Over the next few years, health systems will need to decide when and how to make the move to value-based care reimbursement models.
Value-based care programs, such as many Medicare Advantage plans, can reward providers for the delivery of high-quality, cost-effective care. Despite the potential for improving both patient care and bottom lines, organizations are often leery of the transition, especially if they are operating successfully under traditional fee-for-service models.
Yet health systems that wait to participate in alternative payment models risk getting left behind. Consider, for example, that in 2017 one in three Medicare beneficiaries were enrolled in a Medicare Advantage plan; that percentage is expected to grow to 41% over the next 10 years.
Clinical and financial success is definitely achievable for health systems shifting to Medicare Advantage delivery and payment models – though the process is admittedly not easy. Success requires that the system undergoes significant realignment and design, starting with a comprehensive assessment of care delivery capabilities to identify potential gaps in knowledge, expertise and operations. For most health systems, working with an operating partner or collaborative payer is more effective than attempting to build internal capabilities from scratch.
Organizations that are developing a strategy to move to Medicare Advantage or another value-based care model - or even those health systems that already have an operational plan in place – should consider the benefits of collaborating with an experienced partner. For example:
1) Collaboration with the right partner to mitigate risk.
By collaborating with a company that has broad experience and proven results working with partners in value-based arrangements, health systems can leverage the knowledge and experience of people who have “walked the walk” before. An organization can further reduce risk when collaborating with a partner willing to accept compensation based on outcomes, rather than on consulting or software fees. The right value-based managed service firm provides expert strategic advising to accelerate success while minimizing the drain on administrative resources.
2) Operational expertise.
Achieving clinical and financial success with a Medicare Advantage plan is not a slam dunk, which is why many health systems seek collaborative partners that have the knowledge and experience to help create and capture value under value-based contracts. A successful transformation requires changes that affect all dimensions of the organization, including people, processes, technology, and data.
Health systems can benefit from the expertise of a partner that understands the challenge of orienting and training clinicians to a value-based culture that is focused on outcomes – especially if they are seeking to operate their own plan. Such organizations require tools to manage variations in cost and quality, determine care pathways, and address the care needs of patient populations. The first step for health systems is to assess their readiness and address any knowledge or technology gaps, including those that impact member acquisition, utilization management, regulatory requirements, and compliance. By partnering with an established value-based management service firm, health systems have access to operational expertise for everything from plan design to managing day-to-day activities.
3) Purpose-built technologies for better outcomes.
A collaborative partner can supplement an organization’s existing infrastructure with technology that addresses new financial, clinical and reporting requirements and helps drive optimized, cost-effective clinical outcomes. Successful value-based Medicare Advantage plans require a high-level of care coordination, deep insights into patient populations, and the proactive management of at-risk patients. Because these capabilities go beyond the scope of traditional EHR systems, health systems must either acquire new technology or find a partner that can provide tools to facilitate such tasks as health information exchange, population health management and analytics, care management, patient engagement, and performance reporting. With purpose-built technologies in place, health systems are better positioned to meet program objectives.
Health systems seeking to transition to value-based Medicare Advantage plans must weigh the benefits of working with collaborative partners versus building and operating their own plans. Most organizations will conclude that aligning with an experienced partner will provide them with the knowledgeable professionals, proven processes, and purpose-built technologies they require to drive a faster and more effective path to success.
By Debbie Zimmerman, MD – Chief Medical Officer of Lumeris and Essence Healthcare