Message from the CEO and Board Chair

Reflecting on Altarum Institute’s accomplishments, we are inspired by two consistent themes: the broad range of our expertise and the commitment of our people.

We are extremely proud of these attributes. Altarum brings a full suite of subject matter and technical expertise to our clients and communities. We confront the toughest challenges facing our health system today, backed by a 70-year history of excellence in objective research and analytics. Our talented professionals approach their work with skill, confidence, and remarkable passion.

Above all, what matters most is Altarum’s impact. We bring ideas and solutions that make a real difference in people’s lives and communities—motivating us to be even bolder in pursuit of our mission to improve human health.

Altarum doesn’t succeed alone. We enjoy a growing list of partners, from government agencies, universities, and major health systems to foundations and grassroots organizations. Working together, we accelerate progress toward a healthier future.

A sincere and heartfelt “Thank you” goes out to all colleagues across Altarum and its subsidiaries, Palladian Partners and KAI Research, Inc. Once again, they delivered exceptional results and helped place us on a path to long-term success.

We would also like to thank Dr. Maxine Hayes who retired from Altarum’s Board of Trustees in 2014. A public health champion, Dr. Hayes made many contributions to Altarum and we are grateful for her strategic vision and service.

On behalf of our leadership team and Board of Trustees, we look forward to making an even greater contribution in the years ahead.

Linc Smith, President and Chief Executive Officer
Mary K. Ousley, Chair of the Board of Trustees

Understanding the Health Care Needs of Women Veterans

As the number of female service members and Veterans continues to rise, the U.S. Department of Veterans Affairs (VA) is working to understand the needs and experiences of this growing population.

In 2014, Altarum Institute supported these efforts by leading a national survey for the VA Women’s Health program office. The study examined specific barriers that women Veterans face in using the VA health system, such as the availability of child care services, the stigma associated with seeking mental health care, and access to transportation.

More than 8,500 women completed the survey, representing users and non-users of the VA health system from all 21 Veteran Integrated Service Networks. Participants offered important insight into their views and experiences.

For example, women shared information about factors that influence their health care decisions, including the convenience of making medical appointments and the ability to receive care from female providers. The initial results were so compelling that VA commissioned Altarum to conduct five additional studies to better understand women Veterans’ satisfaction with care.

“Women Veterans are a rapidly increasing demographic, and both Congress and the Department of Veterans Affairs have shown commitment to studying the unique needs of this population,” said Dr. Chris Duke, project research lead. “We were able to identify areas where the VA health system is performing well but also where improvements could be made to enrich the entire patient experience.”

VA is using Altarum’s study findings to identify best practices, inform future policies, and ultimately improve care for women Veterans across the country.

Supporting Nursing Mothers at Work

Breastfeeding can be challenging for new mothers returning to the workplace. Many of these women, particularly hourly-wage workers, need assistance from their employers to continue nursing.

In 2014, Altarum Institute and Every Mother, Inc. developed “Supporting Nursing Moms at Work: Employer Solutions” for the U.S. Department of Health and Human Services Office on Women’s Health. This online resource features creative and practical ways for businesses to provide employees with the time, space, and accommodations that they need to express breast milk. The information also helps businesses comply with a provision of the federal Patient Protection and Affordable Care Act.

Altarum collaborated with local, state, and national partners to identify organizations with model lactation support services in place. The team incorporated this information into the online searchable compendium, which contains tips, photos, videos, and best practices from more than 200 businesses in 34 states. People can search by industry, such as agriculture, construction, or manufacturing; or look for specific solutions, including ways to set up lactation areas or store breast milk.

Companies of all sizes and in all major industries use the Web resource. It also serves as a tool for breastfeeding coalitions that play a key role in providing technical assistance to businesses and employees at the grassroots level.

“Breastfeeding is well-established as a low-cost, low-tech practice with longstanding health and economic benefits,” said project manager Doris McGuire. “With this resource, businesses are able to better support nursing moms while promoting health and productivity in their communities.”

Improving Patient Flow in the Emergency Department

Emergency departments (EDs) serve a vital role in our communities, offering 24-hour access to a range of health care services. However, with many hospitals stretched to capacity, a trip to the ED can often mean long delays and overcrowded rooms.

In 2014, Altarum Institute collaborated with the U.S. Navy Bureau of Medicine and Surgery to improve the flow of patients through the ED at Naval Medical Center Portsmouth. The medical center is the oldest continuously running hospital in the Navy, serving approximately 420,000 people in southeastern Virginia.

