels; breast, cervical and colorectal cancers

• Average hospital spends 4% of operating revenue on health insurance benefits for employees

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� Seek initiatives that serve multiple purposes.

Example 2: Improve hospital employees’ health

• Increase employee engagement

• Decrease rate of health insurance cost/expense growth

• Reduce absences

• Develop wellness, behavior-modification competencies

• Forge relationships with local partners – grocery stores,

fitness centers, parks department, etc.

• Build data, anecdotes, other background to show impact

if other employers joined in the effort

• PR/marketing/recruiting

Questions

&

Discussion

session #11: health care’s micro-macro dilemma · new business model . . . that will ......

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