Becoming an Age-Friendly Health System entails reliably providing a set of four specific, evidence-based elements of care to all older adults, as needed, in your health system. The following excerpt from Business Case for Becoming an Age-Friendly Health System explores what it means to be Age-Friendly Health System from a business perspective.
What Is an Age-Friendly Health System?
An Age-Friendly Health System is one in which every older adult’s care is:
- Guided by an essential set of evidence-based practices (“4Ms”);
- Causes no harms; and
- Is consistent with What Matters to the older adult and their family.
In an Age-Friendly Health System, value is optimized for all — patients, families, caregivers, health care providers, and the overall system.
Age-Friendly Health Systems use a set of four evidence-based elements to organize the care of older adults, known as the “4Ms”: What Matters, Medication, Mentation, and Mobility. The 4Ms are essential elements of high-quality care for older adults. When implemented together, they are expected to result in significant improvement in the care of these individuals.
While most health systems integrate some of the 4Ms into the care of some older adults, some of the time, an Age-Friendly Health System reliably uses all 4Ms to organize the care of every older adult, every day. An Age-Friendly Health System identifies where the 4Ms are in practice, realigns its resources to ensure they are implemented consistently, and eliminates care activities that are unnecessary under this regimen. Achieving reliable practice of the 4Ms can be accelerated by board and senior leader commitment to becoming age-friendly; establishment of age-friendly care as a strategic priority, including associated executive dashboard measures; patient and family engagement; and community partnership to support older adults as they move between community settings and health care facilities.
The Age-Friendly Health Systems initiative is the result of a collaboration between The John A. Hartford Foundation and the Institute for Healthcare Improvement (IHI), in partnership with the American Hospital Association (AHA) and the Catholic Health Association of the United States (CHA). The goal of the initiative is to spread the “4Ms” Framework of an Age-Friendly Health System to 20 percent of US hospitals and medical practices by 2020.
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The Business Case for Becoming an Age-Friendly Health System
The business case for becoming an Age-Friendly Health System focuses on its financial returns. There are six steps in making a business case: 1) adopt a perspective; 2) determine additional costs; 3) estimate financial benefits; 4) estimate the return on investment (ROI); 5) compare the ROI to a hurdle rate; and 6) conduct sensitivity analysis.
The business case for becoming an Age-Friendly Health System is stronger when the financial benefits are captured by the health system that is making the investment; utilization and associated expenses of “usual” care are especially burdensome; the health system is effective in mitigating those costs; and the added expense of becoming age-friendly is lower.
Especially challenging is estimating the benefits of being an Age-Friendly Health System. These benefits accrue in three categories: 1) avoid costs associated with poor-quality care; 2) deliver care in a more cost-effective manner; and 3) enhance revenues from higher-quality care.
The benefits tend to fall into different categories depending on the care setting. In the inpatient setting, the major driver is reduced costs, resulting from fewer iatrogenic complications, fewer undesired medical interventions, and improved patient safety. These cost savings are reflected in the form of fewer and shorter hospital stays and lower costs per day. In the outpatient setting, by contrast, the gains come chiefly from added revenues resulting from expanding appropriate outpatient services.
In both settings, the increased use of cost-effective services can contribute to the business case for age-friendly care. Redesigning services can optimize the site of care by organizing care based on the What Matters element: the particular priorities and care preferences of older adults and their family caregivers. This approach often supports the transition of older adults from hospitals to lower-cost ambulatory care and home settings, ultimately reducing overutilization and increasing practices such as palliative care and home-based care.
IHI’s Business Case for Becoming an Age-Friendly Health System presents two case studies of organizations working toward becoming Age-Friendly Health Systems. The first case study, in the outpatient context at St. Vincent Medical Group, focuses on Medicare’s Annual Wellness Visit (AWV). The case demonstrates the income-generating power of an age-friendly AWV, which leads to advance care planning, appropriate screenings, and other encounters, all of which generate additional revenue. At St. Vincent, these services collectively have the potential to generate an estimated annual net income of about $3.6 million.
The second case study, in the inpatient setting at Hartford Hospital, examines the business case for an age-friendly delirium prevention and treatment program. The case study focuses on the program’s efforts to reduce the high costs of hospital stays complicated by delirium. The condition can add more than $20,000 to the cost of a stay by lengthening it and increasing the daily intensity of care. Hartford Hospital’s Age-Friendly program reduces costs and also generates revenue by freeing up hospital beds that can then be filled by other revenue-generating patients.
These case studies provide important lessons for health systems contemplating adopting the 4Ms Framework. The most important is that in order to make a convincing demonstration of ROI from the 4Ms, reliable and relevant clinical and financial data must be collected. The methodology described in IHI’s Business Case for Becoming an Age-Friendly Health System will help an organization seeking to become an Age-Friendly Health System identify the relevant data, analyze it, and describe its financial implications.
To learn more about the other essential elements of improvement, download the free Business Case for Becoming an Age-Friendly Health System.