Refocusing on the population

‘We have a big population to serve and we want to make sure they are all healthy’

By Steven Ross Johnson

While largely seen as a positive step, the shift toward population health management puts additional financial pressures on struggling rural providers.

Serving about 1.4 million patients, Carle Health System, an integrated healthcare network based in Urbana, Ill., has spent more than a decade exploring ways to better manage population health.

Carle Hospital in Urbana, is the flagship facility of rural Illinois healthcare provider Carle Health System, which serves as the only large-scale tertiary facility for a region that spans much of southern and eastern parts of the state.
Photo by Carle Health System

For much of that time, the system’s approach has focused on educating patients with such chronic diseases as diabetes or hypertension about how to take a more active role in controlling their condition.

Despite such efforts, the system still saw and admitted a large number of patients whose unmanaged chronic health conditions became more advanced.

The problem was not so much an issue with the effectiveness of Carle’s wellness programs, but rather the fact that many of the patients were being transferred from other facilities that were outside of its service area.


The problem was not so much an issue with the effectiveness of Carle’s wellness programs, but rather the fact that many of the patients were being transferred from other facilities that were outside of its service area.

Carle’s main hospital serves as the only large-scale tertiary facility for a vast region covering most of the southeastern part of the state. The facility is surrounded by critical-access hospitals and clinics that stretch as far north as Kankakee, about an hour away from Chicago, to as far south as near the Kentucky border.

Many of those providers did not have the resources needed to invest in the kind of disease management initiatives Carle has implemented.

So in 2014, the system formed a partnership with four independent critical-access hospitals throughout the region to form a rural alliance. Facilities could collaborate with one another and share resources aimed at ensuring access to healthcare services and best practices for patients throughout the region.

The collaboration expanded its focus over the past couple of years to focus on prevention, with specific goals aimed at reducing the rural population’s risk for developing diabetes.

Stephanie Beever, Carle’s executive vice president and chief strategy officer, said plans are underway to conduct a longitudinal study on the initiative later this year to provide empirical data on its effectiveness.

“Diabetes management is not something that you do today and then in six months you know whether it works or not,” Beever said.

Clinical data collected from the study will be cross-referenced with information from the system’s health plan to see whether the interventions reduce health costs. Over the next year, the rural alliance plans to develop payment arrangements that incentivize critical access hospitals to invest in prevention initiatives for their Medicare populations.

“We want to make sure that we are providing the right types of financial incentives for that small rural facility,” Beever said. “We have a big population to serve and we want to make sure they are all healthy.”

“We want to make sure that we are providing the right types of financial incentives for that small rural facility.”

Stephanie Beever
Executive vice president and chief strategy officer
Carle Health System

The struggles facing providers in Carle’s alliance are the same ones rural hospitals across the country are confronting as payment and delivery models shift from episodic care to community and outcomes-based care.

The revenue of most rural healthcare providers remains closely tied to the number of patients they treat under fee-for-service. But declines in the rural population in recent years have led to decreased inpatient admissions, which has been at the heart of their financial struggles.

Hospitals that rely heavily on treating a high volume of patients may find it counterproductive to address population health when doing so would only result in further hurting the very source of revenue that keeps them afloat.

“In this new era of healthcare delivery, no longer are hospitals at the center; patients are at the center,” said Dr. Karen Meador, managing director and senior physician executive at consulting firm BDO’s Center for Healthcare Excellence & Innovation. “Hospitals have to remake themselves and advance to be a part of a sustainable economy in those rural communities.”

The challenge of reinvention

Rural healthcare providers have for the most part found it more difficult than their urban counterparts to reinvent themselves and become more patient centered in the current economic environment. Increased financial pressures have caused many hospitals in such areas to either significantly roll back their services or close their doors.

Since 2010, 83 of the 2,244 rural hospitals in the U.S. have closed, according to research conducted by the University of North Carolina’s Cecil G. Sheps Center for Health Services Research. The National Rural Health Association estimated more than 670 facilities are at financial risk of closing, with 44% of all rural hospitals operating with negative margins.

