Attend any healthcare conference and you’ll speedily discover that it’s become downright all the rage for healthcare leaders to talk about their steadfast commitment to “value-based care.”
The outing has become ubiquitous in healthcare circles. Its virtuousness goes unchallenged.
Unwavering Commitment to “value-based care.”
Michael E. Porter and Elizabeth Teisberg (with whom I worked as a student and college at Harvard Business School from 2006-2010) popularized the value equation (Value = Quality/Cost) and suggested that improving value should be any healthcare system leader’s highest aim.
Since that time, the federal paperwork has introduced a number of policy instruments to accelerate the transition to including Medicare Advantage, accountable care organizations, and bundled payment models.
New startups—such as Aledade, Iora Health, Landmark Health, Oak Street Health, and VillageMD—have arisen when the intent of bringing value-based care to the masses.
And big-box retailers such as CVS, Walgreens, and Walmart, too, have jumped upon the value bandwagon.
The underlying principle of “value-based care” is simple enough—managing to a subjugate cost of care for a population of patients, while aiming to add up outcomes.
But what does this value-based care look like in practice in the real-world of accommodating care (beyond the industry conference jargon and academic expositions upon the subject)?
I got the idea for this column after a recent call subsequent to a close professor buddy who has long been a follower of value-based care. On our call, he expressed dismay at his mother’s care in a value-based medical group that was contracted with her Medicare Advantage plan.
On one occasion, his mommy was discharged from a hospital sooner than he felt she should have been (she was far ahead readmitted). On unorthodox occasion, she was denied entrance to a tertiary cancer center, where he believed she should have taking into consideration for a second opinion. And upon a third occasion, she was denied entrance to a specialist who my buddy felt could have corrected an earlier, botched cataract surgery.
As my buddy decried his mother’s care experience, I couldn’t put taking place to but think that he (and others) are anyhow failing to be unventilated to the dots between the treaty of value-based care and its real-world implications. Which got me thinking that it perhaps might be willing to help for all of us to look closely at what value-based care means—good and bad—for patients receiving care governed by its principles.
These notes arise from my time as an academic studying value-based care; my leadership of CareMore and Aspire Health, the value-based care delivery divisions of Anthem Inc; and my current role leading SCAN Health Plan, a non-profit Medicare Advantage health direct that partners next door to with many value-based groups.
Tracking Hospital
While pharmaceutical costs gain a lot of attention, the single most expensive line item for many groups effective in the “value-based care” space is handing out of acute hospital bed days. A day in the hospital can cost as much as $3,000-$4,000. Given these hefty cost implications of a single morning in the hospital, leaders of many value-based care organizations are in the craving of tracking hospital bed days (bed days/1,000 patients) and entrance rates (admissions/1,000 patients) on a daily basis. The subjugate the numbers the better.
The overall try is to attempt to avoid hospitalizations by closely managing patients in outpatient clinics and sometimes directly admitting patients to bright nursing facilities, whose costs are significantly belittle than those of hospitals. Intensive outpatient paperwork often includes enhanced admission to primary and urgent care and better doling out of chronic disease—all taking into consideration the endeavor of reducing emergency room visits and subsequent hospitalizations. Many value-based care groups after that make house calls to patients. The more technologically-enabled ones remotely monitor patients at particularly tall risk of hospitalization.
Such gruff bed day paperwork often translates into degrade hospitalization rates and abbreviated hospitalizations, but it can sometimes leave patients and families feeling short and uncared for in their most vulnerable moments. Patients who expect (and sometimes need) long hospital stays might be surprised when they’re discharged rudely to their homes with house care facilities or to skilled-nursing facilities in lieu of an further few nights in the hospital.
In addition, many value-based care groups prioritize pain reliever care and proactively transition patients to hospice—in part, because it’s often the right situation to do, and in ration because patients later than end-stage conditions often gain admitted to the hospital and utilize countless expensive (and futile) hospital bed days. Patients in these groups sometimes character that their doctors are quickening them by the side of the alleyway of pain reliever care and hospice prematurely, when they themselves have a want to save fighting their illnesses.
Specialist care
Like hospitalizations, specialist care—with all of its united tests and critical procedures—can be expensive. In fee-for-service environments, primary care physicians often lecture to patients reflexively. Chest pain? Cardiologist. Stomach pain? Gastroenterologist. Rash? Dermatologist. Aggressive specialty consultation is a mainstay for many fee-for-service primary care doctors.
