Senate HELP Committee Hearing Highlights Employer Uncertainty in Face of EEOC Lawsuits Against Wellness Programs

On Thursday, Jan. 29, the Senate Health, Education, Labor and Pension (HELP) Committee held a full committee hearing entitled “Employer Wellness Programs: Better Health Outcomes and Lower Costs.” The hearing was triggered by the recent EEOC lawsuits against three companies related to their wellness programs and the use of incentives.

Population Health Alliance (PHA) members know that worksite wellness programs are one segment of a broad continuum of population health approaches that includes disease management, case management and other population health services being implemented by employers seeking to improve the health of their employees. This, in turn, can increase productivity and lower costs.

The PHA has been tracking and working on this issue for over a year and a half. In May 2013, the PHA organized a meeting of its Washington, D.C.-based Government Affairs Committee members, with Chris Kucszynski of the EEOC, to discuss disability issues and wellness programs. This effort ramped up even more in May 2014 with the public announcement that the EEOC would soon release guidance on this issue (which never happened). Since then, and in light of the EEOC’s lawsuits, the PHA established an internal subgroup of our Government Affairs Committee to begin working on this issue, and formed a larger coalition of organizations and individuals to collaborate.

In the past few months, the PHA has developed a white paper for our members, held a webinar in collaboration with the National Business Coalition on Health (NBCH), reached out and provided support to the Senate HELP Committee, met with key staff on The Hill and organized a meeting with HELP Committee staff for our members and collaborators.

Jan. 29 hearing takeaways

Overall, the Senate HELP Committee was positive about the use of wellness programs in the workplace. This section of the Affordable Care Act (ACA) passed with bipartisan support and there was little disagreement from committee members regarding the merits of programs like this.

In his opening statement, Committee Chair Sen. Lamar Alexander, commented on the EEOC lawsuits relative to wellness programs, saying, “We want to make sure we don’t have a countervailing move going on in the government to discourage that. Even the White House has expressed concerns regarding the EEOC actions.”

The EEOC has had the opportunity to weigh in on this issue for quite some time and in May, announced that it would provide rules. The EEOC has not issued rules and instead, has chosen to litigate the issue. This approach has created considerable uncertainty for employers whose wellness programs adhere to the requirements of the Patient Protection and Affordable Care Act (PPACA), HIPAA and the Genetic Information Discrimination Act (GINA), yet find themselves in the cross hairs of the EEOC. As Dr. Catherine Baase, medical director of The Dow Chemical Company stated, “Employers should not have to face this uncertainty.”

Ranking Committee Democrat, Sen. Patty Murray highlighted the positives of wellness programs, “The ACA has put the power back into the hands of patients and encourages new, innovative delivery systems.”

Dr. Gary Loveman, president and CEO of Caesars Entertainment Corporation, also testified that “Wellness programs are ideally suited to address the epidemic of chronic diseases in this country.”

Additional testimony focused on these themes

1) Engagement is critical.

“In the absence of incentives for biometrics, we would not have such significant results.” – Dr. Loveman

“Successfully engaging employers is critical to achieving health for our society. We cannot achieve the results we want without it.” – Dr. Baase

“Engagement is key in wellness programs. Financial incentives are just one part; we need an integrated aligned system.” – Dr. David Grossman, medical director for Population and Purchaser Strategy, Group Health Research Institute

James Abernathy, a Blue Cross and Blue Shield of Tennessee employee, testified that the financial incentives of his company’s wellness program motivated him to lose weight and make significant improvements to his health.  He said that the program incentives are tied to participation and that he receives discounts and rebates.

2) Wellness programs are generating results

The King County program saw smoking levels drop by six percentage points as a result of their program, according to Dr. Grossman.

The Dow Chemical Company spent $4.8 million less in 2014 than it would have without the program, based on the industry average trend, noted Dr. Baase.

3) There is additional work to do

Jennifer Mathis of the Bazelon Center for Mental Health Law, expressed concerns from the disability community that these programs force individuals to self identify as being disabled. She questioned the voluntary nature of the wellness programs named in the EEOC lawsuits because of the high amounts of the incentives.

Dr. Grossman suggested that we use what we already know and then fill in the gaps, noting that the programs that have succeeded are those that implemented incentives based on best practices.

