The time for value-based care … is now

Sept. 14, 2018

HMT interviewed several HIT professionals on the topic of value-based care. Most, if not all, interviewees told me that the time to move your organization to value-based care is now. Continue reading for their thoughts on the challenges, benefits, tips, the future, and more.

Heather Lavoie, Chief Strategy Officer, Geneia

Geneia is a healthcare analytic solutions and services company that focuses on improving systems to support personalized, patient-centered care. We help clients improve outcomes, lower costs, and restore the joy of medicine to physician practice. Our technology, education and training, insights, and clinical services simplify the evolution to value-based care and drive alignment and collaboration among healthcare providers, health plans, and employers.

Geneia’s Theon analytics and care management platform delivers key insights into performance, risk, cost, and utilization to help our clients deliver early and targeted interventions to continuously improve outcomes.

Geneia’s remote patient monitoring solution combines predictive analytics, state-of-the-art technology, and individualized clinical support to chronically-ill patients.

Please describe/define value-based care in your own words.

Value-based care is contractual model of paying providers that compels greater alignment and collaboration between health plans, providers and, in many cases, employers to focus more holistically on patients and populations as well as the healthcare system that serves them. The proliferation of value-based care means we need to focus not only on patients’ clinical needs but also their life outside the physician’s office and its impact on their health outcomes, and increasingly to anticipate patients’ future health events and intervene to mitigate them.

When is the right time for an organization/hospital to move from fee-for-service to value-based care?

Ideally, the time is now. As I’ve said many times, the value-based care and population health train has long since left the station.

In the last few months, CMS has publicly recommitted to value-based care. CMS Administrator Seema Verma has shared her concerns about the acute need to bend the cost curve and for more ACOs to take on downside financial risk. She told attendees at the American Hospital Association Annual Meeting that failure to assume two-sided risk may result in significant changes to Medicare ACO programs. She added, “While we understand that systems need time to adjust, our system cannot afford to continue with models that are not producing results.”

That said, healthcare organizations need organizational capacity, strategic investments in population health, analytics, education and training, and more, and the financial reserves to carry the organization before initiating the transition to value-based care.
Healthcare organizations also need to prepare their physicians and clinicians for the change. Physicians—who are already suffering from widespread burnout—are the frontline of delivering patient care and are among the first constituency to feel the changes associated with value-based care. While I believe value-based care offers the possibility of increasing quality time with patients and ultimately helping to restore the joy of medicine, physician burnout may increase at organizations in the midst of the transition.

How is value-based care going to change our healthcare system?

I hope value-based care means patients are seen and treated as a whole person who sits at the center of their own healthcare system and their range of clinical and lifestyle needs are known, anticipated and addressed through alignment and collaboration of physicians, hospitals, health plans, and employers. Just as importantly, I believe value-based care has the potential to yield healthcare systems that support meaningful improvements in the health of patients and populations while, at the same time, helping physicians and care teams to, once again, find joy in practice and patient care.

For starters, we need to consolidate the 2,000+ different quality measures hospitals and physicians collectively are tracking into the most meaningful 25-50 metrics and use those same measures across the entire healthcare system. We also must have true interoperability and the systems to support real-time, integrated and complete information-sharing among the patient and the entire care team.

I know my vision for value-based care could be seen by some as utopian. So let me add that at a very basic level, the technology and systems supporting value-based care potentially mean patients will only need to complete a health history once and the comprehensive patient profile will be updated with real-time clinical, biometric, and lifestyle data, will be married with predictive and prescriptive analytics, will outline care team actions in priority order and will be shared broadly.

In other words, with value-based care we have a fighting chance—the best chance—to improve costs, quality, and outcomes for individual patients and populations as a whole.

Dr. Andrei Gonzales
, AVP, Value Based Payments, Change Healthcare

Change Healthcare HealthQx helps payers gain a comprehensive understanding of claim costs and utilization by episode of care. Through this analysis, payers can identify the episodes with significant cost or utilization variances to target for alternative payment approaches.

Our solution also enables payers to pinpoint both high-and low- performing providers and delivers analytical evidence to facilitate provider buy-in and benchmarking, ultimately driving continuous improvement.

Our solution enables you to:

  • Increase speed to market: Our claims data experience and understanding of episodes of care composition enables us to convert raw claims data files into powerful episode intelligence.
  • Reduce medical costs: Episode analytics make it easy for you to identify cost drivers to target avoidable expenses that run rampant in typical fee-for-service pricing models.
  • Improve provider engagement: HealthQx leverages industry-accepted episode definitions that convey clinical integrity to facilitate provider buy-in, such as Altarum’s Health Care Incentives Improvement Institute (HC13) and the Centers for Medicaid and Medicare (CMS) Bundled Payments for Care Improvement Advanced (CMS BPCIA). Drill-down reporting and dashboards support transparent, evidence-based discussions with providers to drive performance improvement.

