Healthcare’s Evolution 2024: Enter Chronic Disease Management

Over the past decade, we’ve witnessed an astonishing restructuring in the healthcare ecosystem. Much of that is in preparation for 2030 - when CMS expects all Medicare patients to be enrolled in value-based care programs.

With the movement of an aging baby-boomer population into Medicare, finding ways to control costs in government-funded healthcare was foreseen long ago.

With that in mind, it's no surprise that hospitals and physicians have consolidated into vast integrated delivery networks (IDNs). These IDNs represent the framework that will enable value-based care delivery on a grand scale.

The traditional roles of hospitals and insurers have been upended. Many IDNs themselves have become de facto insurers under Accountable Care Organizations (ACOs) and other value-based plans.

In the redesigned and evolved healthcare delivery system, the larger the integrated network, the more control it has over patient access. This is critical to operating in a value-based care and risk-sharing environment. For example, as the network's population cohort grows, the patient mix (and population health) becomes more diverse, and the risk lessens as the population grows.

PBMs

Insurers still hold a key element of leverage - and that's with pharmacy benefit managers (PBMs). Over the past decade, some of the largest insurers have acquired pharmacy benefit management companies (PBMs).

Three PBMs control 80% of the entire market share. And that's a problem for Medicare, costs, and value.

That PBMs can influence drug costs is an increasingly contentious topic within CMS and Congress. As a result, legislation has recently been introduced to address the role of PBMs. And the Federal Trade Commission is examining the largest PBMs and their business practices.

Some see a very different future for PBMs. In a July 25th article in Benefits Pro, they cite Jason Borschow, CEO of Abarca, and his forecast of "what the healthcare industry would look like in 2030. Among his predictions was the idea that PBMs would cease to exist as we know them. Instead, they would become deeply integrated into their client's technology, services, and brand – essentially operating as an extension of their clients."[1]

The authors also stated, "by moving away from the traditional PBM model; chief among them is increasing control and visibility payers have over their pharmacy benefits. They also have the potential to increase access to advanced technology, diversify partners, eliminate conflicts, and share risk."

The slow evolution of ACOs and Value-Based Care

In a 2021 op-ed piece from STAT News, Kip Sullivan and James G. Kahn shared their views of the then-floundering Accountable Care Model of healthcare delivery. Sullivan and Kahn claim that the basis for creating ACOs—the widely held concept that physicians drive up costs through the overuse of services—is misleading. In 2021, they believed that out-of-control costs – not physician overuse - were the drivers for the high healthcare costs in the US.

Despite the initial struggles of the ACO model, CMS has pressed onward. In the past two years, CMS has provided additional incentives to encourage providers to enter and remain in ACO plans. Advanced payment models, lower thresholds for quality benchmarks, risk management programs for certain patient cohorts, and other special programs to address ACO-entry objections have increased the attractiveness of ACOs and value-based care participation by providers.

While ACO entry and participation have grown, quality metrics and financial risk still exist for the networks and their providers.

IDNs are understandably sensitive to measurements and risk - since quality scores are related to payment models, and outcomes are highly associated with cost savings.

Aligning Chronic Disease Management with Different Care Models

Chronic disease management (sometimes called Chronic Care Management or CCM) programs have been found to lower costs, increase quality, and improve outcomes.

This is true for both traditional Medicare fee-for-service models (with billable CMS CPT codes) - and it’s also true for ACO and VBC models.

Studies have shown that remote patient monitoring and chronic disease management systems have effectively improved outcomes and reduced costs. Especially important is the ability of these programs to offer staffing, EMR integration, billing, and audit data to providers.

Health systems attempting to staff and custom-design Chronic Disease Management and Remote Patient Monitoring programs (build versus buy) have struggled with development and staffing costs. Many of these health systems have since migrated from their self-developed and self-staffed systems to commercially designed and separately staffed next-generation solutions.

The leading commercial Chronic Disease Management and Remote Patient Monitoring systems have incorporated advanced automation, analytics, white-labeled telecom tools, and artificial intelligence into their solutions.

In the ACO and VBC models, CCM and Remote Patient Monitoring solutions reduce physician workload, help prevent hospital readmissions, and can improve the population's health, especially in metabolic disorders and cardiovascular disease cohorts.

As I’ve shared in recent posts, metabolic disorders often lead to cardiovascular disease, hypertension, stroke, insulin resistance, and neurodegenerative disorders.

What’s important to understand about Chronic Disease Management and Remote Patient Monitoring is that while they empower ACOs to improve outcomes and lower the cost of care, they are also well aligned with traditional FFS Medicare plans, which have numerous billable CPT codes that can increase physician and practice revenue while improving quality and outcomes.

Recently, CMS programs for 2025 have been proposed to provide funding for social services, including access to behavioral health, oral health, and caregiver training services. These programs would maintain existing reimbursement for telehealth that grew out of COVID-era necessities.

In my next post, I’ll discuss the difference between Chronic Disease Management, Remote Patient Monitoring, Transition Care Management, and Principal Care Management.

[1] Benefits Pro, Javier Gonzalez July 25, 2024 Why-the-PBM-industry-faces-a-very-different-future