Humana is lowering costs and improving care quality through value-based care agreements by shifting their dollars to primary care physicians, their CMO explains.
Supporting primary care will bring value-based care results, asserts Humana’s Chief Medical Officer Roy Beveridge, MD.
Value-based arrangements between providers and payers have the lofty, yet admirable goals of improving care quality while lowering total costs of care to the healthcare system. The arrangements hold providers accountable for the financial and clinical outcomes of patients, incenting care delivery teams to provide the highest value care to their patients.
However, to date, results from value-based care models have been lackluster. Value-based payment models did not reduce total cost of care or improve clinical quality outcomes at the market level, a recent Healthcare Financial Management Association analysis showed.
Furthermore, providers have been hesitant to take on the accountability of value-based care. Only about one-third of healthcare payments stem from an alternative payment model, the Health Care Payment Learning & Action Network recently reported. And 61 percent of physicians fear that value-based arrangements will damage their practice financially and clinically, a new survey revealed.
But Humana, one of the largest health payers in the US with over $53 billion in annual revenues, is finding success through its value-based arrangements with providers.
The payer recently reported that its value-based care models reduced medical costs by almost 16 percent in 2017 while improving care quality, preventative care, and healthcare utilization. The insurer also reached its goal of having 66 percent of its 2.9 million individual Medicare Advantage members affiliated with a primary care physician in a value-based agreement.
Humana’s CMO attributes the payer’s value-based care success with their emphasis on supporting primary care.
“Who do you think is accountable? Well, it’s the primary care physician. Who’s the one who’s making the hard decisions? And who’s the one who’s answering the telephone call Friday at 4:00 a.m. and Saturday at 10:00 p.m. talking to their patient and keeping them from having to go to the hospital or the emergency room? It’s the primary care physician,” Beveridge recently told RevCycleIntelligence.com.
Humana is supporting their primary care physicians by valuing the work that they do through value-based reimbursement models.
“When you think about primary care physicians, historically they have been undervalued, underappreciated, and under-resourced,” Beveridge explained. “When we worked with the American Academy of Family Physicians, we found that our data was very consistent with theirs. For non-value-based clinical models, about six percent of the dollar amount goes into the realm of the family practitioners.”
“Given that we believe in the centricity of the family practitioner and the extra amount of work and time that is required for these providers to spend with their patients, we have ensured over the past number of years that we’re paying the family practitioners significantly more,” he continued.
Almost seven percent of every dollar spent by Humana on member care in 2017 went to primary care physicians.
And that percentage significantly increased for primary care physicians taking the leap into value-based care. Nearly 17 percent of every dollar spent on member care went to primary care physicians in value-based agreements, the payer reported.
The increased capital allowed the providers to truly act as the quarterback of patient care, giving them the financial support they needed to invest in health IT systems or care coordination support. As a result, healthcare costs declined, and preventative care increased.
“We view ourselves fundamentally as agents to support the clinicians who are taking care of our members,” Beveridge stated. “That’s an important distinction to make. We don’t view them as our patients. We don’t say that we are the best buddies of the physicians. What we say is that we fundamentally recognize that they’re delivering the care. And we need to support them in this endeavor.”
Value-based care moving to the home
Humana is incentivizing providers to participate in value-based agreements by providing the financial support necessary to invest in value-based capabilities. But the agreements will also help to push care beyond the traditional setting, which can be expensive for the entire healthcare system.
“When you talk to seniors, about 90 percent of them want to be in the home for care,” Beveridge reported. “You need to recognize that even when a patient goes to see their doctor a few times a year, they’re still spending 8,200 or 8,300 hours in their homes. Or said another way, not in a doctor’s office.”
Being able to control health and cost outcomes within patient homes will be the key to bending the cost curve while improving patient outcomes.
For example, nearly every fifth hospitalization among Medicare fee-for-service beneficiaries ends up back as an inpatient within 30 days. Influencing a patient’s health within their home can prevent the costly hospital readmission and help him manage his condition in a comfortable, low-cost setting.
“Where we’re going is how do we understand what’s happening in the home and what’s happening not in the hospital,” he continued. “And we’re beginning to see the shift of bringing value-based care into the home through analytics, metrics, and telemedicine, which will allow our members to have a higher quality outcome at lower costs.”
However, providers need to be engaged with value-based care models that shift the risk away from payers for in-home care to implement the necessary workflows and technologies to truly improve the healthcare system.
“We’ve got 66,000 or so provider groups that we work with in value-based care. We think it’s the better payment methodology because it allows there to be innovation and allows there to be improvement in the health of our members,” the CMO explained.
The value-based agreements, particularly those with downside financial risk, allow providers to extend their care beyond the hospital or doctor’s office because Humana is paying them for care management, not just for specific services.
“We’re going to start paying not just for the visit, but also for the management and the outcomes,” he elaborated.
The value-based agreements will allow providers to send nurses into the home and connect with primary care physicians through telemedicine or other technologies.
“Connecting with nurses in the home to primary care physicians through telemedicine is natural,” he stated. “The nurse goes in to take care of the diabetic foot ulcer. The nurse, as she’s there, has the iPad and she connects with the patient’s doctor. The patient’s doctor says, ‘Well, let’s just review the medicines here with me. Let’s work on this.’ Each party id practicing the top of their license and doing things efficiently.”
And provider reimbursement covers the costs of that diabetes management, not just for treating the foot ulcer.
“I don’t care whether the nurse is there 17 or seven times provided the diabetic foot ulcer is treated. And if that means they’re going to bring technology in, iPads and telemetry, that’s fine,” he said. “Those are the changes we’re going to see pretty rapidly.”
Value-based care still currently resides in the doctor’s office for the most part. Providers are still investing in the capabilities necessary to deliver high-quality lower cost care that can eventually transition to the home setting.
But Beveridge is confident that transition will happen with time as payers invest in their primary care physicians. And even more cost and quality improvements will stem from transitioning patients to the home through value-based care models.
“Value-based care has been around for a while and, even a number of years into this, there are still continued improvements,” he said. “This is not just going into value-based medicine, changes occur, and then it’s static. What this means is that there should be continued quality improvement, which should then continue to improve the health of our patients, our members.”
Date: November 23, 2018