Does Care Coordination Really Save Money? Does That Really Matter?

Time to move past “Care Coordination = Cost Savings”

A recent HealthAffairs paper discusses what the authors describe as a big deal: In one big health system’s accountable care organization (ACO), it was the care management program that led to the majority of savings (reductions in hospitalizations, non-emergent visits to the emergency department, overall spending).

That’s it: The big take-away was that care management is a way for ACO’s to save money in a sustainable manner over time. In typical academic fashion, the authors spend several pages describing study methodology (staggering enrollment over time to isolate the program effects for more precise measurement), and precisely zero space describing the actual care management intervention they used!

In fairness to them, care management programs are pretty well understood by now: Step 1) You identify patients with high utilization or high clinical risk profiles; Step 2) You enroll them into a program where they have elevated support from their doctor, a care manager and/or care coach, to help them stick to the care plan, identify medical issues before they become expensive emergencies, seek out lower-cost alternative care, and so on.

Of course, as with anything and everything in health care reform, it’s not that simple. In an insightful piece in the New England Journal of Medicine, Dr. J. Michael McWilliams outlines a few reasons why the narrative of care coordination as a surefire cost-savings tool are problematic.

• First, most of these programs will see an increase in utilization at the outset, because many patients were not getting adequate care to begin with. As the study authors note, this is a typical utilization pattern among ACO enrollees as well. This is a microcosm of what happens when uninsured people sign up for health insurance — the first year or three will be expensive as they get their unmet needs addressed.
• Second, building these intervention programs is not cheap. IT tools are needed to bridge the shortcomings of electronic medical record systems, patient education and engagement is time and labor intensive, and finding and hiring the right personnel is an ongoing challenge.
• Third, care coordination misses the mark on the big driver of health care cost growth: wasteful, unnecessary care. While there may be some reduction in over-testing or medical error, the version of care coordination that has been prescribed as a policy solution perpetuates the “do more” approach to health reform.

All of this is not to say that care management or care coordination is not worth doing — but organizations and policymakers need to do a better job of factoring in the sunk costs before jumping to conclusions about ROI. More importantly, according to Dr. McWilliams (and I agree with him), when we talk about care coordination as a cost-saving lever, we’re missing the entire point.

Though nobody likes waste, nobody likes rationing either. The idea that less is more is a tough sell. The idea of care coordination slowing cost growth, on the other hand, supports the romantic notion that if we could do more for patients, savings would materialize. As health services and health economics research has shown, however, the only guaranteed outcome from doing more is that more is done. — Dr. J. Michael McWilliams

There are two problems with the “care coordination=cost savings” dialogue.

First, it removes the emphasis on care coordination being the right thing to do. Setting the expectation that costs will go down because of a new analytics dashboard and a squad of care managers moves the emphasis from “let’s equip ourselves with the right technology and personnel to provide the best possible care” to “we’re investing in efficiency.” It’s a subtle shift that equates doing more, investing more, coordinating more, with spending less.

Better patient care resulting in fewer admissions should be a worthy endeavor (and investment) unto itself — so let’s not conflate care coordination programs with efficiently run healthcare delivery systems.

Secondly, this punts the discussion about the real issue: Wasteful healthcare delivery. For big health systems like the one who published the Health Affairs paper, saying a care coordination plan is in place should not become an acceptable, politically correct diversion from the smorgasbord of low-value services, duplicative testing, market-driven price inflation, and other such shenanigans.

In healthcare parlance, this is a malignant malady; look around and you will see multi-billion dollar EMR vendors profiteering from the care coordination problem for which their own lack of interoperability is a primary culprit. These software behemoths could be developing better tools for identifying and reducing low-value care, but instead they are making for the market and teaching to the test, taking their cues from a spate of federal reforms that bang the drum on care coordination.

As Dr. McWilliams points out, large systems have started using care coordination as justification for marketplace consolidation: If a health system owns all of the other facilities in the area, they can ensure tighter coordination. The reality is that care coordination is looking like a break-even investment, while market consolidation is a near-guaranteed driver of higher prices and higher healthcare spending.

So what’s the rub?

At the level of care delivery: Healthcare systems who want to curb unnecessary spending should focus on eliminating low-value care. A common example in literature is the use of imaging for lower-back pain, a diagnosis with which I am unfortunately all too familiar.

Storytime: Last December, I saw an orthopedic specialist for persistent shoulder and back pain. Before I even met the doctor, his nurse asked me if I was ready for the X-ray. She seemed bewildered when I said I’d like to speak with the doctor first. I was then bewildered when the doctor didn’t ask me to take off my shirt or move around to look at basic biomechanics, but wrote a script for pain meds. On my way out of the building, I saw an imaging facility one floor down from his practice.

It’s highly probable the parent institutions at play here have some transitions-of-care or CM programs in place for frail, complex patients. But that doesn’t make them a value-driven organization.

At the level of policymaking and reform discussion: We could all stand to become a little bit more nuanced when we talk about the goals of health care reform. ACOs are one experiment in curbing unnecessary care for complex, high-risk patients, not a harbinger of some seismic shift towards “fee for value” for the entire nation. When we talk about these efforts as such, and applaud big health systems’ efforts at coordinating care for small pockets of their communities, it adds to a national dialogue that overlooks the much larger driver of high healthcare costs: The fee for service mindset engrained in our healthcare institutions that will persist long after fee-for-service payments fade away.

So, say it with me: First and foremost, care coordination is about better patient care, not cost-savings.