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A guide to downstream analysisDiscovering value across your health system

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A guide to downstream analysis: Discovering value across your health system 2

Table of contents

1 Aguidetodownstreamanalysis

3 Thevalueofcare

4 Thewhysandwhereforesofdownstreamanalysis

5 Thebenefitsofdownstreamanalysis5 Casestudy:Return of physician investment

6 Casestudy:Population health management

8 Downstreamanalysisprocess8 Integrating data

8 Mapping and tracking

9 Definingthepatiententrypoint

9 Definingthetimeperiod

10 Identifyingexclusions

10 Framinguptheresults10 Thebenefitsofdownstreamanalysis

11 Definingandmeasuringdownstreamvalue

11 Summingup

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ThevalueofcareRecenthealthcaremandateshaveonlyintensifiedtheneedforhealthcareorganizationstoquantifythevalueoftheirservices.Todoso,healthcareorganizationsmusthavetheabilitytomeasureandquantifypatientoutcomesandtotalcostofcareacrossthecontinuumofcare.

Unfortunately,manyhealthcareorganizationsarefindingthistobeaseeminglyimpossibletask.Withobstaclessuchasdatasilosandintegrationinabilitiesontheirminds,healthcareexecutivesarescratchingtheirheadstryingtofigureoutjusthowtogoaboutgettingthatcomprehensivevisibilityessentialtoquantifyingtheirorganization’svalue.

Thesolutiontotheseissuescanberesolvedthroughdownstreamanalysis.Downstreamanalysisgiveshealthcareorganizationsafullpictureintothecarerenderedacrosstheirhealthsystem.Theinsightsobtainedhavethepowertoeffectivelydrivevalueintohealthcareorganizations.

Downstreamanalysisprovidesapracticalwaytoassessvalueacrossthecontinuumofcarebyidentifyingthevaluecreatedforapatientoverthefullcycleofcare,includingallproviderinterventions.Thisanalysismeasures,tracksandquantifiesvaluedowntothepatientlevel.Thispatient-centricviewprovidesvisibilityintooutcomesrelativetothecostsassociatedwithcare.

Throughdownstreamanalysis,patientoutcomesandcostscanbetrackedlongitudinally,overvariousentrypointsandmultipletimeperiods.Italsoallowsyoutoaccuratelymeasureyourphysicians’totalfinancialperformanceacrossthecarecontinuumbyintegratinghospitalandphysicianbillingdataatthepatientleveltoconstructacomprehensivelongitudinalanalysis.

Thiswhitepaperwillprovideanin-depthlookintothemethodologyofdownstreamanalysisandtheinsightsthatcanbegainedthroughitsimplementation.Downstreamanalysishasthepowertobalancequalityandcarewithinhealthcarebypushingthepatienttotheforefront.

Themethodicalmeasurementandquantificationofdownstreamanalysisidentifiesopportunitiesforimprovedpatientoutcomesresulting in increased patient satisfaction, streamlined referral processes,readmissionreductionandrevenuestability.Bymeansofdownstreamanalysis,healthcareorganizationsareabletoidentifypotentialopportunitiestostrengthentheirvalue-basedinitiatives,leadingtogreaterefficiencyandqualityofcareatareducedcost.

When performance is measured, performance improves. When performance is measured and reported back, the rate of improvement accelerates.”

KARL PEARSON, BRITISH STATISTICIAN

Outcomes & Patient

Experience

Operational & Strategic

Costs

VALUE

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Thewhysandwhereforesof downstream analysisToday,mosthealthsystemslookatanormalpatientencounterthroughtheeyesofthedepartmentwherethecarewasrendered.Asaresult,eachpatientendsupgettingdividedintodifferentpiecestoreflectthefinancialperformanceacrossthedepartmentorplaceofcare,asisgenerallyreported.Unfortunately,thisapproachdoesnotbenefitthepatientorthehealthsystemintoday’shealthcarereformenvironment,wherevalueisking.

Inordertoattaintruevalue-basedcare,thefocusmustbeontheoutcomeorvalueofpatientcarenottheinput.Withdownstreamanalysis,thepatientbecomestheanalyticpointoffocus,insteadofthedepartmentorplaceofcare.

Downstreamanalysisidentifiesthedownstreamvalueofapatientacrossthehealthsystembasedonadefinedentrypoint.Trackingisdoneatthepatientlevelinordertounderstandhowpatientsaretravelingthroughthehealthcaresysteminadditiontothevalueofpatientscomingfromvariousentrypoints.

