As they move from a fee-for-service environment to the value-based care reimbursement model, healthcare systems and providers are looking more to population health management (PHM) as a way to navigate the “tricky transition,” according to this iHT2 report.

Although the majority of providers still have not embraced health IT tools designed to handle their PHM initiatives, a recent HIMSS brief showed that about 75 percent of the 104 hospitals surveyed in 2016 were starting risk-based population health management programs—an increase of 9 percent from 2015.

“It is encouraging to see the level of population health programs and initiatives increase in 2016 from our previous 2015 study,” says HIMSS Analytics Director of Research, Brendan FitzGerald. “However, organizations still face challenges with these programs on a number of levels, including data and solution integration, knowledge and expertise, and cost of sustaining these programs long term.”

But as payers pressure providers to assume the financial risks of value-based care, selecting appropriate analytic and automation tools aren’t the only daunting tasks facing healthcare systems.

“The biggest challenge for healthcare organizations will be to change their culture in every corner of their operations,” says the iHT2 report, “from the C-suite to their front line clinicians. They will also have to change their governance, operational, and financial model; learn how to coordinate care across the continuum; use data analytics to improve population health; measure their financial and clinical performance; make evidence-based medicine the standard of care; and use automation to drive high performing care teams.”

Building patient-centered medical homes (PCMHs) while partnering with payers can help providers transition their operations to value-based care. The PCMH is a “key building block” of PHM because of the emphasis on quality of care as shown by patient-centered access, team-based care, wellness and preventive care, performance measurement, patient education, self-management training and support, care coordination and care transitions, tracking of chronic conditions, and the use of data analytics.

“There’s no other mechanism to motivate and change behavior for the provider group than to be part of a team-based care system,” said Creagh Milford, DO, President of Population Health Management for Mercy Health. “The PCMH includes a variety of structural measures that require providers to be a team not only among themselves, but also among other provider groups and specialists. It’s the foundation for all our PHM initiatives.”

Payers can also help providers strengthen their population health management by using automation technology and data analytic tools to track their members’ health and then inform primary care providers and hospitals about high-risk patients.

“Both CMS and private health plans can help healthcare organizations in their PHM quest. In markets where payers and providers have made less progress toward value-based reimbursement and financial risk, healthcare organizations are more likely to be aided by CMS demonstrations and programs than by private insurers. By contrast, in markets where risk contracting has begun to take hold, health plans are more fully engaged with healthcare organizations in building PHM and preparing for financial risk. So healthcare organizations need to evaluate their markets to decide how and when to partner with payers.”

“Health insurers … will likely need to transition to value-based care reimbursement contracts as well as partner with new healthcare delivery platforms like patient-centered medical homes or accountable care organizations.”

For large healthcare organizations, it is difficult to overstate the profound impact represented by PHM in particular and value-based care in general.

“PHM represents a fundamental transformation of how healthcare is delivered and paid for. Before a healthcare organization embarks on a PHM initiative, it must be ready to change its business model from pay for volume to pay for value.”

When all is said and done, value-based reimbursement is here, and healthcare organizations as well as individual providers must review and apply strategies to take advantage of programs and partnerships and to avoid “a near-death financial experience.”