Premier Inc. Identifies $8.3B Savings Opportunity in the ED with More Preventative and Coordinated Ambulatory Care

Analysis reveals wide variation in the number of patients with
chronic conditions presenting to the emergency department, with 4.3
million potentially preventable visits; behavioral health issues,
diabetes and hypertension associated with greatest opportunities

CHARLOTTE, N.C.–(BUSINESS WIRE)–Emergency department (ED) visits for people with at least one of six
prevalent chronic conditions varied greatly and contributed to nearly 60
percent of all annual visits at nearly 750 hospitals in 2017, according
to a Premier analysis released today. More than 4.3 million of these
visits were potentially preventable and equate to an estimated $8.3
billion in ED costs, suggesting these patients may need more effective
primary care services.

Premier published the analysis in its latest data-driven report, Ready,
Risk, Reward
: Improving Care for Patients with Chronic Conditions
which highlights the major opportunity to offer more coordinated and
preventative care services in ambulatory care settings to avoid
unnecessary ED visits. Premier analyzed 2017 data on nearly 24 million
ED visits among patients with asthma, chronic obstructive pulmonary
disease (COPD), diabetes, heart failure, hypertension and/or a
behavioral health condition, such as mental health or substance abuse
issues. The findings showed variation in the rate of ED visits by
hospital, particularly for patients with behavioral health issues (0.8 –
64.4 percent), diabetes (0.1 – 22.2 percent) and hypertension (0.1 –
48.6 percent).

“It is widely known that people with chronic conditions contribute to
high healthcare expenditures, making them a critical population for more
strategic, preventative care,” said Joe Damore, Senior Vice President of
Population Health Consulting at Premier. “While providers face the
challenges of perverse incentives that have impeded coordinated,
cost-effective care delivery, Premier members are actively taking steps
to overcome this fragmentation and assume responsibility for the total
health of these patient populations through alternative payment models.
Alternative payment models create an incentive for providers to organize
high-value networks, such as accountable care organizations (ACOs),
which deliver coordinated care across the continuum.”

In its work with more than 120 ACOs, Premier has observed that
approximately 30 percent of ED visits occurred for issues that could
have been treated in primary or other ambulatory care settings. To
further investigate, Premier’s analysis compared hospitals that achieved
the lowest quartile (25 percent) of ED visit rates for patients with
chronic conditions to those that did not to identify the 4.3 million
potentially preventable visits and associated $8.3 billion in ED costs.
These findings underscore the value of pinpointing evidence-based care
delivery improvement opportunities, as well as building integrated
high-value networks across the continuum of care.

For high-value networks, such as ACOs and clinically integrated networks
(CINs), preventing ED visits and improving health outcomes for patients
with chronic conditions can mean the difference between significant cost
savings or financial losses. Additionally, hospitals and health systems
receiving traditional fee-for-service reimbursement are at risk for
these patient populations under the Centers for Medicare & Medicaid
Services (CMS) Hospital Value-Based Purchasing and Readmissions
Reduction Programs, as well as the Merit-based Incentive Payment System.

“ED visits can be costly as they may lead to hospitalizations and other
high-cost services,” said T. May Pini, MD, MPH, Principal of Population
Health Consulting at Premier. “Although the value of primary care
services is known, access to and the use of these services varies
dramatically. To avoid disease progression and poor health outcomes,
people with chronic conditions need more preventative and proactive
care, including more reliable access to their primary care provider for
urgent issues. However, the delivery of high-quality primary care
requires significant transformation across acute, ambulatory and
community providers to align around a coordinated care management model
that is truly focused on the patient.”

Lessons learned from Premier member ACOs have shown that developing a
patient-centric, cross-continuum care management model in partnership
with primary care providers (PCPs) could aid in preventing ED visits,
while allowing health systems to achieve healthier patient populations
and receive a higher return on investment. Based on these learnings,
Premier has identified five keys to a successful care management model,
which are described in the report.

  1. Establish a care management vision, strategy and infrastructure
    that is developed and shared in partnership with the provider
    community, particularly the PCP, enabling physicians to participate in
    leadership and governance of care management strategies, care model
    design and contracting decisions.
  2. Define, stratify and target at-risk populations by reaching
    consensus on standardized processes, including algorithms and data
    sets, to identify patients who will most benefit from care management
  3. Create longitudinal, individualized care plans based on patient
    needs and goals, including hands-on assistance that allow care
    managers, PCPs and coaches to empower patients through education and
    access to community resources.
  4. Develop, clearly define and articulate multidisciplinary roles and
    to coordinate and implement care plans and
    associated transitions.
  5. Invest in cross-continuum technology and analytics that can
    customize care management assessments, synchronize patient
    segmentation/risk stratification algorithms and facilitate timely
    information to drive more efficient workflows.

Premier’s recommended strategies for building a patient-centric,
physician-aligned care management model are based on its years
of experience
and data working with hundreds of ACOs, CINs and
various other organizations on successful population health management
models, care delivery optimization initiatives and physician alignment

Premier’s Ready, Risk, Reward reports provide a detailed view and
deep understanding of cost, quality and population health trends across
the continuum, as well as share insights on evidence-based strategies
and solutions designed to tackle inefficiencies in healthcare, ranging
from variation in clinical practice to alternative payment model design.
The analyses leverage the PremierConnect® performance
improvement platform, which houses data on more than 45 percent of U.S.
hospital discharges nationwide.

Analysis Methodology

The analysis of ED visits among patients with chronic conditions
included 2017 discharge data from 747 hospitals across 44 states,
representing nearly 23,982,070 million ED visits overall. Conditions
included principal and secondary diagnoses for asthma, chronic
obstructive pulmonary disease (COPD), diabetes, heart failure,
hypertension and/or a behavioral health condition, such as mental health
or substance abuse issues. The analysis benchmarked the lowest quartile
of ED visit rates associated with each condition by hospital and
adjusted for patients with multiple conditions, finding that 21.4
percent of visits overlapped, which resulted in 4,327,662 unique
potentially preventable visits. With the average cost for an ED visit
estimated by the Health
Care Cost Institute
as $1,917, if all visits outside of the top
performing quartile were preventable, they would equate to an estimated
$8.3 billion cost savings opportunity.

About Premier Inc.

Premier Inc. (NASDAQ: PINC) is a leading healthcare improvement company,
uniting an alliance of more than 4,000 U.S. hospitals and health systems
and approximately 165,000 other providers and organizations to transform
healthcare. With integrated data and analytics, collaboratives, supply
chain solutions, and consulting and other services, Premier enables
better care and outcomes at a lower cost. Premier plays a critical role
in the rapidly evolving healthcare industry, collaborating with members
to co-develop long-term innovations that reinvent and improve the way
care is delivered to patients nationwide. Headquartered in Charlotte,
N.C., Premier is passionate about transforming American healthcare.
Please visit Premier’s news and investor sites on;
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and Premier’s
 for more information about the company.


Morgan Guthrie, Premier Inc.;;

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