More focus on group ‘medium cost’ patients will save money later on

9 March 2017
The company recently deployed analytics tools to examine and classify patients coming through the system from 2010 through 2015. Using a technique called an acuity pyramid, the executives placed patients into three tiers and found big opportunities in the largest group, which it had not previously focused as much on, senior director of connected health innovation Kamal Jethwani told Healthcare IT News.

  • 4 percent of patients fell into the top tier of the pyramid. These patients required the most care and were the most expensive to treat. Doing an exceptional job managing these patients offers the potential to save quite a bit of money.
  • 45 percent of patients fell into the bottom tier of the pyramid. These patients cost the least amount per patient to care for. Still, because of the sheer number of patients here, the total costs are significant.
  • 51 percent of patients, the majority, fell into the middle tier. These patients have chronic illnesses or mental health issues, for example, that are fairly well managed but perhaps not extremely well managed.

Partners learned a valuable lesson in population health management from this middle-tier, according to Jethwani. “When you look at 2015 in a static fashion, you will gravitate toward working with the sickest at the top of the pyramid, many hospitals do that. If you look at the pyramid in a static manner, you think, if I can just get these patients better, I can save a lot of money.”

But when you look dynamically from year to year, a lot of the patients at the top ultimately fall down into the middle segment, while a lot of patients in the middle go to the top. So even though working on the top 4 percent of patients makes sense for the current year, it makes no sense for next year, Jethwani states.

The question then becomes: What if I could intervene with the middle bucket this year so they do not wind up in the top bucket next year?” To find this out, the team examined cost data from 2010 through 2015, studying the same cohort of patients going through the health system, and compared what happened with patients from one year to the next.

Moving between risk levels

This showed both how patients moved from one risk level to another risk level over the years and the financial consequences of these moves. That led to the understanding that more focus is needed on the second tier, because untreated they might move to the top 4 percent, thus costing health organizations a lot more money. “ These are people with longstanding chronic illnesses, people with mental health issues, people who have had two or more chronic illnesses for five years who are fairly well managed but not well managed.”

A strategy to take better care of the middle segment or tier, will:
  • Help organizations get better at treating chronic conditions or help patients do this better.
  • Lower the hance middle-tier patients will shift to the top tier and become more expensive patients in the years ahead.

Jethwani will discuss the acuity pyramid and other population health strategies at the HIMSS and Healthcare IT News Pop Health Forum in April.