A framework for rewarding better care

December 14, 2020 / By Carole Cusack

Last month, key industry leaders wrote about their vision for the future of health care delivery and financing in a Health Affairs blog, which outlined a framework to improve outcomes and reward better care. In fact, the authors termed their program the “Better Care Plan.” These ideas may seem lofty or unattainable, but I am optimistic they can be achieved based on 3M’s experience in addressing the key foundational concepts espoused in the article.

The concept that health care payment drives behavior is not new. The industry saw a major shift in how inpatient and outpatient care is delivered after the adoption of case-based payments by the federal government. Private insurers followed suit by applying similar programs, but added risk adjustment to the payment methodologies. Behaviors changed, but there was still a degree of inefficiency that could not be overcome through base payment alone. What was needed was a measure of quality or value when considering outcomes. These methodologies also omitted the key providers for managing care delivery—the primary care team. 

The authors of the “Better Care Plan” highlight a person-based, pre-determined monthly fee as the foundation of health care payments. They believe that paying to treat the ”whole person” instead of piecemeal services will generate better health and financial outcomes. I agree that these payments should be risk-adjusted, but caution that the methodology used for risk adjustment should account for the whole person as well, that is, adjust for interactions between comorbidities as well as the effect of socioeconomic stressors. Many risk adjustment methodologies deployed today do not offer these benefits. If we are to base payment on the resources needed to treat a whole person, then we need to understand differences in individual conditions and how their interactions affect overall health, treatment options and outcomes.

At 3M Health Information Systems, we help many of our payer clients manage accountable care relationships with their health system partners. As the Health Affairs blog stated, these programs do generate efficiencies using predetermined annual expenditures based upon the risk of the populations being managed. The incentives provided through risk sharing of financial outcomes against those budgets result in more tightly managed patient care, fewer low-value services such as less intense emergency department visits and inpatient admissions, and better use of prescription therapies.

At the heart of this success is the primary care team. We promote evidence-based models for attributing patients to primary caregivers that reward the team actively treating patients for the positive outcomes that are generated. Unless the industry is willing to move back to the unpopular “gatekeeper” model of the late 20th century, a program of prepayment for care delivery must consider where patients are being managed, not who they are assigned to. We have witnessed the shortfalls of attributing patients to primary care through assignment; in extreme cases as much as thirty percent of monetary incentives were being shared with primary care providers who were not managing their assigned patients.  That is a loss for everyone.

Highly effective primary care providers exhibit behaviors that engage their patients in both preventive care and chronic care management, with success determined using quality measures that relate to the strength of the primary care relationship, not just processes of providing care. In working with 3M clients on analytics programs, the data indicates that patients who interact regularly with their primary care team have a lower total cost of care. Given these results, a system of prepayment should incent effective primary care behaviors. It should also incent coding for socioeconomic factors made available through the ICD-10 coding system. These codes not only help to refine risk adjustment, but they can be used to identify interventions needed to avoid low-value services such as preventable emergency department use, admissions and readmissions.

VBC Webinar ButtonThis year, 3M HIS sponsored a webinar series on incenting the shift to value-based care. Like the authors of the Health Affairs blog, we believe that it is time for a better framework that will improve outcomes and reward better care. You can access the webinar series here to gain insight on how our payer clients are making the shift. We will continue this series in 2021 as we begin to reimagine care delivery. Access an archive of the January webinar here. The following is a brief description of the journey:

  • Q1: Insights for Success: Use social determinants of health and risk adjustment to uncover vulnerable populations, unmet needs and deploy care management tactics.
  • Q2: Measures that Matter: Move beyond traditional process measures to help primary care providers understand their patient relationships and build stronger ties.
  • Q3: A Patient First Approach: Analyze the “whole person” to identify patterns of care access and new approaches to measuring outcomes.
  • Q4: One Community: Create a single source of truth for data sharing and care management within the medical community.

We know from experience that the approaches explored within the Health Affairs blog are effective beyond a public health plan option. I hope that you will join us in 2021 to explore the possibilities!

Carole Cusack is the Director of Client Engagement & Strategy with 3M Health Information Systems.