Executive Compensation and Population Health

May 10, 2018

Executive bonuses for health system CEOs have long been linked to financial targets, such as net income, profit, operating margins, and cash flow. More recently, as value-based payment methodologies reward good outcomes, forward-thinking health systems are beginning to tie executive compensation to quality and population health efforts.

Leading the Way

Trinity Health System executives, for example, take home more pay when they keep patients healthy and out of the hospital. Trinity puts ten percent or more of each eligible executive’s total pay at risk. Of that amount, 20 percent is linked to reducing hospital-acquired infections and decreasing readmissions; 20 percent to smoking and pediatric obesity rates; 20 percent to patient satisfaction; and 20 percent to workforce engagement.

Meanwhile, Mercy Health executives' compensation is determined in part by the system's performance in Medicare's bundled payment programs for joint replacements; curbing avoidable readmission rates; and boosting population health via preventive care, such as breast cancer and diabetes screenings.

Most would agree that aligning financial incentives with quality measures is the right thing to do. However, only a minority of health systems are committing to holding leadership financially accountable for outcomes.

The Key to Efficient Population Health

Many providers struggle to understand how they can implement population health strategies within their health system. Beginning a population health program requires efforts like gathering and analyzing clinical data, risk-stratifying patients, regularly communicating with patients, monitoring patients after they leave the hospital or clinic, and proactively intervening to avoid an adverse health event. Already short on time and resources, many providers shy away from adopting a population health strategy because it appears to be a monumental undertaking.

But what many providers don’t realize is that automated patient engagement technology exists that makes many of the tasks associated with population health management much more efficient. This technology automates patient outreach so that providers can connect with more patients and support them in ways that would be virtually impossible to do manually. This automation enables providers to easily connect with and support all patients – not just those deemed at highest risk – without placing additional demands on limited resources.

Patients with a chronic condition such as diabetes, for example, may receive reminders to check blood glucose, notifications for when they are due for foot or eye exams,  or reminders to schedule appointments for AC1 blood draws. These patients might also receive educational content with healthy lifestyle tips for managing diabetes.

Patients undergoing a surgical procedure, such as a total knee replacement, receive educational information about the procedure and about complications that can arise during the recovery period. After surgery, automated daily check-ins explain symptoms a patient might experience, ask questions to assess recovery and adherence to treatment plans, and prompt patients to report concerning signs or symptoms. 

For patients, this knowledge is empowering. They know what to expect. They appreciate being reminded about what to do and when. These well-informed patients make decisions that prevent adverse and even potentially fatal events. And, not least importantly, patients whose care teams reach out to them every day to find out how they’re doing are happier.

Aligning Incentives

For hospitals, automated patient engagement maximizes performance. Our HealthLoop clients have seen an average 54 percent reduction in complications, 45 percent reduction in readmissions, and a cost savings of $656 per episode when compared with patients not using HealthLoop. Outcomes like these are best for the patient. They’re also best for hospitals striving to deliver better care at lower costs.

Health systems moving toward population health-related financial incentives for executives must be able to closely manage patients outside the walls of the hospital or clinic. An automated patient engagement solution is a critical component of that effort.

 

HealthLoop scales the impact of care teams through the power of patients.

Categories: Blog

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