Thistypeofanalysisidentifiesgapsandpotentialopportunitiesforhealthsystemimprovementbyidentifyingpatientconsumptionpatterns,physicianreferralpatterns,aswellasthetotalcostofanepisodeofcare.Thus,thepatientisthestimulusofoutcomesimprovement.

12+13+12+13+12+13+12+13+tOP Surgery

Spec. Phys. Office

Imaging

Lab

Pharmacy

Nursing Unit

Rehab

P.C. Phys. Office

PATIENT

12+13+12+13+12+13+12+13+tOP Surgery

Spec. Phys. Office

Imaging

Lab

Pharmacy

Nursing Unit

Rehab

P.C. Phys. Office

PATIENT

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ThebenefitsofdownstreamanalysisDownstreamanalysisprovideshealthcareorganizationsaclear,completeviewintopatientcareacrossthecontinuumofcare.Itprovidesinsightspertainingtooperationalandstrategicplanninginitiativesofhealthcareorganizations.

Atanoperationallevel,downstreamanalysiscanfocusonclinicalpathways,referralpatternsandpatientflow.Strategically,downstreamanalysisprovidesinsightintothefinancialreturnoninvestments,potentialgrowthopportunities,aswellasthedevelopmentofservicelinesandrisk-basedpaymentmodels.

Downstreamanalysisdeliversthedeepestinsightspossibleintohowpatientsarebeingtreatedandwhattreatmentsaremosteffective.Furthermore,itinformsphysicianacquisition,alignmentandperformancemanagementinitiatives.

Italsoallowsfortheaccuratemeasurementofaphysician’simpactoncross-continuumrevenue,theidentificationofopportunitiesforimprovement,andthedevelopmentandimplementationofchangestoimprovephysician- hospitalalignment.

Casestudy:Return of physician investmentChart1belowillustrateshowdownstreamanalysiscanbeutilizedtodeterminethereturnofphysicianinvestmentforprimary carepractice.

CHART 1

INITIAL VISIT Month 0 Total

Encounters $5,174 $5,174

Charges $840,749 $840,749

PaymentsExpected $470,679 $470,679

DirectCosts $806,872 $806,872

DirectMargin ($336,192) ($336,192)

TotalCosts $944,620 $944,620

Profit Margin $473,941 $473,941

DOWNSTREAM ACTIVITY Month 0 Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Total

Encounters $3,630 $3,034 $1,664 $1,223 $1,111 $1,040 $999 $12,701

Charges $6,794,065 $5,437,621 $2,777,408 $1,771,990 $1,523,613 $1,186,860 $1,066,303 $20,557,860

PaymentsExpected $3,124,866 $2,561,507 $1,288,808 $851,462 $740,675 $518,467 $483,392 $9,569,177

DirectCosts $1,961,609 $1,733,615 $909,712 $584,115 $504,061 $428,162 $351,148 $6,472,422

DirectMargin $1,163,257 $827,892 $379,096 $267,346 $236,614 $90,305 $132,245 $3,096,755

TotalCosts $2,726,656 $2,357,280 $1,212,611 $793,972 $695,305 $548,496 $461,846 $8,796,165

Profit Margin $398,210 $204,227 $76,197 $57,490 $45,371 $30,029 $21,546 $773,012

Forthespecifiedprimarycaregroup,theanalysisshowstherewere5,174initialencounterswithina6-monthtimeperiod.Theinitialvisitsresultedin12,701downstreamencounterscreated.Althoughtherewasaphysiciangrouplossof$473,971,thedownstreamanalysisshoweda$773,012offsetfortheloss.Theanalysisclearlyidentifiedthevalueofthephysiciangrouptothehealthsystem.

Downstreamanalysiscanbedonenotonlyatthegrouplevel asillustratedinChart1butcanbebrokenoutbyserviceline,evendowntothechargecodelevel.Itprovidesadeepview intowhatishappeningwithpatientsastheyflowthroughthehealthsystem.

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Casestudy:Population health managementChart2belowillustrateshowdownstreamanalysiscanbeutilizedtoseewhattypesofpatientshavethehighestlevelofcostacrossapopulation.

CHART 2

% of Pop.

% of Total Expenditures

Health care Expenditures

Count of Patients

Exp per Patient

1% 26.19% $249,908,568 1,776 $140,714

5% 54.45% $519,574,267 8,883 $58,491

10% 6841% $652,742,069 17,767 $36,739

15% 76.49% $729,848,399 26,651 $27,385

20% 81.9% $781,441,649 35,535 $21,991

25% 85.83% $818,922,859 44,419 $18,436

30% 88.79% $847,182,927 53,303 $15,894

40% 92.9% $886,364,150 71,070 $12,472

50% 95.54% $911,563,499 88,838 $10,261

60% 97.29% $928,319,444 106,606 $8,708

70% 98.49% $939,713,868 124,373 $7,556

80% 99.3% $947,421,308 142,141 $6,665

90% 99.79% $952,121,114 159,909 $5,954

100% 100% $954,143,340 177,677 $5,370

% of Pop.

