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© PA Knowledge Limited 2013 1

HEALTHCARE UNBOUND 2013 Strategies for driving patient

adoption of technologies for healthy

lifestyles

Nilesh Chandra

July 2013


PA Consulting Group - an employee-owned firm of over 2500 people specializing in management consulting, technology and innovation

About PA

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SECTORS

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OFFICES North America

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24

8

TECHNOLOGY

AND INNOVATION

INFORMATION

TECHNOLOGY

BUSINESS

TRANSFORMATION

We work with leaders on their most

pressing challenges


Healthcare is a key area of focus for us in the US

Telehealth strategy and

business plan for a large

hospital chain

Sourcing and contract

negotiations for HIE for a

major payer

IT Demand management and

Capacity planning for large

healthcare payer provider

Strategy and Operating

Model for an enterprise wide

Shared Analytics function at

a payer-provider

ICD-10 strategy and EHR

selection for a healthcare

provider

Behavior modeling to

improve patient adoption of

technology for large

healthcare provider


Healthcare is facing unprecedented change

Regulatory

reform

Accelerating

technology

development

Ageing population

and increased

chronic coditions

HEALTHCARE CHALLENGES

There is an opportunity

for improving health

outcomes and creating

tangible value for all

stakeholders for anyone

who can leverage

technology, navigate the

regulatory landscape

and work with patients to

modify their behavior

to adopt healthier habits

and reduce/ manage

incidence of chronic

conditions


The US healthcare market is enormous and growing

0

5

10

15

20

0

2,000

4,000

6,000

8,000

10,000

19

60

19

63

19

66

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69

19

72

19

75

19

78

19

81

19

84

19

87

19

90

19

93

19

96

19

99

20

02

20

05

20

08

% US$

Total US healthcare expenditures are increasing both as a percentage of GDP (17.6% in 2010) and per capita ($8,650 in

2010)

Total health expenditure per capita ($US)

Total health expenditure as % of GDP

831.5 30%

537.4 19% 276.6

10%

221.9 8%

105.5 4%

787.1 29%

Hospital care and physician and clinical services make up approximately 50% of the estimated total US healthcare expenditures

in 2011 (US$B)

Hospital care

Physician and clinicalservices

Prescription drugs

Nursing home and homehealth

Dental care

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

19

60

19

70

19

80

19

90

19

93

19

97

19

98

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

16f

US$B

Total US healthcare expenditures are very high and increasing

US Healthcare Expenditures

0

10

20

%

US healthcare costs as a percentage of GDP are rising much higher than those of other

industrialized nations Australia Canada Denmark FinlandFrance Germany Iceland IrelandIsrael Japan Luxembourg NetherlandsNew Zealand Norway Spain SwedenSwitzerland Turkey United Kingdom United States

Source: OECD Health Data 2011, November 2011 Source: Plunkett Research, Ltd.

Source: OECD Health Data 2011, November 2011 Source: OECD Health Data 2011, November 2011

US

$2.6

trillion

$3.6

trillion (f)

Siri


Source: PwC Health Research Institute

As healthcare costs increase, so does the pressure to reduce them

Market forces are causing medical supply and equipment

costs to decrease

There is a shift in delivery methods in primary care to more

low-cost alternatives

The looming patent cliff is encouraging use of more low-

cost generics

Laws promoting price transparency are pushing costs

down

Source: PwC Health Research Institute

Source: PwC Health Research Institute Source: PwC Health Research Institute Consumer Survey, 2012 (n = 1,001)

Grant


0%10%20%30%40%50%60%70%

Dep

en

den

cy

rati

o

Dependency ratio forecasts (non-workers vs. workers) show that the proportion of the non-workers will increase dramatically in

developed nations 2005 2050f

Source: UK Department of Work and Pensions

The future healthcare market must accommodate an aging and more dependent population

64

66

68

70

72

74

76

78

80

19

60

19

62

19

64

19

66

19

68

19

70

19

72

19

74

19

76

19

78

19

80

19

82

19

84

19

86

19

88

19

90

19

92

19

94

19

96

19

98

20

00

20

02

20

04

20

06

20

08

Years

US total population life expectancy at birth is increasing and is now 78.2 years

The baby boomer effect is shifting the US population

pyramid

41.1 54.2

70.8

0

20

40

60

80

2011 2020 2030

Million

The US is ageing rapidly: the population aged 65 and older is set to nearly double in

the next 20 years

US Population Aged 65 and Older

Source: OECD Health Data 2011, November 2011 Source: Plunkett Research, Ltd.

