Population health still at odds with fee-for-service

Year after year, surveys show the same thing: Healthcare providers’ evolution toward accepting risk to keep patients healthy—widely viewed as the holy grail of lowering healthcare costs—has been painfully slow.

So long as that’s the case, experts say the financial returns providers can expect to draw from population health management, where they gather patient data and use it to craft health improvement programs, will depend on how much of their revenue is tied to risk. If it’s not much, which is more than likely the case, they probably won’t see meaningful savings.

Not only that, providers’ population health teams often find themselves battling an entrenched, opposing strategy of growing per-transaction revenue. There have even been instances where a system’s fee-for-service spending goes on hyperdrive—adding more nursing homes or performing more procedures, for example—to compensate for savings achieved through population health programs.

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