AHA: 7 ways health systems are transitioning to value-based care

Key drivers pushing hospitals toward value-based payment models include rising expenses, declining reimbursement from Medicare and Medicaid, changing policy at the state and federal level, and accessing capital, according to the American Hospital Association.

In its recent TrendWatch report, AHA analyzed how seven health systems are shifting their operations to a value-based payment system. They are listed below in alphabetical order.

1. Milwaukee-based Aurora Health Care participates in a shared savings and losses model, where savings from care improvement are shared between payer and provider. Under the model, Aurora Health Care partners with national health plans to create Medicare Advantage ACOs, and established a joint-venture insurance company with Anthem Blue Cross and Blue Shield of Wisconsin.

2. Banner Health in Phoenix participates in a shared savings and losses program, as well as a capitation model, under which providers are paid a single payment for a specific group of individuals. To accomplish this, Banner Health partners with national health plans to establish ACOs.

3. When it comes to value-based care, Billings (Mont.) Clinic operates under a bundled and shared savings model. Shared savings programs add incentives and penalties to provider payments to improve quality and value outcomes. While the clinic discontinued its Medicare bundles and Medicare Advantage health plan, it is positioning itself for commercial ACOs.

4. Rockledge, Fla.-based Health First is developing a fully integrated delivery system and health plan under a capitation model.

5. Salt Lake City-based Intermountain Healthcare also uses a capitation model, under which it formed a health plan offering commercial, Medicare Advantage, Medicaid and exchange policies.

6. Columbus, Ohio-based Nationwide Children's Hospital likewise uses a capitation model in its move toward value-based care. The hospital accepts full-risk sub-capitation from Medicaid managed care plans under a joint-venture physician hospital organization, which was formed with affiliated physicians.

7. Saint Luke's Health System in Kansas City, Mo., participates in Medicare bundled arrangements. It is also considering participation in CMS' Comprehensive Primary Care Plus program, following Kansas City's selection as a target region.

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