The pursuit of value-based care has now spanned more than a decade as the healthcare system strives to move away from a fee-for-service (FFS) payment model, which is the root cause of a fragmented delivery of care. Value-based care shifts the focus from quantity to quality by delivering measurable outcomes that are relevant to the patient and the healthcare system itself. Using cost-effective ways, this care model places the individual at the center of care.
The relevance of adding value to care has been more pronounced at the height of the pandemic when hospitals were overwhelmed and doctors were exhausted. Patients with preventable illnesses were brought to the ER and patients who delayed care for fear of the virus experienced faster disease progression. Value-based care would have prevented an escalation or a costly hospitalization. With its high-touch care that leverages a team-based approach, physicians can focus more on the diagnosis and treatment.
At this point, it is only fitting to ask where are we now in terms of pursuing value-based care? Are we close to providing better quality and coordinated care? Are providers tapping into new income as they strive to add efficiency and effectiveness to their care?
How practices approached value-based care
Transforming age-old practices in healthcare cannot happen overnight, so naturally, the pace toward scaled value-based healthcare will be slow, but steady. There is already proof of stable growth as supported by a recent survey by MGMA and Humana. The study builds on a 2019 report that looked into the structural changes primary care physician practices must implement to effectively shift to value-based care.
The new report is based on the responses of 104 primary care practice leaders and how the pandemic has affected their transition journey.
Here are some of the essential findings on the practice’s journey in transitioning to value-based care:
1. Practice share of total revenue from value-based contracts remains stable.
- There is a slight decrease in the percentage of practices with 5% to 30% of revenues from value-based contracts. From 59% in 2019, it is now down by just 2 points or 57% in 2022
- Practices with less than 5% value-based revenue grew from 23% to 28%
- Meanwhile, practices with huge revenues, around 75% to 100%, tied to value-based contracts, increased as well from 6% to 9%
Practices with the lowest share and highest share in value-based revenues, experience a slight increase. Physician practices are gradually engaging in value-based contracts because it promotes a sustainable and more flexible healthcare system.
2. Practices have learned valuable lessons during the pandemic on the importance of value-based care.
It is not surprising that the percentage of primary care practices with more than five years in value-based care programs significantly increased from 41% in 2019 to 53% in 2022.
3. Practices acknowledged that value-based care offers a better quality of care and improved financial performance compared to the FFS model.
About 43% of respondents believe that value-based care outperforms the FFS model in terms of the financial health of the practice although there is still about 31% who said the same about FFS.
4. Primary care practices resorted to staffing and technology investments to overcome the challenges in pursuing value-based care.
Because of the pandemic, primary care providers have faced challenges in pursuing value-based care, which has dictated their investment decisions.
What are these challenges?
- About 70% cited a lack of staff resources
- 67% said it’s the lack of control in the care-seeking behavior of patients
- 46% claimed inadequate data and reporting hinder them from supporting value-based care
To overcome these challenges, practice leaders have reported that their organizations have invested in staffing, new technology, and patient engagement tools.
- About 75% added new staff to accommodate the demands of value-based care
- 71% invested in new technology
- 59% relied on patient engagement resources
For the staffing investments, practices added new staff to handle the following:
- 72% on care coordination
- 67% on care management
- 57% on data analytics
- 56% on quality improvement
To effectively provide value-based care, practices have invested in new technology with 80% adding data analytics and reporting tools. Meanwhile, practice leaders reported their organizations invested in these resources:
- 57% on population health management,
- 49% on EHR tools, and
- 40% on registry platforms.
5. Physician pain points are addressed by value-based care addresses like physician shortages, burnout, and staff retention.
These issues have long existed and the pandemic has put them under the spotlight. The report confirmed this with 64% of respondents admitting to having burnout. Meanwhile, 74% of practice leaders with value-based contracts expressed satisfaction with their current organization.
6. Practices are able to mitigate problems of inadequate data and reporting on value-based care.
The report shows a significant decrease in the number of respondents citing data sharing as a problem when compared to the 2019 study. This implies changes have been implemented to support the transition to value-based care.
How to complete the value-based care transformation?
With $4.1 trillion in total healthcare spending, outcomes are lagging behind. The U.S. has the highest rate of hospitalizations from preventable causes as well as the lowest life expectancy according to data from the Organization for Economic Co-operation and Development. Hence, transformation is needed to mitigate the high spending and resolve care quality issues.
For practices to transform into value-based care, it requires more than just investing in staffing, adopting new technology like the EHR system, and providing patients with innovative treatments or medications. Though these are all important elements in care, practices need to approach value-based care by identifying four key areas: contracting, physician compensation, digital medicine, and care delivery according to Robert Fields, MD, MHA, EVP, and chief population health officer at Mount Sinai Health System.
Value-Based Contracting
This contracting is based on the risk pyramid with the bottom representing the lower risk and healthy patients with commercial insurance. The top is the highest risk typically covered by Medicare or Medicaid and comprises a big chunk of healthcare spending. The key is to go for risk-based contracts that leverage Medicare’s incentives. In this way, caring for the highest-risk patients improves and becomes sustainable.
Physician Compensation
Providers can thrive with value-based contracts especially those with more Medicare and Medicaid patients. The contracting strategy is to seek a better quality of care that pays physicians and not a higher quantity of services that could lead to physician burnout.
Digital medicine
Practices can leverage digital tools and virtual care delivery that significantly improves access to care and is relatively cheaper than in-office care. Patients do not have to pay transportation costs or take time off from work. Consumers now prefer virtual care because of its ease and convenience.
Care delivery
Practices can build care teams so as to unburden the physician and maximize the skillsets of non-physician healthcare professionals. Collaborating and working together as a team can significantly improve the efficiency and productivity of the practice.
How to shift investments to value-based care
Providers can create more coordinated care that utilizes a team-based approach and the right technology to improve quality and access to care. With value-based care, an opportunity has opened to help physicians optimize their patient care and tap into a new income from reimbursements.
Transition to value and innovate your care with Ascent Care Partners (ACP). We offer turnkey solutions like Chronic Care Management (CCM) and Remote Patient Monitoring (RPM), which provide high-touch care in-between office visits and capture vital patient data to facilitate timely intervention. CCM and RPM are important value-based care billable services that can help you grow clinically and financially.
