In November 2022, Numerof & Associates released the State of Population Health: Seventh Annual Numerof Survey Report. Historically, respondents to the survey have stated their belief that a population health approach will be a critical component of healthcare delivery in the future. In this most recent survey, 81% of c-suite healthcare executives that were surveyed said population health will be “critically” or “very” important to the future success of their organization. However, only 25% felt “very” or “completely” prepared to transition to a financial model linking payment to patient outcomes and utilization. The threat of financial loss remained the largest obstacle (21%) in the way of moving toward a population health-based approach.
The report found that there continued to be three primary motives for organizations to pursue population health: 1) to control clinical costs, quality, and outcomes; 2) alignment with company mission/culture; and 3) performance based financial incentives. 31% of respondents said that controlling clinical costs and clinical quality is the primary reason for pursuing population health while only 1% of respondents felt adding predictability to their revenue model was a reason to pursue population health.
Respondents in the 2019 survey predicted that a median of 30% of total revenue for their organizations would be through risk-based contracts. In line with prior years, the most recent report found that the median amount of reported revenue flowing through risk-based contracts was only 10%. When it comes to capitated contracts, more than half of those surveyed said their organizations had none. And, while 85% of respondents said their organization was in at least one agreement with a payer that included upside gain and/or downside risk, just 32% of respondents reported that their organizations received more than 20% of its revenue from risk-based contracts.
The survey also found that 60% of respondents agree that at-risk contracting would increase post-COVID, up from 39% in prior years. Additionally, more respondents believe that the pandemic will expedite the acceptance of capitated models, 38% as compared to the 2% in 2020.
Further while most respondents said their organizations are slowly improving in their ability to manage variation in clinical quality at the physician level (71%), more than 60% believe their organizations’ ability to manage variation in clinical cost at the physician level is “average” or “below average.”
Respondents also noted that they have been working to offer more services to address social determinants of health, including food pantries or nutritional programs (55%), transportation (57%), and housing/community development support (35%).
“Healthcare delivery in the United States is failing and has been for a very long time, thanks in large part to a fragmented and inefficient fee-for-service model that incentivizes providing more services to patients without any link to resource management, patient outcomes or experience,” said Rita Numerof, Ph.D., President of Numerof & Associates. “While the Covid-19 pandemic highlighted some of the system’s gaping holes and accelerated the need for an organizational course correction, institutional change is incredibly difficult. Entering the population health waters has unfortunately been more of a toe dip than a real commitment for many health systems.”