The Role of Care Management in a Changing Healthcare System


The role of care management within healthcare is evolving to help healthcare organizations respond to the demands of outcomes-based financial arrangements, the COVID-19 pandemic, and persistent inequitable health outcomes. Comprehensive care management plays a key role in enabling care that is responsive to the needs and desires of diverse patient populations, including older adults and people with complex care needs. While technology developments and other trends offer the promise of efficiency gains, when combined with financial pressures, they threaten to reduce the availability of relationship-based comprehensive care management, which is key to Age-Friendly Health Systems and the ability to age in community.

Key Words:

Age-Friendly Health Systems, Centers for Medicare & Medicaid Services, CMS, social care, value-based care, fee-for-service, COVID-19, quality measures

Care management plays an important role in the United States’ healthcare system. Social workers, nurses, and others in healthcare organizations across the continuum provide care management services, from discharge planning to coaching and case management to encourage appropriate use of healthcare services and resources, and to improve health and well-being outcomes. For instance, for an individual who has been recently hospitalized, a transitional care manager may connect with the patient and-or those who care for them to help secure transportation to a follow-up primary care appointment, to address concerns with affording new medications or in-home assistance with daily needs, or to coordinate with home health nurses to ensure that durable medical equipment has arrived.

While the scope of healthcare-based care managers differs by organization, fundamentally they are focused on addressing resource and care needs so patients have what they need to heal and manage chronic conditions. While there is an increasing emphasis on care management for older adults who are dually eligible for Medicare and Medicaid that is focused on long-term services and supports, care managers based in healthcare organizations typically have a broader scope, including serving older adults who are not Medicaid-eligible.

The field of care management has grown in the twenty-first century, with the Affordable Care Act (ACA) and more recent state and federal legislation shifting healthcare reimbursement mechanisms to recognize outcomes rather than inputs. A 2019 consensus report from the National Academies of Sciences, Engineering, and Medicine recommends healthcare organizations promote health equity by integrating social care activities into healthcare delivery, such as: adjusting clinical care to accommodate social barriers; providing assistance in connecting patients with relevant social care resources; and aligning with and investing in community-based organizations (CBOs) as leaders in social care (National Academies of Sciences, Engineering, and Medicine, 2019).

The growing field of complex care identifies care management as one aspect of a multipronged approach needed to support individuals with complex care needs, including frail elders (Long et al., 2017). As illustrated in Figure 1 (below), the 4Ms Framework is part of the growing Age-Friendly Health Systems movement, which is spurring health systems to be more responsive to key domains for age-friendly care: what Matters most to people as they age, Mobility, Mentation, and Medication (Institute for Healthcare Improvement [IHI], 2020).

In recognition of the importance of family caregivers, the Caregiver Advise, Record, Enable (CARE) Act has been adopted into law in forty states, prompting hospitals to identify those who will care for an individual after discharge and to provide guidance on supporting patients’ post-discharge care plans (Reinhard et al., 2019). Care managers play a key role in each of these developments, and ideally can help align all of them for more cohesive population health strategies.

Age Friendly Health Systems chart
Figure 1: Age-Friendly Health Systems “4Ms” Framework


The COVID-19 global pandemic exposed numerous inequities in health outcomes, shining a light on the need for the healthcare system to be more responsive to what influences people’s health and well-being, including their ability to follow a medical plan of care. Healthcare organizations—especially those in rural areas (Tribble, 2020)—are facing significant pandemic-related financial pressures due to reductions in revenue-producing procedures. Such revenue reductions stem from limitations in personal protective equipment needed to staff medical facilities, a need to redirect staff time to care for patients with COVID-19, and patients avoiding the emergency department, doctor’s appointments, and elective surgeries (Abelson, 2020).

Nationally, care management teams responded to the pandemic by focusing their efforts on patients who test positive for COVID-19 to ensure that they have the information and resources needed to quarantine, and proactively reaching out to at-risk populations to address needs and encourage appropriate engagement in care. Teams often address questions and anxieties related to the pandemic, such as how to access telehealth or fears about receiving in-home care, and reschedule elective procedures such as hip replacements or colonoscopies. Care managers also address concerns about limited patient visitation policies—with many health systems minimizing exposure risk by not allowing visitors, even for patients with intellectual disabilities or cognitive impairment.

