Being Proactive in the Face of Uncertainty

While none of the Policy Pub’s guests have provided any comments yet (I’m hoping a few more “spirited” posts will begin to wear down the  contributory inhibitions), several patrons have emailed me privately and asked whether I had any practical advice on how to approach this period of policy limbo – between before knowing how SCOTUS will decide and the outcome of the fall general election.  So I thought this might be a good opportunity to offer some advice.

Accept the Brutal Reality
Often lost in the din of popular media reporting on the Healthcare Reform debate are the irrefutable realities that underlie how and why it has become a major public policy issue in the first place.  The Internet is replete with charts and tables illustrating the debated evidence of unsustainable healthcare spending.  I think a very poignant and candid assessment that ought to resonate with business-minded individuals can be found in the January 2012 Standard & Poor’s credit report, Mounting Medical Care Spending Could Be Harmful To The G-20’s Credit Health
.  It was noted there that, “steadily rising health care spending will pull heavily on public purse strings in the coming decades. If governments do not change their social protection systems, they will likely become unsustainable, in Standard & Poor’s Ratings Services’ view.”

The will to control healthcare spending is not a Republican or Democrat phenomenon.  So holding out hope that future policy outcomes directed at the behest of either current or future elected officials, irrespective of political party, will somehow relieve the pressure is a fantasyland belief that only serves to psychologically forestall the inevitable.  Healthcare organizations that are able to accept and internalize knowing that they will have to compete on value in the future will survive – those that do not, will not.  It is really as simple (and brutal) as that.

Use this Time to Answer Some Tough Questions
If the Affordable Care Act is either partially or fully struck down – and/or the general election delivers a major shift in party majority, there will be a brand new tsunami of political opportunism in its wake.  It will take a fair amount of time (I am betting six quarters, at least) for that special interest flooding to subside to the point where any type of meaningful legislation can be passed replacing the ACA.

What impact that actually has, however, on the timing of the policy-driven financial realties that senior housing and care providers are facing is unclear because much of the ACA’s impact is not scheduled to begin until 2014 in any event.  And while we wait for the Federal government, State budgetary pressures will continue to mount.  So I think a prudent approach is not to mark the passing of time by the political winds but assume that every month going forward should reflect a quantifiable movement toward a future state vision of your organization that is more lean, more efficient – and is able to deliver more value than your competition.

To accomplish this, however, you first need to decide what that future state vision looks like.  I just finished a new whitepaper on strategic planning and positioning that discusses the importance of visioning in context.  For the purposes of this post, I think the relevant questions that need to be answered by most organizations – and very soon – are:
     What business(es) are we in?
     Who really are our constituents and stakeholders –
        and how do we bring value to them?
     Are we ready to partner with other healthcare 
        providers – and under what circumstances?

     How do we ensure that our investments create
         future option value?
     Where are the opportunities to monetize our value
        chain into revenue?

Be Ready to Negotiate
If there was one skillset I would say – on average – represents the weakest link for high quality, high value senior housing and care organizations desiring to thrive in a future world of Healthcare Reform it would be the ability to negotiate business deals.  It is just not an inherent skill that seems to be well correlated with other leadership qualities that are of paramount importance – and have historically been sufficient to achieve leadership excellence.

That is changing, and quickly.  Effective negotiation will determine whether you are  “bought by” or “merged into” another organization.  It will determine whether the acquisition you make increases or decreases the overall value of the combined organizations.  It will determine whether you drive the terms and conditions necessary to financially survive under managed care, or accept what you’re given – and hope for the best.

When the time comes to partner with other market participants (whether those are community-based organizations, physician groups operating as a medical home or  hospitals) you don’t want to be sitting there with your hand up, saying, “oh pick me, pick me!” You want to know well in advance what you bring to the table, what it is worth and what you demand for that value.

Create an Opportunity Assessment Matrix
Finally, senior housing and care organizations will have to be able to react more quickly to opportunities than they have in the past.  As Healthcare Reform – in whatever final format that takes – begins to roll forward in earnest, market dynamics will accelerate.  New – and often unexpected – partnership opportunities will emerge.  Being able to react quickly – and before the competition – will be a huge strategic advantage and key to survival.