Count of Patients

Health care Expenditures

Exp per Patient

% of Patients

% of Exp

0-1% 1,776 $249,908,568 $140,714 1% 26.2%

2-5% 7,107 $269,665,698 $37,944 4% 28.3%

6-10% 8,884 $133,167,802 $14,990 5% 14%

11-15% 8,884 $77,106,330 $8,679 5% 8.1%

16-20% 8,884 $51,593,250 $5,807 5% 5.4%

21-25% 8,884 $37,481,210 $4,219 5% 3.9%

26-30% 8,884 $28,260,068 $3,181 5% 3%

31-40% 17,767 $39,181,223 $2,205 10% 4.1%

41-50% 17,768 $25,199,349 $1,418 10% 2.6%

51-60% 17,768 $16,755,945 $943 10% 1.8%

61-70% 17,767 $11,394,424 $641 10% 1.2%

71-80% 17,768 $7,707,440 $434 10% 0.8%

81-90% 17,768 $4,699,806 $265 10% 0.5%

91-100% 17,768 $2,022,226 $114 10% 0.2%

Inthischart,theanalysisshows1%ofthepatientsaccountfor26.2%ofexpenses.Inaddition,5%ofthepatientsaccountfor28.3%ofexpenses.Withthisknowledge,thehealthsystemnowknowswheretofocusitsefforts.

(CONTINUED ON NEXT PAGE)

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Next,furtheranalysiswascompletedtobetterunderstandthespecificsofthecareofthesepatients.

Inthisdiagram,theanalysisshowsallpatientswithacongestiveheartfailure(CHF)diagnosiswhoreceivedthatdiagnosisataninitialcardiologistvisit.Fromthisanalysisthesystemlearnedthemostcommonpathwayaftertheinitialvisitwas:1)lab, 2)inpatientcare,3)additionalcardiologistvisitand 4)specialist.Thus,indicatingthecurrentclinicalpathways werenottooconsistent.

Thisinsightwasthensharedwiththecardiologistandamodelofwhatshouldhappenwasbuiltforthatpatienttypescenario.

Totakethisastepfurther,additionaltrackingcriteriacanbeinstitutedtobetterunderstandcaremanagementinterventions.

Thus,questionssuchas:

• Doweseebetteroutcomesinpatientswithinterventionsthanthosewithout?

• Canwedemonstratebothaclinicalandfinancialbenefittoaspecificintervention?

Thispatient-centrictrackingallowshealthcareproviderstoseehowpatientcareisprogressingandwhetherornottheinterventionsimplementedareyieldingpositiveoutcomes.

Downstreaminsightisinvaluableformakinginformedstrategicdecisionsimpactingnotonlypatientcarebutthehealthsystem’sgrowthandfinanciallivelihood.

Cardiologist150 patients

Lab36 patients


Other Specialists14 patients

Primary Care8 patients

No Follow-up7 patients

Surgical Specialist1 patients

Rehab1 patient

Other6 patients

Radiology3 patients

Inpatient38 patients

ED2 patients

Lab19 patients

Other Specialists14 patients

Primary Care14 patients

Inpatient14 patients

No Follow-up14 patients

Radiology5 patients

Other5 patients

Surgical Specialist1 patient

Home Care2 patients


1 to 5 patients

6 to 10 patients

11 or more patients

CHF - ENTRY POINT CARDIOLOGIST (+1 TO 5 PATIENTS)

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DownstreamanalysisprocessTheprocessofdownstreamanalysiscanbebrokendownintothreemainphases.Thefirstphaseisintegrationofsystemdata.ThesecondphaseincludescreatingaMasterPatientIndex(MPI)anddefiningpatiententrypointsandcriteria.Thethirdandfinalphaseisdefiningandmeasuringthedownstreamvaluediscoveredasaresultoftheanalysis.

IntegratingdataAnalyzingdatafromdisparatebillingsystemswithvariedlevelsofcomplexitycandoomadownstreaminitiativebeforeitevenstarts.Therefore,inpatientandoutpatienthospitalandclinicaldatamustbeintegratedbeforedownstreamvaluediscoverycanbegin.