Please describe/define value-based care in your own words.

Value-based care is a way of looking at care from the patient’s perspective to understand the benefit care provides relative to the cost. The difference between value-based care and fee-for-service care is that patients don’t see a single visit or procedure as the path to the benefit care provides.

As patients we expect the overall care we receive for a procedure like a knee replacement or for a condition like diabetes to be coordinated to create the benefit we want from the care. Value based models consider this overall view of care and build models to measure the value and cost of care from the time the patient enters care to the point at which the benefit is achieved. In an episode of care for a knee replacement, this would be from the time the decision has been made to have a knee replacement to the time the patient has recovered and has achieved the desired mobility and relief of pain. This longer view is very different than looking only at the hospitalization or procedure or physical therapy. Value-based care requires providers to work together and coordinate care to achieve the desired benefit at a reasonable cost.

What is the most challenging part our healthcare system moving toward value-based care?

As a whole? The most challenging part for our healthcare system to move toward value based care is in creating the structure and accountability to look at care across different providers and settings of care to coordinate care effectively. Our system is set up to hold providers accountable for the care they provide at the point of service, without having to coordinate care. Providers who are successful at value-based care have designated care coordinators who ensure patients are educated and guided through the process of care they require.

As an individual organization/hospital/hospital system? The most challenging part for individual providers to move toward value-based care is to understand their role in conducting care to ensure they are meeting patient needs in an efficient manner. Providers face many challenges in managing their care and businesses, and value based models require an additional level of management to coordinate with other providers in the community. This task can be overwhelming if providers do not designate time and resources to the effort. We have seen successful organizations focus on this task and use it to differentiate themselves in a competitive market by showing employers, payers, and patients their cost and quality metrics in a value based model. This is a way to turn the effort into a competitive advantage.

What is the best way for an organization/hospital to prepare for the transition to value-based care?

There are three main tasks that will help an organization prepare for value-based care. The first is to engage with local stakeholders to understand the kinds of programs that are most relevant for your community and understand how your organization can participate in a meaningful way.

The second is to analyze and understand your position in the community by looking at data across the continuum of care by episodes of care that will show opportunities for improvement in care quality, outcomes and cost. This will help your organization understand where you are performing well today and where you can improve. This will also help your organization understand where you need to add care coordination and the level of accountability your organization is going to take. This loops back to the first item to understand how your organization will participate in value based programs.
Finally, it is important to take a deep dive in your areas of improvement to really understand processes of care and your internal costs in those areas to ensure that you can meet your quality and profitability targets. As with any care analysis, it is important to understand what kinds of care your organization will provide and to align your strategy with your strengths.

Mike Funk, Vice President of Humana’s Office of the Chief Medical Officer, Humana

Humana is committed to helping its millions of medical and specialty members achieve their best health. Our efforts are leading to a better quality of life for people with Medicare, families, military service personnel, and communities at large.

To improve our members’ health and well-being as well as lower costs, Humana supports physicians and other healthcare professionals as they work to deliver the right care in the right place for their patients and Humana’s members. Humana’s range of clinical capabilities, resources, and tools—such as in-home care, behavioral health, pharmacy services, data analytics, and wellness solutions—combine to produce a simplified experience that makes healthcare easier to navigate and more effective.

Please describe/define value-based care in your own words.

Value-based care is different from the fee-for-service model of care, which simply pays for the number of services a patient receives. These services include physician and hospital visits, procedures, and tests. While value-based care pays physicians for these services, it also includes more pay for meeting quality measures, coordinating care, preventing repetitive treatments, improving health outcomes, and controlling the overall cost of care.
What is the most challenging part our healthcare system moving toward value-based care?
As a whole? One of the biggest hurdles in transitioning to value-based care is the fact that many physicians/clinicians and healthcare executives simply don’t feel ready. And, according to a survey conducted by the HFMA and sponsored by Humana, they have limited ability to share clinical information—in other words, limited interoperability—which they cite as a major obstacle. The survey found that both external and internal interoperability is a current shortcoming in healthcare. External interoperability (the ability to aggregate clinical information across networks with payers and health plans) is the area where health executives are least likely to report feeling highly or extremely capable.