Eric Dreiband, partner with Jones Day law firm, felt there were two possible solutions, “Either the EEOC articulates a public solution that ACA meets requirements [of the ADA] or Congress enacts legislation.”

Sen. Murray echoed that urgency, “I think it’s really important that the EEOC get the rules out and makes sure all people are protected. I am assured they will be out very shortly.”

The PHA and our members will continue to follow and work on this issue in an effort to provide more certainty to employers, employees and vendors.

Population Health Management and Value Based Care: The Overarching Approach That Makes a Difference

The healthcare system and ecosystem is in a period of great change as we shift from pay per service to pay for value.  As the nuances of federal and state policy continue to evolve we need to keep the following principles in mind especially for the sake of our nation’s seniors:

Focus on needs and preferences of seniors as consumers

Seniors deserve choice, a satisfying experience and the support to achieve their optimal health. As the fastest growing consumer segment, they will demand it and get it or seek alternatives. Alternatives could be a different health plan, hospital, doctor, other service provider or site of care. Choice is not limited to hospital and provider network. Choice means if, where and how they get treatments, what type of treatment and at what cost financially and to their quality of life. A satisfying experience doesn’t mean a satisfactory experience. It means an experience that is satisfying to them; did it meet or exceed their expectations in terms of ease of access and use, courtesy and knowledge of their health care team members and did they achieve their optimal health outcomes. Furthermore optimal health is different for every senior and their view of optimal health must be understood, respected and supported.

As 10,000 baby boomers per day age into Medicare, these principles and the need to deliver on them doesn’t disappear. In fact the need is amplified as according to the Council on Aging 80%  of older adults has at least one chronic conditions with 68% having two or more1 and  9 of 10 take at least one prescription and depending on the source up to 27-29 prescriptions per year 2,3.  Furthermore, their desire to age better and remain in their homes longer than previous generations4 while on average living longer will take proactive self- management skills, sophisticated and comprehensive care management and leveraging of data insights and innovative solutions that support independence.

Approach payers with engaged providers as purveyors of population health management vs payer of claims

In addition to the market pressure of consumer demand, cost of care continues to place a burden on society as a whole. Traditional self- insured employers, health plan and at risk providers have evolved from payers of claims to purveyors of population health management.  A population health framework includes up front data analytics and in person assessments to understand the population and individual; risk stratification; pairing the right interventions in a timely manner based on risk and individual need and preference, supporting self- management skills care coordination including in chronic conditions and through transitions of care and measuring and improving outcomes.5

In both Fee for Service Medicare and Medicare Advantage CMS is supporting advancement of quality outcomes through numerous demonstrations and  programs that provide bonus incentives for plans e.g.  Star Ratings and penalties for providers e.g. reduction of payments when readmissions exceed national averages. However, population health by definition requires much more than tracking quality metrics or providing more benefits that seniors have to seek and pay for6. As seen in most Medicare Advantage plans, it is the overarching approach to promoting holistic consumer centric services that improve or maintain health and avoid unnecessary costs and quality of life setbacks.7,8 Value based care arrangements have also expanded among commercial payers through contracting for value or supporting provider lead models with the building blocks necessary to assume financial risk.

Advance comprehensive, cost effective benefits through expertise, infrastructure and scale

The number of seniors enrolling in a Medicare Advantage has increased to roughly one third of the total 57 million beneficiaries enrolled in Medicare9  and most plans likely due to a combination of more benefits to include dental, vision and hearing but also because of the approach described above. Most Medicare Advantage Plans have invested substantially in the infrastructure to go beyond administering the benefit to provide full service population health management programs for the group of seniors for which they have accountability.  In their direct employ or through a delegated partner they have engineers, data management experts and senior scientists transforming data into useful insights about the population and individual’s needs. They have a range of clinical and nonclinical navigators, coaches and care and case managers working directly with consumers to access the best, most cost efficient care as well as support tools and programs to optimize their health.  Finally, quality experts produce and review metrics to share with programs leads and engage providers in value based care models in an effort to continually innovate and enhance solutions aimed at improving outcomes for the individual and population as a whole.

