Can payers and providers transform healthcare by transforming their contracting relationships, and by collaborating on data? While there is no unanimity on the answer to that question, the members of a panel of industry leaders agreed that things are at least moving in that direction. The panel discussion, entitled “Transforming the Payer-Provider Relationship: Aligning Business Models for Improved Outcomes,” was held on June 10 at the Health IT Summit in Chicago, sponsored by the Institute for Health Technology Transformation (iHT2; since December 2013, iHT2 has been in partnership with Healthcare Informatics, through our parent company, the Vendome Group LLC).
Cynthia Burghard, research director at the consulting and research firm IDC Health Insights, moderated the panel. The panels other members were Cathy Dimou, M.D., chief medical officer at Rush Health, the physician-hospital entity within the Chicago-based Rush Health System; Dan Hounchell, COO of the Cincinnati-based HealthSpan health plan, which is owned by the Cincinnati-based Catholic Health Partners health system, the largest health system in Ohio, and which operates hospitals throughout Ohio and Kentucky; and Scott Sarran, M.D., divisional senior vice president and CMO, government programs, at the Chicago-based Health Care Service Corporation, an umbrella organization that encompasses the Blue Cross Blue Shield health plans of Illinois, New Mexico, Oklahoma, and Texas.
panel members Hounchel, Sarran, Dimou, and Burghard
The panel members discussed broad issues around payer-provider collaboration, value-based contracting, and data-sharing. And each of the panelists shared perspectives gleaned from her or his organization’s work in this key sphere. Asked where the Rush Health people began their value-based healthcare work, Dr. Dimou said, “We decided to work with our employed population first, because we thought it would be a great place to start. We worked with Cigna,” she noted. “And we were able to actually look at shared savings with our physicians, and try to set up a pay for performance model that way. It was a good way of putting our toes in the water and trying to level off the cost curve in that way. We are just starting to see outcomes in select patient populations. We’re looking at diabetes and hypertension and are starting to see a decrease in cost. And we’re trying to figure out if the progress in terms of a decrease in cost and an improvement in outcomes is real, or is seasonal variation.”
HealthSpan’s Hounchell noted that being provider-based health plan within his organization’s umbrella has supported a great deal of activity. “We’ve got a lot going on,” he noted. “Cincinnati was selected for the Comprehensive Primary Care Initiative. And partnerships with several local health systems; and we’re working on partnerships with health plans. What have been the key success factors for us? I hate to sound so blunt about it, but money really does talk for us,” he said. Physicians, he emphasized, will respond to financial incentives, whether they bring gains or losses in the short term. With regard to his organization’s recent moves, he reported that Catholic Health Partners’ purchase last year of what had been Kaiser Permanente of Ohio, now HealthSpan, also included the purchase of the employed physician group of Kaiser Permanente of Ohio, now HealthSpan Physicians. “And it’s all prepaid care,” he emphasized. “And just in the last six months since that acquisition, we’ve seen benefits. We see the benefit of the Kaiser Permanente model, but how do we adapt that to the Midwest? That’s what we’re trying to work out right now.”
Importantly, said Dr. Sarran, “What creates sustainable change is when providers do things that reduce cost and improve outcomes. To [execute on] the Triple Aim, it’s going to require providers to reengineer care and processes. Our take on that,” from a health plan perspective, he added, “is that pay for performance is not sufficient. Simply changing from a volume- to a value-based payment system is necessary, but not sufficient. It’s got to happen in order to transform care for cost, but is not sufficient. So when there’s enough provider skin in the game, in terms of the percentage of their patient flow as well as dollars at stake per patient, to cause them to reengineer, and there’s enough physician leadership, and true support with data and analytics, that’s what we look for. On the flip side,” he added, “work with providers through some programs to focus on the very high-cost patients. There, we think value can be more immediately created.”