CMS backing away from value-based payments? Not so fast….

Despite CMS changes to bundled payment models, value-based care is here to stay – making disruption and innovation even more important. Here’s what you need to know.

Last week’s CMS proposed ruling, which would cancel three mandatory bundled payment programs and cardiac rehabilitation incentive payment model and significantly roll back a fourth, left many wondering: do these changes signal a shift away from value-based care?

Not a chance.

In fact, it is widely viewed that the proposed rule, which would also cut the number of locations mandated to participate in the Comprehensive Care for Joint Replacement, or CJR, model from 67 to 34 and cancel Episode Payment Models and the Cardiac Rehabilitation incentive payment models that were supposed to begin on Jan. 1, 2018, would allow for greater flexibility among providers. Though some may think they are getting a pass in not having to move away from fee-for-service, this is not the case.

Value is here to stay. If ever there were a doubt, all we need to do is reflect on the reason this shift began in the first place. The ACA was the catalyst for the move, and though questions linger about the future of the ACA, it appears more and more likely that it’s here to stay, with modifications. And, with all the brouhaha over the ACA, it’s important to remember that the U.S. healthcare industry was already headed toward a value-based system, as experts and policy analysts had long warned that the fee-for-service healthcare model is unsustainable.

With the ongoing debates and changes by CMS, the shift to value creates opportunities in the market for innovation. Delivering a new kind of healthcare experience is driving existing and new players into entrepreneurial partnerships—and competition—unlike what the industry has previously experienced.

So, what’s next? While the ACA itself will change, the overall direction of healthcare as an industry will not. The drive and pressure to reduce costs and deliver value will accelerate among industry stakeholders, resulting in new models of care, new partnerships, and new demands for each to clearly delineate the value they contribute. Organizations must continue to invest and innovate. Along with cost pressures, competition from sources such as retail health, concierge medicine, and mobile technology are changing the market.

As you look to innovate and drive change across the organization, be sure to:

• Decide what your organization must do to meet emerging consumer trends
• Identify what you can realistically accomplish in-house and your limitations
• Find partners to fill in the gaps.
• Build pilot programs with quick iterations and low risk to failure
• Top down: ensure clear strategic alignment, prioritization governance, and budget process
• Bottom up: ensure the pieces are in place for execution, including project teams with necessary expertise
• Incorporate voice of the customer into product/process development
• Remove organizational siloes.

Despite what becomes of the ACA and the evolution of bundled payment models, disruption is here to stay. Shape your organization’s future—and the future of healthcare—by using a consumer-centric filter and a flexible approach to strategic planning. Those that fail to anticipate trends and competitive forces stand to lose out to new entrants to the market.

About the author:
Steve Gordon, M.D. is a national principal healthcare consultant with Point B Management Consultants. Steve has three decades of progressive healthcare experience as a clinician, educator, executive, and board member. Steve trained in internal medicine at Massachusetts General Hospital and attended Harvard University for his Bachelor, Master in Public Policy and MD degrees.

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