One idea that we have found helpful is the Opportunity Assessment Matrix.  This is a concept that we have used with several senior housing and care organizations, and it is a tool that is designed to streamline the process of identifying, assessing, analyzing and prioritizing market opportunities.  It is also helpful in mitigating risks and ensuring the requisite organizational support is in place before valuable resources are invested in pursuit of alternative opportunities.

The concept is basic: discuss, agree upon and document the various elements that any potential opportunity must possess to merit consideration.  Determine the relative weights of those elements in the context of the organization’s business strategy.  And then create a consistent methodology for who and how the individuals responsible for assessing the opportunity will be engaged.

Hope this is helpful . . .
  ~ Sparky

Don’t Let Data Get in the Way of Good Judgment

There was an interesting article in the April 2012 issue of Harvard Business Review (Good Data Won’t Guarantee Good Decisions, by Shvetank Shah, Andrew Horne, and Jaime Capellá) that I think has relevancy to post-acute/long-term care providers.  Specifically, insights there can be useful in better understanding the significant clinical and operational challenges associated with developing the type of IT infrastructure that will help those organizations demonstrate real value as participants in integrated care delivery models.

About the Article
The authors are part of the leadership team at the
Corporate Executive Board
and they share some of what was learned through development of a proprietary tool used to assess the ability of employees to, “find and analyze relevant information.”  They call this the, Insight IQ, and through researching 5,000 employees at 22 global companies they stratified those employees into three types:
     Unquestioning Empiricists: Trust analysis over judgment
     Visceral Decision Makers: Go exclusively with their gut
     Informed Skeptics: Balance judgment and analysis

They argue that the Informed Skeptics are, “best equipped to make good decisions,”  but that only 38% of employees – and 50% of senior managers – fell into this group. Their research also uncovered four problem areas that represent obstacles to achieving better ROI on IT expenditures to develop data analysis:
     Analytical skills are concentrated in too few employees
     IT needs to spend more time on the “I” and less
on the“T”
     Reliable information exists, but it’s hard to locate
     Business executives don’t manage information as well
        as
they manage talent, capital and brand.

Implications for PA/LTC Providers
As I have written in this space previously (and in other publications), PA/LTC providers face a challenging Catch-22 with respect to Information Technology: how to make prudent investments that position them to be competitive in a world of integrated care delivery without subverting scarce resources during a period of tremendous financial pressure.  In making such investments it is critically important to fully understand and anticipate how future IT functionality will enhance clinical and operational capabilities.

To really create demonstrable value as part of an integrated care delivery network it will not be sufficient to collect, assess, analyze and report data collected through an EHR/EMR system.  Those providers seeking to gain a distinct competitive advantage through IT capabilities will also need to demonstrate how their IT infrastructure supports tangible achievements, e.g., greater patient activation, operational efficiencies and improved productivity, higher stakeholder and constituency satisfaction scores and lower rates of hospital readmissions.

As I wrote in my recently published white paper: Strategic Planning and Positioning for Healthcare Reform,
     Data becomes Information when it is organized
     Information becomes Knowledge when it is analyzed, and
     Knowledge becomes Wisdom when it is synthesized.

The stakes are very high for PA/LTC providers entering the new world of integrated care delivery.  IT investment is a foregone certainty of participation – and with that comes the tremendous risk of not achieving the necessary ROI.  As the article points out, “investments in analytics can be useless, even harmful, unless employees can incorporate [those analytics] into complex decision making.”

And there are few industries where the complex decision making of employees carries as much importance (and risk) as in healthcare.  When developing your organization’s IT Strategy, therefore, it is very important to do so in a way that sufficiently recognizes and incorporates operational and clinical understanding.

Policy Implications
There is a lesson here, too, for public policy initiatives seeking to drive wider adoption of Evidence-Based Healthcare (EBH) and Evidence-Based Medicine (EBM). Direct caregivers – and in particular physicians – are being pressured to make greater use of EBH/EBM.  We see this in the regulatory platform of the Shared Savings Program (i.e., Medicare ACOs).  We see it in how the Insurance Exchanges are being built.  And we see it in how Minimum Essential Benefits have been defined.