As an individual organization/hospital/hospital system? At Humana, one of our key areas of focus is primary care physicians (PCPs) and making them successful. Their success carries over to create successful healthcare organizations. As such, we have looked closely at the challenges PCPs face in implementing value-based care. According to a study of 5,000 practicing physicians, which was conducted by the American Academy of Family Physicians and sponsored by Humana, some of the top barriers to physicians adopting value-based care include:

  • Lack of staff time to implement care functions that support value-based payments
  • Lack of resources to report, validate, and use data
  • Lack of data as it relates to interoperability
  • Lack of standardization of performance measures and metrics
  • Lack of transparency between payers and providers

Solving these problems for physicians will in turn solve many of the problems that healthcare organizations face when transitioning to value-based care.

What challenges are associated with cost or financials moving to a value-based care system?

According to the HFMA survey sponsored by Humana, almost three-quarters of executives report their organizations have achieved positive financial results from value-based payment programs. Nevertheless, many executives find it challenging to make the move to value-based care from a financial perspective. Even though many indicate that they are seeing positive financial results, many executives find it challenging to be able to determine projected costs, lost revenue and/or risk. Healthcare organizations are often required to invest in new tools to meet reporting requirements and new IT infrastructure, and may also need to hire additional administrative staff to help with reporting and other tasks—all of which pose financial challenges

How is technology assisting with value-based care?

At Humana, we’re leveraging technologies, such as data analytics, big data, and artificial intelligence that connect varying parts of the healthcare system and help them work as a team to coordinate care around the patient. We’re committed to value-based care and implementing technologies including not only data analytics, but also interoperability, mobile technology, and telehealth to empower physicians and care teams.
In the future, we’ll see interoperability well-integrated into healthcare organizations. People already expect a completely seamless and customized experience in everything from banking, to shopping, to ordering something to eat. We’re right on the verge of delivering that same personalized, secure, and seamless experience in healthcare—and will get there with increased interoperability.

Michael Cousins, Chief Analytics Officer, Lumeris

Lumeris is a value-based care managed services operator for health systems and providers seeking better clinical and financial outcomes. Lumeris aligns providers and payers across populations with technologies, processes, behaviors, and information to achieve high-quality, cost-effective care with consumers and physicians.

Please describe/define value-based care in your own words.

Healthcare’s traditional fee-for-service payment system is economically unsustainable and the shift to value is inevitable. Value-based care shifts the entire focus of healthcare delivery from focusing on inputs (provision of procedures and products) to outcomes (measurable quality and costs improvements in the health of individuals and the populations they are part of). It makes healthcare patient-centric.

What is the most challenging part our healthcare system moving toward value-based care?

We don’t see a single challenge that, if solved, moves U.S. healthcare meaningfully toward value-based care. The challenges are many, but imminently solvable. They include achieving alignment and focus among disparate constituencies/stakeholders, including among providers and payers. Fee-for-service contracts with providers need to be renegotiated. Other challenges include the need to reconsider laws that impede collaboration amongst providers. Systems need to develop new capabilities to measure and manage financial risk, and to improve the reliability and predictability of care delivery from both clinical quality and cost-of-care perspectives including the delivery of data and insights seamlessly into the provider workflow. So yes, there are many challenges, but they are addressable.

What challenges are associated with cost or financials moving to a value-based care system?

There are many. One of the challenges is setting up the contracts and monitoring/management systems so that quality improvements and financial incentives are aligned. This alignment needs to extend to provider groups and individual practitioners. Another is that health systems need to analyze their payer contracts in the context of their stand-alone financials in order to optimize holistically. From this holistic view, the systems then need to create the action plans, including identifying investments, so that they can optimize their performance under all value-based and stand-alone arrangements, deliver better coordinated care, lower administrative costs, and enhance preventative care.

When is the right time for an organization/hospital to move from fee-for-service to value-based care?

Health systems’ value-based contracts and programs are in varying stages of development and implementation, but the common thread is that most health systems lack the expertise, resources, and tools required to succeed. To successfully transition to value, health systems must invest in enabling technology, processes, and people to support the management of risk, the alignment of contracting and compensation, the evaluation of performance, the coordination of care and the engagement of patients.

What types of programs do you think we’ll be seeing in the next few years?

