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Transitioning From Volume to Value: Lessons Learned From the Dissolution of a Population Health Partnership

Halvorson, Stephanie A.C. MD; Tanski, Mary MD, MBA; Milligan, Lee MD; Yackel, Thomas MD, MDP, MS, MBA

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doi: 10.1097/ACM.0000000000002614
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In 2017, we published an article describing the experiences of Oregon Health & Science University (OHSU) as it adapted to new challenges of changing payment models and the imperative to manage the health of populations.1 We described Propel Health, created in 2013, a multi-institution partnership created to deliver the tools, methods, and support necessary for population health management. In the ensuing two years there were considerable changes to the structure and mission of Propel Health, ultimately resulting in its dissolution in January 2018. The purpose of this article is to share lessons we have learned with other academic medical centers (AMCs) as they make the journey toward value-based care and population health management.

OHSU is a 550-bed hospital located in Portland, Oregon, and is the only AMC in the state. In response to competition from local health systems, changing payment models, and a desire to compete for statewide contracts, OHSU partnered with Moda Health, a large health insurer, as well as six hospital systems across Oregon to form a statewide collaborative called Propel Health. Propel Health’s goal was to provide population health data and analytics capabilities and to develop the capacity for shared contracting. The structure of Propel Health is described in our previous publication.1

In that article, we described the principles informing the creation of Propel Health, made up of a governance model including engaged physician leaders, shared tools and technology, internal transformation, and business model transformation. Below, we summarize the history of Propel Health and its dissolution, then describe the lessons learned from the vantage point of an AMC.

A Brief History of Propel Health

Propel Health was formed out of a preexisting health care consortium that had been in place since 1979. This alliance, known as Health Future, focused on leveraging economies of scale to accomplish aggregated purchasing. Beyond discounted purchasing, this organization promoted sharing best practices through a variety of councils, such as a Chief Information Officer Council, Dietary Council, Lab Council, Operating Council, Pharmacy Council, Perioperative Council, and Supply Chain Council. The concept of collective collaboration to achieve mutually beneficial outcomes long predated Propel Health via this joint effort.

The Propel Health member hospitals—made up of one AMC, two small community hospitals, and three moderate or large health systems—also had a preexisting, informal referral relationship. As the only AMC in Oregon, OHSU had been and continues to serve as a main recipient for many of the state’s tertiary and quaternary referrals. One of the advantages of this particular group of organizations coming together was distinct geographic draw areas, such that member organizations were not in direct competition with one another.

When Propel Health was formed in 2013 (including the six hospitals as well as an insurance company), it initially enrolled the employees and dependents from each member organization’s individual medical plans, resulting in approximately 55,000 commercially insured lives. In 2016, the Propel Health Board made a decision to enter the Medicare Shared Savings Program (MSSP) as an accountable care organization (ACO), with a goal of covering 110,000 lives by 2017 and a hope that shared savings would result in additional support for Propel Health’s mission.

As a first venture into shared clinical programs, Propel Health implemented a care management program developed by an external vendor. In this program, a proprietary database analyzed medical and claims data and flagged patients as high or “rising” risk. As originally intended, a centralized group of care managers (registered nurses trained in care coordination) reached out to patients to help manage acute and chronic medical issues.

In a parallel program, care managers identified hospitalized patients at high risk for readmission using the same software, and performed outreach in a 30-day postdischarge program. The intent of this program was to decrease hospital admissions and readmissions, improve clinical outcomes, and lower the overall cost of care for patients. Case studies provided by the vendor illustrated significant cost savings from these programs at several of its other health system sites.

Two Propel Health hospitals were successfully able to implement the model as it was designed; however, not all were able to do so. For example, one small community hospital lacked an affiliated primary care group and thus chose not to implement the care management program. At OHSU, the implementation of the external care advising program was fraught. Several of the primary care clinics already had well-developed care management programs and were reluctant to use external care advisors. Providers in those clinics were willing to be notified about which patients were designated as “at risk” but performed their own care management interventions, which were different at each clinic. Care management interventions thus varied across and within sites. Communication and data collection proved difficult because of the reluctance of clinics to document dually into both the external software program and their own electronic health record (EHR).

Technical issues were also apparent early on. The external vendor provided a software program that was intended to merge multiple EHR platforms with insurance claims data. This process of integrating EHRs took much longer than anticipated in part because of different EHR platforms and different institutional rules regarding sharing data, as well as the need for lengthy legal and contract reviews. Once EHR and claims data had finally been successfully merged, the resulting data suffered from attribution and validation challenges.

