Can payment reforms be used to incentivize reductions in health disparities and to promote health equity? Does the newly announced ACO Reach model hold potential? A panel of experts hosted by Weill Cornell Medicine’s Population Health Sciences department on March 2 weighed in.
The panel discussion was moderated Dhruv Khullar, M.D., M.P.P. a physician and assistant professor of health policy and economics at Weill Cornell Medical College. He is also a contributor at The New Yorker, where he writes about medicine, healthcare, and politics. He also serves as Director of Policy Dissemination at the Physicians Foundation Center for Physician Practice and Leadership, and was recently a Senior Research Fellow at NYC Health + Hospitals.
Khullar started the discussion by noting that over the past decade, value-based payment has seen mixed results. In many cases, there has been success and in others, there's been little or no impact on outcomes spending. “There's evidence that some payment programs worsened disparities, or at least shifted resources from providers who care for less affluent patients to more affluent patients,” he added. “There's a lot of reports of increased administrative burden. There's evidence that providers have engaged in gaming of certain types of metrics,” he said. He asked panelists to talk about whether they were optimistic about the idea of paying for equity and what were causes for concern.
J. Michael McWilliams, M.D., Ph.D., a professor in the Department of Health Care Policy at Harvard Medical School, and a professor of Medicine and Practicing General Internist at Brigham and Women's Hospital, described two things that he says are clearly achievable through the payment system for addressing health disparities. “One is that in order to have more equity, we need more efficiency,” he said. “One of the most crippling things to economic opportunity in this country right now is healthcare costs, so to the extent that we can rein in healthcare spending growth through new payment models, as well as various policies to regulate high prices in the commercial markets, the stronger the chance we stand to address healthcare disparities.”
Reducing wasteful healthcare spending, through incentivizing more efficient practice patterns, or through regulation of prices, is a huge win for equity, as long as we redistribute those resources in a way that helps those who experience disadvantage,” McWilliams added.
Second, he said, population-based models can help improve equity by giving providers more flexibility. They can then help overcome barriers to care to serve patient populations that have trouble getting to the office, for example. “In the ACO Reach model, which I'm very familiar with, is the prospect of setting population-based payments based on population characteristics,” McWilliams explained. “Those characteristics can include predictors of need. That is a big deal. That is just a fundamental paradigm shift in payment policy. We have either had payments and therefore revenue that follows the amount of care that's delivered, or we've had population-based payments that are risk-adjusted according to statistical models that predict spending, but we have never gone in any substantial way in the direction of setting payments according to where we think spending ought to be, which for many populations is well up above where it is. That creates incentives for providers or plans to attract patients living in historically underserved communities with enhanced care or benefits. This is a game-changer in policy, certainly in Medicare payment policy. And there's a lot of work to be done after we have that in place.”
Focus on paying for outcomes
To address disparities in maternal health outcomes, there has been talk of a need to pay for additional wraparound services. But Dana Gelb Safran, Sc.D., president and CEO of the National Quality Forum, emphasized the need for budgeted models that create incentives around favorable outcomes.
“We have a lot of money we're paying for care, and we're not rewarding the outcomes,” Safran said, “so let's reward the outcomes.” She spoke about work she had done in Massachusetts on an alternative quality contract. “For chronic illness, we rewarded the achievement of favorable outcomes. Providers then have to think outside the literal and figurative box of the clinical settings to where patients live and work and what it is that they can do to achieve those better outcomes,” she said. “We can achieve the same with maternity care by thinking about that woman as a whole human being — where she lives, works, where she is going through pregnancy, then labor and delivery. That really leads to truly patient-centered care. There is evidence that you can actually reduce disparities once you're focused on those outcomes, not by paying extra money for wraparound services, but by having a budgeted model that says ‘use these dollars in a way that will get you the best results for your patients.’ And then, sure, use those wraparound services if that's the best use of the dollar for getting good results for this population.”
Laurie Zephyrin, M.D., M.P.H., M.B.A., is vice president for Advancing Health Equity at the Commonwealth Fund. She has extensive experience leading the vision, design, and delivery of innovative health care models across national health systems. She said the term paying for equity raises lots of questions, such as how do we create accountability for prioritizing and eliminating inequities? How can we hold health systems accountable? How can we help support providers? How do we address the impact of structural racism on health? How do we help address the drivers of health and social determinants of health? “I think payment reform has a huge opportunity to do that by providing greater flexibility in incentives, particularly for community-based providers and safety net providers and plans,” she said.
Zephyrin added that the measurement piece is going to be very critical. “At the Commonwealth Fund, we've been thinking a lot about what are what are ways to help support the measurement aspect. We all know that there aren't really clear and sufficient federal standards. How do you address misconceptions and fears around collecting data? It is critical to really think about how we create measures that can intentionally address health equity and racial equity? How can we get data where we can disaggregate by race and ethnicity? There's a lot of investment that needs to happen around that. We have funded some work to show that we need to update our data standards. We need to be able to ensure that there are resources to support data collection, and also involve historically marginalized communities in this as well, to help people understand how this data will be used, and address regulation and data sharing concerns as well.”