Effective population health management requires not only expertise and experience but the scale to spread the cost of these programs over a large number of lives. This explains in part the ability of Medicare Advantage plans to offer more programs and services for seniors at no added cost and in turn why seniors continue to enroll in Medicare Advantage programs at increasing rates.

Ensure sustainable policy and program models-our job as leaders

As health care leaders it is the job to see that Medicare is funded at a level and in a design that can sustainably through smart cost management strategies support our growing number of seniors.  Not surprisingly supporting seniors in their goals is often times more cost effective. Remote monitoring in the home and some self- care help to keep them in the environment they choose is much less expensive than institutional care. Transportation while not “medical care” provided to attend a doctor’s appointment is much less costly than a missed appointment that results in a complication and hospital stay.

The examples above and many others form the underpinnings of population health tailored to the individual senior’s need and the foundational elements of sustainability i.e. quality effective, cost efficient and desirable. By providing service beyond benefit administration to include the principles and infrastructure to support population health management and value based programming, we can honor our seniors by delivering preferred, high quality options for optimizing their health and lives.


  1. Council on Aging. Chronic Diseases. accessed February 20, 2017.

  2. Home and Community Preferences of the 45+ Population. AARP. November, 2010.

  3. Many Seniors Take Too Many Medications –Here’s How to Fix It Accessed February 20, 2017.

  4. Medicare HMOs Fact Sheet.

  5. Population Health Alliance-Understanding Population Health Accessed February 13, 2017.

  6. CMS Chronic Care Management Services-How is it covered? Accessed February 13, 2017.

  7. Maximizing Medicare Advantage  Accessed February 13, 2017.

  8. How Original Medicare and Medicare Advantage Differ.  Accessed February 13, 2017.

BMA: MA Enrollment Update: Beneficiaries Continue to Choose Medicare Advantage. Issue Brief: July Accessed February 20, 2017


Rose Maljanian, Chairman & CEO HealthCAWS, Chairman of the Board Population Health Alliance

PHA Forum 2017 – Stakeholders United for Population Health

The Population Health Alliance (PHA) was proud to host our PHA Forum 2017 in Philadelphia, PA on March 27 co-located with the Population Health Colloquium and co-hosted by Jefferson College of Population Health.  We spent the morning hearing from industry experts and executive leaders among our membership discussing past, present and future innovations in the population health industry. Featured presentations included:


Stakeholders united for Population Health™, Rose Maljanian. Chairman & CEO HealthCAWS, Chairman of the Board, Population Health Alliance


Implications for Health Care under the New Administration, Clay Alspach, Principal, Leavitt Partners,


A Thought Leadership Perspective on Population Health, Congresswoman Allyson Y. Schwartz President & CEO Better Medicare Alliance


Panel: Advancing Population Health for Seniors 

Moderated by David Chess, MD, Chief Medical Officer and Co-Founder, TripleCare Senior Health

Chris Long, Executive Vice President and Chief Operating Officer, AxisPoint

Sean McManamy, SVP, HealthFitness

Initiative Sponsored by AARP


Panel: Population Health Implications for Value-based Care

Moderated by John Sory, Chief Executive, UHealth Regional Alliance, University of Miami

Andrew Baskin, MD, Aetna Quality & Clinical Policy

Barbara A. DeBuono, MD, MPH, VP, Clinical Strategy and Value Based Care, 3M Health Information Systems


Panel: PHA Looking Glass: A Window into PHA Initiatives

Moderated by Brenda Schmidt, Founder and CEO, Solera Health

Mary Jane Osmick, MD, Vice President and Medical Director, American Specialty Health, Quality and Research Chair

Victoria Shapiro, JD, Vice President Health Policy, External Affairs, UnitedHealth Group, Government Affairs Chair


The event concluded with the PHA Membership Annual Meeting and VIP Luncheon.





Thank you to our sponsors:


Good Measures

Noridian Healthcare Solutions

PHA Forum 2016

Thank you to our Chairman Sponsor, Aetna and sponsors Health Fitness and Noridian Health Solutions.


The Population Health Alliance (PHA) was proud to host our members at our invitation only PHA Forum 2016 in Washington, DC on November 10 held at the Kaiser Center for Total Health.  We spent the day hearing from industry experts and executive leaders among our membership discussing past, present and future innovations in the population health industry. It was a productive day of networking and rich discussion of specific industry segmented population health strategies that impact multiple stakeholders organizations, consumers and providers.



