Will value-based healthcare be the answer to America’s medical woes? A significant subset of providers seem to think so. According to a recent survey of the NEJM Catalyst Insights Council, 42% of participants believe that value-based reimbursement models will one day supplant fee-for-service as the primary revenue model for healthcare in the United States.
The value-centric approach has been proven to work well for patients and providers alike. According to United Healthcare’s 2018 Value-Based Care Report, organizations that applied value-based models experienced a full 17% fewer hospital admits and ranked 87% better on top quality measures than comparable fee-for-service organizations. Doctors, too, benefited; the report noted that the physicians who participated in UHC’s value-based initiative received a collective $90 million in performance bonuses.
However, this coup hasn’t occurred quite yet; in fact, the above study noted that value-based reimbursement accounts for a quarter of respondent organizations’ total revenue. This statistic might seem small at first glance, but even that much change constitutes a significant step forward for a market that has long struggled to make stale, ill-suited fee-for-service models work for patients. That said, the widespread positive change that the model’s proponents hope for will not occur if provider organizations do not take decisive, proactive steps to change their approach to suit the priorities of a value-based system.
A Change in Priorities Demands a New Approach to Care
Fee-for-service and value-based models take a fundamentally different approach to reimbursement. With the former, providers take a reactive approach to patient care; they receive compensation for the care that they deliver on a per-unit basis (e.g., payment for individual tests, procedures, and care visits) only after the patient schedules a consultation. With value-based care, doctors are financially rewarded for providing high-quality care and proactively striving to keep their patient base healthy enough that they and don’t need to seek further treatment.
This is an approach dedicated to proactively keeping people healthy, rather than reacting to what comes through clinic doors. As we move towards a value-based market, healthcare leaders will need to change their focus from only offering clinical care to providing medical support within an effective community and interdisciplinary context. I’ve included a few leadership priorities that healthcare organizations will have to put front and center in the transition to a value-based system below.
A person’s health and well-being do not hinge solely on the quality of the medical care they receive. Instead, their wellness is the result of a complex convergence of factors such as food, economics, education, and their community and social services, and more. Any of these could have a profound impact on a patient’s physical and mental health — and yet, traditional care providers often have little influence over them. Instead, fragmented social service and community organizations are often responsible for helping patients address the social determinants of health.
With a value-based model, healthcare organizations are compelled to be proactive in their approach to patient care. For that reason, providers may benefit from forming strong partnerships with community organizations and finding ways to improve population health beyond what they might accomplish within the traditional bounds of a clinic or hospital. Healthcare leaders should consider how they might forge these connections — and what collaborative efforts might provide the most benefit to the communities they serve.
When it comes to crafting an effective treatment approach, the collaboration between specialty care providers and primary care physicians is critical. As one researcher for Johns Hopkins put the matter in a 2000 study, “Failure of specialty care (SC) and primary care (PC) services in providing coordinated care can result in major delays in diagnosis, iatrogenic complications, and even mortality.” When providers from various medical disciplines are siloed, they lose the ability to communicate — and work jointly on a patient’s case — effectively. Numerous studies have pointed to communication breakdowns as the reason behind collaborative setbacks such as misunderstood roles and subpar responsibility-sharing.
For value-based organizations, providing efficient, quality care is paramount. Healthcare leaders will need to eliminate the silos between specialty and primary care providers, facilitate better channels of communication, and set the groundwork for more effective partnerships. One 2015 study published in the Journal of Multidisciplinary Healthcare suggests that the best way to foster effective collaboration across these professional lines is to create opportunities for both informal and formal networking. These strategies could include hosting a bi-annual collaborative seminar or even creating a shared lunch space that encourages cross-specialty interaction.
The best way to facilitate effective partnerships that value-based care systems demand is to ensure that providers across specialties already have friendly and collaborative working relationships.
Organizational Transparency and Improvement
There is little doubt that value-based care will come to dominate the American healthcare market. However, the transitional period between then and now will be rocky. Leaders need to keep a keen eye on what changes are working and which are not; they need to be open to feedback and wholly transparent in their efforts.
The result will undoubtedly be worth the trouble.