Community-based care managers in particular play key roles in ensuring older adults, people with disabilities, and others at risk for poor outcomes of COVID-19 have the information they need to quarantine and the resources to do so; for example, by locating reliable in-home supports and following through with the patient and service provider to ensure the supports are in place.

Trends in Healthcare and Pressures on Health Systems

Healthcare organizations are operating in a changing landscape, and care management is a key strategy for addressing evolving financing mechanisms and pressures within hospitals, physicians’ groups, ambulatory clinics, skilled nursing facilities (SNF), and home health agencies (HHA).

Healthcare reforms have ushered in value-based payment models, encouraging care settings to focus more on short-term costs and outcomes than on care volume or long-term outcomes. The ACA’s Hospital Readmission Reduction Program and the SNF Value-based Purchasing Program both withhold a small percentage of Medicare Part A payments and redistribute those funds to participating sites based on performance and improvements in hospital readmission rates. This has spawned significant institutional investments in transitional care management activities and coordinated networks of after-hospital (post-acute) care providers, often focused on conditions on which Medicare bases hospital readmission penalties: Chronic Obstructive Pulmonary Disease, heart failure, coronary bypass surgery, heart attack, pneumonia, and total hip or knee replacement.

‘Health systems and insurers increasingly are using community resource referral platforms to respond to social needs.’

Care managers can improve care and outcomes for individuals with heart failure by: developing relationships with them to identify factors that may exacerbate symptoms (such as smoking), providing education and reminders on fluid intake and weight monitoring, coordinating with home health or family caregivers around medication adherence, and connecting patients with disease-specific support groups or self-management education classes (Sochalski et al., 2009).

ACO Models Healthcare organizations increasingly are taking on financial risk for a defined set of patients through Accountable Care Organization (ACO) models or contractual agreements with managed care insurers. The Medicare Shared Savings Program is Medicare’s largest ACO initiative and holds physicians, hospitals, and others involved in patient care accountable for the quality, cost, and experience of caring for an assigned Medicare fee-for-service population. Each ACO’s performance is compared to other local ACOs’ performance on costs of inpatient care, costs of outpatient care, and quality measures. Many ACOs are attempting to reduce long-term costs by deploying care navigation and care management services, and anticipating a favorable return-on-investment by preventing unnecessary expenditures (Centers for Medicare & Medicaid Services [CMS], 2020).

In addition to cost and use outcomes, healthcare organizations adhere to extensive lists of quality measures, such as inpatient satisfaction scores, inpatient length of stay, and breast cancer screening rates (CMS, 2019a). Care managers can improve many of these measures by building trusting relationships with patients and those who care for them, enabling effective in-home care supports, and coordinating preventive care appointments.

Vertical Consolidation  Increasingly, the healthcare sector is experiencing vertical consolidation between companies whose services complement one another (e.g., a hospital merging with an SNF network, or an insurance plan acquiring local outpatient practices) and horizontal consolidation between two similar companies (e.g., two hospitals). Health systems, defined as organizations that include at least one hospital and a physician’s group that provides primary and specialty care (Agency for Healthcare Research and Quality, 2016), are one particularly relevant example of consolidation.

In 2018, there were 637 health systems in the United States, encompassing 72 percent of the nation’s hospitals, 51 percent of its physicians, and 91 percent of its hospital beds (Furakawa et al., 2020). While consolidation offers the advantage of more coordinated care across settings and providers, it has been associated with higher prices due to greater negotiating power with insurance plans to secure higher reimbursement rates (Cutler and Morton, 2013).

Data Capture  Health systems and plans are increasingly focused on accurately capturing patients’ health conditions to predict future costs and secure enhanced reimbursement rates, and care managers can play a key role in capturing such data. CMS uses the hierarchical condition category (HCC) risk adjustment model, which uses ICD-10 diagnostic coding to estimate future expenditures for Medicare beneficiaries. The CMS-HCC model is used to adjust ACOs’ financial benchmarks and to adjust per-member, per-month payments to Medicare Advantage plans (Yeatts and Sangvai, 2016).