Welcome remarks provided by Rose Maljanian, PHA Board Chair, and Sandeep Wadhwa, MD, At-Large PHA Executive Committee Member


Erwin Tan, MD, AARP Thought Leadership – Director, Health followed with his presentation, “Life Purpose as a Lever to Impact Health and Healthcare Costs Across the Age Continuum.”


JP Sharp, JD, MPH, MACRA Lead, CMS Innovation Center, presenting, “QPP-MACRA Implications for Population Health Across All Stakeholders”


Board Alumni Panel, “Today’s Pop Health: What Has Staying Power, What Needs to Evolve”

Richard Vance (Panel Chair), Peter Dibiaso, David Nace, Jaan Siderov


Board of Directors Panel, “Population Health: Markets and Winning Strategies”

Sean McManamy (Panel Chair), Jim Pshock, Brenda Schmidt, Anthony Akosa, MD


Select invited members with the PHA Board and Alumni

Hon Pak, 3M, Peter Dibiaso, Quintiles, Chris Seleckey, Population Health Strategies, Mary Jane Osmick, American Specialty Health, Jim Pshock, Bravo Wellness, Sandeep Wadhwa, Noridian Healthcare Solutions, Rose Maljanian, HealthCAWS, Susan Riley, TripleCare, Sean McManamy, HealthFitness, Anthony Akosa, Franciscan Health, David Nace, MarkLogic, Sunny Ramchandi, Aetna, Al Lewis, Quizzify, Allison King, Population Health Alliance, Andrea Powers, Silverlink, Chris Long, AxisPoint Health, Brenda Schmidt, Solera Health, Gordon Moore, 3M, Richard Vance, Chrysalis Ventures, Ashley Reynolds, Sensei, Jaan Sidorov, MedSolis

Save the Date for PHA Forum 2017 March 27th in Philadelphia, PA in conjunction with the Population Health Colloquium!

The Popularization of Population Health: Enduring Traits & Current Challenges

Rose Maljanian is founder and CEO of HealthCAWS, a privately held corporation focused on improving health and making healthcare more affordable by aligning accountability models and supports for success. Throughout her career, Maljanian has served on the frontlines of health innovation as SVP for Product Innovation at Magellan Health Services, a senior member of the Innovation Center leadership team at Humana, and as the founding director of Hartford Hospital’s Institute for Outcomes Research and Evaluation. She is a founding and current Board member of the Population Health Alliance.
Note that this post was originally published by Oliver Wyman Health on May 17, 2016.

Population Health is the latest topic talked about in every innovation and investor setting, yet it has been in the making for decades. Frameworks have been made publically available for years by thought leadership groups such as the Population Health Alliance (PHA). The primary reason population health has moved up higher on the national radar is that the umbrella term “population health” includes “value-based care.” Other groups such as the American Medical Group Association (AMGA) and the Patient-Centered Primary Care Collaborative (PCPCC) have additionally contributed to the advancement of the underpinnings for the delivery of value-based care.

The enduring traits of population health management include: accountability for a defined population, intervening in partnership with the consumer and producing results in the form of measured outcomes tied to performance agreements. While great strides had been made by multiple stakeholders to advance population health in a fee-for-service environment, the current trend of aligning financial incentives for care delivery, versus consumer engagement and care coordination initiatives alone, substantially improves the likelihood that all stakeholders will work together toward value-based goals.

Common challenges in population health management have been highlighted over the years but authors in a recent article published in the International Journal of Integrated Care summed up the major challenges we are facing today quite succinctly: governance models, engagement of the population served, payment models, and evaluation of what by its nature is a complex multifaceted set of interventions.

