NHRMC Future: Advancing the Value of Care

February 17, 2020
Lower costs. Higher Quality. This is what everyone wants from nearly everything they buy. The balance between the two equals its value to you. Sometimes, you will settle for lower quality if you can spend less. Other times, you want something better and are willing to pay more.

But when it comes to healthcare, we all want the best and believe everyone deserves access to it: the most advanced equipment, the most effective medications, the highest skilled care team. We want it all and we want it to be convenient, compassionate and tailored to our unique needs.

As expectations have climbed, so too has the cost of care. Over the years, medical costs have grown at a rate that is unsustainable for nearly everyone involved: those who pay for the care and those who provide it.

The “payors,” which include private health insurance companies and government payors like Medicare and Medicaid, have responded by reducing the amount they pay to those who provide care and passing along more of the costs to patients.

The “providers,” like New Hanover Regional Medical Center, have responded by finding new ways to eliminate unnecessary costs and improve efficiencies while ensuring continued safe and effective care.

Together, payors and providers are developing new value-based plans that tie payments to how effectively and cost-efficiently a healthcare team can manage a person’s overall care. These value contracts are a shift from the traditional payment models that pay separately for every visit, test, procedure, and hospital stay. Whether a provider can succeed under new value models will depend on how quickly they can adapt.

New Hanover Regional Medical Center has been working to lower costs and improve quality for years, resulting in millions of dollars in savings and steadily improving patient care. This commitment to value is a key part of NHRMC’s strategic plan. It is also one of ten goals driving the work of the NHRMC Partnership Advisory Group as it evaluates options for the health system, from restructuring to different levels of partnerships.

What NHRMC is Doing to Advance Value

From small projects to eliminate wasted steps and expenses in a process, to large initiatives to help patients get the right level of care at the right time, NHRMC’s focus on constant improvement has made it the strong health system it is today. Across the organization, staff and physicians work together using Lean tools to improve care and lower costs.

Examples of recent projects include implementing consistent standards for when to give a patient Tylenol tablets instead of using a more expensive IV. This saved $242,683 in six months.

Another team looked at blood transfusions. A lifesaving procedure, it can also be overused and increase the risk of complications for the patient. A multi-disciplinary team evaluated how to prevent patients from needing a transfusion and standardized the process for performing them.

The changes reduced unnecessary blood transfusions by 864 units of blood, minimizing risk to the patient, and saving $386,208.

Better management of high-risk patients also drives down costs while helping patients live better. Improvements in the support of congestive heart failure patients have saved $692,233 and have spared patients from some of the most devastating complications of the condition.  Other efforts focus on getting patients to the right level of care. For example, NHRMC is working with community partners to help patients who come to the emergency department with dental pain find a more appropriate, and less expensive, place to receive the care they need.

One of the most successful examples of how care providers can drive value can be seen in the results achieved by NHRMC’s Accountable Care Organization, Physician Quality Partners. This network of practices worked with NHRMC to manage the care of 18,000 Medicare beneficiaries.

Through supportive preventive care and reducing hospitalizations and ED visits, Physician Quality Partners saved more than $5.3 million in Medicare spending in 2018 and achieved a quality score of over 95%, achieving the highest available merit-based incentive for the second consecutive year.

These initiatives are just some of many that underscore NHRMC’s commitment to delivering care that is affordable and high quality. They’re also an example of what all health providers need to do going forward.

Accelerating Efforts to Advance Value

Looking ahead, NHRMC needs to expand what it is doing on a small scale, with limited groups of patients, to a much larger scale, encompassing everyone the system serves. Value-based contracts represent about 36% of U.S. hospital contracts now, but that will steadily grow and NHRMC will face penalties if it fails to manage each person’s health within the reimbursement rates set.

To succeed, NHRMC needs to move from manual tracking and management of patients to sophisticated data systems and analytics that can help quickly identify risks, best practices, and steps that can be taken to manage a person’s health more effectively.  These costly systems require significant investments in both technology and people with the expertise to manage it.

When evaluating options through the partnership exploration, the Advisory Group will consider how different partnership models could accelerate NHRMC’s efforts to drive better care at lower costs. They might provide access to data systems, clinical expertise, and/or support priorities for building new, lower-cost care models that will reduce the demand for higher-cost inpatient hospital care. They may also help NHRMC expand its capabilities to develop new payor strategies that keep more of healthcare spending focused on patient care and prevention.

Next Steps

Specific questions about value are detailed in 20 questions in the Request for Proposals (RFP) issued January 13. You can see these, and the other questions in the RFP, online by visiting www.nhrmcfuture.org and clicking on “RFP” in the top button bar. “Advancing the Value of Care” is section 2.

Once the proposals come back and are finalized near the end of March, they will also be available on the website, so members of the public can find out exactly how each proposed partner can advance value.

Members of the Partnership Advisory Group will evaluate the support suggested and weigh it with other considerations, including the nine other sets of goals and objectives approved by the group, and the degrees of local control and ownership outlined in the proposals.

The Advisory Group will then publicly make their recommendation to the NHRMC Board of Trustees and New Hanover County Board of Commissioners.

You can follow the progress and learn about public forums online at www.nhrmcfuture.org/stay-informed.
Categories: NHRMC Future

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