As California continues to forge ahead implementing health reform, state Medi-Cal leaders and UC Davis researchers announced an agreement to examine public health system transformation efforts that may serve as models for the nation.
The researchers will evaluate public hospital systems as they revamp daily operations in ways meant to simultaneously reduce health costs and improve patient health.
New programs are taking shape under California’s Medi-Cal “waiver,” a $10 billion program that is part of the state’s effort to prepare for a major influx of beneficiaries who will be covered when the Affordable Care Act expands eligibility in 2014.
The waiver was adopted to set aside some federal Medicaid requirements so California can reshape systems, shifting from an emphasis on responding to health crises to preventing them altogether.
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The Department of Health Care Services, which operates the Medi-Cal program, last week announced a $4.25 million agreement with the UC Davis Health System’s Institute for Population Health Improvement.
The institute will examine how the state’s 17 public hospital systems transform to meet the new goals, an effort that comes with $3.3 billion in federal funding. Leaders will be trying to figure out what works well and might be replicated across the state, according to the institute’s director, Dr. Kenneth W. Kizer, who led state health services under Gov. George Deukmejian.
“The opportunity is great,” Kizer said in an interview. “If we can make this work in California, then I think there’s a very high likelihood we can show the way for the rest of the country.”
Kizer will be focusing on quality across the Medi-Cal program and also on the Delivery System Reform Incentive Program, which provides $3.3 billion in incentive funds for public hospital systems. Those systems serve about 2.5 million people each year in California.
Kizer said the overarching idea is to shift the health systems from an emphasis on providing fee-based health services to exploring how they can help people stay healthy.
The focus at the public hospital systems will be on patients with chronic conditions such as diabetes, heart failure and asthma. Research has shown that a small percentage of patients who end up in hospital emergency rooms with those conditions account for a vastly outsized percentage of medical costs.
So the goal is to adopt evidence-based methods to help people manage illnesses and keep symptoms under control. That way, they are less likely to land in the intensive-care unit in need of lifesaving and costly care.
“What the Affordable Care Act is trying to do overall is a fundamental mind shift for most of health care,” Kizer said.
Kizer said the impetus for the public hospital system change is the pending health reform implementation, which will add about 1 million people to California’s Medi-Cal program.
Melissa Stafford Jones, president of the California Association of Public Hospitals and Health Systems, said systems already are more than a year into their transformation plans. Each of 17 health systems sought and received state and federal approval for a change plan, she said.
Stafford Jones said there are four phases to the plans. Currently, she said, hospital systems are working on the first phase, which includes expanding hours, sites and staffs at primary care clinics.
She said health systems also are creating electronic disease management registries meant to track the health status, lab results and appointment histories of patients with chronic illnesses.
“That way, someone on the health care team isn’t waiting for someone (with diabetes) to show up in the emergency room because their blood sugar is off the charts,” she said.
Instead, a health care team might notice that the patient hasn’t been seen for several months and call the person to come in for an appointment.
Stafford Jones said the second phase encompasses how the health systems overhaul delivery of care, creating teams of doctors, nurses, health educators and social workers and connecting with patients.
She said the clinics also are trying to create links between the physical and mental health care delivered to patients. They’re exploring how connecting patients to care providers by telemedicine and e-mail might help them stay healthy.
Stafford Jones said the third phase of the plan involves examining population health status. The fourth calls on hospitals to reduce mistakes that injure patients and drive up costs, such as central-line infections and bedsores.
Stafford Jones said each hospital submitted detailed goals and milestones for achieving change and improved outcomes. If hospitals meet those goals, they will tap into $3.3 billion in federal funds over five years.
Kizer, who helped lead the transformation of the Veterans Affairs health system from 1994 to 1999, said UC Davis researchers will play an advisory role, looking for successful programs and approaches that bear replicating.
“Not everything has to be reinvented de novo every time you’re trying to solve a problem,” he said. “Maybe what works in San Diego or San Bernardino will work in Salinas.”