Value-based care is here to stay

March 30, 2017
Mark A. Caron, FACHE, CHCIO, CEO, Geneia

Despite the uncertainty around the Affordable Care Act (ACA), the healthcare industry’s embrace of value-based care continues unabated. Just in the past few weeks, many healthcare organizations have announced value-based care expansions, including the following:

  • Medicare Advantage insurer MeridianCare inked a value-based contract with Oak Street Health, a Chicago-based network of 19 primary care clinics.
  • Regional health plan Capital BlueCross announced a new accountable care arrangement with Lancaster General Health.
  • Aledade, a company that partners with primary care physicians to build accountable care organizations (ACOs), raised $20 million to expand value-based arrangements with commercial health plans.
  • Excellus BlueCross BlueShield and Geneia agreed to partner to deliver value-based analytics and insights to the health plan’s 1.5 million members.
  • UnitedHealth, Aetna, and Anthem say they’re now paying out nearly half of their reimbursements via value-based care models.

Value-based care and population health link healthcare payments to patient outcomes and health, creating a meaningful connection between cost and quality. In other words, these provisions help drive a return on investment on the $3.2 trillion, or $9,990 per person, our country spends each year on healthcare.

Value-based care is working

Early results indicate value-based care is leading to better health, better care and lower costs. Taking better care of patients upfront often reduces the need for emergency department visits, urgent care, and hospitalizations. This is especially true for patients for whom predictive analytics has identified as at-risk or high-risk and therefore account for approximately 75% of healthcare spending.

ACO results

Since the ACA was enacted in 2010, health plans have created many value-based and risk-based contracts with physicians, hospitals, and other providers with the shared goals of improving healthcare quality and lowering cost. Estimates suggest there are approximately 900 ACOs serving 31 million Americans, and nearly all health plans have some type of value-based arrangements in place.

There is increasing evidence ACOs are working to reduce costs and improve patient health. Data for a recent 12-month period show the health plan’s accountable care partners are outperforming their peers:

  • Acute inpatient hospital admissions are 4.7% lower for employer group customers and 7.2% lower for Medicare plan
  • Hospital readmissions are 8% lower for employer group customers and 14.8% lower for Medicare plan customers.
  • Emergency department visits are more than 8% lower for employer group and Medicare plan customers.
  • Accountable care partnerships are meeting or exceeding agreed-upon quality goals and are exceeding the regional average for Healthcare Effectiveness Data and Information Set (HEDIS) measures for chronic disease management.

Other health plans are having similar success with ACOs and value-based care, including the following:

  • Anthem reports a 7.8% reduction in acute patient admissions, a 9.6% improvement on pediatric preventive care, and a monthly savings of $9.51 per participating patient.
  • UnitedHealthcare reports patients have 8% fewer emergency department visits and as many as 16% fewer hospital admissions. Breast cancer screenings are up 11.4% for commercial ACO members, and colorectal screenings are up 7.8% for Medicare ACO members.

Aggregate results for the Medicare ACOs are demonstrating success. The Centers for Medicare & Medicaid Services found that more than 400 Medicare ACOs generated more than $466 million in total program savings in 2015; 125 of the ACOs qualified for shared savings payments by meeting quality performance standards and savings thresholds.

Remote patient monitoring results

A statistically significant Geneia study of patients with diagnosed heart failure demonstrated remote patient monitoring facilitated earlier interventions by the patient’s care team and prevented avoidable hospitalizations and disease progression. In short, the heart failure patients in our study fared much better than the control group:

  • Risk score stabilized: A 2% increase in the study group compared to a 31% increase in the control group—indicating a slowing of disease progression for participants
  • Hospital admissions: With a net 45% reduction in acute hospital admissions, they spent far less time in the hospital
  • Medication adherence: Increased by 37%
  • Financial:  Annual savings of $8,375 per monitored patient

Identification and stratification

Today’s advanced analytics platforms are able to predict which patients are at-risk or high-risk. This capability has proven critical to the early success of value-based care models.
For example, remote patient monitoring is a particularly effective way to detect clinical deterioration earlier and intervene before an emergency department visit or hospitalization is necessary. That said, remote patient monitoring is not well-suited to every patient.
In the case of the Geneia remote patient monitoring study, we used a number of criteria to select the patients most likely to benefit, including the following:

  • heart failure as primary, secondary, or tertiary diagnosis;
    at least one inpatient admission or two or more emergency department visits in the last 12 months; and
  • Enrolled in a Medicare Advantage plan.

We also had exclusion criteria, including patients with cancer who were receiving chemotherapy or had been diagnosed with Alzheimer’s or dementia or were enrolled in a hospice program.

The proliferation of data and data sources coupled with machine learning will allow us to improve patient identification, particularly in terms of identifying those who are on the brink of illness, as well as stratification into such diverse cohorts as those most likely to engage in their health after receiving a daily text from their physician or an office visit with their provider. Just as quickly, prescriptive analytics are advancing to improve our ability to prescribe specifically how to prevent the at-risk from becoming ill, and that means healthcare organizations and the populations they serve are positioned to continue to succeed in value-based reimbursement models.

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