Here are three ways to move the industry forward:

1) Lead with your strengths: Understand roles and focus on accountability and outcomes

a) Population health management entities: These organizations take responsibility for a defined population for a defined set of outcomes (quality and cost). Examples all share common themes of defined population, accountability, intervention, and outcomes:

  • Providers and hospital systems in various risk sharing models for quality and cost outcomes for defined populations owning, licensing, or partnering for necessary data and technology solutions
  • Payer initiatives (health plan and employer)that for a defined population take full risk and/or support providers to take risk, provide front end and back end data solutions, and coordinate care and other services and interventions (licensed or wholly owned) leading to outcomes for which they are accountable
  • Health services companies that for a defined population in total or for a phase of the care continuum (e.g. inpatient, outpatient, post acute) provide front end and back end data solutions and coordinate services and interventions (licensed or wholly owned) leading to outcomes for which they are accountable
  • Community or public health entities that are responsible for a defined population for which they monitor, intervene with, and produce outcomes for which they are accountable

b) Population health support solution companies: It really is OK for one organization not to do it all. Partners are needed to enable the implementation of population health with support tools and services. A company can provide a vital component of support to population health management entities. The four market segments above all need supports that integrate well with their core competencies. These tools and functions are vital to identifying and stratifying the population, setting triggers for outreach or quality improvement, engaging consumers, intervening and measuring and tracking outcomes to ensure the success of both consumers in achieving their goals and healthcare organizations in meeting their value-based contract requirements. Solutions that fall into this category may be:

  • Analytics companies, front end or back end, that provide predictive modeling, risk stratification, outcomes evaluation, and reporting
  • Electronic Health Record (EHR) or Health Information Exchange (HIE) solutions for data acquisition and management and transmission platforms and services
  • Consumer portals, health risk assessments, health and wellness trackers, biometric monitoring, telehealth, and CRMs
  • Care management software alone or with staffing but no risk bearing
  • Administrative services companies

2) Checklist for success: Build from past evidence and learnings

  • Look at evidence based research and case studies for components of the population health strategy that make up the total program
  • Use data assets and modeling to identify and intervene with high risk groups and work with providers and consumers to get quality gaps and high but avoidable utilization under control quickly
  • Don’t forget that health is dynamic and a static snapshot is out of date immediately, even more so if based on a report from a 1-3 month data lag
  • Don’t forget about the full continuum of care; moderate risk individuals can move to high risk and low to moderate if they are ignored
  • Leverage care extenders and technology to keep support strategies for all groups affordable
  • Take a community approach; the environment of live, work, and play represents the bulk of impactable hours

3) Consumer is king: Keep the focus on patient-centered solutions  

The future of population health tied to consumer experience: Consumers are expected to continue taking a more proactive, holistic approach to health; care is also increasingly occurring remotely, at home or in nontraditional settings; and advancements in technology are growing exponentially not only for what in other fields is 101 items like data capture, analysis, and sharing but with more focus on improved diagnostics, monitoring, and treatments that put consumers increasingly in the driver’s seat. Consider these keys to population health consumerism:

  • Population health ultimately involves the roll-up of individual consumer’s goals and their personal best outcomes. Shoe horning individual consumers into predefined goals will likely yield unrealistic care plans, avoidance behaviors, and unintended consequences
  • Understand the average consumer is overwhelmed by delivery systems, insurance procedures; thus most need guidance and support at each touchpoint
  • Provide convenience and efficient self-service and self-management options where possible like other industries but pair them with the necessary clinical expertise and support

The Great Debate

In November at the PHA Annual Forum, Al Lewis, CEO of Quizzify, and Ron Goetzel, Senior Scientist, Johns Hopkins Bloomberg School of Public Health engaged in “The Great Debate” on whether employee wellness programs demonstrate a return on investment. Download the recording here.

Don’t miss the chance to learn real strategies and tools to improve population health

The 16th Annual Population Health Forum is just one week away and here at the Population Health Alliance we are thrilled about the speaker line-up and incredible learning opportunities we have in store. Our goal is for every participant to come away with actionable strategies and tools to improve population health.

We can’t wait for our attendees to hear from our keynote speakers, including noted journalist Eleanor Clift, about what the elections mean for health care, along with Oliver Wyman partner Sam Glick who will share his thoughts on how to safely navigate the consumer health care revolution.

Providers should be sure to take advantage of CEU available for nurses and physicians and can attend several education sessions focused on everything from scaling programs to population health strategies for aging populations. Henry Chueh, MD, MS, Chief of Biomedical Informatics and Director of the Lab of Computer Science, Massachusetts General Hospital’s Lab of Computer Science is just one of the excellent educational presenters sharing insights. There is so much to learn and understand in population health related to the dizzying maze of  new models of payment.

