The sea change in healthcare from a volume-driven business model to a value-based system has executives reassessing just about every aspect of their operations, from staffing to IT and other infrastructure, community relations and even how “success” is measured.
Getting up to speed on best practices among industry leaders, understanding the options available, and being prepared to make strategic adjustments will be critical to effective leadership as change continues to unfold in the coming years.
Moving from Volume to Value-Based Care
It was the Affordable Care Act (ACA) that really pushed a move toward value-based care, with the Centers for Medicare & Medicaid Services (CMS) introducing alternative payment models and value-based initiatives, as noted in a 2016 healthcare report from Philips published on the Washington Post’s brand partner platform.
“By focusing on outcomes for an episode of care, rather than separate procedures in care delivery, we are incentivizing hospitals, doctors and other providers to work together to provide high quality, coordinated care for patients,” said Patrick Conway, M.D., a senior CMS official.
Conway goes on to say, “Value-based initiatives are about paying for quality over quantity – spending our dollars more wisely and improving care for Medicare beneficiaries.”
But that survey of hospital executives found only about a third of the 346 respondents – representing hospitals and care systems in every region of the country and sizes from fewer than 50 beds to more than 500 – were participating in some form of value-based payment model.
The organizations surveyed cited various reasons for participating, from competitive considerations to federal mandatory requirements and those enacted by commercial payers – or a voluntary decision to move in the direction of a value-based model.
The survey also found hospitals and health systems slowly investing more in electronic health records and IT security – noting concerns about mandates, incentives and risk – as well as patient portals, telemedicine, outpatient facilities and hiring.
7 Best Practices in Care Transformation
In a write-up following the recent American Hospital Association annual membership meeting in May, Hospitals & Health Networks magazine highlighted best practices in care transformation shared by a panel of healthcare executives.
Below is a summary HHN's 7 best practices in care transformation.
1. Timing Is Everything in Care Intervention
At New Jersey-based Virtua Health System, doctors found they could make the greatest impact not with the most-at-risk patient but rather the next level down.
“Once [patients are] in that real high-risk category, it’s difficult to make impactful interventions,” said Mike Kotzen, Virtua’s executive vice president, population health, at the conference, “so we’re trying to focus on that emerging-risk category in an attempt to keep them from becoming high risk.”
2. Invest in Staffing for the New Model
New healthcare jobs, workflows and additional touchpoints for at-risk patients are likely to come with the value-based model.
Forrest General Hospital in Mississippi is in an ACO led by Hattiesburg Clinic; the clinic has hired more than 30 case manager RNs as well as a medical social worker and a diabetes educator to address such issues as:
- transitioning patient care
- managing chronic disease cases
- improving the quality of care
3. Partner With Other Community Organizations
Lois Bernstein, chief community executive for MultiCare Health System, based in Tacoma, Wash., said hospitals are looking to community groups to team with in addressing “social determinants of health” vital to the population, especially those at risk.“If you don’t have food, how can you be healthy?” she noted. “If you don’t have transportation, you can’t get to your appointments.”
Peter Goldbach, M.D., the chief medical officer of RediClinic and Health Dialog in Boston, offered similar advice on shifting to value-based care in an article for HHN.
Goldbach says utilizing already established providers, such as pharmacies and convenient-care or urgent-care facilities, can pay dividends for patient outcomes and healthcare savings.
4. With Interventions, One Size Does Not Fit All
Patient needs can vary greatly by populations, even among those with similar conditions.
“The Medicare Advantage population is a lot different than a commercial [insurance] population, and both are different than the Medicaid population,” said Jason Dinger, COO of St. Louis-based Ascension Care Management. “…The challenge is [to] honor the needs of the distinct populations while aggregating those in a way that we can scale.”
5. Weigh Your Ability to Scale - and Act Upon It
The panelists agreed that scale is needed to cost-effectively make investments in areas such as IT systems, predictive analytics and dashboards used in care management.
The panel also noted that scale doesn’t mean necessarily dominating a single, regional market, but simply having “enough covered lives at the clinical level,” as quantified by Greg Walker, CEO of Wentworth-Douglass Hospital in Dover, N.H.
6. Quality: There’s No Substitute
Alvin Hoover, CEO of Mississippi’s King’s Daughters Medical Center, said that effectiveness as much as efficiency is important in the long run. “We started paying attention to the quality and hoping that improving our quality would reduce our cost. We’ve found that to be true.”
Positioning your organization to scale, improving quality, and redefining how hospitals and health networks measure success depend heavily on the strategic vision of executives and proper hospital board governance.
7. Rethink How You Measure ‘Success’
“We are now measuring healthy days,” said Dinger. Most patients don’t want to be hospitalized, and having a goal of “healthy days” puts the priority on patients and their preferences.
Another way to measure success could be reducing the number of unnecessary hospital visits by leveraging telehealth, web, and telephonic services.
Goldbach states that minor medical emergencies often can be served with a computer-based visit. Nurse lines, he noted, are an inexpensive and effective way to direct patients to the proper non-emergency-room care.
The Executive Master of Health Administration program through USC’s Sol Price School of Public Policy offers healthcare professionals a graduate-level education that prepares them for navigating the changing landscape of healthcare.
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