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Think Tank

Improving California’s Approach to Chronic Conditions

Chronic conditions are the major cause of illness, disability, and death in the United States. They also have a considerable financial impact on the health care system.

The arrival of national health reform might offer opportunities for improving the way California’s health care system deals with chronic conditions.

Coordinated care and disease management can improve health outcomes as well as reduce costs for patients with multiple chronic conditions ranging from diabetes and heart disease to respiratory ailments and cancer. As state, federal and private programs and policies are reshaped by the Affordable Care Act, new opportunities to orchestrate coordinated care may present themselves.

We asked stakeholders: What should California policymakers, legislators, providers and insurers do to best take advantage of opportunities to improve the way we deal with chronic conditions?

We got responses from:

Remember the Ultimate Stakeholder: The Patient

There is no doubt that chronic conditions are on the rise and that their increasing prevalence costs California substantial dollars, not just in health care services, but also in lost work productivity and increasing disability.

The disability resulting from chronic conditions exacts a financial and human cost.  Current approaches to treating chronic conditions do not generally consider the role that long-term services and support can play in improving quality of life for those who have these conditions.  Any efforts to improve chronic care in California must include appropriate and targeted supportive services in the mix with clinical care in a person-centered manner to achieve true and effective care coordination.

As it stands, the continuum of care, composed of the entire realm of primary, acute, and rehabilitative medical services along with supportive long-term care services, is fragmented and unsustainable.  The Affordable Care Act presents several opportunities to improve this continuum of care for people with chronic conditions and functional impairment, concurrently creating and strengthening linkages between medical care and supportive services.

Key platforms in the ACA include the continued pursuit of alternate models for paying for services and organizing care.  The new law builds on this approach through the Center for Medicare and Medicaid Innovation, which creates a more rapid environment to develop, test, and expand innovative payment and delivery models that improve quality while controlling costs.  When considering which demonstration projects to support, legislation directs the CMI to give greater weight to those projects that address the key elements of person-centered care coordination — such as individualized assessment, direct engagement with patients and their caregivers, and interdisciplinary team care.

In addition to the CMI, three other innovative payment models included in the ACA encourage providers and provider organizations to improve service arrangements for vulnerable populations: accountable care organizations, medical/health homes and post-acute payment bundling.  Each of these payment models can also reach beyond the medical realm to involve home- and community-based services, ensuring that chronically ill adults with functional impairment have a safe and healthy transition back home following a hospital and/or rehabilitation stay.

The ACA lays the foundation for a more cost-efficient and person-centered approach to care, but it will take leadership and vision from the next governor to get there.  We hope that California will pursue one or more of the systems transformation projects and insist that projects be built with the ultimate stakeholder in mind: the patient.

Reform Lessons From Counties

The Patient Protection and Accountable Care Act — better known as health care reform — provides an unprecedented opportunity to improve the health of millions of Americans with chronic illness. The new law specifically mandates the development of strategies to deliver care for people with chronic conditions, many of whom are poor, lack insurance and do not have a regular source of medical care.  Yet, few models have identified how exactly we can reach these most vulnerable groups.

For the past three years, 10 California counties, under a Medi-Cal-funded demonstration project called the Health Care Coverage Initiative, have employed a number of methods to deliver care to low-income uninsured adults, the majority of whom — 59% — have at least one chronic condition.

The programs create an expanded network of safety net providers in each county — public hospitals, private hospitals, public health clinics, Federally Qualified Health Centers and community-based private physicians.  They also assign all program participants to a “medical home,” a primary care provider who acts as the regular source of care and assumes overall responsibility for all care coordination. Programs vary in the extent to which they employ different patient management techniques, utilize health information technologies and quality improvement programs and manage referrals to specialists.

As a result, HCCI programs have succeeded in pioneering a number of innovations in the delivery of primary care including:

  • Training primary care providers to better manage chronic care;
  • Establishing a “patient-centered medical home,” a model that includes the patient in medical decision making and organizes care around the patient’s needs;
  • Creating intensive programs of care for patients with particularly complex care conditions; and
  • Assigning trained health providers a “panel” of patients with chronic conditions in order to ensure that patients comply with their treatment plan.

