Seeking ROI With PHM

Karen Minich-Pourshadi, for HealthLeaders Media , June 13, 2012
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QualChoice was started in 1994 as a third-party administrator by the University of Arkansas for Medical Sciences and has expanded into provider networks, administering corporate benefits, and healthcare insurance and other ancillary coverage markets.

The payer's initial P4P program morphed into PHM, says Armstrong, when it began looking at both quality and efficiency measures and establishing targets for physicians treating specific patient populations within the plan, such as diabetics. Provider payments are based on practice results that are scored against the predetermined metrics. Each segment being tracked is scored and totaled against a larger dollar target for the provider organization. Any savings shown in the comparison are then shared evenly between the practice and the payer.

Armstrong says QualChoice had 11,420 members representing family practices, internal medicine, and pediatrics participate and saw an average total reduction in cost of $16 per member per month year over year, from $226 to $210 averaged across those three practice types—representing about 8% of the total average spent.

"We are focusing on the quality of care, and the metrics help show how we're also bringing value," explains Robert Hopkins, Jr., MD, FACP, FAAP, professor of internal medicine and pediatrics at the University of Arkansas for Medical Sciences. The university has been working with QualChoice to improve the community's overall health through PHM.

Accurate and current data is essential from participants of a PHM program, explains John J. Walker, MD, CPE, chief medical officer at Cornerstone Health Care, a physician-owned primary care and specialty group practice based in High Point, N.C. The ability to aggregate data between the payer and the provider helps drive better treatment and results. Moreover, the payer must accurately identify the population in order to manage by acuity as well as understand the true cost of care for these individuals to the overall system. However, data-sharing can be an obstacle for PHM especially with so many IT systems in use across the healthcare industry, and typically some type of shared technology or system upgrade is needed, as Walker can attest.

In 2003 Walker joined Cornerstone, a $190 million multidisciplinary group practice with 73 locations, to lead the organization's medical home initiative. He became chief medical officer in 2010. Shortly after Walker started, Cornerstone Health Care's CEO Grace E. Terrell, MD, adopted the Humedica MinedShare platform as the tool that would put the organization's data to use targeting high-risk diabetic patients for its burgeoning medical home.

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