Z-codes are a subset of ICD-10 diagnostic codes that capture factors that influence health status and engagement with health services. These codes include categories such as problems related to housing and economic circumstances, occupational exposure to risk factors, and problems related to primary support group. To date, the use of Z-codes has been extremely low (Weeks et al., 2020). However, they provide a significant opportunity for healthcare organizations to track social risks and social needs in a similar way to tracking health conditions, thus enabling improved tracking of social needs, normalizing social care as critical to health, and informing risk adjustment models.

Fee For Service Programming  At the encouragement of the Medicare Payment Advisory Commission, CMS reimburses care management activities with various fee-for-service services, including: Transitional Care Management following an inpatient stay (which includes care management and a post-discharge medical appointment); Chronic Care Management for individuals with multiple chronic conditions; Principal Care Management focused on one complex condition; and Behavioral Health Integration focused on a mental health or substance use condition (CMS, 2019b). Commercial (employer-based) insurers also have begun reimbursing for many of these services.

Chronic Care Management recognizes services that many care managers provide: assessment of the physical, mental, cognitive, psychosocial, functional, and environmental factors that influence one’s health outcomes; creation of a comprehensive care plan based on this assessment and upon available resources and supports; and ongoing touchpoints to ensure timely receipt of preventive care, successful receipt of medications and medical equipment, and adequate communication with other care and service providers. There also are fee-for-service billing codes for screenings that care managers regularly conduct as part of clinical teams, including depression, patient health risk, and caregiver health risk (Hughes, 2017). Preventive services such as annual wellness visits and advance care planning also are key for patient engagement with care managers.

While these fee-for-service opportunities are significant developments in making more care management services available, operational barriers have slowed their use. The billing opportunities described above must be billed exclusively by physicians, advance practice nurses, physician’s assistants, and other “qualified health providers,” as designated by CMS. Although clinical staff can provide some services under the general supervision of the billing provider, expansion of the services has been slowed in part due to the significant amount of oversight and documentation required from billing providers. Health systems also face challenges meeting incident-to billing requirements if their outpatient clinics each have their own tax identification numbers but are staffed with care managers from a centralized or contracted team supporting the institution.

Implications on Access  In response to these value-based and fee-for-service developments, many health systems offer care management services based on an individual’s insurance status, rather than on providing the same care management for all patients (i.e., whether they have commercial insurance, Medicare, Medicaid, coverage from a public or private exchange, or no insurance at all). This means some patients may receive more in-depth assessment, navigation, and care management support because their health system will be reimbursed, while other patients miss out, creating a varied standard of care.

Due to the growing prevalence of value-based care, health systems more and more are building preferred provider networks of referral partners for post-acute care, such as SNFs and home health agencies (HHAs) (Medicare Payment Advisory Commission [MedPAC], 2015). While hospitals cannot instruct patients on where to seek post-acute services, they may provide lists of recommended providers and reasons for those recommendations, such as a higher quality of care. Hospital-based care management teams increasingly collaborate with staff from partner SNFs and HHAs, especially as SNFs have aligned incentives: they also are financially penalized when Medicare patients return to the hospital within thirty days of hospital discharge.

Automation and Community Referral  Recently, health systems have begun replacing care-manager-led interventions with automated phone calls and text messages. Although some aspect of these tools may be helpful, they are likely to exacerbate disparities in access to care and outcomes. People may not be as likely to engage with an automated system due to concerns about scams or lack of patience with automated systems. Additionally, often older adults have lower technological facility, and benefit from the relationship with a care manager who can assess for nuances, address ambivalence, and destigmatize their experiences.

Health systems and insurers increasingly are using community resource referral platforms to respond to social needs (Cartier, Fichtenberg, and Gottlieb, 2019). These platforms integrate screening tools to identify social risks and social needs, and then provide a curated list of relevant community resources. A patient care navigator or care manager can sometimes use the systems to send referrals directly, and CBOs can indicate when someone has followed up on a referral. While such tools are promising for identifying needs and providing referrals, they are not a replacement for care management, and they create significant administrative burden due to challenges with data interoperability and duplicative data entry requirements.

