Ballad Health Chairman and CEO Joins National Healthcare Leaders in Joint Commitment to Transform Healthcare System

Pointing to hundreds of millions of dollars in reduced healthcare costs locally, Ballad Health joins leading health systems to build a more equitable, resilient and affordable American health system.

Ballad Health Chairman and CEO Alan Levine and other national healthcare leaders from government, health systems, employers and health plans formally announced their joint commitment to leading a transformation toward healthcare payment models that drive better patient experience, access, outcomes, equity and affordability.

Levine joined other leaders for an open and free national virtual summit on Tuesday, Oct. 13, providing input on a variety of opportunities to transform the national healthcare system to one of value. Ballad Health was asked to participate in this innovative effort due, in large part, to its own actions to reduce the cost of healthcare and improve access and equity since its unique creation in 2018.

The Health Care Payment Learning & Action Network (HCPLAN or LAN) is an active and formal group of public and private healthcare leaders dedicated to providing thought leadership, strategic direction and ongoing support to accelerate the American healthcare system’s adoption of alternative payment models that enhance quality, equity and resilience, while reducing the total cost of healthcare.

Executives leading this initiative include leaders from:

• Ballad Health
• BlueCross and BlueShield plans
• Cigna
• CVS Health
• Duke Margolis Center
• Families USA
• Geisinger
• Google
• HCA Healthcare
• Humana
• Intermountain Health
• Optum
• Pacific Business Group on Health
• Planetree
• Premier
• TennCare
• Trinity Health
• United States Center for Medicare and Medicaid Innovation
• United States Centers for Medicare and Medicaid Services (CMS)
• University of Pennsylvania Health System
• Walmart

“Ballad Health is no longer simply a hospital system,” Levine said. “We are a community health improvement organization working to keep people healthy and deliver the best possible specialty and hospital care when our community needs us.

“The changes to the payment system advocated by the LAN today are vital to sustaining this mission and providing accountability to the people who pay for this care, here and nationwide.”

Ballad Health leads in population health and value-based care

Ballad Health has emerged as a national leader in implementing population health and value-based programs that reduce the costly and unnecessary use of hospitals and other high-cost treatments and diagnostics.

Since 2017, through the efforts of Ballad Health and its physician partners, Ballad Health’s hospital admissions have decreased by more than 16,000, creating annualized savings in healthcare costs of more than $160 million, or $1.6 billion over the coming 10 years. This reduction in healthcare costs benefits area residents, employers and state and federal taxpayers, especially when those savings are passed on to insurance rate-payers by health insurance plans.

These reduced costs have been recognized by self-insured employers, who pay for employee healthcare directly – including county governments. Recently, the Mayor of Washington County, Tennessee, applauded Ballad Health’s efforts to contain costs and acknowledged these efforts have translated into lower costs for taxpayers and individuals – in Washington County’s case, this work resulted in a 10% reduction in healthcare costs in 2019. That change was the result of Ballad Health’s efforts to provide innovative solutions such as on-site healthcare to reduce the use of emergency rooms visits and hospitalizations that create undue costs for employers.

In another example, Ballad Health’s AnewCare Accountable Care Organization (ACO) aligns the health system’s hospitals and physicians with independent physician groups, such as physicians affiliated with East Tennessee State University (ETSU), to improve care for Medicare patients who have elected not to join a Medicare Advantage plan. ANewCare generated more than $65.3 million in savings for Medicare from 2012-2019, with the ACO receiving approximately $27.3 million in savings directly for its members.

Since 2012, 33 ACOs have generated savings to Medicare each year of the program. Of those 33, only 18 generated enough savings each year to be eligible for shared savings every year, and AnewCare is one of the 18.

Ballad Health is also partnering successfully with a number of private Medicare Advantage plans, including those participating in the HCPLAN, to reduce the total cost of care for beneficiaries while sustaining high levels of quality.

As confirmed by the State of Tennessee and Commonwealth of Virginia, Ballad Health has also seen a dramatic improvement in its quality measures, with a sizeable majority showing improvement from pre-merger performance. In their most recent annual reports, leaders from Tennessee and Virginia have concluded the merger creating Ballad Health has led to a public benefit.

Ballad Health’s successful efforts were also highlighted by Harvard Medical School and United Healthcare in a report detailing examples of success with value-based programs. Ballad Health leaders were pleased to share the system’s success story.