Source: U.S. Census Bureau, Census 2000 and Census 2010 Summary

File 1

Siri


A small percentage of mostly elderly top spenders accounts for the vast majority of US healthcare expenditures

Source: The Atlantic (2009 Medical Expenditure Panel Survey)

The Atlantic: http://www.theatlantic.com/business/archive/2012/03/10-ways-to-visualize-how-americans-spend-money-on-health-care/254736/

Approximately two thirds of the top 5% of healthcare

spenders are older than 55

US per capita healthcare spend is much higher than that of

other nations, but it does not lead to a higher average life

expectancy

The top 1% spends $90,000 per person on healthcare –

approximately 380 times more than the bottom 50%

The top 5% of spenders account for half of all US

healthcare spending

United

States

Siri


The number of physicians in the US will need to increase rapidly in the next 10-20 years to meet the growing demand for care

There are currently about 110,000 resident positions in 874 residency programs the US, according to the

American Association of Medical Colleges. Teaching hospitals rely heavily on Medicare funding to pay for

these slots. In 1997, Congress imposed a cap on funding for medical residencies, which hospitals say has

increasingly hurt their ability to expand the number of positions.

While doctors trained in other countries could theoretically help the primary care shortage, they must still

complete a US residency and therefore face the same bottleneck. In the 2010, 13% of residency slots were

filled by non-US citizens who completed medical school outside the US.

97,989

108,176

90,000

95,000

100,000

105,000

110,000

1999 2009

Number of Residents

The total number of residents in US Medical Schools increased by an average of 1.11% per

year between 1999 and 2009

Total Number of Residents in US Medical Schools

Sources: Wall Street Journal. http://online.wsj.com/article/SB10001424052702304506904575180331528424238.html (April 12, 2010); American Medical

Association. http://www.ama-assn.org/resources/doc/med-ed-products/graduate-medical-education-trends-1999-2008.pdf

Siri


Physician compensation has declined across the board in recent years with primary care physicians consistently earning the least

Source: http://www.medscape.com/features/slideshow/compensation/2012/public

Anshul


“Health Reforms” - Attempting to balance access, quality and cost through integration of care and increased individual consumer decision making

Access

Quality Cost

? ?

? Patient

Nurse

Payer Hospital

Pharmacy HCP

Cost?

Quality?

?

Payer

Patient

Quality

HCP

Other

Pharmacy

Nurse

Cost

From fee-for-service… …to accountable care

While ensuring ….


The full vision – integrating across care spectrum and fully engaging the patient and community

PCP

Patient

Endocrinologist

Insurance

Nurse / AP Lifestyle

Counselor

Pharmacy Family

Reimbursement

Online Diabetic Support Groups

Other Patient Advocacy / Support Groups

Healthcare Network

Community & Religious Groups

Effective implementation of both new technology and processes for patient interaction

within the portal are key to increasing overall patient engagement with their health.


The complexity of the healthcare system and people’s interaction with it make change very difficult

Many outstanding healthcare reform projects are underway, but uncertainty exists

about how people will really act in the new health system and many are skeptical

that the desired behavioral changes can be achieved. Further, some new policies

risk triggering negative unintended consequences.

Examples include:

Will people go

to the intended

provider or

continue to

utilize

emergency

services?

Reducing hospital

infrastructure?

Will patients

respond to care

initiatives, such

as reductions in

risky behaviors?

How will

physicians or

other providers

respond to

policy

changes?

The “problem” is that real reform also requires changes in the beliefs and behaviors

of a large majority of the population – a dynamic, evolving, and interconnected

challenge.

Changing patient

behaviors?

Enabling physician

change?


