How Hospitals and Employers are Creating Medical Home Partnerships

07.15.2016

Medical Home News

By Yale Miller, Client Solutions Principal, Aegis Health Group

When a community hospital partners with a local employer to create a patient-centered medical home (PCMH), it’s mutually advantageous for both parties.

For medium-size hospitals, it helps solve the growing problem of “outmigration” – patients who choose to drive 50 miles or more to visit an urban hospital for a variety of reasons.

For employers, a PCMH partnership helps boost productivity because employees don’t have to spend time making ad hoc healthcare decisions, like whether to visit an urgent care center or a retail clinic such as Walgreens. The quality of care is higher, and the health data captured by the hospital creates a strong foundation for community-wide population health management.

Some employers are creating their own self-funded PCMHs, but it’s much less expensive to partner with a local hospital. For example, the RoyOMartin lumber company in Alexandria, Louisiana created its own PCMH in 2011, staffed with two medical directors (one general practitioner and one internal medicine physician), a physician’s assistant, LPN, medical assistant and receptionist. But if an employer partners with a community hospital, those hard costs can be borne by the hospital.

PCMHs Designed for the Commercially Insured
The PCMH model places great emphasis on reorganizing care teams to be more patient-centric, but that’s just the first step. By working closely with area employers, a hospital can add a significant number of commercially insured patients to its network – something that’s critical for success.  When partnering with a hospital, key biometric data on the workforce can be gathered and utilized to create financial incentives for employees to establish ties with a primary care physician and to get regular health screenings. Employees then have powerful motivation to manage their health before the onset of chronic conditions, helping the employer reduce healthcare costs.

Much like the “company doctor” of the past, this PCMH alliance can even extend into the workplace to help manage employees’ health conditions in real-time. When employees get quality care in the workplace or nearby, they’re far less likely to make the long trip to a large urban hospital.

Outmigration Now a Serious Problem
Hospitals on the outskirts of large metropolitan areas are already losing significant revenue to urban hospitals. For example, hospitals in two Pennsylvania counties lost nearly $1 billion over two years to big-city rivals. The main reason was that patients felt quality was higher in the urban facilities, even when excellent local services were available. Patients were more likely to outmigrate if they were employed and had higher income and education.

But the quality disparity is simply a perception – one that’s more prevalent among community members without ties to a local health system. National data reveals that only about one-third of commercially insured consumers have a primary care physician – and as many as half of them haven’t seen a doctor in the last three years.

Meanwhile, area employers are searching for ways to lower their healthcare spending. The community hospital and local employers need each other more than ever before – and when they join forces, it sets the stage for truly effective population health management.

With the accelerated migration to outcomes-based reimbursement, successful health care systems will need to fully understand how to manage an individual patient’s health and healthcare across the care continuum, engaging the patient as an active, accountable participant in the process. Without an engaged patient, failure is all but guaranteed.

Building Relationships with Local Employees
When a provider partners with local employers, the hospital and its affiliated physicians create a direct-to-consumer relationship where one previously didn’t exist. Instead of waiting for an employee to seek care, the hospital takes preventive care and education directly to the workplace.

This usually starts with on-site biometric screenings and education, and can easily morph into on-site clinic operations and health coaching. Employees begin to see the hospital as a valued health partner. Along the way, the hospital gathers key information about local employees’ lifestyle habits, disease history, health risks and frequency of regular checkups. They then use this data to directly connect with employees, customizing care and education to their specific health risks, age and gender.

This proactive approach achieves five key objectives for the hospital:
• Encourages area employees to keep their care local
• Lowers costs by identifying health risks upstream before they become costly chronic conditions
• Increases revenue for the hospital and its affiliated physicians because employees are incentivized to find a PCP and get regular health screenings
• Improves payer mix by bringing more commercially insured lives into the network
• Creates a favorable environment for a “narrow network” or direct contract with local employers

Strengthening the PCMH with Telemedicine
The PCMH model is also tailor-made for telemedicine. The American Hospital Association estimates that nearly two-thirds of U.S. hospitals already offer telemedicine services. By 2018, 47% of employers with onsite health clinics will offer telemedicine services.

Hospitals on the periphery of large cities can “level the playing field” using telemedicine. Here’s an example:
An employee living 75 miles outside Atlanta suffers what appears to be a stroke. In the past, that person would likely have been transported to a stroke specialist in the city. But there’s only a three-hour window in which to administer the “clot-busting” tPA drug – and when it comes to stroke care, “time is brain.”

Using telemedicine, that person can now be treated at the local hospital in a timely manner. The consulting neurologist can be literally anywhere – like Boston or Los Angeles – as they electronically collaborate with the local hospital’s staff. Most of the revenue from that person’s care stays with the local hospital, which formerly might have gone 100% to a large urban facility. Community members begin to view the local hospital as “state of the art” – greatly reducing the chances for outmigration.

Hospital/employer PCMH partnerships, aided by telemedicine and data analytics, are changing long-held beliefs that the local hospital can’t match big-city quality. Through this type of alliance, local employees know and trust their community providers, who consistently deliver high-caliber care. The question then becomes: why go anywhere else?

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