By David B. Snow, Jr., chairman and CEO, Cedar Gate Technologies.
If you are reading this, you already know that the fee-for-service model conflicts with the delivery of quality healthcare and the ongoing optimal management of chronic conditions. The model incentivizes the quantity of services rendered and disincentivizes preventive care. As a result, fee-for-service is highly inefficient for payers and not aligned with the sustainability of healthcare delivery systems.
Value-based care has presented a better model for providers, payers, self-insured employers, and patients alike. However, it was not until recently that value-based care was positioned for adoption at scale. The challenge in adoption has always been the realignment of financial incentives and focus on long-term optimization of patient outcomes. New technology platforms have had to evolve to the point they enable fully integrated analytics, population health management, and administrative capabilities to realize the transformational opportunity we have in front of us.
Value-based care is the path to translating early intervention into healthcare savings. In 2016, a study on primary care spending in the United States showed total healthcare costs increased from $810 billion to $1.6 trillion. Specialty care accounted for 75% of healthcare spending in the United States. According to the CDC, four in 10 Americans have two or more chronic conditions requiring continued treatment by specialists.
Comprehensive value-based care requires identifying health risks and chronic conditions early. It necessitates consistent monitoring of an individual’s health and the earliest possible interventions through primary care, and specialists when necessary. In value-based healthcare, getting patients to high-performing specialists, backed by clinical outcomes data, must be prioritized to avert severe conditions and their corresponding high costs. Early intervention is proven to drive the most optimal patient outcomes while significantly reducing cost. Meaningful, specialized intervention is one of the most powerful strategies for saving lives—and therefore, it should be at the heart of advancing healthcare.
Value-based Models are Ready for Adoption
Why isn’t there complete adoption of value-based care, given its alignment with patient outcomes and cost reduction? The factors are varied, but the perceived financial risks and lack of technology enablement have held back adoption – until now.
The reality is that value-based care requires a robust and unified technology platform. Many have been leveraging three to five-point solutions, with different data definitions across siloed systems. The result: constituents get different answers to the same question. A single data platform, fully integrated across the spectrum of needs for true, consistent efficacy, has been needed for more advanced adoption and more consistent positive clinical outcomes.
The trick with an effective platform is to have a foundational data lake where the data is homogenized, integrated, and enriched to the member level and available for all functions in the value-based equation. A complete data-set is needed to balance the care management equation at the patient level. What’s required is relative performance on a risk-adjusted basis to understand the cost and quality data models.
The technology supporting value-based models needs to streamline workflows while tracking patient outcomes. For example, when a specialist meets with a patient, they should not spend 25% of the appointment sifting through a 20-point system; the insights arising out of the data must be presented within the provider workflow, enabling the provider to optimize time spent with the patient.
The public health disaster of the pandemic has assisted with furthering the adoption of value-based models. It drove the seismic adoption of telemedicine dramatically increasing access to valuable provider consultation, enabling more efficient, direct care management with the patient.
The pandemic also catalyzed the benefits to providers of a value-based revenue model, and many regret deferring decisions to embrace the model pre-COVID. Existing value-based practices continued to produce revenue as in-person visits halted due to the risks of COVID-19. The unprecedented disruption to the access of care and the incredible speed required to adapt have left permanent, remarkable impacts that support value-based care adoption.
It’s a Journey to Full Adoption
Providers’ risks in moving to value-based care decrease with technology and new models that support an incremental journey. A popular initial strategy is moving to a shared savings model, a simplified method that provides members with a limited share in savings without being solely responsible for the risks incurred. In the shared savings model, providers can focus on learning how to manage risk and adopt actionable methods to bend the cost curve while improving quality – with analytics capturing the data and integrated care management tools utilizing the insights to provide care pathways and checklists.
The technology behind the shared savings system should also make operations smooth and efficient for the physician and support staff. A high-quality platform will facilitate communications and data sharing between the stakeholders in a patient’s care program. An integrated solution eliminates unnecessary duplication of effort and incompatibility issues that can arise from using multiple systems and siloed functionality.
Healthcare needs to advance, and advanced platforms offer an efficient path. Through technology and best practice medicine, healthcare can deliver high-performance clinical outcomes with improved financial outcomes. Providers need more time to focus on early interventions, hindering disease progression and driving positive outcomes for their patients, and payers need to avert costly late interventions. It’s time that we see all the factors that contribute to cost and quality at one time. It is being done successfully today by those who are leveraging technology and a much-simplified equation.