In another example of Ballad Health’s efforts to reduce the cost of healthcare, the system has partnered with the Virginia Center for Health Innovation (VCHI) on its three-year effort make a 25% reduction in the utilization of seven tests and procedures identified by the American Board of Internal Medicine (ABIM) as low-value. In 2017, VCHI identified almost $750 million of spending in the commonwealth on just 42 of the 550 tests and procedures identified by the ABIM as of questionable value to patients.

Ballad Health’s efforts are not limited to those with insurance

As a part of its commitment to lead, Ballad Health is also initiating an unparalleled effort to manage the care for uninsured patients in the region through its Appalachian Highlands Care Network. Uninsured individuals with chronic conditions and high utilization of healthcare services can now enroll in the network, and they will be assisted by a care navigator who connects them with the primary care, specialty care and diagnostics services they need to avoid unnecessary emergency room visits and hospitalizations.

Reducing unnecessary hospitalizations and emergency room use by uninsured individuals will ultimately save money for employers who indirectly pay for these services through higher commercial insurance rates, as well as the federal and state governments that pay to help offset the costs of this care nationally.

Ballad Health is working to reduce the social determinants that drive the cost of healthcare

“Twenty-five to 30% of healthcare is considered wasteful, and personal health is driven largely by social determinants and social needs,” said Tony Keck, chief population health officer for Ballad Health. “The best way to reduce the long-term costs of healthcare and improve the health of our communities is to diminish the disparities that continue to undermine these communities.

“Reducing unnecessary and costly waste and redirecting those resources toward closing the disparity gaps is the most sustainable way to reduce the cost of our expensive national healthcare system.”

Ballad Health has taken several steps to address inequity and social determinants

Ballad Health has established an Accountable Health Community program in Southwest Virginia, earning a five-year, multi-million grant from CMS. Ballad Health has offered almost 178,000 screenings for social risk in Medicare and Medicaid patients and identified more than 28,000 needs, such as food or housing insecurities, and provided referrals to local food banks, social service agencies and faith-based programs. The federal government is using patient privacy-protected data from Ballad Health and 29 other grantees nationally to determine how screening and navigation leads to lower healthcare utilization and costs in high-risk patient populations.

Ballad Health is implementing the Strong Starts/Strong Pregnancies Program to connect with the 300-member STRONG Accountable Care Community (ACC) it facilitated, which consists of churches, schools, employers, healthcare providers and social services agencies in the Appalachian Highlands. More than 6,000 babies are delivered each year in Ballad Health facilities, and beginning in 2021, Ballad Health and participating independent obstetricians in the region will provide assessments and screenings to help connect families with a community navigator who will work to make sure each child receives the strong start they deserve. This includes connecting families with the supports and services provided by the members of STRONG and other community partners.

Ballad Health has funded the creation of the Strong Brain Institute/Center for Trauma Informed Care at East Tennessee State University. This institute will accelerate education on the issues of Adverse Childhood Experiences and will establish ETSU as a national leader in helping close this disparity, which leads to the cycle of poverty and poor health and also drives the cost of healthcare and destroys communities.

Ballad Health has funded the creation of the ETSU Center for Rural Health and Research, which has now established ETSU as one of seven national rural research centers, as designated by the United States Health Resources and Services Administration. The Center was recently designated as a recipient of a multi-million dollar grant to help lead the fight against addiction – an issue disproportionally impacting rural America and contributing to higher healthcare costs.

“The evidence shows much of the cost of healthcare is baked into the system far in advance of an individual’s encounter with the system,” Levine said. “This is why Ballad Health is a national leader in helping transform the payment system, so the dollars spent in healthcare are not merely a reward for doing more healthcare services.

“Rather, reshaping the value of services, such as helping children get off to a strong start, improving the number of 18-year-olds who are college- or career-ready and reducing disparities that lead to poverty and poor health and thus increase the cost of healthcare, are all part of the equation required to fundamentally reduce our spending spree on healthcare costs.”

CMS has recently announced new payment models targeted specifically towards rural communities and hospitals that make it more likely programs such as these can survive and expand. But much work remains to be done.

“The LAN has found, as of 2018, only 30% of commercial payments and 23% of Medicaid payments support the type of community health improvement work Ballad Health is doing,” Levine said. “Right now, because payment models have not kept pace with Ballad Health’s innovations, many of the unnecessary hospitalizations, emergency room visits and diagnostic tests we are successfully preventing actually erode the system’s financial health, putting many of our smaller hospitals at risk.”

Learn more about the LAN’s announcement and Ballad Health’s statement of support. Population health and value-based care commitments from LAN participants are available here.