Moreover, community service providers often are not compensated by referring entities for the services they provide, increasing demand on their services and often leading to unsuccessful referrals. Without relationship-based care management to assess and navigate resources for each patient, individuals with complex care needs are at particular risk for receiving an irrelevant or inadequate resource recommendation. Poor quality referrals may have long-term ramifications; for instance, being referred to an organization that previously has failed the patient could be demoralizing or trigger an underlying trauma, causing the patient to lose trust in the healthcare system and avoid discussing their needs in the future.

Care Management as it Should Be

When carried out with the breadth and depth needed to identify and respond to evolving needs and complexities among patients and those who care for them, care management improves health and enables equitable outcomes (Altfeld et al., 2013). When used in conjunction with broader population health initiatives, such as Age-Friendly Health System initiatives, care management ensures that patients receive person-centered care and supports that enable them to work through barriers to following their medical care plan, while also achieving improved quality of life and what matters most to them.

Comprehensive care management should focus on more than a diagnosis and incorporate all of the factors that influence one’s health. Care management should build on people’s hopes and strengths and encompass inpatient (acute) and outpatient (chronic) care, as well as health promotion (preventive) activities, social care, and behavioral healthcare. Longitudinal relationships between care managers and patients are critical for trust, person-centeredness, and efficiency in navigating the nuances of an individual’s and family’s situation.

This approach to care management is distinct from the commonly deployed fast-track and surface-level care management approach that involves large caseloads managed by providers who lack clinical training and rely on scripted screenings. Training for comprehensive care management includes learning how to conduct conversational assessments that can elicit complexities and motivations to create and carry out more realistic care plans. Such plans will not fall apart after someone discharges from the hospital or after a caregiver returns to work.

People live in communities, not hospitals. Thus, care management is most effectively carried out in collaboration with CBOs, which provide home- and community-based services (HCBS) critical to recovery. CBOs provide services to address social needs such as hunger, social isolation, and caregiver burden, and have demonstrated success in leading care management, in partnership with hospitals and primary care practices (National Academies of Sciences, Engineering, and Medicine, 2019). Integrating CBOs into care management helps to rebuild trust with healthcare institutions, while also improving care by facilitating connection with social services, in-home personal care, and other critical HCBS.

CBOs have innovated to address client needs by serving as resource hubs and creating referral networks, and providing community-based serious illness care and mental health services. Groups including the National Coalition on Care Coordination and the Aging and Disability Business Institute are actively working to support CBO leadership as part of population health initiatives.

Enhancing information exchange across healthcare and social care providers is critical to enabling effective care management. Greater interoperability allows supporting providers to be aware of one another’s work and care provisions, adjust care accordingly, and prevent duplication. The County of San Diego built a Community Information Exchange that interfaces with its Health Information Exchange, connecting diverse electronic health record and other organizational databases. Community resource referral platforms are one step in this direction; however, full interoperability between the numerous data systems that connect health and social care providers in a locality may take years.

In addition to robust cross-sector care management for individuals with complex care needs, care management initiatives should build in strategies that are effective for individuals who may not have significant care needs now, but are at future risk (“rising risk”). It is challenging to predict whose needs will escalate when, and needs can evolve quickly, so many care management initiatives build in self-referral mechanisms as well as regular screenings and utilization-based reviews. As new needs are identified, patient care navigators or community health workers often escalate a case to social work or nurse care managers for clinical follow-up.

Comprehensive care management is critical as the healthcare delivery system rebuilds after the COVID-19 pandemic. Care management plays a key role in enabling care that is responsive to the needs and desires of diverse patient populations and seeks to provide equitable, high quality healthcare that works for everyone, including older adults and people with complex care needs. While many trends support the provision of comprehensive and effective care management, pressures also threaten the availability of such supports.

Health and social care providers must seek to provide comprehensive care management and enable coordinated care for patients and families who are in the system now, create robust care ecosystems that innately facilitate coordinated care, and move upstream to prevent care needs in the future.

Robyn Golden, LCSW, is associate vice president of Social Work and Community Health at Rush University Medical Center in Chicago, Illinois. Bonnie Ewald is associate director of the Center for Health and Social Care Integration at Rush University Medical Center


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