Those who attend the Executive Leadership session on November 2nd will be treated to a debate to remember as expert Al Lewis squares off against expert Ron Goetzel.  Al Lewis has already said wellness industry defenders have “got some ‘splaining to do.” It will surely be a fun and educational session!

Our Convening Leaders workshops offer participants the chance to delve deeper into specific topics like how to deliver the right message to patients at the right time. Our sponsors including Health Dialog, Healthy Roads, Interactive Health, Healthwise, Silverlink, and Intel-GE Care Innovations have vast expertise to share.

Employers have a keen interest in population health and there will be plenty for them to learn about including wellness programs and how to structure health challenges to get the most engagement from employees. A special Innovators Learning Lab will also focus on how we help individuals and employers take data and create an actionable plan for behavior change and improved whole health. Those interested in incentives can learn from Welltok’s Michael Dermer and other industry experts about the latest science and strategies.

As a reminder, thanks to our sponsor Healthy Roads, all attendees will receive a complimentary copy of the updated Population Health Alliance Outcomes Guideline Report, the “official playbook” of population health program measurement.

We hope to see everyone in Washington next week!

It is a Matter of Time Before Every Health Plan Has a Rewards Program

Rewards for healthy behaviors have been growing at leaps and bounds as a way to reduce healthcare costs for several years. In 2009, employers offered employees $260 in rewards for making healthy choices. Now, companies are projecting to spend $693 per employee on wellness incentives. ObamaCare added fuel to the fire. It increased the allowable amount of rewards from 20 percent to 30 percent (and in the case of smoking cessation) 50 percent of annual premium. Forbes named “health rewards” as two of the top 5 health IT trends in 2014.“Incentive Driven Healthcare” is here to stay.

Why don’t health plans want consumers to know this? It seems like a win-win. Well in some ways they do. Health plans win by reducing costly behavior through prevention and lifestyle changes. Consumers benefit not only by getting healthier and making better health decisions, but by receiving rewards. This is all true. But in some ways they don’t. Once consumers realize that purchasing health insurance, while incredibly personal, is nothing more than purchasing another consumer product, the marketers of the world will be faced with a health rewards competition.

ObamaCare created “exchanges” or “marketplaces” through which health insurers compete for the business of individuals and businesses. These marketplaces were established with a series of pre-packaged health plan options, which limit the variations in using traditional levers such as coverage and networks. Health plans that were used to competing on these levers are left with a single lever – price. Selecting from gold, silver and bronze hardly creates differentiation among UnitedHealthcare, Cigna, Aetna, Humana, Wellpoint, the Blues and many other plans in the United States.

Think of your credit card, hotel, airline or favorite retailer. It is a sure fire way to create loyalty, brand affinity and engagement. Let’s be honest, you are more inclined to use specific services or retailers if they provide a robust rewards program. When marketers of consumer products ask themselves “what tools do I need to attract, retain, and generate loyal customers?” the answer inevitably comes to reward programs.

As further evidence, consumers across multiple demographics were interviewed on what they wanted from their health plan. The only item that appeared in every demographic was “rewards for healthy behavior.” Would you have a more positive opinion of your health plan if they sponsored a program that rewards consumers for healthy behaviors? According to a Welltok survey, 75  percent of respondents agree. Furthermore, 81 percent said that access to such a program positively influences their decision to renew with their current plan. Not to mention, the fact that incentives are a proven means to motivate health choices and change behaviors. More than 96 percent of consumers would engage in healthier behaviors if rewarded.

Health plans are entering a new competitive landscape. Rewards will not only be an essential component, but will also drive a healthier population – creating a win-win situation for all.


Michael Dermer is the Chief Incentive Officer of Welltok. Prior to his current role, Michael was the founder and CEO of IncentOne, the first company that in 2003 identified incentives in healthcare as a critical solution to driving consumer and provider engagement.  Michael is considered one of the nation’s experts on rewards and incentives in healthcare –learned in running over 4,000 programs and 40 million transactions over ten years. His personal mission is a national reward program in which all Americans can “be healthy and be rewarded.” Since 2003, he has been guiding health plans, employers, health systems, governments and providers in how to use incentives to deliver cost reductions and health improvement.