Using Lean industrial engineering approaches, Altarum experts worked closely with ED staff members to redesign the care delivery process. This involved studying existing practices, identifying bottlenecks and inefficiencies, and making a series of operational changes. The results led to a smoother, more effective system of triaging and treating patients in the ED. For example, by simplifying the intake process, the team reduced the time that it took for a patient to be placed in a room (“door to bed”) by 67%. New streamlined processes also shaved more than 20 minutes off a patient’s overall length of stay in the ED.

“The tangible impact is rewarding,” said Jim Laramie, project director. “By improving processes, we produced measurable outcomes and created a better experience for patients and providers.”

Altarum’s success on this project has spun off into additional contract awards, including opportunities to enhance the performance of other Navy hospitals. Collectively, these efforts play an important role in building trust in the overall military health system.

Bridging Gaps in Addiction Recovery

Drug and alcohol addiction causes thousands of preventable illnesses and deaths each year and takes a devastating toll on Americans from all racial, ethnic, and socioeconomic backgrounds. Of the 22 million Americans who struggle with addiction, 90% do not receive the treatment and support that they need to achieve recovery.

Altarum Institute is working hard to bridge this gap. For the past 8 years, Altarum has partnered with communities to implement and expand the U.S. Substance Abuse and Mental Health Services Administration’s Access to Recovery (ATR) grant program.

In this effort, Altarum supports grantees in building integrated networks of public, private, and grassroots organizations that offer a range of treatment and recovery services. The team assesses community readiness, develops culturally appropriate service plans, and provides coaching and technical assistance to implement, adapt, and sustain ATR programs. Altarum has worked with 39 states and eight tribes, providing guidance and peer-to-peer learning opportunities on topics ranging from care coordination to tracking and reporting outcomes.

“We are successfully transforming the system to support long-term healing and recovery from addiction,” said Diana Williams. “Empowering one single person is worth it; the benefits extend to families, communities, and society as a whole.”

Overall, the ATR program has changed the lives of more than 800,000 people. “I have family and friends; I have a purpose,” said Deirdre Davis, an individual who achieved recovery as a result of ATR. “My life is full…and I’m just really grateful to be alive.”

Advancing Public Health Surveillance

Health care providers are required to report cases of certain conditions, such as birth defects and cancer, to public health agencies. This information drives important research and surveillance activities to track, monitor, and improve the nation’s health.

With funding from the Michigan Department of Health and Human Services, Altarum Institute developed an electronic quality assurance tool to improve the integration of clinical data with public health surveillance systems. The tool evaluates the electronic submission of data, identifies errors and areas for quality improvement, and helps to ensure that public health agencies receive information in a clear and useful format.

The Altarum-led Michigan Center for Effective IT Adoption, the state’s go-to resource for electronic health record (EHR) and Meaningful Use support, served as a key partner by training health care providers on the use of the tool.

Overall, more than 500 health care organizations are expected to adopt the new technology. Armed with timely, high-quality data, surveillance teams can better understand the impact of diseases in the state. Additionally, public health leaders use this information to implement prevention strategies and take steps to improve the care and quality of life for residents affected by these conditions.

“This is clearly the future of disease surveillance,” said Glenn Copeland, director of the Michigan Cancer Surveillance Program. “The Altarum Team provided just the right mix of project management, technical skill, and consultation. Their efforts will significantly improve the quality of surveillance data in the state.”

Enhancing the Delivery of Services to Michigan Veterans

In the award-winning Michigan Veteran Community Action Teams (MiVCAT) project, Altarum Institute is working on behalf of the Michigan Veterans Affairs Agency to support the 660,000 Veterans who live in the state.

MiVCAT is a collaborative community model created by Altarum to enhance the delivery of services from public, private, and nonprofit organizations to Veterans and their family members.

Veterans often have complex needs and face difficulties in accessing support. For example, a Veteran may require assistance with housing accommodations, child care services, treatment for post-traumatic stress disorder, and transportation to medical appointments. In the MiVCAT model, Altarum builds and strengthens local networks of service providers who collaborate in real time to meet these needs.

“We address the many factors that affect a Veteran’s ability to lead a healthy, productive life,” said Max Burke, program manager and a Veteran himself. “This is a complete systems approach.”

Altarum uses cloud-based technology as the “glue” to create linkages and enable service providers to operate across physical and organizational boundaries. This is especially important in areas like Michigan’s Upper Peninsula, where people are more geographically dispersed.

During 2014, the team successfully expanded across 6 of the state’s 10 regions. The model currently covers 40 counties and a population of 522,000 Veterans, who are served by networks of more than 1,000 providers. By the end of the project, 10 coalitions will be established to form a comprehensive, community-driven system of care for Veterans in Michigan.

