THE 'EDGE REPORT BLOG

Value-based: Are payers and providers on the same page?

The right care at the right time — with payments based not on volume but on value, improved patient outcomes and lower cost. Value-based healthcare just makes sense. Yet our country’s been slow to move from the long-entrenched fee-for-service model. Are payers and providers on the same page? What do they agree on? And how can data help payers and providers fully adopt value-based care delivery and reimbursement?

Are payers and providers on the same page?

In some respects, yes. In one survey, 67 percent of payers and providers said at least half their payments and reimbursements would be value-based by the end of 2018. Of those that had implemented value-based models, half reported they saw benefits. And most survey respondents — 86 percent of payers and 76 percent of providers — believed value-based healthcare would benefit all stakeholders.

What do they agree on?

Payers and providers agree not just in word, but in action. Both payers and providers have made significant investment, and they are signaling that value-based healthcare is the right path forward.

Aetna, Orlando Health and UnityPoint Accountable Care have formed an accountable care organization (ACO), hoping to help participating employer groups save 15 percent on benefit costs. Mercy Health is partnering with Cigna to more effectively manage chronically ill and high-risk patient populations. And Tufts Health Plan and Hartford Healthcare are teaming to offer value-based Medicare Advantage plans, pending CMS approval. These are just three of many payer-provider partnerships in the value movement.

Medical technology firms are getting in on the act, too. Medtronic has inked nearly 1,000 contracts to reimburse hospitals for some costs if its Tyrx antibacterial sleeve fails to prevent infections. The company’s deal with Aetna ties reimbursements to improved outcomes among diabetic patients who use Medtronic’s insulin pumps. Additionally, GE Healthcare and Philips each have several outcomes-based contracts totaling $2 billion.

How can data help payers and providers?

At the risk of oversimplification, integration of three data sets is essential to the move from fee-for-service to value-based: providers’ clinical data and payers’ claims administration and care management data. A primary care physician (PCP) may have robust clinical data on their patient encounters. However, their patients will visit additional physicians and facilities to meet their healthcare needs. Unless the PCP is part of an integrated care delivery system such as Kaiser Permanente, the PCP will rely in part on self-reporting for a full picture of the patients’ care.

This is where the health plans come in. Typically, they alone view a patient’s medical services across the care continuum. Therefore, its claims and care management data can be instrumental in helping the PCP coordinate the patient’s care through entire episodes by multiple providers.

Clearing the hurdles

Unfortunately, there are two hurdles to full, transparent data sharing by payers and providers. One is technology. Providers must invest in IT infrastructure that can process payer data; many are ill-prepared for the considerable download by payer systems.

The second hurdle is legal. If a payer fully shares data with a hospital system, for example, the data could fall into the hands of competing payers. Or, if the hospital can view the payer’s reimbursements to other facilities, the hospital could use this information to negotiate higher rates from the payer. Further, the hospital could collude with other providers when negotiating network pricing.

Do payers and providers have the will to clear these two hurdles to sharing data? Let’s hope so. No less than our nation’s health depends on it.

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