Twitter: @rewardforhealth

Linked In:

What Employers Want from ACOs for Better Population Health

When employers think about population health, they are thinking about the health of their workforce and their retirees. Employers want their workforce and their retirees to become and remain healthy. For large, self-funded employers this is about the bottom line and reducing health care costs, but more important than that, it’s about employee/retiree health outcomes, satisfaction and employee productivity.

Accountable Care Organizations (ACOs) are one of the promising new models of health care delivery that seeks to deliver better quality care at lower costs. ACOs can be designed to improve the quality of care, increase patient satisfaction, and lower the cost of care by aligning incentives and connecting the care provided by hospitals, medical groups, and health plans to work together to decrease fragmented care. So what are large employers looking for from ACOs?

First and foremost, employers want an ACO to consider the care of “the whole person.” They recognize that not all ACOs are alike and that they have different capabilities.  They expect ACOs to meet all the care needs of their employees, including behavioral health. To do this, the ACO needs a wide variety of service providers that deliver a holistic menu of care. For example, if the patient has a psycho-social issue, the ACO should have a social worker who can address that issue. If the patient needs to lose weight to help with her diabetes, she should have access to a dietician to work on changing her eating habits.

Second, employers want their ACOs to offer integrated care. Fragmented care is not only challenging for patients to navigate– it is not clinically optimal.  Primary care providers, behavioral health providers, pharmacy staff and specialists should work together, share information with each other, and have shared incentives for the same goal: the patient’s best interest.

Employers also want their ACOs to be able to identify the highest-risk patients and target them for special intervention. The greatest savings come from identifying the sickest patients and keeping them out of the hospital. The ACO needs to be able to identify these individuals and intervene before episodes escalate out of control. Some early employers in this space have seen great success with this targeted intervention, which is now a vital component of both employer-driven and health plan-driven ACO products.

ACOs also need to be able to support“smart” benefit design features designed by employers to engage employees in a partnership for value based healthcare.  This means ACOs should have programs and policies in place that align with the employer’s goals of promoting patients’ access high quality care, and  efficient use of care.  Appropriate utilization of high priced procedures, integration of step therapies, and shared decision-making have been shown to reduce cost and improve outcomes.

Finally, employers want their ACOs to embody quality improvement and payment reform. For decades, employers have been concerned about the variance inquality of care of our health care system. They know they spend too much for care that is too often unneeded, unsafe, and of poor quality. ACOs should be committed to quality improvement, and capture data so they can track their quality outcomes including patient reported outcomes. They should work with their partners implement new forms of payment that rewards for good quality, and that does not pay for waste and efficiency.

Vela headshot

Lauren Vela, MBA

Senior Director of Member Value, Pacific Business Group on Health

As Senior Director of Member Value, Lauren works directly with the large purchaser members of PBGH to facilitate collaboration and to support their purchaser-driven initiatives impacting healthcare delivery in the US. To that end, Lauren manages the processes of translating PBGH’s ground-breaking work in transparency and accountability into workable solutions for PBGH member organizations.

Prior to this role, Lauren was the Executive Director of the Silicon Valley Employers Forum (SVEF), a coalition of high tech employers that benchmark benefit designs and collaborate for improvement. During her SVEF tenure, Lauren systematized the group’s benchmarking practices and served as a facilitator and strategist for their joint projects with regard to both US-based and international employee benefit programs.

Prior to the SVEF role, Lauren enjoyed a twelve-year tenure with PBGH serving in three distinct areas; multi-stakeholder health information exchange, provider group organization improvement, and employer value-based purchasing. To this day, SVEF and PBGH maintain a strategic alliance and Ms. Vela works closely with purchaser members of both groups.


A New Alphabet Soup of Payment Models, Medicare Programs Drives Providers to Focus on Population Health

For providers, changes in payment models are now driving a much stronger emphasis on population health. Under the traditional fee-for-service model, providers don’t have a financial incentive to think about the health of a given population or community; they are simply paid for every test or procedure performed on each individual. But under new payment models such as accountable care organizations (ACOs) with shared savings, providers’ ability to improve the health of a population is directly tied to financial reward—and, in cases when they fail, a financial penalty. Some new payment models also help pay for care coordination and other much-needed services.

