Benefits and Compensation

How Health Plans Help Providers Convert to Quality & Value Models

Health care providers need help moving to value-based reimbursement and adopting accountable care models, and insurers and health plans often provide the best support, health plan executives told a recent conference. They discussed best practices for helping providers adopt value based pay and outcome-based reimbursement on April 11 at the World Health Care Congress in Washington, D.C.

Drivers forcing providers to adapt to value based reimbursement include a retail environment accelerated by the Affordable Care Act, the drive toward consumer-driven health care and the MACRA legislation of 2015.

Pay Finally Being Linked to Performance

The Medicare Access and CHIP Reauthorization Act of 2015 repealed the Medicare sustainable growth rate and created another system for controlling physician payments. Important details are yet to be fleshed out over the coming years, but there will be a two-track system. Under one of these alternative tracks, providers may choose to be reimbursed on a basis akin to fee-for-service. However, pay will vary based on performance, which will be assessed on the following four factors:

  • clinical quality (care coordination, patient experience, prevention and population health);
  • resource utilization;
  • meaningful use of electronic health records; and
  • clinical practice improvement.

The second alternative payment track represents a more dramatic departure from FFS. A host of questions remain to be resolved, and the Centers for Medicare and Medicaid Services in October 2015 started accepting comments to help it develop its merit-based incentive payment system. It envisions that roughly half of Medicare physician reimbursement will hinge on a practice’s adoption of an accountable care model or patient-centered medical home, starting in 2019. The MACRA legislation creates strong incentives for physicians to adopt ACO, PCMH and pay-for-performance models.

Another CMS initiative promoting quality and linking pay rates to it, is the “Comprehensive Primary Care Initiative,” unveiled April 11, which is testing population-based care management at health care facilities in New Jersey, New York, Arkansas, Oklahoma, Ohio, Kentucky, Colorado and Oregon. It will help primary care practices:

  • support patients with serious or chronic diseases in achieving their health goals;
  • give patients 24-hour access to care and health information;
  • deliver preventive care;
  • engage patients and their families in their own care; and
  • work with hospitals, other clinicians and specialists to provide better coordinated care.

Many Providers Welcome Help from Plans

Health plans can help smooth provider transitions toward preventive care, population management and phasing out the FFS system, according to Jeffery Spight, senior vice president of ACO market operations for Universal American. Relations between health plans and providers are rapidly shifting from being adversarial to being more collaborative, he said, due to aligned interests, in which transparency is key and there is a new need for trust.

Small providers need more help from health plans, such as single-physician offices that do not have the possibility to buy new software systems or stay open for extra hours, according to Robert Hinckley, VP for the Capital District Physicians’ Health Plan.

Because the government is driving it, much of the progress has been occurring within Medicare and Medicaid populations. Thus, Medicare Advantage vendors and state Medicaid programs have learned they must take into account the different populations being targeted with care, and avoid a one-size-fits-all strategy.

For example, Medicare is an elderly population, while Medicaid has a traditional population of poor mothers trying to insure their children. At the same time, these programs are evolving: for example, Medicaid health plans are learning ways to provide comprehensive services to increasing numbers of homeless men with little income. The differences among children, the elderly and the homeless, for example, affect the continuum of care, and the medical home models must be tailored accordingly, Hinckley said.

Achieving physician buy-in involves more than just applying new medical records or scheduling software, Hinckley and Spight agreed. To avoid making physicians reject initiatives, the speakers suggested that plans:

  • Rely on data-driven decision-making instead of relying on guesswork or intuition.
  • Accommodate the pre-existing nature of the practice and blend innovations in with that nature. Health plans have to resist the temptation to intrude on the providers’ pre-existing systems. Avoid a controlling approach and do not overly impose on provider coding, billing and scheduling, Spight said.
  • Do not wait until the first physician ratings come out to tell a doctor they’re in the middle or at the bottom. Work on explaining the rating system first so individual doctors will believe the validity of the data, and they are prepared to understand if they do not get a very high rating.
  • Make physicians the coaches for quality improvement and improving ratings. ACOs and medical homes are more successful if they have spokespeople whom other physicians will follow.

The medical home model and ACO can clash with profitability. Health plans can combat this perception by explaining why up-front investments — such as staying open an extra few hours on the weekend, providing more preventive care or adopting a PCMH model — can create efficiencies that will pay for themselves over time. But those changes are harder for some providers to implement. Also, they do not immediately produce return on investment, and (if improperly designed) sometimes not at all.

That means practices and health plans have to be nimble and ready to drop changes that do not produce ROI. They cannot keep saying “wait until next year” for ROI to materialize.

A smart adjustment is for health plans and practices to refocus and target adjustments onto populations and diagnoses where ROI is proven to happen. That can mean a practice that once aimed care coordination at 1,000 patients and saw no savings (or health benefits) can realize ROI by coordinating the care of the 50 individuals who need it the most and who are the most willing to cooperate.

The 13th Annual World Health Care Congress convenes decision makers from all sectors of health care to catalyze provider-health plan partnerships and health system change.

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