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Expanding the Clinical Network for Value-based Care

by Brian Murphy | May 05, 2014

expansionThe provider world is dominated by organizations that believe in a slowly evolving status quo that will somehow carry them across the threshold of accountable care to a fully formed world in which VBR-compliant ways of delivering healthcare solve their sundry problems. These status-quo organizations remain wedded to fee-for-service (FFS) and have not begun to focus on the inevitable shift in risk from payers to providers under future value-base reimbursement (VBR) models.

There are a select number of forward-thinking HCOs that are actively preparing for VBR and the day when revenue depends on how well they deliver care to the individual patient and panels of patients as a whole over time – not just episodically. However, these forward thinkers represent an exceedingly small proportion (5-7%) of all HCOs in the U.S.

An area of weakness we find across HCOs, including a few forward thinking ones, is a lack of core competencies in a number of areas that have been the domain of payers and will be critical for success under VBR including: actuarial analysis, benefit design, utilization management, authorization management, disease management, consumer marketing, and similar functions. One could debate consumer outreach and marketing, but by and large, even here payers have done a better job than most HCOs

Providers of both the progressive and less progressive variety will find that their ability to thrive under VBR depends on how well they perform these functions. Some provider organizations see VBR as a way to disentangle themselves from payers without realizing that they will wake up one day and find that they have become the payer.

These new functions that providers will be required to adopt will ultimately have to be incorporated into clinical operations even though the current crop of clinical applications (e.g., EHRs and HIEs) is arguably not up to the task. HCOs preparing for VBR will find themselves at worst hamstrung or, at best, minimally supported by their clinical vendors.

The longtime focus of clinical application development has been on the physician and, to a lesser extent, the nurse. The point-of-care has been where the money is for EHR and HIE developers. No one can dispute that the physician-patient interaction is the central and most important element in a clinical visit. Every clinical intervention flows from that interaction. However, an office visit consists of multiple interactions between the patient and the HCO. Patients, in a single visit, interact with many people: front office staff, nurses, phlebotomists, radiology technicians, nutritionists, care managers and a host of others. The idea of team-based care requires that EHRs and HIEs do something they aren’t that great at: provide a point-of-care focus for the individual clinician as well as a point-of-encounter focus for the HCO.

When we look at introducing functions formerly performed by payers into clinical operations, the point-of-encounter perspective rises in importance. Under VBR, clinicians will make clinical decisions based on the facts and circumstances of the specific patient and based on past experiences with that patient. The specifics of follow-up care and the composition of a care team will depend on the benefits design and utilization patterns of the patient and the patient’s risk panel.

Instead of sweating out an authorization from a payer for a particular clinical intervention, individual clinicians will be responsible for following evidence-based care plans enforced by the HCO through the EHR/HIE. Instead of letting the payer control where patients are referred, providers will want to keep referrals in-house and away from competing providers.

The irony, at least for now, in this is the volume imbalance between administrative payer-provider transactions and clinical inter-HCO transactions (via HIE and other mechanisms) that are occurring today in a HCO.

Payers have invested heavily in transaction-oriented networks to support all of the things so feared by providers: authorizations, claims presentment, referrals, eligibility determinations. A significantly smaller volume of inter-enterprise clinical transactions, on the other hand, are flowing between HCOs to support a relatively narrow range of point-of-care clinical activities. We think that EHRs and HIEs will have to adopt a view and development focus that looks at the totality of information needed to support a clinical encounter — patient clinical data, administrative data and panel level data — to really support HCOs on their voyage from FFS to VBR.

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