According to a recent Lumeris survey, 27% of major U.S. health system executives who participated intend to launch a Medicare Advantage plan in the next four years. These survey findings are consistent with our conversations with healthcare executives across the country who are feeling a sense of urgency around Medicare Advantage strategies as they transition to value-based care. According to the 90 surveyed executives from major health systems, their top reason for launching a Medicare Advantage plan is the opportunity to capture more value by controlling a greater portion of the premium dollar as compared to fee-for-service Medicare. Other key drivers cited include market and regulatory trends supporting Medicare Advantage. In particular, shrinking Medicare margins could threaten the viability of hospitals and health systems as the senior population continues to grow and becomes a larger proportion of providers’ patient panels.

Niki Buchanan, Business Leader, Philips Wellcentive

Philips is focused on transforming the business of healthcare through collaborative health management—our global solutions and services span the health continuum—across diagnostic imaging, patient monitoring, consumer health, and health informatics.

A critical piece of this strategy is population health management. Combining data-driven population management solutions, hospital, and home-based telehealth solutions, and a spectrum of data, analytic, and consultative services, we empower truly connected care to help enable healthcare systems and clinicians to meet the clinical, financial, and human demands of the evolving, pay-for-value landscape. Our population health management platform offers in-depth population insights and scalable care management to reduce patient leakage and improve referral management to help close care gaps at the point of care. We support patient activation toward better health by giving them access to tools that help make it easy for them to be more active participants in their own preventive health, including virtual care, remote patient monitoring, and medication adherence solutions.

Please describe/define value-based care in your own words.

The transition to value-based care is a journey from delivering sick care to delivering continuous health for an entire population, in which healthcare organizations are reimbursed based on patient health outcomes. Under value-based care contracts, providers are rewarded for helping their patients live healthier lives in an evidence-based way. To me, value-based care and population health management go hand-in-hand: It is the organization of and accountability for the health and healthcare needs of defined groups of people utilizing proactive strategies and interventions that are coordinated, engaged, clinically meaningful, cost effective, and safe. By engaging in population health, it will move the needle on cost, quality, and outcomes.

What types of programs do you think we’ll be seeing in the next few years?

The incorporation of social determinants of health can—and will—contribute significantly to the future of population health by improving risk prediction accuracy and revealing inconspicuous trends. Identifying at-risk populations based on social determinants of health and then tailoring healthcare delivery to them aims to reduce costs via care coordination, care management, and preventive care, long before patients present at the emergency room.

The ZIP code is one of the most important numbers to predict a patient’s health status—it can tell physicians and care managers about a patient’s access to healthy food, environmental exposures, education and income levels, and neighborhood stress levels. Social determinants can help care teams address health needs and tailor care management plans based on the patient’s economic, educational and environmental context. Through predictive modeling, social determinants can help healthcare organizations determine at-risk populations and identify avoidable healthcare costs. And finally, social determinants improve the fairness of provider profiling by using the populations’ social risk to adjust quality and performance measures.

What is the best way for an organization/hospital to prepare for the transition to value-based care?

As we partner with customers throughout their value-based care journey, we’ve uncovered that the funding process typically starts with incremental quality revenue generation. The next step is to gradually take on more complex value-based care contracts with greater risk—to reap greater rewards as they move up the maturity curve.

A health system should drill down to its greatest areas of need, whether it be aggregation, utilization management, wellness or chronic care tracking, risk stratification, or other analytics functions. We advise customers to create a yearly plan to maximize the fee-for-service visits that align to the quality initiative in your contracts, such as preventive visits.

This will help you pivot from a business model designed for reactive sick care to one designed to deliver proactive well care.

How is value-based care going to change our healthcare system?

Healthcare organizations that want to thrive are undergoing a transformation in the way they think about, manage and deliver care. Value-based care forces healthcare organizations to view patients as consumers who we approach on a continuous basis. Rather than our current cycle of crisis care, where patients see their health as more episodic and tend to only interact with their provider in an emergency, healthcare systems will need to develop seamless patient care. This starts with understanding those they serve at the population level with unprecedented visibility into cost, quality and patient risk across multiple settings and sources. Once they have analyzed and stratified their population, they then can help patients navigate to appropriate care, providing guidance about their best next health interaction. Finally, they can empower patients to be more active participants in their own health at home with connected care technology.

Feel free to share any other thoughts on value-based care.

If the past ten years are any indication of the next ten, then we have learned that for U.S. healthcare, it takes government incentives to change behavior. Once those are in place, the commercial payers change as well. However, what’s most intriguing is that consumers may be fed up with the lack of change coming from both, and they may be willing to pay for alternative means of care out of pocket for convenience sake until there are truly high cost only needs. As a healthcare vendor, we are obligated to push for the “coming together” of the best of the technology, people and processes to make healthcare more affordable, more convenient and aligned to the right care at the right time.

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