I believe most physicians rightly view themselves as Informed Skeptics: balancing available data with their practice experience.  I think where very often a policy disconnect occurs is when physicians try to paint policymakers with the broad brush of being Unquestioning Empiricists: seeking to supplant physician judgment with mandated decision trees.  In response (retaliation) then, policymakers will often argue that physicians’ Visceral Decision-Making is used as a cover for the economic benefits of fee-for-service based medicine.

Of course, reality as usual, lies somewhere in the middle – beyond the interests of political campaigning.  I have always argued against mandated third-party protocols (i.e., those not created and implemented by healthcare providers) because I believe the Visceral Decision Maker brings more to the table than the authors’ research necessarily implies.  I am mindful of Malcolm Gladwell’s book, Blink, in which he explains the importance of rapid cognition and intuition – and how these capabilities are based on a lifetime of experience that exists in our subconscious.

But the key takeaway here, from a policy perspective, is the importance of going beyond the “data,” which constitutes the evidence in EBH/EBM, and understanding how data will (can) be used in provider decision-making.  The same caution that applies to organizations of being at risk of data getting in the way of good decision making thus applies equally to the development of effective public policy.

What do you think?

  ~ Sparky

Can We Afford Home & Community-Based Services?

So who wants to spend their final days in a nursing home? Please raise your hands.

I think we all hope that when our time comes we will be in natural repose – whether that’s flying down the road with a gang of over 75 year-old Harley riders or in our own bed, surrounded by those who have made our life worth the living.  What many of us also hope is that we never be a burden on others; and if that means we require care in a nursing home, we are very grateful that care exists.

The “consumer preference” side of the inertia that has been driving the social and political push toward home & community-based services (HCBS) is plain enough.  The portended cost savings side, however, has yet to be supported with hard evidence.  In fact, as reported by Jenni Bergal in her May 24, 2012 article, States Encounter Obstacles Moving Elderly and Disabled Into Community, published in Kaiser Health News, the 2007 CMS initiative, Money Follows the Person, has been a disappointment to many.

As reported there, the demonstration was initially anticipated to place apx. 35 thousand Medicaid recipients in HCBS settings within the first five years – while the actual amount has been 22.5 thousand (36% below what was targeted).  Although $4 billion has been authorized by Congress to underwrite costs of the program it is estimated there currently exist 900,000 individuals living in institutions that qualify for transfer to HCBS settings under the program.  In addition to falling short of volume and outreach expectations, it is still not clear from available research whether the program is capable of providing an overall aggregate cost savings.

There are two general areas representing obstacles to success: affordable housing and operational support.  Effective HCBS models very often require that individuals transition to a new setting because their current home does not adequately accommodate accessibility and permit in-home supportive assistance.  Affordable housing for the elderly is, of course, one of the greatest social challenges that we are now facing, irrespective of HCBS.

Within the area of operational support there are two distinct categories: lack of what I will call technical support (e.g., timely access to direct caregivers, such as physicians, nurses and therapists; inability to most effectively leverage available remote monitoring and assistance technology; and inadequate management of medication);  and individual support (e.g., both access to community-based service supports and/or availability of informal caregiver support, such as families). 

The Affordable Care Act has a number of specific programmatic initiatives in support of HCBS, including: Community First Choice (Sec. 2401), State Option to Provide Health Homes (Sec. 2703), Money Follows the Person Continuation (Sec. 2403); Independence at Home Program (Sec. 3024); Community Based Care Transitions Program (Sec. 3026); Community Health Teams (Sec. 3502); and Community Based Collaborative Care Networks (Sec. 10333).  Additional support of HCBS initiatives is coming from the Center for Medicare and Medicaid Innovation, as well as numerous state Medicaid programs.

Many senior housing and care providers that have historically provided post-acute and long-term care within the confines of institutional settings have been committing substantial resources to advance strategic HCBS initiatives.   Again, their efforts are reflective of both the perceived preferences of their targeted market, as well as recognition of the trending shift in available public funding.  And I do believe there is merit in having a sense of urgency behind such efforts because of the potential rewards that first mover advantage may bring as integrated delivery models drive markets toward greater consolidation.

Based on the available results of the Money Follows the Person demonstration, however, there is at least anecdotal evidence in support of incorporating additional risk mitigation into those efforts.  It would be prudent to ensure development plans are assessed and modified periodically as additional information becomes available about future HCBS initiatives.  To the extent those initiatives can provide organizational Option Value that can reduce the potential cost of market repositioning in reaction to what is learned over time, the additional up front investment is probably a good idea in this environment.