Aholisticapproachmustbetakenwhenintegratinghealthsystemdata.Thismeansalldatamustbecleaned,consolidatedandstandardizedintoasingledataset,acrossbillingsystemsandthroughoutallareasoftheorganization.

Dataintegrationprovidestheabilitytodrilldownintodatabymultiplemetrics.Aholisticviewofvalue,costandpatientconsumptionpatternscanonlyoccurwhendataisfullyintegrated.

MappingandtrackingOncehealthsystemdataisfullyintegrated,financialandclinicalanalyticscanbeutilizedtomap,trackandforecastcostandrevenueflow.

First,auniquepatientidentifieriscreatedtotrackpatientsastheyflowthroughthehealthsystem.Forhealthsystemsthatalreadyhaveasingledatawarehouse,thepatientMRNcanbeusedforpatienttracking.Forallothers,aMasterPatientIndex(MPI)iscreated,assigningauniqueidentifierforeachpatient.

TheMPIiscreatedbyreferencing15-20differentpatientrecordfieldstoensurepatientidentificationisaccurate.Thisisdoneasadoublecheck,notinghumanerrorssuchaskeyinginaccuraciescanleadtoinaccuratepatientmatchingbetweensystemrecords.

TheMPIprovidesanaccurateandconsistentviewofthepatientswhoreceivecareandaremanagedwithinthesystem’svariouslocations.TheMPIisusedtotrackclinicalcarepathwaysof patients including patient entry points, tracking groups and clinicalservicelineassignments.

Hospital

Physician

MPI Patient Entry & Points Criteria

Direct & Indirect Downstream

GL & Payroll

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DefiningthepatiententrypointOncetheMPIhasbeencreated,adeterminationismadeofwhatshouldbeanalyzed.Forinstance,youmaywanttoknowaboutthepatientflowforthoseseenataspecificpracticeorforacertaindiagnosisand/orcomorbidity.Oryoumaywanttolearnwhichpatientswereseenataspecificlocationasaresultofcommunityoutreachprogram.Thesetypesofquestionswillhelptodefinethepatiententrypointtobetracked.

DefiningthetimeperiodNext,youwillneedtodefinethecriteriaforwhichthatentrypointwillbetracked.Todoso,thetimeperiodfortrackingpatientflowmustbedefined.Inotherwords,determininghowfardowntheroaddoyouwanttoobservethepatientflow.

Bytrackingpatientflow,thedifferencesinvolumelevelscanbemeasuredandcomparedforeachpatientalongtheircarejourney.Furthermore,varioussnapshottimeframesalongthepatientjourneycanbeusedtopinpointgapsandopportunitieswithinthepatientflow.

Whendeterminingthetimeperiodforwhichthetrackingwilloccur, it is important to define a reasonable time period for thetypeofepisodeofcare.Thetimeperiodwilldifferbasedontheentrypointoffocus.Forinstance,whenobservinganobstetrician practice it would not be useful to look at encounters aftertheinitialvisitforonly2months.Instead,thetimeperiodshouldinclude10-12monthsaftertheinitialencounter.

Master Patient Index (MPI)

is an electronic database that stores information on every patient registered at a health care organization.

INITIAL VISIT SPECIALTY VISIT Diagnostic Testing

Lab Tests Consultation

SPECIALTY CARE/PROCEDURE

Procedure Inpatient Care

FOLLOW-UP VISITS Monitoring

Diagnostic Testing Lab Tests

ENTRY POINT DOWNSTREAM

Dr. Zahn’s practice cost XYZ Health System $50K in April

2015

However, with downstream analysis, XYZ Health System learned that Dr. Zahn’s practice led to 2,000 additional patient encounters across the system over the month of April, which accounted for a

$3.4 million profit for XYZ Health System.

Patient Flow Across the Health System’s Continuum of Care

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IdentifyingexclusionsIdentifyingexclusionsisanotherfactorthatmustbeconsideredcarefully.Itisimportanttoexcludedatathatshouldn’tbetiedtogether.Forexample,ifyouwereanalyzingthedownstreamforcardiologistpatients,youwouldnotwanttoincludeavisittoanorthopedicsurgeonduetoabrokenleg.However,itisimportanttoincludecardiacservicelinesandotherservicelinesthatarerelated,suchaspulmonologyforthisexample.

