CHI St. Luke's Health in Houston seeks out and bulks up population health skills

During a strategic planning retreat in late 2015, CHI St. Luke's Health Health Chief Executive Officer Michael Covert unveiled what he called his “big hairy goals” for population health:

• 1 million covered lives
• 1,000 primary care providers and extenders
• At least 100 clinics, free-standing emergency departments and retail locations
• At least 100 direct-to-employer relationships
• 10 percent earnings before interest, tax, depreciation and amortization to fund it all.

And Covert wanted to accomplish all of that in 1,000 days.

The Houston-based health system, owned by Catholic Health Initiatives (CHI), sought outside help from Dallas-based Population Health Advisors (PHA) to jump-start the process. PHA resources developed Baylor Scott & White Health's accountable care organization called the Baylor Scott & White Quality Alliance. Baylor Scott & White is the largest not-for-profit health system in Texas.

James McDeavitt, MD, CHI St. Luke's chief clinical integration officer and dean of clinical affairs and senior vice president of growth and strategy at Baylor College of Medicine, said, “The journey to population health is littered with failed experiments. We saw some value in consulting people who had done it before, who had real-life experience. We did not want to make the same mistakes they made. Value-based care is an emerging paradigm. We are no different than other health systems. We are hospital-centric. We had no core competency in risk-based or value-based contracting. The economics require a distinctly different skill set. The strategy is about quality improvement rather than being rate-centric.”

Dr. McDeavitt said CHI St. Luke's newly acquired population health skills have paid off in the marketplace.

“We've developed technology, people and infrastructure. We've developed the scope and scale of a network that's drawn the attention of the insurance industry. We're a more attractive force,” he noted.

CHI St. Luke's decided its first population health target would be employees. It combined its 10,000 workforce with the 14,000 at joint venture partner Baylor College of Medicine. The initiative began in January 2017.

Dr. McDeavitt said, “We can't go to a company and say, 'Let us help you lower your health care costs' without being able to answer the question of how we did that for our own employees. We see more potential direct-to-employer relationships. We hope to be able to show that we can improve health of company's employees because we did it for ourselves.”

CHI St. Luke's is in the third year of its Medicare Shared Savings Program (MSSP), covering 13,000 lives. The ACO showed no savings in the first year. In the second year, it saved $2 million on an actuarial basis but needed $3 million to trigger a bonus. The system's executives are confident its augmented population health infrastructure will improve its MSSP performance.

Dr. McDeavitt has advice for systems looking to tackle population health: “If you wait until you feel completely competent to do risk-based contracting, you'll probably lose most of your market. If you start too soon without the right skill sets, it's like rolling the dice in Las Vegas.”

For more information, please visit pophealthadvisors.com.