In value-based care organizations, patients lead in the hands of confident generalist primary care physicians who accept more responsibility for patients and their outcomes than those who acquit yourself in received primary care models. These generalist doctors only direct to specialists following they need an highly developed opinion or the patient requires a procedure that they aren’t accomplished to feat themselves.
Of course, there can be a downside. Patients who belong in the hands of specialists are sometimes delayed getting there—and can vacillate and have poor outcomes correspondingly of those delays. Because of the focus on gatekeeping, patients often locate themselves irritated by utilization management—the administrative process through which health plans and medical groups review referrals to specialists and orders for analytical tests. And patients aren’t the single-handedly ones complaining. Almost every practicing doctor will say you stories more or less how much decree it sometimes takes to obtain praise for referrals that are absolutely indispensable and just make common sense.
Relationships
Many value-based care groups contract once narrow networks of specialists and medical centers. Members of these networks are usually fixed because they have contact with the primary care groups and are sometimes employed members of their group (as behind Kaiser Permanente).
Increasingly, groups are using network diagnostic tools subsequent to Cotivity’s RowdMap and Embold Health to identify so-called “high value physicians” who are thoughtful and cautious about their use of systematic tests and procedures.
The assistance of these kinds of networks are manifold. Groups purposefully curate specialists who communicate and coordinate effectively with primary care physicians and practice high-quality, evidence-based medicine. Group selection of specialists eliminates the guess-work that sometimes plagues patients (“Who should I look for….?”). And these specialists often operate on common electronic health folder systems that can more seamlessly assist care coordination and the flow of uncomplaining information across clinical sites.
The downside is that some value-based networks are therefore focused on cost dispensation that they tend to contract later than specialists and hospitals based more upon cost than upon quality. Many “value-based” groups seem to steer certain of contracting as soon as the most reputable (and sometimes far ahead quality) hospitals and their joined physician groups because they are expensive. Patients used to going to everything facility they once for care are often amazed at how narrow the offerings are within their networks, especially in the unfortunate circumstances afterward patients tend to purpose out severely specialized care facilities (i.e. cancer centers) and specialists.
In addition, some patients locate that small, carefully curated specialist networks subject them to significant, potentially harmful delays in accessing care.
Reduce Costs
Again, seeking to condense costs, many value-based care groups often introduce further types of clinicians in the care of patients. This is frequently known as “practicing at the summit of the license.” In practice, it means groups addition the play a role of physicians gone nurse practitioners, pharmacists, physician assistants, registered nurses, medical assistants, and community health workers.
The supplement of these clinical practitioners can intensify access to care and also add together outcomes subsequently they work as ration of a team to more effectively coordinate the care of patients and control their chronic conditions. The best value-based care groups have determined and involved rubrics for how anything members of the clinical teams produce a result together to support patients.
On the additional hand, patients who want to see physicians—or, sometimes, need to see physicians—often get frustrated that right of entry to generalist physicians (and specialists) might be limited by non-physician gatekeepers. What’s more, the worst value-based care groups use professionals of whatever types interchangeably without paying near attention to differences in skills and knowledge across clinician types—or articulating a determined view as to how to coordinate efforts across disciplines.
lower drug costs
Value-based care groups that are managing to the cost/quality threshold are often quite conservative in the forward movement of the formularies they hire for the care of patients.
In practice, this means they tend to favor drugs when a significant evidence base and often prioritize the delivery of non-branded generic pharmaceuticals in lieu of branded drugs, and sometimes older drugs in lieu of newer drugs. What this translates to for price-sensitive patients is often subjugate drug costs and a focus on affordability of the therapies that they are prescribed.
That said, some critics argue that value-based organizations sometimes seem anti-innovation, as they can be slow to adopt supplementary drugs upon formularies and are sometimes price-focused to the reduction of ignoring cutting edge cost drugs that can meaningfully assuage patients’ suffering. The same can be said about futuristic diagnostics and newer procedural interventions.
Value-based care groups can speedily find themselves at odds past their patients past their recommendations and treatment plans contradict what patients themselves learn behave their own research on the best and most innovative course of take steps for their condition.
