July 25, 2013

Clark: How hospitals are partnering with employers to reduce health costs

Daily Briefing

The Daily Briefing's Hanna Jaquith spoke with Megan Clark, head of the Health Care Advisory Board's Care Transformation Center, about the rise of innovative partnerships between hospitals and employers, which are intended to reduce employee health costs. 

Q: In recent years, we've seen more and more companies—Wal-Mart, Boeing, and Ford Motors, to name a few—taking a more proactive approach to managing their employee's health. What are some of the different ways employers are teaming with hospitals to make this happen?

Clark: First off, employers come in a whole bunch of different flavors: Some want to get really involved with what's going on with their employee's health, while others are looking for a partner who wants to take on that health ownership.

That said, a lot of companies are working with local hospitals and health systems to figure out what their on-site wellness approach should befrom weight-loss challenges to exercise programs. These types of investments are more of a long-term health savings strategy since it is often years before you see results.

Access to care is another piece of the puzzle: Employers are trying to encourage their workers to not unnecessarily use the ED. Instead, they want to encourage workers who feel low-acuity symptoms to head to a retail clinic, log on to a work-sponsored patient portal, or just walk downstairs to the company's on-site health clinic.

Where we are increasingly seeing very productive partnerships is around chronic condition management. There is more of a short-term "hit" for focusing on conditionssay, diabeteswhere clinical outcomes can be improved in a 12- to 24-month period.

Q: Out of the partnerships that you've outlined, are there more 'bang for your buck' strategies?

Clark: Chronic condition management is where people see a more immediate return on their investment. Again, some of that comes back to focusing on conditions that can be measurably changed in a short period, versus wellness initiatives that encourage workers to lose weight with the hope that it will result in better health down the road.

Chronic condition management also can boost patient engagement. In one pilot program between Bon Secours St. Francis and Michelin North America, a physician said the partnership provided him with additional resources and tools to engage patients in the care plan.

How managing chronic conditions saved one organization $331,000. This Crimson Population Risk Management case study explains how a three-hospital system's condition management program positively impacted utilization and care guidelines compliance.

Q: What kind of competition are hospitals and health systems seeing in this market?

Clark: A number of organizations are positioning themselves to partner with employers including providers and payers.

And more disruptive innovators are popping up and basically positioning themselves as the employers' partner. These innovators have the potential to steer entire patient populations and redirect referrals.

Q: So, how can hospitals position themselves to attract employer partners?

Clark: When seeking out these opportunities, it is important to weigh the metrics that matter to an employer. Besides the very health care-focused view of outcomes, hospitals need to understand what employers are looking for: to cut spending on health benefits, avoid hospitalization and unnecessary ED use, and reduce absenteeism.

Having good geographic coverage around the employers' site and where workers live is important. It's not going to be good for the company if workers do not have access to a single primary care physician close to home. However, offering good virtual programs—24/7 access to a nurse practitioner or patient portals—can make geography more flexible.

When it comes to services offered, what has worked well for hospitals has been to start with a targeted partnership around one service. As the employer and the hospital gain experience working together, the partnership can expand to more comprehensive options.

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