At-Risk Contracts Push Quality, Value

The challenge remains measuring total cost of care. Contracting with risk can help get you there.

Anil Keswani, MD, is disheartened about the integration of behavioral health into the health insurance equation but not necessarily for the reason you think. Yes, he believes people can be treated more efficiently and with much more success if behavioral health can be better-integrated into the healthcare continuum.

There is a more pressing business problem with carving out behavioral health from most health plans—which is more often the case than not these days: It becomes more difficult for hospitals and health systems to make accurate calculations on total cost of care. Those calculations are critical for future success at Scripps Health, where Keswani is corporate vice president of ambulatory care and population health management.

Divorcing behavioral health from the equation is not the best patient care. It also screws up predictive analytics, which is the key to managing the health of populations, he says.

"The challenge is sometimes that's not how the game is played," he says. "When you get to ACOs and capitation, you bring more of that total cost of care in the conversation. What I like about value-based contracts is they allow you to look at the entire spectrum of care, not just the episode."

For that reason, Keswani hopes that behavioral health can be integrated sooner rather than later. In any case, he feels better-positioned to do something about the disconnect because there's promise in risk-adjusted capitation, which Scripps has encouraged in its commercial contracting strategy.

This risk-adjusted capitation has allowed Keswani and the system's physicians to focus on value, which is something that has been extraneous to the hospital or health system's business model for far too long.

That's why Keswani is happy to talk with any payer who wants to negotiate with the health system on the total cost of care for its beneficiaries.

"I don't care what they call it, I'm interested," he says.

It's important that Scripps is evaluating dedicating analyst support to the issue. Keswani says he's confident the health system will improve faster under these contracting arrangements, which is why the system is pursuing them so aggressively.

"There are large data sets we can use to look at total cost of care, risk adjusted," he says.  

Keswani credits Scripps CEO and President Chris Van Gorder with recognizing "a couple of years back" that the health system wouldn't move as quickly toward understanding population health and total cost-of-care concepts unless the organization pushed into risk-adjusted capitation, so it converted many of its contracts to that model.

There were growing pains, as expected, but Keswani says pushing into the space was critical because it kept Scripps off the back foot in negotiations.

"One of our medical groups had trouble with capitation because they were seeing a lot of adverse selection and so (they) were struggling under that model," he says. "We should not be harmed for doing the right thing for people who need more intense care. Our risk-adjusted cap allowed us to re-enter that model."

Physicians have been patient, Keswani says, thanks to a decade-long relationship with the health system that put physicians at the negotiating table and supportive and focused on moving the organization the right way.

"If we get them to help build the system, the process will be ongoing," he says. "Now we're building a process around formulary management. I know it's going to work because I'm having the physicians develop it."

The business model that works for Scripps has changed as it has embraced capitation, he says. Much of the evolution that's taken place in the health system over the past several years would not have been possible without embracing new reimbursement schemes that reward value.

"We know the world of healthcare is changing toward more value-based care and we've seen a million presentations on it. The challenge is how do you and your team execute?" says Keswani, who first encountered discussions about value in healthcare nearly 10 years ago.

A simple-sounding, but critical component how "quality" is measured and defined. Process measures are only a half-step, and surveys can only tell you so much. Keswani is encouraged that quality has as much sway as financials in the boardroom these days. Indeed, the goal of capitation is to better-align the two measures.

"Our community board members know more detail about some of our top quality issues than you would imagine," he says. "I find this fascinating because quality has entered the boardroom."

Scripps is also redefining its business model in public-facing ways. "We're known for being a hospital system, but our access points should not be ERs," Keswani says.

The health system recently built a new sub-brand, Scripps Health Express, a network of quick care clinics creating convenient system "access points" for patients. Scripps is also collaborating with employers to develop what Keswani calls "near site clinics" for employers not large enough to have an onsite clinic.

Progress is being made, but Keswani hopes to achieve better value through integrated behavioral health.

"For people with the means, there is still a fragmented system but the means to pay for it. If you don't have the means, you'll find a fragmented system and sometimes people slip through the cracks," he says. "There's a structural problem around behavioral health but we're beginning to chip away at it."

Scripps is in two commercial ACO models. One is a Cigna collaborative and one is a California Blue Shield ACO, which both provide data on an episodic and risk adjusted basis. Representatives from the insurers confer with physician and staff leaders about the data, and Keswani says Scripps has gotten actionable data on total cost of care.

"We want them to show us how we're doing compared to others in the ACO model," he says. "We want to get high performers in room and have them teach others, and to tell us where we're not great."

One ongoing challenge and frustration remains the speed of change, Keswani says.

"One of my mentors when I was younger and learning management noticed my impatience and he pulled me aside and told me every dance has its steps," he says. "I learned from that. We want to move faster, but if you're moving faster than the music, that's out of sync. We're aligned a little bit ahead of the curve but we can't go tomorrow when the market isn't there yet."