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Improving health and reducing hospitalization for target patient groups

Integrated care approach brings double-digit decreases in emergency and nursing home admissions and reduces costs by more than 20 percent.


The leaders of a health service organization in a European capital city believed that patients could be better served at a lower cost if care was more tightly integrated among primary, secondary, social, and mental health providers. But substantial barriers stood in the way of making integrated care a reality, from incompatible technology systems to the lack of a unified view of the services provided to any individual patient.

The client asked for McKinsey's help in designing and implementing an integrated care pilot for patients in two priority groups: diabetics and the elderly.

The effort was focused on four distinct goals: reducing costly emergency admissions for the elderly, reducing nursing home admissions for both groups, and achieving overall cost savings while meeting quality standards (in this case, safety, effectiveness, and a good patient experience).


Meeting project targets would require new care delivery models, operating processes, service enablers, and support. Given the magnitude of change and number of participants involved and affected, it took the combined client/McKinsey team more than a year to design and launch the pilot. Over the course of that year, the team worked closely with other stakeholders in four distinct phases.

  • The setup phase was devoted to gaining agreement on specific pilot goals and designing a governance model with health system leaders. They also set up an incentive structure that would reward provider performance and align the interests of all participants.
  • Next, the design phase saw the team develop a new operating model for the pilot. This included working with clinicians to map new treatment pathways for the target patient groups, refining financial models to ensure appropriate funding and incentives, and developing a business case to help recruit providers and practices to participate in the pilot.
  • In the pre-launch phase, the team focused mainly on setting up multidisciplinary groups (MDGs) of doctors, specialists, and social and community care workers who would be providing holistic treatment to patients. MDGs were given important supporting tools to identify available services, help share digital patient records, and facilitate coordination between providers.
  • In the final launch phase, pilot team members trained MDG staff on the new pathways, tools, and processes to ensure consistency. The pilot team also helped establish performance criteria for each MDG, including assessing the risk categories for all patients. Such risk-assessment data can help proactively map out the level of care and frequency of intervention that patients should receive—a critical step in minimizing emergency admissions.

Fourteen months after the pilot team first began work, it launched an innovative program aimed at providing the right level of care, at the right time, by the right people. MDGs regularly discuss the toughest cases, plan suitable care, and evaluate performance against pilot goals. Management approves incentive payments to MDGs meeting or exceeding service levels.


The pilot launched in two consecutive waves. Positive results were documented in each:

  • Providers and practices involved in Wave 1 prevented more than 175 hospital admissions in the first 6 months, with a projection to end the first year with a reduction of 800 admissions. Hospitals in pilot geographies were able to reduce bed capacity.
  • Wave 2 providers and practices are on track to reduce 1,300 admissions of patients in the first 12 months.
  • Total savings on health and social care for the targeted populations within the first year is projected to be more than $9 million, with 2 percent additional cost reductions projected in each year of the 5-year pilot.
  • Total spending on acute care over 5 years is projected to fall by 24 percent, based on a 12 percent reduction in the first year.

The first year had been a success. Subsequent funding and incentive payouts are contingent upon providers showing improvement, inspiring them to share best practices and deploy resources well. Incentives are also tied to exceeding the previous year’s benchmarks, reinforcing continuous improvement.

Based on initial success with elderly and diabetic patients, work is under way to extend the integrated care pilot to other groups, including children and adult patients with COPD, asthma, CHD, and multimorbid conditions—an effort that McKinsey is supporting.