How Population Health, Risk Stratification Support Value-Based Care 

December 20, 2021 - During the COVID-19 pandemic, organizations witnessed the consequences of fee-for-service as providers and patients struggled with communication and revenue.  

While value-based care is not a new concept, the approach to care delivery and reimbursement has seen significant traction during the pandemic. As patients opted for virtual care options, leading healthcare organizations invested in digital technology to tend to treatable conditions remotely.  

With value-based care models, providers obtained fixed payments to cover the cost of patient care. Additionally, providers receive incentives if they successfully reduce patient health risks and costs. Throughout the pandemic, value-based care models provided financial stability to healthcare organizations, allowing them to provide tailed care management.  

Through population health management and risk stratification, organizations can accelerate their shift away from fee-for-service and volume and towards value-based payment and care quality.  

The path to value-based care 

The goal of value-based care is to standardize the healthcare process by improving the patient experience, the health of patient populations, and the cost of care. Through data mining, providers can determine which processes are the most effective. Strategies for wellness and prevention are stressed under value-based care models.  

According to Cleveland Clinic, “Prevention of health (through quitting smoking, dietary and lifestyle changes, exercise, etc.) reduces the need for expensive tests, procedures, and medications. You’re staying well cuts healthcare costs for everyone.” 

To deliver the best value-based care, providers can implement population health management strategies, replacing the “one size fits all” care mentality. With population health management, organizations can consider physical and social determinants of health that may impact individuals and focus on “well care” rather than waiting for a patient to become ill.  

What is the role of population health management? 

According to the American Hospital Association, population health management refers to “the process of improving clinical health outcomes of a defined group of individuals through improved care coordination and patient engagement supported by appropriate financial and care models.” 

The term “population” can be used to identify a smaller group of individuals or a much larger one. Of primary importance is that all people within a group share a common characteristic or problem. Ultimately what medical professionals are looking at in population health management is how to improve the care within the specific patient group.  

The process of population health management usually begins by gathering key demographic and clinical data about patients attributed to the provider, often from electronic health records. Attributed patients may be decided by the geography of the service area, their health insurance provider, or their current diagnoses. 

These patients are then sorted into categories based on their clinical history and risk.  

Researchers and clinicians then use aggregated clinical and claims data for risk stratification. The data may include the number and type of chronic diseases, a history of high utilization or frequent hospitalizations, a mental health or substance abuse diagnosis, advanced age, or an address in a low-income or underserved community. 

What is risk stratification? 

Risk stratification is identified as the ongoing process of assigning all patients a particular risk status. Risk statuses are based on data that reflects vital health indicators, lifestyle, and medical history. Researchers and clinicians can match risk with levels of care, individualized treatment plans, pursue value-based care approaches, and address population health management challenges. 

 The overall goal of risk stratification is to identify patients who are most likely to benefit from care management to improve patient outcomes and decrease costs.  

Using analytics tools, the provider then assigns each patient a risk score.  

Patients with higher risk scores may receive extra attention, including more frequent follow-up, social and community support, enhanced care coordination services, medication adherence advice, or an invitation to enroll in an educational patient support program.  

Those with lower risk scores might still benefit from services like automated screening reminders or telehealth options. 

These preventive care strategies are intended to help maintain each patient’s highest possible health status while avoiding crisis events, decreasing preventable hospitalizations, and improving the overall quality of life.  

As a result, providers may be able to lower expensive services, avoid duplication of efforts, raise patient satisfaction, and enhance the overall health of their patients. 

Risk stratification plays an important in population health management by understanding the needs of patients in different risk categories, improving health outcomes. 

How to implement population health management 

The main goal of population health management is to keep patients out of the doctor's office through preventive care. Additionally, the concept benefits providers by decreasing program costs. To implement population health management strategies, organizations need to start by creating a strong population health team and maximizing analytic technology.  

Once the organization has an understanding of its patients and the available technology, it can develop a strategic roadmap by asking the following questions: 

• Are we planning to participate in any formal value-based reimbursement programs, like the Medicare Shared Savings Program (MSSP) or a private payer accountable care organization (ACO)?  Are we planning to achieve patient-centered medical home recognition from an accrediting body like the NCQA? 

• Do we understand how these arrangements and recognitions will affect our future attestation under the MACRA framework? 

• Do have a clear picture of the socioeconomic issues facing our patients?  What is the average health literacy level?  How will we communicate with them?  Do the majority have access to the internet at home, or should we investigate a texting-based platform? 

• Do we understand our geographical region and the health resources available to our patients?  Can we reach out to the public health department, school districts, and community leadership organizations to better understand the challenges of this particular area? 

• Have we thoroughly assessed our baseline data integrity and analytics competencies?  Do we understand how our data accuracy, quality, completeness, and timeliness will affect our population health management insights? 

• Do we have the skilled staff on board to help meet these data challenges?  Are we interested in working with a consultant?  Should we consider outsourcing any of our technology or business processes? 

• Is there a local health information exchange organization that provides access to population health insights?  Is there still a regional extension center nearby that can provide advice on technology adoption and planning? 

• What is the first project we will tackle?  What is its time frame, its requirements for participation, and its anticipated results?  How will we report on its outcomes, and what will we do with that information? 

The organization will then collect feedback regarding workflows and patient satisfaction, searching for ways to continue improving the program.  

Through population health management and risk stratification, organizations can adopt value-based care strategies and participating in alternative payment models to improve patient outcomes and decrease costs.