- A new survey from the healthcare alliance Premier found that healthcare payers are not transitioning to value-based care payment arrangements as quickly as medical providers would like, according to a company press release. With the Centers for Medicare & Medicaid Services (CMS) moving Medicare reimbursement toward value-based care, many providers have been focused on meeting quality measures including cutting preventable hospital readmissions and medical complications such as hospital-acquired infections.
The findings show that even though providers are ready to pursue value-based care payment arrangements, they are finding few of these type of contractual structures available among health payers. This is leading a number of healthcare systems to invest in provider-sponsored health plans, the survey found.
However, it is vital to note that this poll consisted of 60 healthcare C-suite executives. The survey was conducted between June 8 and July 25, 2016. Out of all those polled, the results show 66 percent of C-suite executives are looking to form their own health plan or work with an established provider-sponsored healthcare coverage plan instead of searching for a commercial payer willing to invest in value-based care payment arrangements.
“Without high-level, meaningful value based payment partnerships, providers must make on all the upfront investments in the cost of building CINs, new technology, and performance improvement and care redesign efforts themselves,” Joe Damore, Vice President of Population Health Management at Premier, said in a public statement.
“Providers are increasingly growing frustrated with some insurers’ limited interest in sharing the savings these care improvements generate. Slow action by some commercial payers to assume accountability and be transparent with providers limits progress in today’s healthcare environment where value is the economy and measurement is key currency.”
This shows how vital it is for private payers to continue pursuing value-based care payment arrangements in order to compete effectively in the health insurance market and keep a strong provider network.
“We hope more commercial payers will move forward shared-risk agreements in 2017 to permit providers to scale their efforts and costs on value-based care,” Damore added.
In a number of states, commercial payers are moving at slower paces toward adopting value-based care payment arrangements with the inclusion of integrated delivery systems and clinically integrated networks (CINs), the release states.
Providers cited that collaboration issues including a lack of transparency and shared accountability from payers. Health insurance companies will need to improve their overall transparency and boost payer-provider collaborations in order to meet the needs of their provider networks. For example, having greater transparency toward claims data for care management and shared risk is vital to operating an effective payer-provider relationship.
Nonetheless, the survey did discover that payers and providers have been working together and coordinating care with 45 percent of those polled stating greater care coordination with insurance companies. Additionally, 42 percent of respondents stated that payers are offering front-end incremental payments to primary care doctors targeting care management.
Value-based care payment arrangements such as shared risk were not common among the healthcare executives. Out of 60 C-suite executives polled, 28 percent stated that their health systems have contracted through alternative payment models in the form of shared savings with commercial insurers.
“This issue becomes even more critical as alternative payment policies like those incentivized by MACRA begin value-based rewards/penalties based on performance in 2017,” Dr. Shane Peng, President of Physician and Ambulatory Services at SSM Health, stated in the press release. “These models require ever-increasing scale that can only be achieved if commercial payers are willing to evolve these relationships to provide timely, transparent information on a provider’s value-based performance and share meaningful financial gains produced by improved performance for an attributed population.”
While some private payers have sat on the sidelines, providers have been responsible for meeting the mandates of the Medicare value-based care goals and the Medicare Access and CHIP Reauthorization Act (MACRA) starting in 2017.
Other results show that 30 percent of healthcare executives report regular updates from payers regarding efficiency and quality performance while 22 percent said payers are sharing claims data to coordinate care, cost, and quality.
These results show that some payers may be lacking transparency when it comes to working with their provider network. This would inhibit the success of value-based care and alternative payment models based on quality measures.
Commercial payers would be wise to improve price transparency, as research from the Health Care Cost Institute shows that providing more cost transparency to consumers can reduce overall medical spending. When looking at out-of-pocket spending among consumers, as much as $27.7 billion could have been cut in 2011 if greater price transparency was available and patients could shop for medical services, the report stated.
Healthcare payers may need to address some of the issues found in surveys and other research. Adopting greater transparency, more streamlined adoption of value-based care payment arrangements, and increasing their number of shared savings contracts could allow payers to compete more effectively in the health insurance market.