I know there are some very forward thinking and experienced senior housing and care providers out there who are already well down the road to building the social, community and provider infrastructure that it takes to develop successful HCBS – regardless of what future research shows.  Hopefully, one of those folks will stop by the Pub and share with us what they have already learned!

  ~ Sparky

 

Chronic Care and Technology

Chronic Care and Technology

Whenever I think about Healthcare and Technology I am reminded of a wonderfully poignant joke that Rita Rudner (think, Rodney Dangerfield’s Young Comedians Special back in the 1980s) used to share:

"They’re trying to put warning labels on liquor now. ‘Caution: Alcohol can be dangerous to pregnant women.’ Did you read that? I think that’s ironic – if it wasn’t for alcohol, most women wouldn’t even be that way."

If it wasn’t for advancements in Medical Technology – and the attendant increase in life expectancy – one has to wonder whether the much maligned Cost Curve would hold sway over our social and political anxiety as it does today.  Undoubtedly, Medical Technology has improved delivery system effectiveness from the standpoint of decreased mortality and longevity.  But it comes at a substantial cost that ultimately impacts the cost of healthcare delivery.

The cost that society bears for increased longevity gained through technology is substantial, and we know that much of this cost is centered in the world of senior housing, aging services and post-acute/long-term care.  Evidence of the costs associated with chronic disease were explored on Tuesday at the second event of a three-part series being presented by the Alliance for Health Reform in Washington, DC.  Speakers at the event, Health Care Costs: The Role of Technology and Chronic Conditions, shared with participants some very interesting data and analysis (I encourage you to view the slide presentations).

I wish I could have participated because the presentation materials, though very informative, on balance seemed to focus more on general trends in how chronic disease drives healthcare costs rather than focusing on the specific role that Medical Technology has played.  But it nonetheless affords the opportunity to offer some thoughts on technology and the costs of managing and treating chronic disease. 

As the demographic Age Wave continues to move ashore – and taking with it an increasing amount of available resources – the theoretical discussion of tradeoffs between investments in technology and direct caregiving is likely to be become more intense.  Applying the concept of value to that discussion should not be viewed as a subjective assessment of the worth of an extra year, an extra month – an extra day of longevity by virtue of technology.  Rather, it should be viewed as a means of evaluating alternative investments of available resources.  This would seem to be a prudent basis for developing future policy surrounding public investments in technology.

Policy aside, however, senior housing and care providers face a daunting reality with respect to technology: the investment requirements can be substantial – and the consequences of making poor investments difficult from which to operationally and financially recover.  Yet to play in a world of integrated care delivery where both Information and Medical Technology provide distinct competitive advantages, ignoring required investments is just as sure a path to quiet obsolescence.

And while providers wrestle with that two-headed dragon, legislators have not yet appropriately recognized the need for parity investment in PA/LTC technology infrastructure, so many organizations are having to do what they can with available resources to position their technology investments in what they believe (hope) will be in alignment with acute care providers.  The irony here is of course thick if not beyond frustrating because the train that is integrated care delivery has left the station without the cars behind that represent the ability to achieve interoperability with PA/LTC providers.

There is also, I believe, a need of both providers – and policymakers – to understand that technology will only be able to help us so much.  It is not the silver bullet that will save us from the need to become more efficient, streamline care continuums, dramatically improve provider communication and tear down delivery setting silos.  In addition, technology may help encourage but it cannot directly change individual behaviors that could go a long way to curbing chronic disease incidence.

I would really like to better understand how different organizations are addressing their technology strategy.  Is it still a wait and watch situation? Is the need to develop EHR/EMR technology enough to deal with right now? What concerns you the most about technology? Who is involved in that thought process?

Please take a moment to share your input – don’t be afraid to be first . . . somebody has to.  Hot smile

  ~ Sparky

 

Is Focus on Hospital Readmissions Misguided?

In the April 2012 issue of the New England Journal of Medicine there was a Perspective’s article that is being circulated and discussed: Thirty-Day Readmissions – Truth and Consequence (you can download and read the article by clicking on it in my Dropbox™ account to the right).  In the article the authors argue, “that policymakers’ emphasis on 30-day readmissions is misguided.”

