What is the path into value-based care in U.S. healthcare going to look like in the near future? Somewhat rocky, that’s for certain. That certainly was the consensus among industry leaders participating in the opening panel Monday morning at the 15th Annual World Health Care Congress, being held this week at the Marriott Wardman Park Hotel in Washington, D.C.
With the title, “Make Value-Based Care a Reality,” panel participants, drawn from across the sectors of U.S. healthcare, engaged in a very lively discussion about the challenges, opportunities, and complexities of the shift taking place in the U.S. healthcare system from a payment system that remains fee-for-service-based for the most part, to an emerging system that will be incenting value to all stakeholders in the system.
The panel was moderated by Ceci Connolly, president and CEO of the Washington, D.C.-based Alliance of Community Health Plans, a national association of 49 community health plans. Connolly was joined by Phil Jackson, CEO, health plan products, at the Sacramento-based Sutter Health, an integrated health system with 24 hospitals across Northern California; Paul Kusserow, president and CEO of the Washington, D.C.-based Amedisys Inc., a nationwide home healthcare provider; Karen Spring, president, healthcare operations, at the St. Louis-based Ascension Healthcare, the nation’s largest Catholic-affiliated integrated health system, with 153 hospitals; and Matt Wallaert, chief behavioral officer at Clover Health, a San Francisco-based health plan that describes itself on its website as “a software driven health insurance company leveraging data analytics and technology to partner with providers to fill gaps in care and help drive clinical operations workflow.”
In introducing herself at the beginning of the discussion, Ascension’s Spring said, “We’re the nation’s largest not-for-profit health system, and we’re actually the world’s largest Catholic healthcare organization. We’ve been structured around people being sick. And we know we need to move towards prevention and wellness. The tertiary care hospitals will all be there. But we need to be in our communities. We have 153 hospitals, and senior living. What we need to be focused on is how we keep people from needing our hospitals, how we help them to feel better about life.”
Further, Spring said, “In Nashville, for example, we have high smoking rates, obesity, diabetes, which means we need to do better. We want to make communities healthier. And we took a bold move this year, for example… last year, we were able to reduce CHF readmissions across all our entities; this year, we’ve focused on not even to admit CHF patients to begin with. We’re about 50 percent at risk—combination of full risk, shared risk, and MSSP ACOs [Medicare Shared Savings Program accountable care organizations]. We haven’t moved as fast as we’d hoped we would. But reimbursement remains a challenge,” added Spring, who noted that she began in healthcare as a practicing nurse in the mid-1980s, and has been with Ascension Health for seven years.
“We are now the largest independent home health, hospice, and personal care company in the country,” said Kusserow, who noted that Amedisys Home Health employs 18,000 healthcare professionals working in 35 states. “Our major competitor is being acquired by a payer. So in people’s attempts to move towards value-based purchasing and delivery, we’re starting to see a lot of influence in terms of the payers and providers getting together, to deliver strong value. Today,” he noted, “we will be in 45,000 homes calling on people. Our job is really simple: to allow people to live independently in their homes. And the Baby Boomers don’t want to be in institutions. And we’re moving very quickly from an acute-based system to a chronic care-based system.”
One key element in that, Kusserow noted, is the aging of the population, and the growing percentage of seniors in the U.S. “People are expecting to live 20 years beyond the age of 65, and at 65, you first start to typically exhibit a chronic illness. Most of our business is FFS. I come from a payer background, also ran hospitals for seven years as well. So I’ve been in a lot of places in the HC system. I think the paradigm is shifting. Payers are acquiring providers, and are going to achieve value that way. And the key paradigm shift will be to keep people out of institutions.”
“I’m a social psychologist by training,” Wallaert said, in introducing himself to the audience. “We all have the same end goal: happy, healthy people. So to me, it’s about motivational systems. It’s sort of crazy to me that I’m the only chief behavioral officer in the industry,” he continued. What’s more, he said, “Money isn’t the only motivator; meaning is also a motivator. No one goes into medicine purely to make money. People go into medicine to help people, and then we very quickly extinguish that motivation by creating payment systems that aren’t value based. Clinicians are required to ask patients, ‘Did you get a flu shot? You should get a flu shot.’ It turns out that 80 percent of our members don’t even want a flu shot. It’s about motivation.” He told a humorous story about noticing how attendees who partook of breakfast downstairs in the hotel’s atrium had the option of taking an escalator up to the ballroom level for this session, or taking a flight of stairs. He said, “On the one hand, I could stand at the foot of the stairs with a stack of $1 bills and offer each attendee $1 to climb the flight of stairs. But there could also be more motivational ways of convincing them to take the stairs. There’s more than one way to change behavior; it doesn’t just have to be standing at the escalator and stairs with a pack of dollar bills. So how do we motivate people?” That, he said, will be a profoundly important question, as members of healthcare stakeholder groups, including both patients/plan members and clinicians, are faced with the potential to modify their behaviors within the healthcare system.
Sutter’s Jackson, in introducing himself, provoked audience smiles, when he noted that, as an anthropologist, “I spent my graduate school career studying primate behavior”—with a wink and a nod to any possible applications in healthcare system dynamics. “From our perspective at Sutter,” he then said, “entering into value-based models is less about the incentive for individual behavior, but rather moving towards capitation. Capitation gives us more of an opportunity to bring care and coverage together. In a traditional health plan-provider contractual relationship, there’s a lot of tension there. What we’re trying to do, by owning and operating our own plan or entering into a partnership with an organization like Aetna—the fact is that owning and creating a budget gives us the incentive to produce high-quality, cost-effective care.”
