The Future of Healthcare Reimbursement Hinges on the Aligned Incentives, Actionable Data of Value-Based Care
Over the past several years, healthcare has been slowly but surely moving toward the adoption of value-based care. As the industry enters a new decade, the transition is finally picking up speed.
Many major payers and providers have already forged ahead with new collaborative strategies for meeting quality and spending targets. Yet a number of independent primary care practices are still unsure about what value-based care will mean for their patients and providers – not to mention the financial sustainability of their businesses.
“I’m here to tell you that it’s okay to come on in – the water’s warm,” said Farzad Mostashari, MD, CEO and Co-founder of Aledade. “And if you’re already dipping your toes in, you can put your whole foot in and come deeper. Value-based care is different than what you’re used to, but it can be a truly meaningful and sustainable alternative for fee-for-service.”
Value-based care, also known as accountable care, fundamentally changes the dynamic between payers and providers, Mostashari explained during a recent webinar hosted by MGMA.
“Ultimately, even the best fee-for-service relationship between a provider and a payer is a zero-sum game. You win and they lose, or they win and you lose – and most often, they’re the ones who win,” he said.
“The difference with value-based care is that you’re getting on the same side of the table with the payers and sharing a goal to work together in the best interest of the patient and of society. Fee-for-service doesn’t offer that opportunity.”
Especially in the midst of the COVID-19 pandemic, providers and payers must work together more effectively to help independent practices stay viable and able to serve their communities.
“I see a lot of willingness and openness right now to embrace this transition and help practices stay independent during the pandemic,” Mostashari commented. “Many payers have a lot of money on the books right now that they’re not spending due to reduced utilization of elective procedures this year, so they are looking for ways to support the transition to value-based care instead.”
Tanner Clinic in norther Utah is one provider that has successfully partnered with its payers, and with Aledade, to navigate the new value-based care environment. Sandwiched between Salt Lake City and the Idaho border, the multispecialty clinic now has about 60 percent of its active patient population in some type of value-based care arrangement.
“Value-based care isn’t always easy, but it certainly is worth it,” said Theren Stoker, COO of Tanner Clinic. “During our first attempts as part of an accountable care organization (ACO), we found that each of the payers would ask us for different things, and our physicians were frustrated that they spent more time checking the boxes than focusing on increasing value and quality of care.”
“We also felt somewhat beat up by our payers when they would say, ‘Hey, you didn’t complete this, this, and this six months ago,’ because there’s nothing we could do about it half a year after the fact,” he added.
As Tanner Clinic reassessed what it would take to succeed as part of an ACO, executive leaders and physician champions stressed the need for access to timely, meaningful, actionable data.
“When we started working with Aledade, that’s exactly what we got,” said Stoker. “Every other week, we sit down and look at the data and feed it back to our physicians in an actionable way.
“We’re able to become truly actionable for the patient while they’re in the clinic, which is leading to some fantastic results.”
Between the first quarter of 2018 and last quarter of 2019, Tanner Clinic saw a 12 percent decrease in ED visits per 1000 patients and a 24 percent drop in hospital discharges per 1000 patients. The clinic also succeeded in reducing 30-day all-cause readmissions by 11 percent.
These impressive improvements in care have also translated into savings for payers, including Medicare, and revenue enhancements for practices participating in the ACO.
Along with its partners in the Aledade Utah ACO, Tanner Clinic achieved a quality score of 99 percent in the Medicare Pathways to Success program during the performance year 2019. The ACO saved $7 million dollars and increased Medicare revenue for practices by 20 percent.
“We see a lot of practices who are justifiably proud of what good care they provide right now,” said Mostashari. “And yet, just by making a few relatively simple changes, they are able to get even better. That’s what value-based care can do.”
Stoker agrees that a commitment to value-based care can lead to significant improvements in care quality and financial savings. He credits access to meaningful data, collaborative financial incentives, and strong physician buy-in for the Tanner Clinic’s success.
“Actionable data and more aligned incentives have really started to have that visible positive impact that motivates buy-in and improves care,” he said. “We have so much more information about how to care for patients inside and outside the clinic, which helps physicians commit to doing things a little differently than they have done.”
“The key is to stick with it long enough to see both the financial results and better outcomes. If you can encourage those changes and improvements with timely, relevant, and meaningful data drilled down to the patient level, you’ll be able to see these positive outcomes, too.”