Premier Inc. Executives: Time to Unpack Some of the Challenges and Opportunities Inherent in the Path Into Risk

Sept. 24, 2018
Shawn Griffin, M.D. and Steve Valentine of Premier Inc. discuss the challenges involved in the path into risk-based contracting, and the potential upending of the landscape by new disruptors

There is great complexity in how the shift from volume-based to value-based payment and care delivery is taking place inside the U.S. healthcare system. As discussed in one of the Healthcare Informatics Top Ten Tech Trends published in the third-quarter issue of the magazine, the path into risk-based contracting is particularly complex—and challenging.

For one thing, as those interviewed for the article agreed, as the shift from a volume-based to a value-based U.S. healthcare delivery and payment system moves forward—albeit unevenly and not as quickly as some would like—some of the lines between what providers and payers do are inevitably beginning to blur. Industry experts and observers say that blurring will necessarily have to occur, as provider organizations take on more risk. Indeed, many believe, the only way to wring significant savings out of the healthcare delivery system is to compel the acceleration of risk, headed in the direction of partial or full capitation.

A number of industry leaders were interviewed for that Trend article, among them three senior executives at the Charlotte-based Premier Inc.—Shawn Griffin, M.D., vice president, clinical performance improvement and applied analytics, and Steve Valentine, vice president of strategy and advisory consulting at Premier. Healthcare Informatics Editor-in-Chief Mark Hagland interviewed those Premier executives around the broad issues surrounding the taking on of risk by the leaders of patient care organizations.

Meanwhile, Griffin and Valentine also addressed issues around new disruptor organizations and business combinations emerging in healthcare, for a Trend article on that subject. Below are excerpts from that interview on both subjects, which took place this summer.

What do you think about some of the new business combinations, including the proposed CVS-Aetna merger, and how they might potentially upend the landscape for provider organizations?

Steve Valentine: Today [Aug. 3], the California Attorney General opposed the CVS-Aetna merger over cost concerns. We would call that a vertical merger. They have the Minute Clinics, the PBM [pharmacy benefit management company], etc.—we see them invading the healthcare space to compete for what we call “stickiness with the consumer.’”You have 9 to11 percent of the spend in pharmaceuticals. It will be interesting to see whether they go down a path like United, which has Optum, and which is acquiring medical groups.

Shawn Griffin, M.D.: You’re seeing continued attempts to find ways to put together groups that can help you save on healthcare spend. You’re seeing that with innovations, and with partnerships of all kinds, and they’re all trying to find out what the right team is, to become more efficient and improve quality. You’ve seen it with the EMR vendors, too.”

Looking at the forward evolution of risk-based contracting, how do you gentlemen see that evolution playing out, from your perspective as leaders of a nationwide alliance of provider organizations?

Griffin: When you look at Premier and the partnerships we’ve made over the years, we think that it’s incredibly important that the people who deliver the care have a seat at the table and aren’t being distanced. With some of these combinations, you start to see mixed affiliations. If you have a payer who owns some providers, how do they treat the ones they employ versus not employ?

The whole picking-teams thing can be very divisive. And some of these groups have existed within silos in the industry. Now, when you combine providers, payers, etc.—a lot of organizations have concerns when they sit down with an insurer that owns a lot of providers, or owns an analytics shop. I don’t think that we necessarily believe there’s a silver bullet with one magical algorithm to save the day. I think it’s going to be people working together to work with innovative models and collaborations, so that we can help people, but not at the expense of the people delivering care.

Valentine: As much as we want the collaboration, the competition is clearly heating up, and inpatient volume has gone flat, and more is moving to ambulatory side, and we’re seeing more payers creating and expanding narrow networks and tiered networks.

Griffin: Maintaining the network enables you to better collaborate on and coordinate care. It’s the collaboration to make sure you’re sending patients to a good acute-care space, not simply, “Here, we have a coupon.”

Can you comment on the continuous “arms race” that’s taking place in healthcare, in which health plans continue to consolidate in response to consolidation on the part of providers, and then health plans turn to creating narrow networks?

Griffin: I was at an organization with 2,000 physicians, and only 10 percent were employed, before I came to Premier. There are things that can be done to facilitate the transfer of care and efficient delivery or care, when you’re on a single platform, which is an important step to take to overcome the siloing of EHRs (electronic health records).

Can you speak to the essential need to master the use of data analytics in order to succeed in the journey around risk contracting?

Valentine: I served on the board of Healthcare Partners Medical Group for 16 years, and what I’ve seen, is that you need an analytics and process infrastructure—hospitalists working with care managers, pre-admission, during the acute stay, and post-admission, and we really needed robust data and information. You get good analytics data to look at costs, handoffs, and where things didn’t work well, and utilization.

What are the biggest stumbling blocks, in that work?

We always worried about patients accessing care outside our network, esp. in outside EDs. We would repatriate patients back into our network, so that we could really manage the patients’ care; that was critical. And if we could keep them within the contracted specialty network, keep the patients in the network, because you had specialists really trying to manage the utilization and care with you. Outside the network, you found a lot of costs driving up.

Griffin: The more fragmented the care, the more likely you’ll be to have extraneous or unnecessary tests, etc. More organizations want to go into the social determinants of health and to see how those influence the costs and quality of care. I’m an old family physician, I think the primary care physician relationship with the patient is core. So to make sure you have an underlying relationship, not just patients seeing doctors for individual encounters, that’s where you can make progress. When you have a relationship between a patient and physician, if they do have to receive care in a hospital, if you can be efficient with tests so they don’t have to be redone, etc., and make sure you’re sending patients to the right post-acute, not just allowing as many swipes as possible in a 21-day post-acute care… stay…

What would you say about the challenges of understanding utilization, care management, and care handoffs, in the moment?

Griffin: There are aspects involving real-time. I think as we’re seeing this risk being handed to providers, we’re all experimenting on the right mix of technology, care management, etc. Real-time becomes tremendously expensive. So what is the appropriate time interval involved? And about doing a fantastic intake meeting with the patient. And our collaboratives are trying to see where the benefit is. We’ve had care managers say, we didn’t get any extra benefit from intensive care management, but then a new study comes out later, and they say, gosh, it did help. That’s why working together in broader collaboratives is so important, and working together in larger groups is so important.

Valentine: You asked about social determinants. The social services agencies are already stressed in terms of resources. And as these ACOs reach out to these social services providers, Habitat for Humanity, etc., they’re very stretched, and are looking for economic support and are asking for funding. They need help.

What are some of the biggest learnings you’d like to share, as well as advice for CIOs, CMIOs, and other healthcare IT leaders, right now?

Griffin: There’s not one magic bullet that will suddenly solve all your problems. There is a base of learning out there. Organizations like HIMSS [the Chicago-based Health Information and Management Systems Society], AMDIS [the Association of Medical Directors of Information Systems], CHIME [the Ann Arbor, Mich.-based College of Health Information Management Executives], etc., offer insights. And I think that providers collaborating with one another, sharing best practices, and working together on expertise, will help. I think it’s the providers who have relationships with patients, and organizations that have relationships with communities, and working a little harder and differently, will make all the difference. I don’t think some white knight will ride in on a horse.