They present three reasons:
1. many of the variables inherent in driving readmissions are beyond the hospitals’ control (e.g., “patient-and community-level factors”), and they note that, “it is unclear whether readmissions always reflect poor quality”;
2. improved discharge planning and care coordination could be more effectively achieved by focusing on other metrics, rather than readmissions; and
3. resources committed to reducing readmissions may be better allocated to focus areas able to demonstrate a perceived higher ROI (e.g., patient safety and quality).

I think this misses the point as to why there is a focus on hospital readmissions.  In particular, noting that readmissions may not reflect poor quality seems like a fallacious assertion because I don’t think the argument is being made (at least by those who understand the issues and concerns) that readmissions necessarily do reflect poor quality.  At issue is whether the readmission could have been avoided with more effective care planning and transitioning – and thus equal or better care provided in a lower cost setting.  From listening to nursing staff at PA/LTC facilities, the evidence of opportunities for care transitioning improvement is overwhelming, albeit anecdotal from my frame of reference.

Admittedly, it is very difficult to study the true economic impact of hospital readmissions by attributing their causes.  Some patients should never have been discharged in the first place, and there are a host of reasons that drive premature hospital discharges.  Some patients are discharged to inappropriate settings – often because the patient and/or patient’s family intervenes over the recommendations of physicians and/or discharge planners.  Some patients are convinced they can follow a required post-discharge regimen and fall way short within the first 24 hours.  While some patients need just a little support (e.g., queuing, companionship, medication management), but they are in a situation where they have none.  And finally, some patients – particularly the elderly – are significantly impacted emotionally by care setting transitions, leading to adverse reactions that are very unpredictable.

But research has shown that education, coaching and timely intervention can be very effective in disease management.  We know that getting patients to change risky behaviors and become better self-managers of care can improve outcomes across a range of chronic illnesses.  We know that doctors have neither the training nor the time to engage in counseling on behavior change or to give self-management support. 

So it is inevitable that PA/LTC organizations will need to play a growing and critical role in designing, planning and implementing post-discharge care transitioning programs for patients in need of chronic disease management.  The sooner those organizations embrace the importance of this role and begin to build the requisite knowledgebase to be successful partners in integrated care delivery models, the better chance they will have of surviving in an era of Healthcare Reform.

A good place to begin for many of those organizations may be to become familiar with the work of Dr. Eric Coleman (University of CO Denver School of Medicine) and his colleagues on care transitions.  Many of the PA/LTC organizations that I work with now talk of the, “Coleman Model” and/or the “Coleman way” as an emerging standard bearer.  Here’s their web site:

http://caretransitions.org/

Have a Wonderful Memorial Day – and let’s all be very thankful to the brave men and women that have given so much to ensure we still have the ability to share ideas like I do here, open and freely!

  ~ Sparky

Branding in An Era of Healthcare Reform

Larry Minnix, President & CEO of LeadingAge, recently began a video series entitled, a few minutes with Larry Minnix (I am guessing they didn’t hire Porter Novelli to help with the naming – or, maybe they did).  If you haven’t already, I encourage you to take the time to watch these.  Larry does a wonderful job sharing timely and highly relevant messages in his famously comfortable speakeasy style.

In the current episode that I’ve embedded below Larry discusses LeadingAge’s 2011 Annual Report. 

In referring to LeadingAge member organizations, Larry noted that, “we’ve had reinforced the fact that the most valuable, priceless thing that you own is your not-for-profit brand and heritage.”

I agree with Larry – today. Tomorrow – as in the next five to ten years – is a different story. The looming reality facing nonprofit senior housing and care organizations is that to remain economically viable in the future I believe their brand will have to become more synonymous with value than being nonprofit.

For those nonprofit organizations desiring to survive (and thrive) under Healthcare Reform, future brand identity and perception may need to change significantly. Consumer preferences of the Baby Boomer generation, the need to participate in integrated care delivery systems, learning to financially manage through new payment models (e.g., ACOs, managed care, payment bundling) – these are factors, which will have a greater impact on successful brand strategy than a nonprofit identity.

