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Analysis

Are Your Value-Based Investments a Waste?

By Philip Betbeze  
   January 04, 2018

It could be tempting to think that your investment efforts in value-based contracting are wasted. But not so, says a former population health executive.

The future of value-based care has gotten a bit murkier in recent months. After hospitals and health systems have made substantial investments in technology, staff, physician practices, and spent considerable time and effort changing workflows and even the basics of their business model to adapt to value-based principles, they're left to wonder whether it all was wasted in the face of the proposed cancellation of mandatory Medicare bundled payment programs and growing MACRA participation exemptions.

But despite the chaos, it's worth recalibrating the changes you've made as an organization to adapt to the new reality, rather than returning to the practices and patterns of a volume-based business, says Chris Stanley, MD, the former system vice president of population health at Inglewood, Colorado-based Catholic Health Initiatives.

"No, those investments haven't been wasted," says Stanley, now a director in Navigant's healthcare practice, "but we are getting that question from a lot of our clients."

One thing to remember, he says, is that many organizations have made investments around episodes of care or in setting up ACOs to provide value beyond an individual program, such as hip and knee or cardio bundles. Those investments still have value beyond the isolated programs that are no longer mandatory, especially in the sense that they have helped align physicians, pull disparate IT systems closer together, and reengineer how care is delivered beyond an inpatient hospital stay.

Following are four tactics that Dr. Stanley suggests your organization can try that work well regardless of the reimbursement scheme, and which don't necessarily rely on specific value-based reimbursement programs to have, well, value.

1. Transition value-based investments toward the Medicaid population. Reducing unnecessary ER use and hospitalizations for Medicaid patients and the uninsured should pay off because these are populations for which providers are not adequately paid, if they're paid at all. Major elements of this strategy are squarely rooted in population health pillars, says Stanley, such as using primary care for risk profiling and other preventive care tactics. Developing community-based partnerships can help reduce uncompensated care costs with this population as well.  

2. Leverage value-based experience as a stepping stone to Medicare Advantage. Stanley says Medicare Advantage plans are appealing to baby boomers, payers, and providers. For the latter, MA is important because benefit design favors in-network utilization where the ROI from provider spending on value-based tactics is clearer than it is with traditional Medicare or many commercial plans.

Philip Betbeze is the senior leadership editor at HealthLeaders.


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