In health care today, we have the potential to cure what was once incurable and fix what was once unfixable. The unraveling of the human genome and the emergence of precision medicine are opening up new avenues for targeted therapies to tackle the most challenging diseases.
But, this all comes with a high price tag.
Exciting new treatments, combined with greater administrative burdens and complexity of the health delivery system, have created unsustainable cost growth.1 And, this phenomenon isn’t unique to the US. Across the globe, organizations and governments that fund and provide care are facing the fact that the status quo will not do; fundamental changes in our approach to managing the costs of health care are required.
In the past, health systems controlled costs by optimizing supply chain and revenue cycle, managing labor costs, and improving clinical efficiency. These traditional strategies are effective at improving margins, but are not truly transformational. Forward-looking health systems, governments, and other stakeholders are taking a more critical look at ways to reinvent health care. In High-value health care: Innovative approaches to global challenges, we explore how successful initiatives use a multi-pronged approach and leverage new technologies, insights, and business models to “bend the cost curve” or slow the rate of health care cost growth. In our review of global solutions aimed at this goal, five major themes emerged.
Social determinants of health
Social needs, including housing and other environmental factors in patients’ lives, are just as important as medical care in contributing to population health.2 Many health conditions start or worsen when basic human needs – such as companionship/family, emotional well-being, shelter, nutrition, and safety – aren’t adequately met.3 One program out of Canada seeks to address social needs that significantly impact health outcomes and costs. It has shown that liaisons focusing on an individual’s needs, rather than the provision of a particular type of medical service, can be effective in averting costly hospitalizations and emergency room (ER) admissions. Addressing non-medical and medical needs and, more generally, treating patients holistically, rather than just addressing their symptoms, can result in meaningful improvements in health outcomes and potential cost reductions.
Alignment of providers’ economic incentives
Reimagining and reconfiguring economic incentives so that providers are rewarded for doing the right thing at the right time to support their patients’ health remains a critical frontier in the push toward high-value care. One health care management company out of Germany that operates a regional integrated care system contracts to manage the health of about 35,000 people. In the program, providers share the savings when costs fall below nationally determined benchmarks.4 Providers’ bonuses are aligned to health outcomes: losing weight, quitting smoking, or improving clinical measures of health are all measures that impact financial incentives.5 When provider incentives are properly aligned, the cost curve can be bent and health outcomes can be maintained – or even improved.
Patient-centered care can improve the experience for patients, their families, and their health care team members.6 In Spain, a public-private initiative shows that patient-centered care delivery, enabled by new health information technology solutions, could help improve health outcomes and lower costs.7 The regional government maintains ownership of public hospitals and health care facilities but engages a private contractor to manage and maintain primary, acute, and specialist care services in exchange for a fixed annual capitated payment. The partnership has shown that putting the patient front-and-center and bridging the traditional silos of primary, community, and hospital services, can prevent patients’ preferences and identity from being lost.
Chronic health conditions
Chronic health conditions are prevalent, expensive, and deadly. In Mexico, one organization worked to reengineer primary care delivery by providing mobile health tools, building clinician capacity, and training clinicians to improve chronic disease management by applying technological innovations that better engage patients and health care professionals.8 By taking health care to where the patients are, rather than requiring patients to seek-out services themselves, this initiative has reported improvements in patient self-management, clinician disease management, and informed clinical decision-making.
The cost of non-adherence, or failing to follow prescription regimens, is estimated to reach $300 billion annually in the US and nearly $500 billion worldwide. Innovative solutions are essential to countering the avoidable adverse health outcomes that drive-up health spending. Combining drugs commonly prescribed together in a single “polypill” has been shown to help patients adhere to their prescribed treatment regimens. A recent study showed that in the United Kingdom, combining three cardiovascular drugs into a single pill could improve adherence approximately 20 percent over 10 years, thereby preventing 15 percent of cardiovascular events per 1,000 patients, compared to patients taking each drug individually. Economic analysis showed that the drug could be affordably priced at up to GPB £12 per month.9
Globally, many companies are experimenting with innovative ways to “bend the cost curve.” Innovation from these organizations could inspire local initiatives by other health care providers, health plans, and governments. However, strong leadership and stakeholder support is essential to making an initiative work. Models that take a multi-pronged, technology-enabled approach may be most likely to yield success, since today’s health challenges are complex and interrelated.
1 D. Squires and C. Anderson, US Health Care from a Global Perspective: Spending, Use of Services, Prices, and Health in 13 Countries, The Commonwealth Fund, October 2015.
2 Harry J. Heiman and Samantha Artiga, “Beyond health care: The role of social determinants in promoting health and health equity,” Kaiser Family Foundation Issue Brief, November 2015.
3 Thierry Lang et al., “Social determinants of cardiovascular diseases,” Public Health Reviews, 33, no. 2 (2011); Jacqueline Hill, Marcia Nielsen, and Michael Fox, “Understanding the social factors that contribute to diabetes: a means to informing health care and social policies for the chronically ill” The Permanente Journal, 17, no. 2 (2013), DOI:10.7812/TPP/12-099; Alvaro Cruz, E. D. Bateman, and Jean Bousquet, “The social determinants of asthma, European Respiratory Journal 35, no. 2 (2010), DOI: 10.1183/09031936.00070309; David Williams, Michelle Sternthal, and Rosalind Wright, ““Social determinants: taking the social context of asthma seriously,” Pediatrics 123, supp. 3 (2009), DOI: 10.1542/peds.2008-2233H.
4 H. Hildebrandt, et al., “Gesundes Kinzigtal integrated care: improving population health by a shared health gain approach and a shared savings contract,” International Journal of Integrated Care 10, no. 2 (2010), DOI:10.5334/ijic.539.
6 Mark Smith, Robert Saunders, Leigh Stuckhardt, and J. Michael McGinnis, editors, Best Care at Lower Cost: The Path to Continuously Learning Health Care in America, Institute of Medicine (Washington, DC: National Academies Press, 2013); Patrick A. Charmel and Susan B. Frampton, “Building the business case for patient-centered care,” Healthcare Financial Management, March 2008.
7 Klea D. Bertakis and Rahman Azari, “Patient-centered care is associated with decreased health care utilization,” Journal of the American Board of Family Medicine 24, no. 3, p. 229-239, DOI: 10.3122/jabfm.2011.03.100170; Moira Stewart, et al., “The impact of patient-centered care on outcomes,” Journal of Family Practice 49, no. 9.
8 Roberto Tapia-Conyer, Héctor Gallardo-Rincón and Rodrigo Saucedo-Martinez, “CASALUD: an innovative health-care system to control and prevent non-communicable diseases in Mexico,” Perspectives in Public Health 135, no. 4 (2013), p. 180-90, DOI:10.1177/1757913913511423.
9 Virginia Becerra et al., “Cost-effectiveness and public health benefit of secondary cardiovascular disease prevention from improved adherence using a polypill in the UK,” BMJ Open 2015, no. 5, doi:10.1136/bmjopen-2014-007111.