Because of these concerns, as well as rising concerns about cost and lack of demonstrated benefit, the decision was made to cease the centralized care advising programs in the fall of 2017. Most of the individual member health systems continued localized care management to meet their individual needs.

Potential additional shared clinical programs across Propel Health were considered by the main advisory committee (physicians from each member organization); however, consensus was never achieved, and no further clinical programs were adopted. Ultimately, the chief medical officer for Propel Health resigned in 2017, and the decision was made not to fill the vacancy, further reducing the ability to implement shared clinical programs.

While facing these challenges at Propel Health, the partner organizations also had to attend to local market competition and individual strategic imperatives, which at times meant that priorities were not shared across Propel Health. Additionally, incentives were not aligned across organizations for engaging in Propel Health initiatives. In 2017, one of the large community hospitals made the decision to withdraw from Propel Health to focus on the implementation of a new EHR and focus on its local market strategy. Around the time of the loss of this hospital partner, the other Propel Health organizations recognized that having a partnership with a single insurer might dissuade other insurers from partnering with Propel Health. Moda Health thus made the decision to withdraw from Propel Health in that same year.

By 2017, initial data showed that the MSSP was on track to lose approximately $3 million.2 Factors contributing to these losses were difficult to determine as the MSSP only reported a target price for shared savings for the ACO as a whole and could not break down losses by individual entity. The expenses at the AMC were higher than the ACO benchmark; however, it was unclear whether this demonstrated an improvement or deterioration over time, and whether there was modifiable health care spending as part of the total.

Unfortunately, the Propel Health Board had not determined at the outset how allocation and attribution of shared gains or losses would be determined. The organization was founded on an unspoken rule of “all for one, one for all” to encourage improvement in cost savings anywhere in the statewide network. However, the lack of granular data and ability to localize main drivers of cost resulted in a lack of accountability.

Once the shared losses were recognized, the Propel Health Board met to discuss next steps. Given the rapid timeline for deciding participation in the subsequent years of the MSSP program and the inability to come to consensus on attribution of losses, Propel Health made the decision to withdraw from the MSSP in the fall of 2017 (to take effect in January 2018).

In December 2017, the remaining members of Propel Health decided to dissolve the partnership. At the time of the decision, member organizations had invested approximately $30 million. The total investment for OHSU, which held 31% ownership, was approximately $10.7 million.

Reflections, Lessons Learned, and Implications for Other AMCs

The original intent of Propel Health was to develop a multi-institution, collaborative partnership designed to deliver the tools, methods, and support necessary for population health management across Oregon.1 Although the dissolution of Propel Health was disappointing for all parties, there are considerable lessons to be learned for OHSU and, we believe, other AMCs that are venturing into similar partnerships. With an eye to other AMCs, we will describe the original goals, actual outcomes, and lessons learned in the arenas of provider partnerships, tools and technology, internal transformation, and business model transformation (Table 1).

Table 1
Table 1:
Original Principles, Actual Outcomes, and Lessons Learned From the Propel Health Partnership

Governance model

Propel Health was governed by a board comprising executive members from each organization, as well as two physician representatives from the Quality Health Management committee, representing physicians from all sites. These physicians, who met monthly, were tasked with advising the board about whether their organization should engage in shared clinical programs. However, this decision-making structure did not account for some members lacking the data and institutional knowledge and, in some cases, institutional backing, to make decisions or carry them out. Additionally, physician leaders met separately from executive leaders, further compromising the opportunity for communication and shared decision making. These groups later merged in an attempt to ensure more collaborative decision making; however, it is not clear that this successfully remediated the issues of strategic alignment.

One of the lessons learned is that the governance structure of a large population health organization needs to take into account the interplay between local and regional factors, and between the skills of clinical and nonclinical leaders, and must have the capacity to drive change up and down the organization. Care should be taken to construct a board of trustees that can concentrate on the new partnership while balancing the needs of the individual institution.3 This is a complex set of political dynamics made more complex by the tripartite mission of many AMCs.4

Furthermore, in any transformational change it is essential for key leaders to have a shared vision, clearly support the change, and clearly articulate the need for change. Ultimately, the failure of Propel Health may be due in large part to a failure of change management. Much has been written on the subject of change management and the essential components such as clear leadership support for any vision change.5,6

Shared tools and technology

One of the largest infrastructure challenges Propel Health experienced was the slow and incomplete integration of multiple EHRs; another was the ability to localize outcomes across sites. Although changes to data systems and EHRs are costly, the need for information technology integration (including legal and contracting barriers) should be considered early on.

