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  • Writer's pictureChronicCare

Assessing the Economic Value of Care Management Programs

Why Should Providers Offer Care Management?


Primary and specialty care practices are facing significant changes in how healthcare is assessed and compensated, particularly with the shift from fee-for-service to value-based care. To adapt, providers can transition from episodic and reactive care models to a proactive care management subscription model. Care management programs are pivotal in addressing the growing needs of an aging population grappling with more chronic illnesses.


This shift is especially crucial for providers who have not yet ventured into value-based care contracts or have dabbled in arrangements with upside-only risk.


By integrating care management programs into a practice's fundamental delivery model, providers can optimize the value of fee-for-service while preparing for future developments.


How Much Revenue Can a Provider Expect?


The revenue potential of a care management program varies based on several factors, including the type of program offered, the number of eligible patients, their level of complexity, patient population trends, staffing and technology needs, program efficiency, and its impact on indirect revenue sources.


Decision #1: What Type of Care Management Revenue to Pursue


There are two primary types of care management revenue:

  1. Direct revenue from reimbursable services.

  2. Indirect revenue from the impact care management programs have on performance metrics.


Direct Revenue


For instance, at ChronicCare, about 250 patients per member care coordinator are assigned. This translates to potential annual revenue ranging from $150,000 to $352,500, depending on the program offered. When non-physician staff, like registered nurses or medical assistants, deliver services, revenue can be even higher.


Downstream Revenue


Care management programs can also influence other fee-for-service revenue streams and performance outcomes. Regular engagement with patients offers opportunities for Annual Wellness Visits, health screenings, preventive services, and care gap closure, which can improve current and future patient health outcomes, thus enhancing revenue.


Decision #2: What Type of Care Management Programs to Offer


Provider organizations can choose from fee-for-service, value-based care, or payor benefit programs. These include Chronic Care Management (CCM), Remote Patient Monitoring (RPM), Transitional Care Management (TCM), Behavioral Health Integration (BHI), among others.


Decision #3: Determine the Number of Patients Who Should Be Enrolled


Providers need to assess their patient population to determine the total potential cohort eligible for care management and which of those patients should be part of an initial or pilot group. Patterns in patient populations help identify prevalent conditions, such as Congestive Heart Failure, COPD, Diabetes, and Hypertension, guiding enrollment decisions.


Decision #4: Estimate Indirect Financial Benefits of Care Management


Providers should also consider indirect or downstream revenue beyond direct reimbursement, including revenue from Annual Wellness Visits, preventive screenings, care gap closures, and improved performance metrics. These programs can enhance coding accuracy, close care gaps, improve CAHPS performance, and boost patient engagement and satisfaction, all of which impact revenue.


Estimating Potential Care Management Revenue


Provider leaders can conduct an economic analysis to estimate revenue targets based on the aforementioned decisions. Depending on patient population analysis, a pilot program could start with 25 patients, ramp up to 75-100 patients for a second cohort, and eventually scale to 250 patients per care manager. Multiple care managers could further increase enrollment capacity.


In conclusion, building or scaling care management programs within a provider organization not only generates revenue but also improves patient care and outcomes, prepares providers for value-based care contracts, and creates diversified revenue streams.


Offer Chronic Care Management To Your Patients With ChronicCare


ChronicCare partners with Physicians, Hospitals, Payors, and Employers to offer Chronic Care Management Services to their patients. We are dedicated to helping people improve their health and quality of life by maximizing their healthcare outcomes. We bridge the gap between healthcare visits, in order to ensure patients are continually cared for each month. 


Click here to connect with our team, we'd love to discuss potential benefits to your patients, staff, and practice.


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