Case Management Doesn’t Scale

PCPs are considered the essential ingredient for ACO sucess. As such, PCPs must be the agents of a major culture change within healthcare. PCPs are expected to lead a renewed focus on disease prevention and ongoing patient wellness. That sounds great on paper, but PCPs don't have infinite time and money at their disposal. Many PCPs within ACOs require case managers to extend their reach. But even case managers are expensive to deploy beyond the sickest 5% of patients.

To put all of this in perspective, let's look at the day-in-the-life of an illustrative PCP: 

  • PCP total hours worked per week: 60
  • PCP non-clinical hours worked per week (charting, billing, practice management, etc.): 20
  • PCP clinical hours available for patient visits per week: 40
  • Weeks worked per year: 50 
  • PCP clinical hours available for patient visits per year: 2,000
  • Average patient panel size: 2,000
  • Time per patient per year: 1 hour

So even if PCPs worked intensely, the reality is that one hour per patient per year is not going to transform our current healthcare system into one oriented around prevention and wellness. Enter physician extenders.

 

        

Physician extenders -- case managers, nutritionists, health coaches -- have been proven to improve health outcomes. Telephone-based case managers have lowered hospitalizations among heart failure patients and online coaches + health trackers have outperformed health trackers alone. The opportunity and threat for ACOs is managing financial margins. Many logically target avoidable hospitalizations as a means of increasing shared savings payments. Case managers can help reduce avoidable readmissions by coordinating care and helping patients follow care plans. But case managers don't scale. That is, like PCPs, there are a limited number of patients that case managers can cover. Ergo, many ACOs deploy case managers against their sickest patients. Here's an illustration of how the math might work:

 

 

Case Management Cost and Productivity

Case Management Impact on Hospitalizations

Fully-loaded case manager cost: $60,000
Case manager clinical hours per week: 25
Case manager patient load: 100
Hours of case management time per patient per month: 1                                    

Reduction of Avoidable Admission Rate: from 35% to 25%
Reduction of Avoidable Readmission Rate: from 20% to 15%
Cost of a hospitalization: $10,000
Shared Savings Rage: 50%

Case management cost per patient: $600

Case management value delivered per patient (hospitalization reduction): $663

 

 

Once you move beyond the sickets 5-15%, traditional case management economics break down. The opportunity is to use technology to extend the reach and effecitiveness of case management. Here's how venture capitalist Vinod Khosla characterizes the opportunity:

During the next decade, we will see systems providing “bionic assistance” to physicians and other healthcare professionals, allowing them to perform at substantially improved levels of expertise like the very best specialists in multiple domains. ... With bionic assistance, in addition to handling more patients, a physician or nurse practitioner will operate at the level of six specialists managing six areas of care for one patient with multiple comorbidities in a more coordinated, holistic and comprehensive manner. Nurses, enabled by technology, will replace many of the functions doctors perform today. Patients will act as the CEO of their own health: they will be better informed and able to make more educated choices to select a course of therapy. Care will become cheaper, faster, more optimal, accessible and consistent across practitioners.

In this quote, Mr. Khosla is peering into the near future, but many solutions are ready to be implemented today. He goes on to highlight some:

Alivecors’ ECG iPhone case enables cardiac patients to take hundreds of ECG’s at virtually no cost and is FDA-approved to diagnose atrial fibrillation, which it can detect as efficiently as a cardiologist looking at the same tests. Continuous and convenient at-home monitoring of atrial fibrillation becomes economically feasible with this low-cost device, possibly avoiding many strokes. ... Similarly, Cellscope’s iPhone case imager will soon be able to diagnose a child’s ear infection and suggest a prescription. Lumiata may be able to help decide when to see a doctor and ensure they do not miss a symptom that may affect a diagnosis. Ginger.io monitors mental health patients and can reduce suicides, depression and bipolar episodes by working with a psychiatrists’ nurse. The app can characterize a patient’s behavior more accurately and effectively when the patient is outside of the psychiatrist’s office than a human could.

 

Bottom Line

Accountable care requires a fundamental reorientation of primary care around keeping patients well and out of the hospital. Most ACOs consider case managers and care coordinators as essential to population health success; however, traditional case management is cost-effective only for a small percentage of very sick patients. Technology is avialable today that can boost the effectiveness of case managers. Still working out your technology strategy? Let's talk.