Once data are available, it is essential to have processes in place to calibrate data from external sources with internal data and available benchmarks to ensure that outcomes are correctly attributed and actionable. Indeed, ready access to both clinical and claims data is a powerful tool. The potential for sharing “big data” resources across organizations is likewise powerful and promotes partnership.7

Internal transformation

The challenges of integration across the Propel Health partnership were daunting. Integration across silos at any AMC will offer a unique challenge and must be considered before embarking on external partnerships. AMCs may require new partnerships, cooperation, and governance across clinical departments to implement new care models and evaluate metrics across the system.8

The ability to implement new clinical programs and metrics in support of partnership goals will benefit from a robust internal needs assessment at each site and understanding of existing structures. Working to measure and improve existing programs (when they exist) may be more palatable to stakeholders than trying to implement “prepackaged” programs created by external vendors. One strategy may be to hold individual clinical areas accountable to common outcome metrics, but allow flexibility with regard to process.

Lastly, organizations should put to use knowledge from industry-specific organizations such as the National Organization of Accountable Care Organizations and the Accountable Care Learning Collaborative, which are on the forefront of ACO partnerships with other health care entities. However, caution is warranted as, like evidence in medicine, recommendations change with time. In retrospect, the decision of Propel Health to invest in the care advising programs was a reflection of the writing on the topic at the time—that is, focused efforts around the care management model—instead of broadening to current best practices that include an emphasis on access, quality metric execution, and complete and accurate coding.

Business model transformation

AMCs have historically been focused on delivering highly specialized care that emphasizes hospitalizations, procedures, and tests to generate revenue. A principle of value-based care is the movement of provider organizations to take risk for patients’ clinical and financial outcomes. The result for many health care systems is a tension between investing scarce resources to build programs and infrastructure to support value-based care, while at the same time receiving the bulk of their profit from fee-for-service revenues. One assumption of Propel Health was that changing payment models would force change in organizational behavior, and at a rapid pace. However, the reality was that these changes did not happen as quickly as expected. Other AMCs may fare better by continuing to focus on their traditionally profitable clinical areas.

When they do engage in value-based payment models, AMCs and other health system partners will need to determine how aggressively risk should be acquired and how this will be determined. Additionally, partner organizations must decide how revenues and losses from shared risk arrangements will be distributed and/or shared, and by what allocation methodology. One of the challenges that Propel Health experienced was being able to accurately track and attribute cost. Cost is a key component of determining value in health care, and AMCs have historically had higher prices for comparable services. Reduction of waste and implementation of evidence-based practices will be crucial for AMCs to remain attractive to both payers and potential partners.7,9

Finally, we would recommend that AMCs and other health care partners develop a system of population health management in order to track and respond to quality and outcome data and rapidly address areas of downside financial risk. Agility with data is perhaps the biggest challenge for large and traditionally siloed AMCs.

Next Steps for OHSU

Despite these challenges, we believe that OHSU and other AMCs can successfully navigate this new landscape. Given that many of the value-based care and population health needs are ultimately local to a particular market, OHSU has embarked on additional local partnerships within the metropolitan area. This consists of partnering with two area hospitals and affiliated physicians to improve hospital access and local market share, with a goal of ultimately competing for value-based care contracts and improving access to care.

OHSU has implemented a number of other strategies to manage its additional challenges. For example, to increase collaboration across departments, OHSU has developed the Office of Population Health and Primary Care to oversee population health data and analytics across primary care, and to organize and manage shared strategic goals across primary care. OHSU has adopted the Epic Healthy Planet module to track population health metrics for its various payer programs. The office of Clinical Integration and Evidence-Based Practice has been created to develop and implement shared clinical guidelines and track relevant metrics across partner sites.

In terms of remaining competitive for value-based care contracts, there is a robust value-analysis committee that, in addition to the Health Future consortium described earlier, oversees supply and service costs. Additionally, there is an emerging institutional infrastructure for vetting and responding to bundled payment and other value-based care payment opportunities.

Ultimately, OHSU is not unique among AMCs. Many are investing in new partnerships and strategies to adapt to the changing landscape of health care, and we hope that our experience will serve to guide other AMCs on this journey.


The authors would like to thank the physician members of the Quality Health Management committee and the administrative colleagues who were involved in the creation of Propel Health.


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