How Health Systems Can Build Resilience & Downside Risk Performance Through Value-Based Care Operations

By Harshith Ramesh

The Center for Medicare and Medicaid Services (CMS) has made it clear that value-based care is here to stay — and that it will continue to test new healthcare delivery and payment models, as seen with ACO REACH. With the looming insolvency of Medicare’s trust fund hanging in the balance, the agency has set the aggressive goal of tying 100% of Medicare payments and 50% of commercial and Medicaid payments to downside risk by 2025.

When taking on downside risk, providers are rewarded when they beat the benchmark and spend less for the same population health outcomes — and penalized when they fail to meet it. In value-based care, it becomes even more important to ensure your operations are cost-effective, know how a given benchmark will affect your reimbursement, and understand how you can change your surroundings i.e., beneficiary pool, to improve disease management and prevent costly healthcare expenditures. Through my experience helping healthcare executives transition to value-based models, carefully considering these three steps has proven key to their success.

Step 1: Shore Up Operational Capabilities

When considering a value-based model, you will need clear insights into your organization’s spending trends, utilization, and operational and financial strengths and weaknesses. To unlock this knowledge, you must be able to aggregate data from multiple sources and carefully analyze it. Think of your analytics as the engine and your data as the fuel. If you fill a luxury vehicle with low-octane gas, its performance will suffer over time, and the same principle holds true for analytics. However, according to a recent survey, only 20% of healthcare executives reported fully trusting their data. Partnering with a vendor that offers: 1) pre-chart prep and concurrent coding programs and 2) a coding platform that pairs NLP technology with expert coder review can help improve documentation and coding without adding layers of administrative expense.

Outsourcing administrative work such as coding can also help reduce provider burnout, a leading cause of turnover. As demand for providers quickly outpaces supply, retaining clinicians and improving their operational capacity will be key. Are your providers spending most of their time caring for patients? Are they working to the top of their licenses? Are you developing your workforce with educational opportunities? Are you partnering with local colleges to ensure a pipeline of ancillary staff? Do you have resources in the wings to make up for shortages, i.e., health risk assessments and traveling nurses? These are all important questions to answer.

Leveraging technology designed to facilitate interoperability, such as automated record sharing and point of care tools, can also help reduce provider burnout. Implementing tools that make it easier to navigate technology and access data from different systems in near-real-time will allow providers to focus on clinical activities and improve decision-making and better health outcomes. As consumerism in healthcare continues to rise, finding ways to meet patients where they are has become increasingly important. Patient-centered technology, such as telehealth and remote monitoring devices, can help providers reach their entire population and provide continuous care for high-risk patients. This, in turn, can help retain your existing population and attract more patients.

Step 2: Tighten & Align Current Value-Based Care Agreements

Success in value-based contracts is ultimately judged against health outcomes vs. the cost and quality of care. Failure happens when the risk in a contract is too high and organizational capabilities are too low. Confidence in your organization’s operations will allow you to look at your contracts with a new eye and allow you to align them with your operational capabilities.

So, once you have completed Step 1 and ensured all operational efficiencies are in place, involve your legal and financial team to calibrate your risk contracts, taking into account:

● Service-level agreements for quality and care management

● Contract triggers, such as population and quality

● Capitation deductions/offsets

● Assignment limitations

● DOFR (division of financial responsibility)

Remember, payers and providers are taking on a new level of partnership and collaboration, and language issues can cause control problems. When reviewing contracts, be sure to focus on language and not just rates.

Step 3: Future State Planning

In the third and final step, you should look to identify conditions in the context of budgeting. Start by analyzing your coding data to understand your patient population and plan for future needs in terms of clinical care. This can help determine where to focus resource allocation, while disease burden knowledge can help determine which specialties to hire for or care management and ancillary services.

Ongoing network leakage and attribution monitoring will also be important here. They can help ensure payment accuracy and allow you to work through the process of bringing wayward patients back into the fold or off to the right provider.

To this end, a robust analytics platform can provide insight into:

● Risk score and disease burden

● Network leakage

● Attribution analysis

● Care management opportunities

● Resource allocation

Preparing for a Value-Based Future

Wherever on the risk spectrum you may be, success in a value-based model depends on having a deep understanding of your patient population. Population health strategies are not one-size-fits-all. They must match your community’s specific needs, organizational capabilities, and strengths. With this information, you can make informed decisions about allocating resources and best care for patients. In this way, value-based care is a framework everyone can win at — patients, plans, and providers.

Harshith Ramesh is co-CEO at Episource, which provides a complete and integrated set of services and products to simplify the way Medicare, commercial, and Medicaid health plans manage their risk adjustment and quality programs.