Pro Non-Medical Interventions
Many groups that are “value-based” assume full responsibility (often known as “full risk”) for the sum cost of care. These groups, which are known for grating to dream at the root cause of why someone is absorbing healthcare services, sometimes focus upon non-traditional, non-medical interventions that tally up outcomes though lowering the sum cost of care for patients.
When I was at CareMore, our care organization team subsequent to procured a refrigerator for a long-suffering who needed it to addition his insulin, recognizing that without the refrigerator, the tolerant would likely home in the hospital with tall blood sugar. Rushika Fernandopulle, the founder of Iora Health, tells the credit of buying an Apple iPod to soothe a uncomplaining whose protest led him to the emergency room beyond 100 get older a year. At SCAN, our Healthcare in Action medical group, which treats people experiencing homelessness, sometimes provides cell phones to patients; connectivity is important for people irritating to permission shelter housing.
Some people, hearing these exceptional stories, might argue that they are just that—stories—that don’t reflect their own experience of care. And few large-scale studies of interventions to habitat social determinants of health have unproductive to excite any meaningful healthcare setting or cost benefit to the programs.
What’s more, while many value-based care organizations (including two I have led) provide entry to gym benefits, transportation, food, and additional interventions expected to tote up key drivers of health, the published literature does not Keep the notion that these minister to have a meaningful effect upon cost or the character of outcomes—though the effect upon select individual patients is incontrovertible.
Revenue Focused?
While in its purest form, value-based healthcare is roughly lowering the total cost of care by ensuring that patients are healthier and are making judicious use of the healthcare system, many organizations spend significant sparkle trying to optimize revenues they earn serving patients.
Payers (including the federal Medicare program) typically get used to payments for patients based on the severity of their illnesses. As a result, many value-based care organizations spend significant life documenting the sharpness of illness—time some patients may quality takes away from actually caring for them. For example, some medical groups hire home-based “welcome visits” from third-party vendors turn your back on annual physicals. The plan of these visits is not at all sure to patients. But for the medical groups, these “welcome visits” identify unmet medical needs and set in motion appropriate referrals, while enabling groups to document all of the medical conditions patients experience.
Yet as few would dispute, at their worst, these visits are sometimes definitely divorced from a patient’s care and serve exclusively to maximize the payments groups receive from payers. These types of visits are often regarded as non-value other overhead.
lowering the sum cost
As I explained to my friend who was concerned virtually his mother’s care, the untold balance of value-based care is that lowering the sum cost of care though improving environment necessarily means creating some abrasion for some patients some of the time. And subsequent to this abrasion will inevitably come the feeling of a exploit of interest, real or imagined. The financial bottom-line of the doctor and his medical bureau may sometimes go neighboring the care that the accommodating feels he or she needs. As my late economics teacher, Martin S. Feldstein, often said, “There’s no such situation as a clear lunch.”
When a doctor denies a long-suffering a test or other drug or referral to a specialist, is it because we are in reality optimizing the care of the patient?
Or is it because we are optimizing the economics of the value-based group?
In an era subsequent to many “value-based groups” are backed by venture capital, owned by private equity firms, or publicly traded, is the decision to deny a specialist referral or the latest additional pharmaceutical instinctive made to optimize care or to guard quarterly earnings?
Said substitute way, is the near term enactment focused upon the cost portion of the famed value equation? Or the quality portion?
It’s not always easy to know.
This set of questions and observations should not be get into as a reason of the costly, traditional fee-for-service system, which has its own skew towards over-delivering care, often with Tiny to no plus to patients. Nor should it be approach as a rebuke of value-based care.
But with everything of the optimistic fanfare (a small portion of which I, too, am guilty of generating) must plus come a dose of realism. Value-based care can indeed be an answer to some of what ails American healthcare, but at its commencement there must be something somewhat increasingly quaint and elusive:
An ethical underpinning to always accomplish what’s right for the patient.
For value-based care to succeed, groups must have a robust clinical (and financial) culture in place to ensure that rude practices to run costs are pursued through the lens of legal benefit to the patient, not the financial interests of the group. The happenings to which we subject patients must be guided by the “radical common sense” that all one of us would want to see in exploit for ourselves and our parents.
Absent such a culture, value-based care will be the latest strategy we take to erode the most precious asset we have in the American healthcare system: the trust of the people we serve.