Going on, Jackson said, “We need a much faster, more accelerated level of transformation. And we think that capitation, and owning or financing part of the overall cost of healthcare, will give us the motivation to transform.” And, within that context, Jackson said, it will be very important to leverage all forms of technology in order to bring care management into “the home or office. We’re meeting patients or members where they want care. I used to work with a guy who talked about the ‘tyranny of the office visit,’ where you have to drive to a physician office, drive, and try to find a parking space, for a 15-minute doctor visit,” he said. “So we’re trying to stratify the service to fit what patients need, including their quality of life. We spend a lot of time talking about financing, contracting, payment, etc. I really appreciate that we’re talking about engaging people where they are.”
“In looking at this shift from a system focused on acute care, to one focused on chronic care, what are the implications, and/or opportunities?” Connolly asked.
“I managed hospitals, then worked for Humana for several years,” Kusserow said. “The real thing that’s occurring, as we looked at our 5 million members, we started to put people into buckets,” with regard to how to manage their care. He noted that many people are now living with cancer who previously would have died from it. Meanwhile, congestive heart failure (CHF) and COPD (chronic obstructive pulmonary disease) “have become quite chronic. And to manage chronics, you need information flow.” He noted that, “In the 1980s, we built something around acute-care episodes. And one thing I learned in the hospital business is that you can’t develop a continuum of care, including information, around patients,” based solely on the information that can be gathered from inpatient hospital stays. “Take myself as an example,” he said. “I’ve been in the hospital once in ten years. What do they know about me? They know nothing. So the whole idea is, if you start to build data,” it’s possible to build the foundations of population health data vehicles.
Recentering care management towards the home
The key question, Kusserow said, is this: “As people get sicker and sicker with chronic illnesses, how do you keep them healthier? And the centering is beginning to focus on the home. And moving towards less-expensive venues. That’s why you’re seeing payers acquiring ambulatory surgery centers and home health. And hospitals and doctors will have to figure out now how we hold these people and keep them from being admitted to hospitals.”
“We have all this data,” Wallaert said. “But we need you to be ready and receptive to receive it, too. That’s the other half of this. How do we surface data to you providers, so that you can come back and use that data?”
“That’s why we have to move away from being hospital-centric,” Spring emphasized. At Ascension, she noted, “We are a clinically integrated system of care, which means we have sites of care where people are, whether in primary care settings or anything else.”
“For a long time, the pickle for so many healthcare organizations has been, if you do your job well, you’re going to have fewer bodies in beds, and that means less revenue,” Connolly said. “How do you manage that?”
“Last year, we did about $1.8 billion in charity care and caring for those who are uninsured and under-insured,” Spring reported. “So for us, embracing that means taking a stance, and understanding that we’ll have less revenue as we move forward, so that’s a rough road. But as a Catholic healthcare organization, we’ll just take a stance that we’ll have a smaller margin this year. Still, if our market share is based on how many inpatient beds we have—that’s not driving you forward. So it has to be around the lives we’re caring for. Using that as a metric would really help us move forward.”
With regard to maintaining core mission while moving forward into the new healthcare, Sutter’s Jackson noted that, “As a not-for-profit, vision-based organization, we’re bound to care for the community; and we consider ourselves stewards of community assets. And it’s clear that the pressure on the cost of commercial health insurance for the employer, with the demographic increase in Medicare, etc., is pushing us towards an unsustainable system. And as a health plan guy, I see us as all cost centers, not revenue centers. And if you’re driving down bed days or admits, the benefit of that is accruing to the delivery system, so that the system can manage the cost of care and translate that into more affordable premiums in the market. We tend to look at things in terms of one-size-fits-all healthcare system. And we have to learn that there are other community partners that are as good as, if not better than, us, in terms of what we can deliver, and we need to partner with them.”
“Let’s tie this into the pay portion of this conversation,” Connolly said. “Paul or Matt, where does the money fit into this? Who gets paid to do what or not do what?”
“The silo-ization is part of the problem; you have to pay on outcomes, because you don’t know which lever will be the right one,” Wallaert said. “What we’ve been bad at as a healthcare system is the horizontal layer. I always tell a story about Walmart: they were trying to solve a problem, and when they brought that problem to engineers, they came up with an engineering solution, and when they brought it to the marketing people, they came up with a marketing solution. That’s why these micro-payment systems are really dangerous: ‘We’ll pay you $10 to talk with patients about this one thing.’ That’s where value goes to die,” he said.
“I think there are ways to approach this,” Kusserow said. “I’ve been in home health for three years, after being on the health plan and hospital sides. We have an RN develop a patient assessment, and the RN consults with a doctor; and we create a care plan. So we basically bet on our care plans, and we’re willing to take risk on that, because the types of care involved—combining unskilled and skilled care, fundamentally, you can get a good enough read that can start to monitor any change in health status. But it’s all data, setting the health plan, having a trajectory to monitor care and health status—and you have to keep doing it and doing it,” he added. “And frankly, we’ve found that the other element is motivation, on the part of the patient—the desire to stay in one’s home, the desire to work with one’s loved ones, will drive very strong outcomes.”
“And using those pathways and care plans, you have to eliminate variation,” Spring said. “But you also have to have the right systems in the community. It takes a village to raise a child, it takes a village to care for a community. Working with the churches and the food banks. Well, is it our responsibility? Well, we believe in it. We want to be the quarterback of all the services that need to be coordinated in the community So that’s a value. But you have that, you have to have access points to provide for a lower cost of service. So expanding access is the most painful thing. And having a social worker and a pharmacy tech and others, who can support a community, that’s important. We can’t ask a physician to take that on as well; that’s really not their wheelhouse. But providing all those supports, we can meet those needs. Partnering with the Ys, etc. But there are a lot of coordinates involved. We talk about healthcare being an art and a science; this will really become an art, in terms of how to coordinate a community.”