Creating Clear and Effective Health Communications

The language of health care is complex, but clear communication is necessary for science to flourish. The National Institutes of Health (NIH) has a long history of working to bridge the gap between medical and scientific jargon and the understanding of the American people. In support of that goal, Palladian Partners has been providing communications support to NIH’s Office of the Director (OD) since 1998.

In 2014, Palladian successfully rebid its contract with NIH OD’s Office of Communications and Public Liaison, which sets the communication strategy across NIH’s 27 Institutes and Centers. This latest contract is the most comprehensive yet, with 19 areas of technical support ranging from media analysis and foreign language translation to Section 508 compliance and Web design.

“This project enables Palladian to demonstrate the full range of tools in our toolbox,” said project director Emily Krebbs. “We remain flexible and responsive to the priorities of NIH leadership.”

Palladian has delivered a range of creative and cutting-edge solutions for NIH’s communications needs. For example, the team collaborated with a medical animator to develop a video animation of a dilated eye exam for the National Eye Institute; the 3-D animation describes the process of performing a comprehensive eye exam from the provider perspective. Palladian also provided website content development, design, and programming for the Explore NIH website and the NIH Plain Language website.

Palladian is committed to nurturing the strong relationship it has built with NIH and continuing to translate evidence-based research into communication that is meaningful for the public.

Studying the Effectiveness of the Flu Vaccine

Influenza viruses have a knack for changing and mutating in unexpected ways. While vaccination is the best line of defense in preventing outbreaks, the flu vaccine is developed in advance based on the best available evidence at that time. Public health officials must constantly update the vaccine in response to these highly adaptable and life-threatening viruses.

In 2014, the Centers for Disease Control and Prevention (CDC) engaged KAI Research, Inc. in a study to analyze the effectiveness of the flu vaccine. The project was part of a larger effort to evaluate whether the vaccine, produced for the 2014–2015 flu season, protected against the virus strains that were in circulation. KAI will repeat the same study in future option years, including in 2015, to help CDC monitor viral “drifting” and develop new vaccines accordingly.

KAI worked with Benchmark Research, a multi-therapeutic network of clinical research sites, to recruit and enroll 207 pediatric, adult, and elderly participants in the study. The team collected pre- and post-immunization samples, helping CDC determine the extent to which the vaccine reduced the risk of getting the flu.

“This project played a direct role in improving the nation’s capacity to prevent and respond to influenza outbreaks,” said Alexandra Stout, clinical research associate. “We enabled CDC to assess how well the 2014–2015 flu vaccine was working and use that information to produce a more effective vaccine for the next flu season.”

CDC’s future recommendations could also extend to international partners, such as the World Health Organization, mitigating the flu’s global impact.

Center for Elder Care and Advanced Illness

In September 2014, The New York Times ran a powerful story about an elderly man whose last wish was to die at home. Instead, he spent the last year of his life transported across various institutions and costing the health care system more than $1 million. The article quoted Altarum Institute’s Dr. Joanne Lynn, who urged a more compassionate, case-by-case approach toward caring for frail elders. “They are more than just bodies with heartbeats,” she said.

Dr. Lynn directs Altarum’s Center for Elder Care and Advanced Illness, which strives to build a system in which people nearing the end of life may count on living comfortably and meaningfully, at a sustainable cost.

To that end, the Center’s team members worked tirelessly to promote the MediCaring Communities model in 2014. This innovative approach organizes and tailors services around the needs of frail elders and parts of the program are now being tested in several communities such as San Diego County, California; Martha’s Vineyard, Massachusetts; Grand Rapids, Michigan; Prince George’s County, Maryland; and Pueblo, Colorado.

In addition to contributing to major news outlets, the Center produced more than 35 publications last year, including an article on easing the burden of family caregivers in the Journal of the American Medical Association and a widely circulated blog post on caregiver advocacy in Health Affairs. Team members were on the road frequently, giving more than 55 presentations nationwide, and also informed key policies and legislation such as the Improving Medicare Post-Acute Care Transformation Act and the Caregiver Corps Act.

Overall, the Center’s reach and scope continue to expand at a remarkable pace, working toward its vision of “making it safe to grow old.”

Center for Consumer Choice in Health Care

Altarum Institute studies have found that most Americans want an active role in making decisions about their health. This is good news, since engaged patients typically achieve better outcomes. The challenge is to ensure that these individuals also have the tools and information that they need to make the best choices, particularly when it comes to weighing risks, benefits, and costs of care.

That is the goal of our Center for Consumer Choice in Health Care: to incorporate consumer preferences into all health care decisions.

