Signify Health CEO Kyle Armbrester participated in a large health system’s recent board meeting wherein executives showed an empty chair in a Zoom window and said: “No longer can we get paid to keep this chair full. That’s morally wrong. Utilization … that game is over.”
With 10 years of experience in alternative payment models and newly appointed federal government officials shaping the national reform agenda, the industry has the wherewithal to achieve impactful payment transformation, Armbrester said. And as health systems and health plans are on the cusp of a wave of diagnoses, delayed care and elective procedures flowing back into the system post-pandemic, Armbrester and others are espousing a move toward value-based care that drives better outcomes and improves affordability while reducing waste.
Washington State Health Care Authority Chief Medical Officer Judy Zerzan-Thul, MD, and Connecticut State Comptroller Kevin Lembo are two public health officials with unique vantage points into managing risk for large populations. Both are at least two years into working with value-based payment programs.
“There’s a real opportunity to be able to pay for things differently, to be able to provide care differently. That maybe doesn’t involve always a face-to-face visit in person, with a clinician and a patient. Maybe there are group visits, or phone calls, maybe it’s e-mails or texts,” Zerzan-Thul said. “There are a number of ways to communicate and help people with their health challenges.”
‘It all comes down to data’
During the Health Evolution webcast Value-based care at a crossroads: Charting the course to 2025 and Beyond, Zerzan-Thul, Lembo and Armbrester said that working to achieve those opportunities requires that leaders own their data in order to understand how to engage providers, direct patients to high-value care and address inequities by learning about social determinants of health.
“Own your data. That’s priority number 1,” Lembo said. “You have to own it and mine it and figure that out.”
In its own journey, the Washington State Health Care Authority started by setting a road map to reach 90 percent value-based care and then outlined the interim steps to move in that direction, Zerzan-Thul said. From there, the state built requirements into its contracts.
“We have contracts with five managed care organizations, and with three health plans for our employee and retiree benefits. So we put seven incentives in there setting a floor at an expectation of where they need to start,” she said, adding that leaders should look to address the fear of change they will likely encounter as people ask whether the transition is financially viable or what it will mean for quality of care.
Zerzan-Thul added that data is a critical aspect of the work that spans the 2.4 million people the Washington State Health Care Authority serves. As executives learn from their data, Lembo also suggested gaining a deep understanding of the organization’s cost centers and keeping an open mind about how partners operate. Connecticut’s initial steps, for instance, emerged from discussions with health systems about how they could work together to develop reimbursement models relative to the state’s value-based insurance design, in ways both rational and substantive enough to make a difference.
When Connecticut embarked on its program, mid-sized provider groups and small to medium-sized hospitals were the first to get excited about episodes of care and networks of distinction, which enabled the state to highlight the good work those providers are accomplishing, Lembo said. Such organizations faced the challenges of vertical or horizontal integration and deciding whether they needed to become part of a larger health system with the leverage to negotiate value-based contracts.
“That seems to be a secondary conversation now. They want to know, ‘Okay, what does this look like? How do we make sure that we’re in the thick of it?’” Lembo continued. “We just need to be their partner and know our place in that relationship.”
As a result, Connecticut’s health enhancement program drives people to high-value primary care by incentivizing them for certain chronic disease states to make sure they see a provider—and r raising the profile of primary care providers to the patient population. “We saw the benefit of that. Good uptake but it took a while to see the benefits,” he added. “We have the benefit of good data about what worked, what didn’t work, so we replicate what works. The data bears that out and we need to engage.”
Data can also be a useful tool for proving that myths inhibiting progress toward value-based care are false. Zerzan-Thul pointed, for instance, to preconceived notions about the state wanting to take providers’ revenue rather than intending to improve care or that people don’t want primary care when, instead, there are access issues such as only being able to book an appointment a year into the future. Another myth data can dispel include the notion that employers don’t want value-based primary care models when they actually want to keep their employees healthy.
“How do we have the three legs of the stool work together instead of pointing fingers at each other? Because that’s all too easy to do for everyone from the clinician health system to the health plan,” Zerzan-Thul said. “We all know our health care system, as it is, isn’t working. These value-based models give us an opportunity to do some of that work together.”
In Connecticut and Washington State this work also includes leveraging data to understand and identify the impact social determinants of health are making on patient populations and then address those inequities to improve the population’s health.
Zerzan-Thul said that is particularly important to Washington’s Medicaid population that struggles with food insecurity, housing issues, education levels, access to care, community safety, and others. Washington State, for its part, has the Foundational Community Supports to help citizens with housing and employment issues. The waiver program, which is three years old, has decreased the rate of ER care and improved behavioral health outcomes, Zerzan-Thul said.
“These are things we really need to tackle, and everyone’s talking about equity and social determinants of health, as we should, because there’s a lot of work to do, and it really helps people, and that can turn into dollars and cents savings. But more importantly it turns into more satisfaction with life and better health outcomes for people,” she said.
Armbrester pointed out that when other countries spend less than the U.S. on health care but yield better outcomes, one critical reason is the societal infrastructure in place to care for people with human-centered support services that maximize impact.
“We need to move our narrative to that,” Armbrester said. “It all comes down to data and moving into a methodology in which people can continue to innovate and offer more holistic services.”
An inflection point for the industry?
As devastating as COVID-19 has been, it has given the U.S. health care system an opportunity to rethink how care is delivered and paid for, as well as what quality care really means relative to the ongoing transition to value-based payments.
“We shouldn’t go back,” Zerzan-Thul said. “The trick will be to figure out what that right balance is to keep it going.”
Lembo explained that it will be important to continue demonstrating that there’s an argument to be made about what organizations such as Connecticut’s Comptroller Office and the Washington State Health Care Authority are doing to rationalize reimbursement and improve the quality of care.
“It’s early. I would not want to say ‘We’ve solved that. We fixed it,” Lembo added. “It’s a ripple in the water. Is it the incoming tide in a wave? Or the wake from a boat that went by? I don’t know.”
That said, in a couple of years Connecticut will have incredible data to help Lembo and the team confidently answer that question. And Armbrester noted that Connecticut and Washington are just two examples of organizations advancing value-based care models.
“We are at an inflection point,” Armbrester said. “We saw this with a lot of our clients and partners during the pandemic saying ‘fee for service is done.’ They feel moving away from it is a moral obligation.”