Carla Smith outlines the role that a value-based care (VBC) approach can have on both reducing healthcare costs and improving overall care delivery to patients in the USA. Smith highlights VBC’s benefits to patients, payers and pharma companies, but notes that physicians are still not necessarily convinced; meaning the adoption of a more inclusive co-creation approach is vital.
Value Based Care as the “Next Great Thing”
The US spends way too much on healthcare – almost 18 percent of our GDP. Value-based care (VBC) is intended to reduce costs and improve overall care delivery to patients – two key attributes in changing the trajectory. Clinicians and healthcare facilities in VBC programs are financially rewarded when they provide evidence they’ve helped patients improve their health, reduce the effects and incidence of chronic disease, and live healthier lives.
This approach differs from the fee-for-service model where clinicians are paid based on the quantity of services provided to a patient. With VBC, stakeholders are paid based on outcomes of the care received by the patient, in alignment with the presenting needs. For example, health plans and pharmaceutical companies are entering into VBC partnerships in which outcomes from medication and digital therapeutics are the primary drivers.
As noted in a 2017 New England Journal of Medicine article, “The transition from fee-for-service to fee-for-value has been embraced as the best method for lowering healthcare costs while increasing quality care and helping people lead healthier lives.”
CMS Administrator is Serious about VBC
The news in 2019 on VBC in the US comes from the Centers for Medicare and Medicaid Services (CMS) with the new models designed for primary care physicians. Ever since she became CMS Administrator, I’ve said Seema Verma is serious about value and interoperability. CMS’s actions since the start of the year are good examples of her commitment.
CMS’ Promoting Interoperability program, launched this year, provides new interoperability guidelines for hospitals and providers. The intent is to ensure both types of care settings have the technologies and policies in place to securely and appropriate share health data electronically with patients and their clinicians. While not specifically a VBC program, this program establishes a needed and important foundation for digital access to and sharing of patient health information.
In April, US Secretary of Health and Human Services Alex Azar and Administrator Verma announced CMS’ Primary Cares Initiative, a new set of payment models intended to deliver better value for patients throughout the health care system.
Then, in May, Administrator Verma introduced a proposal to “transform the way CMS pays certain rural hospitals and hospitals in other low-wage areas.” The strategy proposes to change CMS’ payment structure for certain rural hospitals, as well as hospitals in other low wage areas. If finalized, the proposed policies go into effect in October 2019.
Benefits of Value-Based Care
Focus on the Patient
VBC focuses on improving care for patients. And, we know that patients want access to their personal health data; a goal that requires improved data accessibility through secure, appropriate electronic exchange.
With the existing CMS MyHealthEData Initiative, patients not only control their data, it follows them through their health care journey. Secretary Verma proposed policy updates to this initiative in February 2019 through the Interoperability and Patient Access Proposed Rule.
Medicare’s Blue Button 2.0 allows the more than 53 million Medicare beneficiaries to securely access and share their personal health data electronically in a readable format to other caregivers, and keep their data in their own personal file. Medicare controls identity and authorization of the data sharing, while the patient gets to make the decisions of when, and with whom, to share data.
This data reveals a variety of information about a beneficiary’s health with four years of Medicare Parts A, B and D information: type of Medicare coverage, prescriptions, primary care treatment, and costs for care.
Focus on the Private Payer
While the Blue Button 2.0 program represents just one component of value-based care improvements, it’s important because CMS has asked private payers to participate, as well, by sharing claims data through Blue Button.
“For the first time, we are proposing that all health plans doing business in Medicare, Medicaid and through the federal exchanges share health claims data and other important information electronically with their patients,” Secretary Verma said in February 2019.
“With all of those plans on board, by 2020, 85 million patients will have access to their health claims information, in addition to the nearly 40 million beneficiaries in traditional Medicare who already have access to their information through our Blue Button 2.0 API. Beneficiaries will now have access to electronic claims data, including pricing information that can be aggregated in one place.”
Focus on Pharmaceuticals
In January, UPMC and Astra Zeneca announced a value-based, risk sharing partnership. Specifically, reimbursement for AZ’s drug Brilinta will be linked to cardiovascular outcomes for people treated with this medication following a recent hospitalization for heart attack or unstable angina. The contract reduces the costs for UPMC “for Life” Medicare members, and clinical outcomes will determine the level of shared costs between UPMC and AZ.
Recent Example of VBC Success
In February, Cigna announced $600M in medical cost savings thanks to VBC. According to their news release, “Cigna has exceeded its value-based care goal of having 50 percent of US Medicare and commercial health care provider payments through alternative payment arrangements in the company’s top 40 markets by year-end 2018.”
Accountable care organizations (ACOs) are part of Cigna’s equation: the payer noted that top performing ACOs had an 11 percent better quality performance than the market. And, 92 percent of Cigna’s providers either met or exceeded Cigna’s quality benchmarks.
However, Physicians Are Not Necessarily Convinced
Providers want, and need, detailed clinical information to best evaluate and treat a patient. And, clinicians have always been committed to their patients, and want the best for them. The method of compensating physicians, however, has a long and somewhat stormy history. Physicians are not necessarily convinced that VBC is the right model.
From a 2018 Future of Healthcare report with more than 3,400 physician respondents, we know 43 percent believe VBC will negatively impact physician-patient relationship, and 61 percent believe value-based care will negatively impact their practice.
And, in more sobering news, Business Insider reports that 90 percent of physician respondents to their recent survey say CMS’ move to VBC has increased their regulatory burden, and 80 percent say the shift to VBS has been unsuccessful.
We Must Use an Inclusive Co-Creation Approach
We need to pay very careful attention to these findings as physicians are vital to our health eco-system. We are already experiencing a gap between our needs for primary care physicians, and the available pool – this gap is expected to grow. And, physicians are reporting increasingly concerning levels of burn-out.
All models of care must involve physicians and patients as partners and co-creators. Only through an inclusive process can we realize long-term, profound, and positive change in our healthcare system.
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