Skip to main content

New Partnership Boosts Transition to Value-Based Care at Primary Care Practices

Analysis  |  By Christopher Cheney  
   August 08, 2022

The partnership between Elevance Health and Aledade features a shared risk model, with a budget for the total cost of care for a population of patients.

A new partnership between Elevance Health and Aledade is designed to foster the transition to value-based care at independent primary care practices.

Elevance Health features several health plans, with independent primary care practices participating in Elevance Health's networks serving 47 million health plan members. Aledade is a Bethesda, Maryland-based primary care physician enablement company.

The partnership between Elevance Health and Aledade centers on a value-based payment model, says Farzad Mostashari, MD, co-founder and CEO of Aledade. "It is shared risk. We have a budget for the total cost of care for a population of patients. If we can reduce hospitalizations and healthcare costs come in less than the budget, Aledade and the practices share the savings with the health plans."

The value-based payment model in the partnership between Elevance Health and Aledade has several advantages over the fee-for-service payment model, he says. "Value-based payment arrangements can pay primary care doctors more for their services if they provide superior experience and outcomes for the patients. It means we have much more of an ability to do same-day appointments. If a patient has a need, instead of sending them to the ER our practices tell patients, 'Call us first.' In addition, when patients show up, the primary care doctors know more about the patient's needs than in a traditional system because one of the things the payer does as part of these agreements is give us access to their full claims history for the patient. So, the primary care doctor knows more about what is going on with a patient."

The partnership also promotes more engaged primary care for the patient, Mostashari says. "When my mom went to the emergency room, her primary care doctor was not told about it and the primary care practice did not have a workflow for calling patients who had been to the ER. Our practices call the patient if they have gone to the emergency room within 48 hours, and they find out whether the patient is OK or feeling better. Our practices have the incentives, the data, and the workflows to provide better care."

Independent primary care practices can benefit financially from value-based care, he says. "Hospitalizations are very costly. If we can prevent hospitalizations by doing better primary care, that can generate a lot of money for a primary care practice. With better primary care and prevention, we reduce hospitalizations and the primary care practices get a piece of the savings by keeping patients out of the hospital. For our average primary care practice in 2021, the average payment from the Medicare Shared Savings Program was $200,000. That is a lot of money for a primary care practice."

Improving finances is essential to sustaining independent primary care practices, Mostashari says. "At the end of the day, if we want to maintain independent primary care, we have to pay for it. Instead of squeezing practices out of existence or having them join a health system, which reduces choice and competition, primary care practices can make more money keeping patients healthy and out of the hospital. That is what doctors went to medical school to do."

The partnership between Elevance Health and Aledade also eases frictions between health plans and primary care practices, he says. "The practices are now on the same side with the payer. There are the same incentives—the payer is no longer concerned that the practices are going to drive up costs or provide unnecessary services because the doctors now have the same incentives on total cost of care. The payers can ease up on some of the administrative burdens that make doctors miserable. For example, there is less prior authorization. The payers do prior authorizations because they want to limit unnecessary procedures and medications; but doctors who are in our program have an expedited prior authorization process for hundreds of services."

Aledade gives independent primary care practices tools, support, and resources to make the shift to value-based care, Mostashari says. "That is what we were founded to do. That is how we serve independent primary care practices. We strive to be the 'easy button' for the practices so that they do not have to figure out how to get data out of the electronic medical record, they do not have to figure out how to connect with the health information exchange, and they do not have to understand the various options in government programs. They do not pay us a dime. We get paid when there are shared savings. There is no upfront cost."

Related: Value-Based Care Advances, but Transition Proves Challenging

Christopher Cheney is the senior clinical care​ editor at HealthLeaders.


KEY TAKEAWAYS

The new partnership has the potential to deliver value-based care for millions of health plan members.

One of the goals of the new partnership is to reduce hospitalizations through better primary care and prevention services.

Primary care practices can improve their finances through value-based care, says Farzad Mostashari, MD, co-founder and CEO of Aledade.


Get the latest on healthcare leadership in your inbox.