A major contributing factor for such fiscal challenges has been the high rate of poverty found among the rural residents, according to data from the U.S. Department of Agriculture. Issues such as food insecurity, lack of stable housing, limited access to reliable transportation, and a higher number of uninsured have led to a widening health gap between rural and urban residents.

According to the Centers for Disease Control and Prevention, rural residents were at higher risk for developing all five leading causes of death in 2014, which included heart disease, stroke, cancer, chronic lower respiratory disease, and unintentional injury driven lately by opioid overdoses. Rural patients tend to be older, have higher rates of risky behaviors like smoking, and are more likely to be covered under Medicaid and Medicare instead of commercial health insurance plans.

So to jump into population health without much of a financial cushion to soften the landing is problematic for rural providers.

“If they’re not associated with a health system that has a payer, or if they are not a part of an accountable care organization, what incentive is there?” said Janet Tomcavage, chief population health officer at Geisinger Health Plan, the insurance arm of Geisinger Health. “If you think about the impact of comprehensive population health, it tends to drive down hospital admissions.”

Geisinger executives in a March 2018 opinion piece in JAMA outlined a new payment and delivery model that the health system developed along with the Pennsylvania Health Department. The five-year demonstration, which has $25 million in funding from the CMS, is aimed squarely at helping rural hospitals transition from fee-for-service to a global-budget payment model based on health outcomes and the quality of services they render.

Called the Pennsylvania Rural Health Model, rural providers establish an annual budget and then are paid one-twelfth of that total each month, which provides them with a predictable revenue stream. Tomcavage said having those hospitals no longer solely dependent on volume for their revenue would allow them to focus on investing in population health strategies for their communities.

“We’ve got to think about how we pay differently to rural healthcare providers for care,” Tomcavage said.

“We’ve got to think about how we pay differently to rural healthcare providers for care.”

Janet Tomcavage
Chief population health officer
Geisinger Health Plan

An innovative approach

Discussions about how to address population health management had been going on for nearly 10 years at Cheyenne (Wyo.) Regional Medical Center, a 222-bed acute-care facility that serves as the major healthcare provider for the region.

In 2012, the facility received a three-year, $14.2 million grant from the Center for Medicare and Medicaid Innovation to develop a statewide population health management model. The result was expansion of its telehealth offerings to address behavioral health, infectious disease, speech therapy and wound care consultation needs at its satellite clinics in more remote parts of the state. But perhaps the most significant innovation came in the provider’s community outreach effort.

In 2012, Cheyenne Regional created the Transitions Across Community Teams, or TACT, which are teams led by nurses to coordinate care for high-risk patients age 55 and older to help them better manage their chronic conditions. Patients who receive support from TACT are identified as being at risk based on clinical and social determinant criteria. Team members follow up with patients after they have been discharged from the hospital or after an outpatient visit by providing up to two home visits and then 90 days of continual wellness checks.

“That follow-up isn’t just about asking how are you feeling today,” said Greg O’Barr, administrator of population health and strategic planning at Cheyenne Regional. He said care teams ensure patients have transportation for their medical appointments, and ensure, with the help of a county food bank, that they have enough food at home.

O’Barr said the program offers a more holistic approach to providing care to their patients than has been available in the past. He acknowledged that the CMMI award was a big reason why Cheyenne Regional was able to implement its population health strategies, which resulted in fewer readmissions. The program’s success among older patients prompted the system in 2014 to expand it to include all high-risk patients age 18 and older.

O’Barr and others said the challenges in managing the health of a population may be similar whether it’s in an urban or rural setting, but the problems rural providers face are often magnified by limited resources, a dearth of viable, non-medical community organizations to partner with on population health initiatives, and the continued reliance on patient volume to generate revenue.

However, experts said, rural providers that not only forge stronger bonds with patients but also leverage opportunities to collaborate with larger health systems within their region can develop population health programs that end up benefiting providers and patients.

“It’s not just about us taking care of you at the time that you need it,” O’Barr said. “It’s that healthcare becomes true health care as opposed to sick care.”