In 2014, the Center’s survey instrument called the Altarum Consumer Engagement (ACE) Measure gained traction in the marketplace. ACE is a no-cost tool designed to understand, monitor, and improve health engagement levels in a population. The measure was developed with support from Safeway, Inc., which uses ACE as part of its employee health strategy. Other organizations, such as community health centers, are currently piloting the tool among diverse populations.

With funding from the American Hospice Foundation, the Center also developed a mobile application to help families make informed hospice care decisions. Additionally, the team launched a collaboration with IPRO, an organization dedicated to improving the quality and value of health care, to develop consumer engagement training programs.

The Center’s staff members published three peer-reviewed articles and delivered 16 presentations at professional conferences and events. Momentum is expected to continue as the team promotes ACE and pursues new approaches to leverage patient engagement.

Center for Sustainable Health Spending

Health spending in the United States is often headline news. Economists, think tank scholars, policymakers, and many other stakeholders keep close tabs on the topic, using the latest figures to offer projections and proposals for reform.

Altarum Institute’s Center for Sustainable Health Spending plays a leading role in shaping this national debate. Recognized as a leader in health spending data, trends, and drivers, the Center focuses on guiding the country’s transition to a sustainable rate of health spending growth.

In 2014, the Center continued to apply its method for creating monthly health spending estimates and learned that the audience for its widely disseminated Health Sector Economic Indicators briefs℠ includes the President’s Council of Economic Advisors.

With funding from the Robert Wood Johnson Foundation, the Center hosted its fourth annual meeting in Washington, DC. The well-attended symposium featured respected thought leaders and experts who discussed current trends, ways to increase value in the health system, the role of disease prevention, and the future path of health spending.

The Center continues to elevate its visibility and enjoyed more than 170 citations in the media last year. Team members were interviewed and quoted regularly in sources such as The New York Times, The Washington Post, The Los Angeles Times, The Chicago Tribune, The Wall Street Journal, The Economist, Modern Healthcare, and other journals and news digests serving the health care, financial, business, and pharmaceutical industries. They also prepared blogs, publications, and peer-reviewed journal articles and submitted testimony to the Michigan House Health Policy Committee.

Center for Healthy Child and Youth Development

Healthy habits start early. As the nation grapples with an ongoing childhood obesity epidemic, it is more important than ever to create opportunities for kids to develop and sustain healthy lifestyles.

Altarum Institute’s Center for Healthy Child and Youth Development is dedicated to helping children to reach their full potential. In pursuit of this goal, the Center has collaborated with many organizations including YMCA of the USA (Y-USA), the national office for the 2,700 local Ys across the country.

For the third year in a row, team members conducted an evaluation of Y-USA’s Community Transformation Grant, a program expected to have an impact on more than 1.5 million lives. This initiative focused on expanding the YMCA Diabetes Prevention Program to reach more African-American and Hispanic communities and implementing healthy eating and physical activity standards in early childhood and afterschool settings that serve these populations.

The Michigan Department of Health and Human Services has also been a strong partner. In 2014, the Center conducted evaluations of state programs related to promoting healthy lifestyles and preventing obesity.

Among other activities and achievements, the Center continued to serve as a third-party verifier for the Partnership for a Healthier America, including monitoring their Hospital Healthier Food Initiative, an effort to support healthy eating in hospitals.

Team members also presented at state and national conferences and wrote numerous articles and publications, including the number one most popular blog of 2014 on Altarum’s Health Policy Forum. The Center’s successful partnerships have parlayed into new opportunities in 2015 and beyond, all devoted to nurturing healthy environments for children to thrive.

Message from the CFO

During 2014, Altarum Institute continued to experience the residual impact of the 2013 budget sequestration and federal government spending cuts. Our 2014 revenue was $75.6 million, down 3.6% from the prior year. Strong project performance and effective cost management yielded a 2014 operating income that was nearly double that of 2013. Revenue and operating income are expected to increase in 2015.

In addition, the Institute used proceeds from the sale of short-term investments to pay down on its line of credit, which strengthened the balance sheet. The Institute’s ratio of debt to net assets has been cut in half over the last 3 years. Total assets are $67.6 million, including cash and investments of $18.9 million.

Importantly, the tighter federal fiscal environment has not hampered the development of Altarum’s internal research and demonstration agenda. In 2011, we established four research centers focused on critical health systems issues. These initiatives are supported by Altarum resources as well as generous funding from external organizations. Over the last three years, our internal research program has averaged $3.7 million per year, and this figure will exceed $4 million in 2015.

Copies of audited financial statements for Altarum are available by written request to the chief financial officer.

Alicia M. Torres, Chief Financial Officer