Report: Despite Uncertainty, Healthcare Execs Focused on Value-Based Care Strategies | Healthcare Informatics Magazine | Health IT | Information Technology Skip to content Skip to navigation

Report: Despite Uncertainty, Healthcare Execs Focused on Value-Based Care Strategies

May 19, 2017
by Heather Landi
| Reprints

Despite current uncertainties in the healthcare market, heightened by the recent passage of the Republican-led healthcare bill in the U.S. House of Representatives, most health system leaders are sticking to their existing business strategies, and will keep their organizations moving towards value-based care, according to a new leadership survey by national healthcare advisory firm BDC Advisors.

The survey findings, “Healthcare Strategy in a Time of Uncertainty”, were published this week in the May-June issue of Healthcare Financial Management Association’s Leadership magazine. The findings are based on interviews with a sample of healthcare leaders in nine states and coincided with the introduction, withdrawal and subsequent passage of the American Health Care Act (AHCA). The findings indicated that despite regulatory uncertainty, the underlying drivers of the healthcare market remain essentially the same as prior to the Republican victory in November, according to the report.

The report authors, Aamer Mumtaz, Alan London, M.D. and David Fairchild, M.D., write that health system leaders feel their organizations face many of the same challenges as they did in 2011 when Obamacare was introduced: “revenues not keeping up with cost growth is still an issue, quality and value remain ongoing concerns, and breaking even on government programs is still a challenge.”

“While the potential capping of Medicaid funding and the fate of the Health Insurance Exchanges are wild-card issues, commercial insurance will remain the main avenue of growth, scale will remain critical, and the move towards value-based reimbursement will continue,” the authors wrote.

The study authors found, based on the interviews, that health system leaders are focused on “no-regret moves” and are, as in the words of one executive, “hunkering down.”

“That is, they are continuing down existing paths while slowing major capital investments. The focus, for now, is on what one executive called ‘no regret’ strategies that address fundamental economic forces: the relentless pressure on costs, the rise of consumerism, the shift from inpatient to outpatient care, and the growth of population health management and other forms of value-based payment mechanisms,” the authors wrote in the article.

Further, the authors wrote, “Providers are focused on moves that transcend the ongoing legislative and regulatory uncertainty and instead address more fundamental economic forces. Such moves include:

  • Achieving scale through partnerships and alliances
  • Commercial market growth (e.g., through targeted ambulatory expansion)
  • Continued focus on Medicare Advantage
  • Aggressive cost control
  • Partnerships with health plans to share more risk
  • Building the clinical network
  • Slowdown or halt on long-term investment

With regard to delaying capital outlays, the authors wrote, “Organization leaders generally expressed a need to wait and see how things evolve before making any significant capital outlays. One CEO observed that most organizations ‘are hitting the pause button on a lot of things,’ including programmatic growth, new hospital construction, and major capital purchases.”

Regarding cuts to Medicaid and the Affordable Care Act marketplaces, the authors noted that the impact on individual providers will vary significantly. Going into more detail, they wrote, “In particular, providers serving a disproportionate share of vulnerable populations face a far greater degree of risk. This includes safety-net organizations serving disadvantaged populations in inner cities and organizations operating in struggling rural areas.

Further they wrote, “Leaders from the Miami-Dade and Los Angeles County markets, which have high concentrations of Medicaid and ACA marketplace business, expressed strong concerns, for example. In Massachusetts, which expanded Medicaid while gaining additional funding in the form of a Medicaid waiver for accountable care organization (ACO) development, a Boston-based AMC with about 20 percent of its business in Medicaid calls the impact of ACA repeal ‘big numbers [that will] hurt everybody.’ Another expansion-state executive described the numbers ‘as so huge, you can’t even plan for them.’”

The article also looks at the outlook for care coordination and quality improvement. The authors noted that although providers are convinced that the shift to value largely is going to continue, “several pointed out a concern: If an organization has not made progress on innovations promoted by the Center for Medicare and Medicaid Innovation (CMMI), the current uncertainty may suggest that it should not start now.”

The study authors expect that as a result, there could be a slowdown of the momentum created by the ACA towards care coordination and value-based care initiatives.

The authors also concluded that economics overshadows politics and that the interviews with major health systems confirmed that healthcare reform remains driven primarily by market forces as opposed to legislative initiatives. “Just as in 2011, imperatives to reduce costs and to achieve profitable growth through the delivery of value remain key. In fact, cutting costs, improving clinical integration, and addressing quality and customer service needs—all while focusing on profitable markets for growth—arguably will be even more important strategies in 2017 and going forward than they were in 2011.”

The authors concluded that the organizations facing the biggest challenges will be providers with significant exchange and Medicaid business, and that cutbacks in these already low-margin businesses lines are likely to have a disproportionately negative impact on those organizations.


Get the latest information on Finance and Revenues and attend other valuable sessions at this two-day Summit providing healthcare leaders with educational content, insightful debate and dialogue on the future of healthcare and technology.

Learn More



PCORI Plans to Award $10 Million to Examine Strategies for Safe Opioid Prescribing

The Patient-Centered Outcomes Research Institute (PCORI) announced that its Board of Governors approved just under $10 million to fund two studies comparing the effectiveness of strategies designed to reduce unsafe opioid prescribing by improving pain management.

Ascension Partners with Tech Accelerator for Greater Healthcare Innovation

Ascension, said to be the world's largest Catholic health system, has begun a collaboration with Plug and Play Tech Center, a global innovation, investor and technology accelerator that supports innovative startups across various sectors, including healthcare.

Report: Aetna, Apple in Talks about Offering Plan Members Apple Watches

Aetna, which already offers the Apple Watch to its employees as part of a wellness program, is now in talks with Apple about pushing the wearable device to the health insurer’s members, according to a report in CNBC.

HIMSS Accepting Nominations for Most Influential Women in Health IT Awards

The Healthcare Information and Management Systems Society (HIMSS) has announced that nominations are now open for the HIMSS Most Influential Women in Health IT Awards.

E-Visits May Have Unintended Consequences for Docs, New Research Finds

Physicians who adopt e-visits often see increases in office visits and phone consultations, a reduction in new patients being seen by providers, and no noticeable improvements in patient health, according to new research.

CMS Provides More Details on Proposal to Eliminate Mandatory Bundled Payment Programs

The Centers for Medicare and Medicaid (CMS) posted a press release Tuesday that provides more details regarding its proposal to change the Comprehensive Care for Joint Replacement Model and cancel the mandatory Episode Payment Models and Cardiac Rehabilitation Incentive payment model.