Value based care, like anything in healthcare, is not pursued without challenges. The handy-wavey term ‘value’ immediately makes some people question its authority, and the one-liner pitch, “paying doctors for improving outcomes,” does the same. We all know it’s way more complicated and not as puritanical as that. Like way more complicated. Then, bringing specialists into the picture makes it even more complicated due to care coordination, greater competing FFS incentives, and an accelerated race-to-the-bottom.
To simplify, we can think of value-based care in an HMO and PPO context. In an HMO, health plans have contracted and sometimes negotiated risk contracts with each provider group in the patient’s network. This term more closely aligns with the term, managed care, where the payer is ‘managing care’ for the patient. In a PPO network, this control over cost is much more difficult to obtain because the patient can see any provider who is enrolled with their plan. Building a network of preffered specialists in this context is much more difficult because:
- Disparate data: For example, with ACOs that report having 16 or more disparate EHRs in their network, only 13% indicate an ability to aggregate the data effectively.
- Competing FFS incentives: Specialists don’t want VBC because of competing FFS incentives.
- In-network specialists: At the 50th percentile, no ACO model was able to generate even 30% of referrals in-network, with PCP-focused ACOs showing the worst overall performance. The Institute for Accountable Care indicates that more than 40% of ACOs provide no incentives to specialist partners.
- “One VP of Specialty Care at a national Payvider reported employing at least 5 FTE per market just focused on calling provider practices to confirm demographics and quantify new patients to be accepted. No one feels they have enough at-risk specialty provider coverage and cited 1) lack of specialist incentive 2) local dominant specialty provider leverage and 3) limited referral volume per specialist as the top reasons why negotiations weren’t more fruitful.” - Primary Venture Partners
- The race to the bottom: Right now, benchmarks are set based by an organization previous ~3 years of performance. If an organization has performed well the previous three years, they are penalized for their own victories. This contradiction is the most existential threat to VBC writ-large, in my opinion. That being said, if we’ve gotten to the bottom, that means we’ve done our job, and maybe we can switch back to a FFS system with robust fraud protections.
- Poor specialist performance: “ACOs with a larger share of participating specialists were less likely to achieve shared savings and had lower net savings per capita, and specialists may need different ACO engagement strategies.”