Care Management Reimagined: A New Definition and Better ROI

Amid healthcare payers’ heightened financial pressures and members’ increased needs, it might be time to change the definition of care management.

For nearly a decade and a half now, healthcare providers have been pursuing the “Triple Aim” framework, which seeks to simultaneously improve the patient care experience, improve population health and reduce per capita costs. The Agency for Healthcare Research and Quality, part of the U.S. Department of Health and Human Services, has identified care management as “a leading practice-based strategy for managing the health of populations,” which is in turn central to each element of the Triple Aim.

The Definition of Care Management

But what does care management really mean from the payer’s standpoint? In the age of COVID-19, amid payers’ heightened financial pressures and members’ increased needs, it might be time to redefine the term.

“Many payers often think of care management as nurses connecting with members over

the phone to manage a condition, such as diabetes, or to prevent an acute event, such as a readmission,” acknowledged the authors of a recent McKinsey & Company article titled “The Untapped Potential of Payer Care Management.” “We propose a more expansive definition of care management that involves any payer-driven efforts to engage with targeted members and their care ecosystems to encourage and enable high-value decisions around their care and improve self-management.”

Included in the authors’ definition of care management:

• Complex case management
• Transition of care
• Condition management
• Multiple engagement modalities, including traditional telephonic or in-person interaction as well as digital and asynchronous “coaching” and tech-enabled “nudges”

Improving the ROI of Care Management

Adopting a broader view of the definition of care management and wider approach promises benefits to individual patients and populations, as well as payers, many of whom have been seeing rising administrative costs related to care management programs and to healthcare spend in general.

It could also introduce new ways to proactively improve the return on investment (ROI) for care management programs. So could implementing these four next-generation actions suggested in the aforementioned McKinsey article:

1. Target multiple high-potential sources of value.

The authors outline sources of value across medical cost (e.g., site of care, unit price) and revenue (e.g., accurate coding, closing gaps) opportunities, and explain how those sources may vary based on member archetypes (e.g., healthy/low-risk, specialty chronic conditions, end of life) and line of business (e.g., Medicare Advantage, commercial, Medicaid). The example framework they provide makes it easier to see why it’s a misstep to target the same source of value for all care management program members instead of the specific needs of different member archetypes.

2. Right-size care management to member needs at a point in time.

The authors suggest tailoring the intensity of care management (e.g., care team size and expertise, frequency of interaction, and mode and length of engagement) to meet the needs of a targeted population. They also discuss the importance of addressing clinically inappropriate spend, such as going out of network and choosing the wrong site of care, and engaging members when they are most receptive to care management, such as around surgery or discharge from a hospital.

3. Engage members as a consumer company does.

The authors note that “healthcare has been relatively slow to pick up consumer engagement trends, such as micro-targeting, personalization, and sticky engagement tactics, that are used in the technology and consumer sectors.” As a result, they say, payer care management could be leaving 90 percent or more of potential value “on the table.” Instead, leverage personalization and multi-channel engagement, segment members for targeted campaigns (to close specific gaps, encourage preventive screening, or stay on track with wellness programs), and improve the data sets used to identify and segment members.

4. Run care management with an operational mindset.

Such a mindset entails setting clear operational metrics, ensuring “top of license” practices that utilize non-clinical staff for tasks that do not require a license, and digitizing and automating processes.