Downstreamanalysiscanhelptoidentifycertainspecialtiesorservicelinesthatmaynothavealogicalconnectiontoeachother.Thistypeofillogicalconnectionisknownasthehaloeffect.Anexampleofthehaloeffectisoftenseeninwomen’sservices.Insteadofrunningananalysisonaparticularpatient,youcanseethehaloeffectbylookingatthefamilyasawhole.Thisanalysiscanindicateifwomenwhoarereceivingservicesaredirectingtheirfamily’scarewithinthesamehealthsystem.Thus,anindicationoftheperceptionofvalueofcarebythepatientwithinthehealthsystem.

FraminguptheresultsOncethedownstreamanalysisiscomplete,itisessentialtoputcontexttotheresults.Acontextualframeworkincludingcomparisons,trending,targetsandinternalorexternalbenchmarksmustbecreatedinordertounderstandwhereopportunitiesforimprovementlie.

Evenifyoucanseethe10downstreamvisitsthatcameasaresultoftheinitialvisit,withoutcontextthisinformationmaynotnecessarilybehelpful.Forinstance,ifyoulearnedfromthedownstreamanalysisthatacardiologygrouphadafive-timemultipleonrevenueinsidetheirdownstream,withoutcontextyouwon’tknowwhethertoconsidertheresultasapositiveornegative.Byputtingcontexttothedatainthisexample,youmaylearnthegrowthratehadbeensteadilydecliningforthelast6months.

Byidentifyingentrypointsandcriterion,healthcareexecutivesgainmicro-levelvisibilityintopatientcareandconsumptionastheyutilizedifferentservicesatmultiplelocationswithinthehealthsystem.

The benefits of downstream analysis − Reviewphysicianlongitudinalutilization,volume,revenue,direct&indirectcostandmargin

− Analyzereferralpatterns − Evaluateservicelineprofitandlosses − Determinecurrenttreatmentpathsforkeydiagnosesbyphysician;createthemostefficient,qualitycarepathsusingactualoutcomesinyourfacility;easilymonitoradherencetothetreatmentpaths

− Quicklydeterminetherightanswerforreimbursementforbundledpayments,fee-for-valueandother risk programs

− Providetheperfectdatatoclinicallyintegrateemployedandnon-employedphysiciansandtoprepareforACO’swhenyourmarketisready

− Viewyear-over-yeartrends − Benchmarkindividualphysicianswithinthe healthsystem

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Definingandmeasuring downstreamvalueTocalculatetheexactdownstreamvalue,thedifferencebetweendirectandindirectdownstreammustbedefinedandquantified.

Directdownstreamincludesthosepatientswhoreceivedcareinthehospitalwherethevolumeisdirectlyattributabletothephysician.Anexampleofthisiswhenthepatientreceivescarebytheattendingororderingphysicianatthehospital.Indirectdownstreamincludesalltheotherclinicalservicesapatientwillreceivewithinthehealthsystem.Thiscouldincludelaboratory,imagingservices,pharmacyservices,etc.

Oncedirectandindirectaredefined,downstreamvolumecanbemeasuredintermsofencounters,grosscharges,netrevenue,directcostanddirectmargin.

Forexample,thedownstreamvolumeofalocationcanbecomparedthroughcomparativeratiostoseetheindividualvalueofeach.Thisallowsforthemeasurementoftheprecisedifferencesbetweenmultiplephysicianlocationsincludingthetotalprofitabilityofapatientoveraspecifictimeframeand/orthelifeofapatient.

Theprocessofmeasuringthedownstreamvolumenotonlyprovidesinsightintothevolumeofthosepatientsfromapracticeperspective,butalsoanunderstandingintowhatthedownstreamcontributionfromaspecificphysiciangroupisfromapatientseekingcareatthatlocation.

Anotherimportantfacttopointoutisthatdownstreamanalysishastheflexibilitytoalsomeasureandtrackphysician,point-of-care,serviceareaoranyotherpatientpointofentry.

SummingupDownstreamanalysisisastimulusforincreasingqualityofcareandreducingpatientcost.Discoveringthedownstreamvalueacrossthehealthcarecontinuumthroughdeep-divedataanalysisprovideshealthsystemstheinsightsnecessarytonotonlysurvivebuttoflourishinthisvalue-drivenhealthcareenvironment.

Byintegratingclinicalandfinancialdataatthepatientlevel,healthsystemscanconstructanaccurateandcomprehensivelongitudinalanalysisacrossthecontinuumofcare.

Insteadofrelyingonanecdotalevidencetomakestrategicdecisions,downstreamanalysisprovidesanobjective,data-drivenviewintothevalueofcare.Thisuniquevisibilitymakesitpossibleforhealthsystemsandhospitalstofocusonefficiency,costeffectivenessandqualitythatwillinevitablybringabouttruevalue-basedcare.

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