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Policy Perspective: Francois de Brantes’ Contrarian View on Provider Aggregation

March 21, 2014
by Mark Hagland
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Francois de Brantes sees bundled-payment reimbursement as one of the keys to health system reform

As the U.S. healthcare system moves forward more and more deeply into the arena of quality-based purchasing and pay-for-performance, policy and industry leaders are sorting through a welter of issues around what should be measured, how it should be measured, and what the implications are for the providers, payers, purchasers, and consumers of healthcare, in an environment that is focusing increasingly on accountability, transparency, quality, and cost-effectiveness.

One organization very much involved in the discussion is the Newtown, Conn.-based Health Care Incentives Improvement Institute. As explained on its website, HCI3 “aims to improve healthcare quality and value with evidence-based incentive programs and a fair and powerful model for payment reform.” Among its goals are to “measure health outcomes; reduce preventable care defects; promote a team-based approach to caring  for patients; realign provider payment incentives around quality”; and “reward excellence wherever we find it.”

Among the organization’s upcoming events are upcoming conferences on pay for performance and bundled payments. Francois de Brantes, the organization’s executive director, spoke recently with HCI Editor-in-Chief Mark Hagland regarding his perspectives on payment and policy, and how CIOs and other healthcare IT leaders can play a part in transforming the healthcare system. Below are excerpts from that interview.

How long has your organization been in existence?

Technically, since 2003; the name Health Care Incentives Improvement is about four years old, but the organization itself started out with the name Bridges to Excellence. We transitioned the name to make sure we made clear we had a broader mission.

Francois de Brantes

And how would you articulate in your own words the main focus of your organization in U.S. healthcare right now?

The main goal of HCI3 is really to develop, test, and implement new payment models, as well as other incentive programs that impact the behavior of both providers and payers. So I like to say that we’re a “do tank,” as opposed to a think tank, though of course, we think carefully about what we do! But there a lot of folks doing different things, and my inclination has always been to actually get things done, and learning from doing those things, and spread that innovation.

When you look at ACOs (accountable care organizations), bundled payments, patient-centered homes,  etc., what types of initiatives do you see working best right now? And what are the elements common to those broad initiatives?

It’s a tough question to answer. Let me start from the ground up. The evidence for PCMH effectiveness is very, very limited. In fact, I think it’s going to continue to be limited, principally because the consumption of healthcare in this country is very different today from how it was even 15 years ago. When you look at the percentage of dollars spent on primary care versus specialty care, the percentage spent on primary care is miniscule in comparison. And the types of patients whom PCPs [primary care physicians] see today are kids, for the pediatricians, and adults who require minor, basic sick care, and stuff you can’t deal with by yourself. The moment it goes from basic to more severe, you’re punted off to a specialist.

And it’s not just because of incentives; it’s really because American consumers’ shopping habits have shifted. I try to remind people that fewer and fewer Americans shop at Sears, because we’ve come to realize that specialty shopping provides more expertise and more specific choices. So the notion that you get the bulk of your care in a PCP’s office just doesn’t jibe with the actual patterns of care utilization. So you can do all sorts of things, but it won’t change the reality, unless you force everyone back into an intense gatekeeper-type system.

So you start thinking about broader levels of aggregation. And I think the central divide—and I don’t think there’s evidence or research that supports one or the other—but there is a camp, clearly, that believes that full integration is the only is the only way to assure quality of care—vertical or horizontal ownership, so your uber-ACO model. And the evidence doesn’t support that. We call them ACOs, but we know that they’re essentially large integrated health systems—that that model offers the best, most effective care. There’s some evidence that that works in Medicare, because of price controls; but when it comes to the private insurance realm, the evidence is that the concentration of power only leads to market power and higher prices, from the providers.

So somewhere between atomization and full integration is probably where the truth lies. And the reason I struggle with answering your question is that it’s not clear that we’ve solved that problem in a robust way. So, experimentation and lots of pilots, have historically demonstrated effectiveness, but effectiveness limited to what’s being tested. And whether the payment model is bundles versus capitation—the evidence has been limited to procedural episodes of care, or to specialized care, like transplant or cancer care.

We keep see-sawing between providers having more market power, and payers having more market power. And there have been problems with both scenarios.