That is, until Kaiser Permanente (KP) demonstrated that its EDs were the best place to lower the cost of caring for the most expensive population of all: seniors in its Medicare Advantage program.
Beginning in the 1990s, when state and federal governments adopted prudent layperson standards, the conventional wisdom of employers and private health plans has been to control ED utilization with high co-pays and deductibles, shifting more of the cost of acute care to plan members.
That is, until KP demonstrated that modest co-pays and patient-friendly engagement were the safest and most cost-effective ways to get plan members to the right place at the right time for first contact care.
Authors from Kaiser Permanente, the University of California at Irvine, and George Washington University recently published an outcome study comparing 2011 ED utilization and emergency hospitalization by KP’s commercial and senior plan members in California with the rest of the state’s population and hospital systems, as well as the same measures for the entire US population.[i] The results not only challenge much of the conventional wisdom of policy makers and health plan sponsors, they offer a compelling vision for how acute care systems should be integrated with primary care and population health management.
As a patient-centered system, the integrated network’s approach to acute care begins with a demand management system originally developed by Vituity. Now known as KP OnCall, it offers plan members access to specially trained nurses for medical advice and immediate referral 24/7. Because the KP OnCall staff also have access to HealthConnect, the electronic record shared by all providers in the network, medical advice is enriched with patient-specific information, and includes direct access to scheduling systems for the primary care clinic, as well as convenient urgent care. The largest proportion – more than one third of all callers - were scheduled to be seen by primary care providers on the same day or next day. Less than 20 percent were referred to 911 or EDs. Staff referred a similar proportion to pediatric or adult urgent care clinics for same-day care. An intriguing 10 percent required only patient education and self-care.
The healthcare system’s most significant acute care protocols, however, are for more than one million members of its Medicare Advantage programs. Because the organization uses its regional EDs as diagnostic centers for more complex patients or high-risk conditions, senior members are actually more likely to be referred to the ED than their counterparts in other Medicare programs. Most interesting is that the network’s admission rate for seniors from the ED is only two thirds of the admission rate in non-KP hospitals throughout California.
In May, the lead author of the outcome study, Jeff Selevan, MD, also one of the principal designers of the organization’s acute care system, was part of a panel at the Brookings Institution, a non-profit public policy organization based in Washington, DC. Once published, the KP experience rapidly became the basis for an important case study by Brookings. As Dr. Selevan explained, while the integrated healthcare system may be paid the same amount per member per month by the Medicare program for each of its senior subscribers, claims data showed that primary care screening and surveillance was not enough for its most complex and chronically ill members. For the sub-population generating disproportionate costs for the organization’s facilities and providers, more aggressive integration and case management is required. Increasingly, for many Medicare core measures for KP facilities, the same was true for many time-sensitive conditions such as stroke and heart attack. The study data is an early demonstration of the potential value-add for well-integrated EDs for other hospital systems and health care programs.
While emergency physicians and hospital-based providers in most communities are paid on the basis of how many patients they see and how many procedures they perform, ED-centric acute care teams at KP are measured by how many admissions and readmissions they can prevent, as well as health plan or hospital benchmarks. As Dr. Selevan explained to the Brookings audience of healthcare experts and government officials at the panel discussion, while some encounters in the ED and related observation units may appear to be lengthy or expensive, if they prevent an admission or readmission that is far more costly, they are adding value to the entire organization. The same is true of efforts to reduce the length of stay for the organization’s senior inpatients. From a patient-centered point of view, few families want to see their loved ones readmitted for established conditions if they can be safely treated in lower acuity settings closer to home. Given sufficient support services, KP acute care teams can also identify patients more appropriate for palliative care, or other forms of post-acute community care.
Other thought leaders have recently made the same macro-argument. Dr. Art Kellerman, Dean of the School of Medicine at the Uniformed Services University of the Health Sciences and previously a senior investigator at RAND, has said, “If Medicare pays $9,000 per admission, you only have to prevent one hospitalization of marginal value to pay for a whole lot of $900 ED visits.”[ii]
What is the secret to KP’s success managing and integrating acute care? Dr. Selevan believes that it is the well-balanced alignment of incentives, risk, and collaboration between its insurance products, hospital systems, and physician groups. Perhaps most importantly, if the conventional wisdom is that the House of Medicine has long since abandoned control of the healthcare system, the organization is a powerful example of what can be achieved through physician-driven approaches to the Triple Aim. Dr. Selevan also believes that it is no accident that the organization’s medical groups operate for profit, even as its insurance program and hospitals operate as non-profit entities.
Vituity seeks similar alignment with hospital systems and healthcare sponsors for their own version of the Acute Care Continuum. Physician leaders in both KP and Vituity would likely agree that superior clinical care, shared ownership and broad-based accountability represent the best path forward to truly patient-centered care, as well as effective population health management.
Dr. Fields is a Clinical Associate Professor of Emergency Medicine at the University of California, Irvine, and Kaweah Delta Medical Center, Director and Past-Chair of the Vituity Board, and an author of the KP study.