Although these programs are new, early results indicate that the programs have increased the use of primary care and reduced more expensive emergency room treatments. There have also been modest improvements in patient health, such as reductions in levels of HgA1C (a blood protein used as an indicator of blood sugar levels) among patients with diabetes.

Perhaps the most significant lesson learned from the HCCI demonstration is that effective management of chronic conditions requires a systematic approach and an organized system of care.

This lesson has significance for health care reform, which (like HCCI) has specific provisions that call for a range of organizations in diverse settings to work together to establish patient-centered medical homes and to focus on the delivery of care for chronic conditions.

California plans to expand the HCCI program statewide to pave the way for national health care reform. Lawmakers and health advocates elsewhere may find that the HCCI initiative has valuable lessons for the law’s implementation in their own back yards.

Medicaid Waiver, Health IT Will Help

California is presented with an unprecedented opportunity to use its current Section 1115 Waiver application as a bridge to national health care reform. Through the provisions of the waiver, California will test health care delivery models that better manage chronic conditions for its most medically vulnerable populations with complex chronic conditions and comorbidities, as well as enroll those seniors and persons with disabilities with the greatest health care needs into organized systems of care.

The waiver includes four major programmatic components: 

1.   Testing four organized health care delivery models for children with special health conditions who are eligible for the California Children’s Services program. The delivery models to be developed include: an enhanced primary care case management model; a provider-based accountable care organization; a specialty health care plan; and an existing Medi-Cal managed care plan that includes payment for comprehensive coverage for CCS-eligible children. Each demonstration model will require comprehensive care management and coordination of health care, including preventive and primary care services.

2.   Enrolling seniors and persons with disabilities into managed care plans to create access to primary care providers, as well as providing targeted care management support for those at high-risk of using acute medical services due to chronic conditions.  Many seniors and persons with disabilities who will enroll in these systems have serious mental illness or substance abuse; therefore, California will also test models for the clinical integration of health and behavioral health services. 

3.   Expanding current Health Care Coverage Initiative programs statewide for the uninsured and developing improved program standards  to include methods for identifying populations and chronic conditions (i.e. the use of predictive modeling and risk stratification); health information technology utilization; targeted interventions (e.g. disease and medication management and complex care coordination); and data reporting, performance measurement, and quality improvement.

4.   Partnering with the federal government to integrate and coordinate care for dual eligibles through expansion of dual eligible-focused programs and, as needed, developing new organized delivery systems in a manner that improves care coordination and recognizes shared savings for this high-need population.

Finally, an integral aspect of these improved health care delivery models will be the use of health IT. For this reason, the California Department of Health Care Services will be launching the Medi-Cal Electronic Health Record Incentive Program in 2011 to distribute approximately $1.4 billion in federal stimulus funds over the next 10 years to assist and encourage Medi-Cal providers and hospitals to adopt, install, or upgrade EHRs and use them meaningfully in their practices to improve the quality of care.

An important component of such meaningful use will be employing health information technology to coordinate care across clinical settings through health information exchange, e-prescribing, electronic continuity of care documents and other means. It is anticipated that the use of health IT will greatly improve both the quality and efficiency in the management of chronic care in California.

Use Reform Law as a Starting Point

The Patient Protection and Affordable Care Act, with its numerous references to chronic diseases, case management and care coordination, provides a general framework for improving the care of people with chronic conditions, but it is only a starting point. To build upon PPACA in California, policymakers, legislators, providers and insurers need to address at least five issues.

The number one post-PPACA priority for improving the lives of Californians with chronic conditions is to assure their access to health care. The Congressional Budget Office and the Joint Committee on Taxation estimate that nationally PPACA will leave “23 million nonelderly residents uninsured,” including millions in California, many of whom will have a chronic disease that will not be optimally treated due to their lack of health care access. This is unfortunate, as CalPERS supports health coverage for all Californians.