This is why I found that part of Larry’s message so timely and well placed. Tomorrow is not too soon to begin proactively managing your brand in lieu of Healthcare Reform. To be sure, managing a brand is a bit like herding cats: there are things you can control, things you cannot control and things you foolishly believe you can control.

I am reminded of a passage I like to quote from the book, Brand: It Ain’t the Logo: It’s what people think of you™  by Ted Matthews.

“A Brand is the sum total impression and memory of every remarkable, every so-so and every negative experience with any and all pieces of an organization. A Brand is the personality of a company, product or service and is judged and assessed a value by everyone it touches, whether inside the company (your employees) or outside (your customers, suppliers, shareholders and other stakeholders). These perceptions of value may, or may not, be what you want them to be. Which suggests a fact that may surprise you: your Brand isn’t really yours. You don’t own it – all the people thinking about you do.”

Perception is reality, isn’t it. Being able to monetize the perceptual advantage of being a nonprofit will continue to be critically important to brand awareness and positioning. I am not suggesting otherwise. But – it will not be sufficient for survival in the face of the tremendous challenges ahead, and it will be secondary to perceptually positioning your brand based upon the ability to deliver value under Healthcare Reform.

What do you think?

  ~ Sparky

An Ounce of Prevention = How Much?!

Section 4004 of the Affordable Care Act – Education and Outreach Campaign Regarding Preventative Benefits – requires that the Secretary of HHS, “provide for the planning and implementation of a national public-private partnership for a prevention and health promotion outreach and education campaign to raise awareness of health improvement across the life span.”

As reported by the Hill’s Healthwatch today HHS has signed a $20 million contract with the PR firm, Porter Novelli (http://www.porternovelli.com/) to assist in the development of a multimedia ad campaign to help implement this requirement.  In the grand scheme of governmental spending $20 million unfortunately isn’t going to get too many folks excited – unless you are a Republican Congressman fixated on removing President Obama from office (see article to the right in the BoxNet widget).

But post-acute/long-term care providers should have a strongly vested interest in this topic.  They will be looked upon by stakeholders of every ilk (e.g., hospitals, physicians, patients, patients’ families, policymakers) to fulfill the role of sponsoring and affecting Patient Activation, particularly as it relates to the prevention and management of chronic disease.

Leveraging multimedia – especially with the ability to tap into the vast web of outreach via social networking – to educate and create awareness of disease prevention and management is logical enough.  If $1 invested in such outreach can save a nickel of Medicare/Medicaid spending, I would be hard pressed to argue against it.

The trouble is, the research I have seen evidences a mixed bag when it comes to demonstrating the economic benefit of such  initiatives.  Perhaps that can change with the ever decreasing marginal cost of messaging dissemination via multimedia.  Perhaps not because the other side of that coin is the increasing challenge of competing for attention.  But if it’s not successful, where will the blame lie for its failure?

That’s what I find quite concerning.  How much of this investment is going to be made without direct involvement from the front-line caregiving staff upon whom we are expecting great costs savings through more proactive individual care management? I think this is something that should be looked into as soon as possible to determine what avenues are available to ensure PA/LTC providers have a meaningful seat at the table.

What do you think?

  ~ Sparky

Welcome to the Policy Pub

Greetings, and welcome to Sparky’s Healthcare Reform Policy Pub!!

This is my first installment, while our team is still working feverishly to create initial content for the Artower Advisory Services Web site.

Eventually – and hopefully sooner rather than later – here you will find a timely, informative sharing of knowledge, information, opinion and debate on public policy issues impacting senior housing, aging services and post-acute/long-term care organizations.

If I am successful in achieving my overarching goal, this blog will become top of mind with industry thought leaders desiring to stay at the cutting edge of awareness, understanding and insight of how Healthcare Reform policy initiatives will impact the industry and their organizations.

I know that success will depend on how diligent I am on keeping content fresh, how well I can provoke meaningful participation from others – and whether Healthcare Reform continues to offer tremendous business challenges – and opportunities.  Well, I’m pretty confident Healthcare Reform isn’t going away, so I guess it’s mostly on me.  I welcome the challenge.

So please come on in, grab a spot and let’s have some fun learning from one another in ways that will ultimately help those organizations providing life-improving housing, services and care for seniors and disabled individuals in our society.

See ya inside!

  ~ Sparky