Value-Based Care in Medicare Advantage Saves Humana $4B in 2019

Humana doctors who take part in value-based programs through Medicare Advantage (MA) saved an estimated $4 billion in medical expenses in 2019, according to a report released today.

When Humana’s MA members saw physicians taking part in value-based care arrangements, they were less like likely to spend time in the hospital or seek care in the emergency room, and more likely to be screened for osteoporosis or get a diabetic eye exam compared with those who saw MA doctors not taking part in value-based models.

Value-based care models give physicians “’an expanded view of patients health” by allowing them access to patient data and offering other tools to offer more comprehensive care, according to a Humana statement. “Value-based care underscores the need to take a holistic view to help members achieve their best health,” said William Shrank, M.D., M.P.H.S., Humana’s chief medical and corporate affairs officer and a member of the Managed Healthcare Executive® Editorial Advisory Board.

“Central to this is the ability for value-based physicians to have access to a full and complete picture of patients’ health, including their clinical, behavioral and social needs,” Shrank said.

Value-based care models give physicians the ability to target those patients most in need of extra monitoring and education, and these strategies will be more effective as interoperability increases and physicians can more easily access data, he explained.

Prior reports have discussed Humana’s emphasis on limiting social isolation and making sure members get enough food. This year’s report said that those long-term strategies will be more important than ever as the healthcare giant helps physicians respond to the COVID-19 pandemic. While not part of the 2019 results, the report does discuss how Humana is expanding telehealth.

CMS has made MA a cornerstone of its strategy to deliver higher quality care at a lower cost. Officials announced recently that MA premium levels would reach their lowest levels since 2007, and that 26.9 million people are expected to be enrolled in a MA plan in 2021, a 10.2% increase from this year’s enrollment of 24.4 million. Humana, which has been increasing its sizable MA presence, recently announced plans to reach 39 more counties next year—up from 2,670 to 2,709.

Value-based care has been key to that growth. As of the end of 2019, value-based care arrangements covered 67% of the 61,900 primary care physicians who work with Humana. There are 1,000 agreements across 43 states and Puerto Rico.

The strategy is essential given that 85% of Humana’s MA beneficiaries have two chronic conditions. The most common is hypertension (66.1%), followed by Type 2 diabetes (30.6%), coronary artery disease (21.4%), and chronic kidney disease (20.8%).

Humana physicians who take on more risk are finding that it can pay off. The most common arrangement is fee for service plus limited shared savings in Medicare A, B and D, used by 36% of doctors, but 19% now take on “global risk,” or full responsibility in Medicare A, B, and D in monthly capitated payments. Smaller shares take on risk programs that fall somewhere in between.

Only 14% of Humana MA physicians are in pure fee for service, so a greater higher share are now in full, global risk arrangements than in traditional fee for service. Those who enroll in some type of value-based program earn 2.5 times on average than Medicare’s fee-for-service schedule and those in the global risk category earn four times as much.

HEDIS scores are higher for doctors taking part in value-based care, with significant differences that favor value-based care in pain screening, eye exams, blood sugar control, and reconciliation of medications after a hospital discharge. Physician-engagement scores, which include measure such as being able to get the right drugs to good care coordination, were higher for doctors in value-based care programs.