In the value-based world of healthcare, health systems are being asked to take on more risk for greater rewards. Value-based arrangements are complicated though, with common concerns including:
- Are the performance measures in the contract realistic?
- Do the goals differ depending on the payer?
- Where do I focus my attention across all my contracts to realize the best outcomes?
When it comes to achieving success in value-based care arrangements for health systems, the importance of understanding and leveraging key value levers that drive performance can’t be overlooked.
Value Levers-
The value-levers that drive success in value-based arrangements usually fall into one of the following categories: network utilization, ED readmission, medical utilization, specialist referral, drug utilization, quality performance, financial performance, and risk management. Value levers provide clear pathways to success in executing your contract terms through provider enablement, provider transparency, payer and provider collaboration and alignment, contract interventions, quality, cost, financials, and utilization.
Now that we have established what value-levers are, let’s take an in-depth look at four specific value levers and how and how they can best be leveraged.
1. Reducing Avoidable ED Visits and Preventable 30 Day Readmissions
The issue of reducing avoidable ED visits and readmissions is one that recurs across the value-based care spectrum, whether you’re a provider affiliated with Medicaid, Medicare Advantage or a commercial plan. As such, the issue should always remain at the top of mind when it comes to all contracts. Through the use of data, including social determinants of health (SDoH) and other socio-economic demographic data, these sorts of ED visits and readmissions can be better spotted, managed and avoided altogether.
2. Improving Quality Metrics
Quality metrics have proven to be a tricky value lever for health systems. In fee-for-service models, there may have been two or three quality metrics to consider. In value-based contracts, the number of quality metrics to factor is more likely to be around thirty. With the expansion of quality metrics in the fold, it’s important for health systems to give greater focus to the metrics that have the most significant impact on cost, utilization, and member satisfaction. Additionally, while the number of quality metrics is often greater in value-based contracts, there are technology-based solutions that can assist in monitoring and analyzing them. These technologies can assist in functions such as scenario planning, predictive models and real-time analytics.
3. Specialist Efficiency—Rate Your Specialist
Having a means of gauging the efficiency of contracted specialists is key to their success in value-based arrangements. Generating an overall efficiency score is based on a formula that, in its most simplistic terms, weighs cost of care against quality of care. One of the trickier aspects of achieving an all-encompassing scoring methodology comes from claims data, which is managed by health plans, and patient data, which is managed by health systems, being siloed from one another. Integrating claims and patient data is crucial to having accurate specialist efficiency scores, which is yet another reason that payer/provider collaboration and transparency are so important in value-based contracting.
4. PCP Referral Efficiency
As health systems enter into value-based contracts, one value-lever they can’t overlook is the importance of adhering to an in-network referral system for specialized practitioners. When network leakage (an out-of-network specialist referral) occurs, it’s usually the result of one or more of the following:
- The network lacks high-quality specialists in core disciplines
- The network doesn’t stress the importance of physicians referring patients to in-network specialists
- The network has the right specialists, but the primary care physicians (PCPs) aren’t aware of them.
Addressing these concerns on a regular basis with PCPs will help health systems to reduce specialist referral efficiency issues and, as a byproduct, will empower their providers to succeed within their value-based arrangements.
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