A second priority is expansion and modernization of health information technology in California. This is essential for people with chronic conditions. The provisions in the American Recovery and Reinvestment Act of 2009 regarding “meaningful use” of electronic health records should expand the reach of health IT. A recent national survey by the California HealthCare Foundation noted that “those with chronic conditions … are more likely to experience positive effects of having their information accessible online” in a personal health record. More widespread adoption of PHRs and other types of health IT promises to revolutionize chronic disease care. Among other efforts to advance health IT in California, CalPERS recently participated in an e-prescribing pilot project and is currently participating in a project to demonstrate integration of genomic information into an electronic health record system. CalPERS is represented on the board of directors of Cal eConnect, a not-for-profit entity that promotes health information exchange in California.

Third, interested parties must work together for the common good to advance chronic disease care. A recent essay by William Sage of the University of Texas in Health Affairs advocates for a “decision to rein in special interests and begin a social conversation about redesigning health care delivery to produce the most cost-effective results,” and that sentiment could be applied specifically to chronic conditions.

Fourth is a need for research to expand the knowledge base for chronic disease management. For example, a bundled payment approach (e.g. as embodied in the PROMETHEUS Payment® model) is considered to be a “promising” method for reducing health care costs. However, we are unaware of scientific literature examining the approach’s effect on the quality of care for chronic diseases and look forward to such studies.

Finally, interested parties should allow and encourage the translation of scientific studies’ findings into practice. A number of models of care delivery are based on research findings, such as the “Chronic Care Model” developed by Ed Wagner and others and the “Patient-Centered Medical Home” advanced by physician organizations.

Along the lines of these models, Blue Shield of California, Catholic Healthcare West and Hill Physicians are conducting a pilot project involving CalPERS members in the Sacramento area. The pilot involves the alignment of health plan, hospital and medical group incentives to improve cost and quality. Similarly, CalPERS, the Pacific Business Group on Health and Anthem Blue Cross have embarked on an “Ambulatory Intensive Care Unit” pilot project that seeks to improve the quality of care and reduce the cost of care for people with chronic, complex conditions. The results of such projects will help guide future expanded implementation of the models.

Just as high-quality follow-up care is important for good surgical outcomes, intense long-term follow-up work is necessary for California to take advantage of PPACA as it relates to chronic conditions.

Prevention Through Cultural Change

We aren’t going to solve the problem of chronic conditions through medical care alone, or even through better coordination of care. The only way to effectively deal with chronic conditions is to change our culture and society so that we can all live healthier lives. We must also empower patients and their families to become more engaged in improving their own health, including their chronic conditions.

Nearly one in two Americans (42%) lives with a chronic medical condition. This accounts for more than 80% of all health care spending. In California, 57% of adults are overweight or obese, and nearly one in 10 adults have diabetes.

So, how do we solve this problem? The best way to improve the way we deal with chronic conditions is to prevent them from occurring. We work long hours, get home too late to cook a fresh, healthy dinner, and are too tired to take an evening walk or work out at the gym. We must change our working culture and societal values in order to support healthy lifestyles.

Second, we must create a healthier environment. Legislators and local government leaders must help create healthier communities by developing public policies like nutrition labels on food and restaurant meals, passing laws that provide for healthy food in schools, at work and in communities, and developing safe and convenient recreational spaces.

Medical care does have its place. We must ensure that patients get the right care at the right time. We should expand access to team-based care that is more convenient for patients, including after hours care and the use of e-consultations and telehealth. Doctors must also work with their patients to provide accurate information, health education and support services to help patients feel empowered to take control of their own health. One example of these support services is L.A. Care Health Plan’s Family Resource Centers in Lynwood and Inglewood, which offer free health education, exercise, nutrition and chronic disease management classes to the entire community.

Finally, we must educate and motivate people to make healthier choices for themselves and their families. This can’t be done alone: insurers, doctors, public health officials and government officials must all participate.

Changing our society to address chronic conditions is no easy task. But, we must make it a collective priority if we expect to succeed.