To Reduce Outmigration, Hospitals Must Partner with Employers


Payers & Providers: Opinions
Reprinted from June 9, 2016 article

By Yale Miller, Client Solutions Principal, Aegis Health Group

Hospitals within a 75-mile radius of large U.S. cities are facing a serious financial challenge: patients who “outmigrate” to urban hospitals for a variety of reasons.

Here’s how dire the situation has become: 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 about one-third of commercially insured consumers report that they do not have a primary care physician – and as many as 50% 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 creates the foundation for truly effective population health management.

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 have an incentive to find a PCP and to 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

Telemedicine To The Rescue

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.

Strong hospital/employer alliances, aided by telemedicine and data analytics, are changing long-held beliefs that the local hospital can’t match big-city quality. Thanks to this partnership, 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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