Ensuring patient adoption is the missing link in managing population health

Identify the high risk population

Offer them technology and

services to maintain health

Help people maintain their healthy habits

Relatively easy to do, the

criteria that determine “high

risk” are well documented

and population data is

available to easily segment

patients

Currently undergoing a lot of

innovation with the

development of new tools,

devices and applications

THE MISSING ELEMENT


THE BIGGEST CHALLENGE IN HEALTHCARE TODAY IS TO CONVINCE PEOPLE TO CHANGE THEIR BEHAVIOR


There are many options being pursued to drive patient behavior

Patient Portals Pharmacy order tracking

mHealth applications and/ or

devices Financial incentives

Regular phone follow-ups

with patient Gamification

Patient consultations Social media engagement


If you build it, will they come?

Most organizations take a “If you build it,

they will come” approach and invest

heavily in setting up the technology

infrastructure required to improve patient

health and engagement

A behavior modeling approach can

help ensure patient adoption by

identifying the levers most likely to

work for specific patient groups

and helping providers and payers

to develop tailored and targeted

interventions.


We use behavioral modeling to improve alignment to strategic priorities and overcome resistance to change

What is our behavioral modeling approach?

• It is highly participative, and engages stakeholders to build consensus across the organization

• It integrates a broad range of information, from qualitative interviews to data on physical work flows,

to our own expert knowledge on complex program management and organizational design.

• It is behavioral, with strategies that anticipate real world physical and informational constraints,

organizational pressures, and cognitive biases.

• It enables planning and experimentation, through rapid what-if analyses focused on outcomes

Events and Outcomes

Underlying Structure

Patterns of Behavior

Visible

Gains to

Daily Life

Civilian

Infrastructure

Economy

Services

Contacts

and Info

Flow

Workforce

Adequacy

COIN

Sympathizers

and SupportersRelative

Attractiveness

of the COIN Path

Military Local

Know ledge

Ability to

Identify and

Vet

Progressive

Leaders

Empow erment of

Progressive

Leaders

Security

Kinetic Ops

Effectiveness

Non Kinetic

Ops

Effectiveness

Resources

and Funding

Satisfaction

w ith Daily Life

Expected

Gains to

Daily Life

Indigenous

Security

Forces and

Govt

Capability

Events and outcomes are caused by

human behaviors, which in turn are

influenced by underlying structures,

including cognitive biases and physical

and organizational constraints.

By understanding and modeling the

sources of behavior we help to design

imperatives that improve outcomes.


A behavioral approach helps to overcome resistance to change

Humans are not computers, constantly quantifying probabilities and making

optimal choices. Emotions, reflex, unconscious motivations, and other non-

rational or irrational factors all play a large role in our judgments and behavior.

But being aware this challenge is only half the solution – what is needed is a

methodology and capability to help simulate the consequences of system

changes and to understand the underlying ways in which people make decisions.

Key takeaways from behavioral economics are:

Confirmation bias People seek out and believe information that confirms their opinions, while ignoring or

downplaying information that contradicts them.

Framing The structure and reference points of information shapes how the decision maker receives

and uses it.

Anchoring People often use a predetermined reference point – even if its arbitrary – as the launching

pad for a decision.

Overconfidence Many people often see their own abilities in an unrealistically positive light – around 90% of

US drivers say they are better than average.


PATIENT ADOPTION

Word of mouth

Physician encouragement

Portal functionality

Etc.

PHYSICIAN ADOPTION

Perceived patient benefits

Financial benefits

Organizational carrots/sticks

INFORMATION TECH

Features

Cost

Benefits

Portals, EHR, etc..

MEDICAL OUTCOMES

Patient benefits

Magnitude of benefits

Delay to observe benefits

HCO FINANCIAL OUTCOMES

Reimbursement rates

Shared Savings

Word of Mouth

Patient Satisfaction

Physician led adoption efforts

Patient enabled health improvements & self

management

Perceived health benefits

Administrative benefits

Payment model: fee for service, ACO,

risk based, etc.

Benefits offered

Ease of use by physicians

IT costs

Physician enabled health improvements

HITECH, Meaningful use

incentives

Patient retention

Behavioral modeling approach uses a system dynamics simulation methodology


Behavioral modeling provides analytical support for the toughest questions

Overview of simulation model environment:

We have been developing a strategy for patient engagement – utilizing our simulation modeling

approach – as part of a larger focus on accountable care. Patient engagement is particularly important

in accountable care in order to improve performance on quality metrics, reduce leakage, and create

greater efficiency gains for shared savings, among other benefits.

