Measuring payer, provider progress in the move to value

Linde Wilson, a global health expert for L.E.K. Consulting’s Healthcare Services Practice, is surprised how quickly value-based-care models have taken off, though she acknowledges some parts of the country haven’t really embraced this change.

Managed Healthcare Executive(MHE) recently interviewed Wilson to get her perspective on the move to value-based care.  Previously, Wilson served as chief executive officer for both Sharon Regional Health System in Sharon, Pennsylvania, and Aria Health in Philadelphia, where she was also chief operating officer.

MHE: Provide a pulse on where things stand in the shift toward value-based payment. What surprises you?

Wilson:  First of all, the embrace of value-based payment has gone a lot faster than anyone had anticipated. More than 90% of payers have value-based products. And fee-for-service payments make up less than one-third of payments today. Of course, a lot of this depends on what part of the country you’re in.

This shift has been helped along by the Centers for Medicare & Medicaid Services taking a stand in this area. And that leads to private payers realizing that the movement to value-based payment is really happening. That said, I do appreciate the frustration that value-based payment isn’t moving fast enough-on the provider side, in particular.

MHE: Tell me what you’re seeing in different parts of the country in terms of value-based care.

Wilson: Rural areas are definitely lagging. Value-based care has really taken off in Massachusetts, where there’s a lot of competition. Rural areas don’t have that kind of competition, so it will be more difficult for value-based care to take hold.

MHE: What could help providers-even in rural areas-move toward value-based payment models?

Wilson: It’s really difficult for providers to live in two or three worlds, meaning the fee-for-service world and different value-based payment models with different payers. If you’re paid on a fee-for-service basis, then you have to maximize your services and you’re focused on what you’re getting paid for each service. If you’re paid on value, you have to look at the most effective and efficient continuum of care.

Provider organizations are going to need to pull the Band Aid off. They’re living today in a world where margins are getting smaller and smaller-still, regulatory requirements are forcing them to hire people to report on quality measures. They’re going to have to make changes operationally to enable the shift to value-based care.

Next: What payers should be paying attention to

MHE: What sorts of operational changes will providers need to make?

Wilson: They’re going to need to invest in technology to track patients and manage their care. Other areas where they should consider investing is with passive movement devices, which can be very helpful for patients recovering from hip surgeries.

Providers will also need to consider the types of investments they need to make in remote monitoring technologies to track patients in their homes. This is one of the evolving care models today, that of “home hospitalization.” The environment is very similar to a low-acuity hospital. In this model, patients are monitored on a remote and in-person basis by nurses.

MHE: What should be getting the attention of payers?

Wilson: Payers should be paying attention to the moves by some providers that are using their trusted brands to become insurers. Think of Geisinger Health System and University of Pittsburgh Medical Center, for example. This is a small population of providers, but it’s still very disruptive. Payers should be worried about this because it could mean losing members.

Payers are going to have start to consider building storefronts, real and virtual. They’re no longer just dealing with employer groups. They’re now serving consumers on a one-on-one basis. That’s a whole different perspective-and one that can lead to brand new products for consumers.