All of this recent change is being driven by the 800-pound gorilla in healthcare, Medicare. The Medicare program has put a huge new emphasis on value-based payment models. In January of this year, Health & Human Services Secretary Sylvia Burwell announced that by 2018, 50 percent of traditional Medicare payments will be tied to quality or value, via alternative payment models like ACOs and bundled payment arrangements.

The Medicare Access and CHIP Reauthorization Act (MACRA) recently passed by Congress makes dramatic changes in how Medicare pays providers. By 2019,Medicare providers must choose between participating in an alternative payment mechanism (APM) or in the Merit-Based Incentive Payment System (MIPS). Providers who receive a significant percentage of their income through APMs can opt out of MIPS and receive annual bonus payments of 5 percent. Those who participate in MIPS will be scored based on quality measures, with their scores reported publicly. High-scoring providers will earn financial rewards, while low-scoring providers will be subject to payment reductions. Given a choice between these two paths, there is an enormous incentive to move to APMs to avoid being publicly “graded” and possibly penalized.

As Medicare goes, so goes the rest of the healthcare system, and we are seeing a dramatic shift toward more value-based payment in the commercial sector as well. As much as 40 percent of payments to providers from commercial health plans are now tied to value, according to Catalyst for Payment Reform’s 2014 Scorecard on Commercial Payment Reform. Across the board, most providers understand the new payment models have the potential to help them deliver better care by actually paying for care coordination. And many recognize that better population health management can lead to greater income as well. Still, some providers are concerned about how all of this will affect their autonomy. However, the alternative—greater cuts in the Medicare fee schedule—is even less palatable.

Already, we have seen some provider groups embracing change; there are impressive pockets of excellence across the country. My home state, California, is no stranger to new payment models—capitation was born here. But our organization has expanded focus beyond California, and we have many members in other states doing groundbreaking work. For example, New West Physicians in Colorado has done a remarkable job improving population health with their ACOs and special attention to chronic care management in the Medicare population.

As we continue to change how providers are paid, I am optimistic we will have a triple win—for patients, providers and policymakers alike. Even in a healthcare system traditionally plagued by unsafe care, waste and inefficiency, the right payment models can lead to better population health, along with financial gains for providers and higher-value care all around.


Don Crane is President and CEO of CAPG, the nation’s only professional association that exclusively represents capitated, coordinated care organizations, and is a leading voice promoting the interests of physicians practicing accountable care across the nation. CAPG consists of over 190 multispecialty medical groups and IPAs that provide medical care to over 16 million patients across 39 states, the District of Columbia, and Puerto Rico.

 Mr. Crane is in the forefront of California and national public policy advocacy on behalf of accountable care organizations across the country as they make the journey from volume to value and move into risk based alternative payment models.  

What is True Population Health Management?

“Population health” is now a popular buzzword and all the rage, whether you are talking to disease management vendors, providers, employers, IT companies or even health policy wonks. But in my experience, far too many of us use that term too liberally, without really understanding what true population health management entails. And then sometimes we throw up our hands too quickly when our so-called population health programs don’t succeed. So what is true population health management?

Any population health program should start with identifying the population and conducting some form of an assessment; then amalgamate those assessments to determine the overall health of the population and stratify the population into risk buckets. This is followed by the all important and difficult engagement, and then person-centered, evidence-based interventions. These interventions must be tailored to meet the needs of each person. Too often, we focus just on disease specific interventions in this stage, when we should also be examining the workplace, home, community and other environments and full range of community resources. For example, how is a diabetic supposed to come in for regular treatment when he or she can’t drive and there is no public transportation in place? The final important step is impact evaluation—we need to understand how our interventions are working across the risk continuum. This can help us refine and readjust our approach if needed.

I’m truly looking forward to our 16th Annual Population Health Forum, where we will learn from the experts about the best ways to approach each of these crucial steps.  I’m pleased we’re really giving person-centered intervention the recognition it is due by making this year’s Forum theme “Welcome to Health.  Population of One.” Too often we get frustrated trying to decide how to improve the health of a large population — the task just seems too massive. It is critical we remind ourselves population health management creates improvements by focusing on the needs of one person.

In the coming weeks I look forward to having a robust conversation with all of you about the strategies and programs you have used to successfully change population health. What examples have you experienced first-hand where the change in population health started with just one person?

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