Included in the model:

Patient adoption

Patient use of portal

Provider adoption

Financial benefits

Portal characteristics

Effects on quality

Etc…

Roughly 100 variables overall

Our goals is to provide an integrated framework that can be adapted to a specific

organization’s setting and used to answer strategic and tactical questions


AN ENGAGED PATIENT IS SOMEONE WHO TAKES THE NECESSARY ACTIONS TO OBTAIN THE GREATEST BENEFIT FROM HEALTHCARE SERVICES AVAILABLE TO THEM


Introducing the patient engagement matrix

Ow

ne

rsh

ip

Needs to be

educated Engaged

Needs high touch

intervention

Needs regular follow-up

and motivation

High

Low

Low High

Confidence

PA’s Patient Engagement

Matrix (PAPEM) is a

behavioral tool with a simple

but highly predictive set of

questions to categorize

patients by their level of

engagement.

It enables developing

targeted interventions to

ensure patient adoption


From … To …

Confusing, sporadic, non-integrated

Mobile or web-based platforms

Clear, consistent, and centralized interactions

1-800 numbers

and call centers

? !

? !

Brochures and

pamphlets

Direct mailing Email

Patient

Unit of

Care

HCP Nurse

Specialist

EHR or

physician portal

Case study 1: An effective patient portal strategy is key to enabling patient engagement

In reality, adoption is a journey of change for getting physicians and patients to

change their behavior and to be successful, organizations should –

1. Invest early efforts in ensuring physician adoption

2. Sustain physician engagement over time, as it is key to ensuring patient

engagement

3. Measure the quality of interaction from the physician against patient satisfaction

and health outcomes achieved


We found that providers hold the key to unlocking adoption of patient

portals

The common “trap” – HCOs market portals to providers, but most providers become “inactive” users.

New strategy: spend resources physician side of portals (instead of the patient side)

Inactive users

Ph

ys

icia

ns

Months

Months

Ph

ys

icia

ns

Active users

Trial users

Potential adopters

Active users (new)

Inactive users (new)

Months

Takeaway:

Physicians “test out

portals” but

ultimately fail to

become active

users.

Takeaway:

When portals are

more responsive to

physicians needs,

they can drive

sustained adoption.

Potential adopters (new)


Providers also have very high-leverage to create long term positive health

and financial outcomes

Months

Patients adopting (new)

Pe

rce

nta

ge

Physicians adopting

Months

Patients adopting

Physicians adopting (new)

Cu

mu

lati

ve

$

Base

Test

Takeaway:

Even small shifts in

physicians adoption

can tip patient

adoption.

Takeaway:

This can have huge

consequences on financial

outcomes. Sustained

patient adoption leads to

meaningful financial

changes, not just “breaking

even.”


Case study 2: Behavioral modeling at large Japanese hospital group to improve operations

The challenge: Medical

errors were reduced but costs

were not

Soon after the implementation of a HCIT system, medical errors fell dramatically. Thus, costs were expected to fall as well.

However, despite initial savings, the financial picture reversed as unexpected losses accumulated.

Nurses were “batch mixing” drugs – mixing all injections for the day early in their shifts to save time – but the HCIT system now allowed for instant order changes by physicians.

When physicians subsequently changed their initial order, the “mixed” drugs had to be thrown out.

Simple framework above captured the core behavioral dynamics at play.

Based on simulation modeling, we experimented with ways to reverse the batch mixing problem.

Given a simple experiment (marking 5 drugs to delay mixing) we created wide spread change in practice.

The behavioral insight: Nurses were optimizing their time

but wasting millions in medicine

The solution: We ran a “simple” real-world

experiment, the results of which

were a catalyst for change


Thank you

Nilesh Chandra

10 Canal Park

Cambridge, MA 02141

Tel: 1-617-252-0136

Mobile: 1-617-838-7196

E-mail: [email protected]

healthcare unbound 2013tcbi.org/hcub13/wp-content/uploads/2013/07/nileshchandra.pdf© pa knowledge...

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