A lack of resources is preventing robust value-based care adoption, but provider incentives and market consolidation could help, a survey shows.
Healthcare providers and other industry leaders are still facing significant challenges with value-based care adoption, but provider incentives and market consolidation could help accelerate the transition, healthcare leaders across the industry said in a new survey.
The survey conducted by Definitive Healthcare polled 1,090 healthcare leaders across the provider, biotech, financial services, staffing, life sciences, IT, and consulting verticals to explore their thoughts on value-based care adoption in 2019 and beyond.
The survey revealed that healthcare industry leaders still lack the resources and interoperability needed for value-based care adoption.
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One-quarter of respondents said their organization is short-staffed, does not have the appropriate health IT software, and/or generally lacks key resources, making lack of resources the top barrier to value-based care adoption.
Coming in second was gaps in interoperability. Nearly 20 percent of respondents cited internal and external issues with interoperability as a top barrier to implementing value-based care.
Other challenges healthcare leaders are facing with value-based care adoption included unpredictability of revenue stream and complexity of financial risk (17 percent), changing regulations and policies (16 percent), and trouble collecting and reporting patient information (15 percent).
The challenges identified by healthcare leaders may be keeping the industry from implementing value-based care models on a wide scale. Only about one-third of healthcare payments are tied to an alternative payment model and that percentage increased by just five percentage points compared to two years prior, according to the Health Care Payment Learning & Action Network’s analysis of claims from 2017, the most recent year for which the group had data.
Slow and steady seems to be the motto for value-based care adoption. But healthcare leaders had some ideas on how to accelerate the transition away from fee-for-service.
Nearly 45 percent of leaders polled by Definitive Healthcare said appropriate provider compensation and incentives would hasten value-based care adoption.
More providers are earning payments based on their quality and value of care, but compensation and bonus payments are still primarily based on volume of services. Research from Merritt Hawkins, for example, found that 56 percent of physicians and advanced practitioners receiving a bonus from 2018 to 2019 earned the incentive payment based on quality metrics, such as patient satisfaction and adherence to treatment protocols.
However, 70 percent of the providers also said they received a bonus based on relative value units, and that percentage was up from 50 percent the previous year.
If the industry wants to accelerate value-based care adoption, then linking more provider compensation to quality and value is the key, respondents of the Definitive Healthcare overwhelmingly agreed
“Under the current system, providers can opt into value-based purchasing initiatives, receiving bonuses for performing above average and being penalized for performing below average. However, more clarity may be needed to entice providers to jump on board the VBC train,” the survey stated.
Healthcare leaders in the survey also said market consolidation through mergers and acquisitions would also help the value-based care transition. Almost 19 percent of respondents cited market consolidation as a means of quickening the implementation of value-based care models, making the strategy the second highest ranking factor.
Healthcare mergers and acquisitions can support value-based care adoption. By merging with a larger organization, physician practices and small hospitals can gain access to the resources they lack for successful implementation and operation of value-based care models. Meanwhile, mergers and acquisitions also help larger hospitals and health systems achieve the scale they need for effective value-based care adoption.
But even deals done in the name of value-based care are causing concern among industry experts. Research has shown that healthcare market consolidation leads to higher prices for payers and consumers, and in some cases, even disincentivize organizations to lower their costs.
Despite concerns, 18 percent of healthcare leaders believe market consolidation will influence value-based care adoption in 2020. They agreed that the evolution of accountable care organizations (ACOs) and bundled payment models, as well as the federal government’s shift to mandatory participation, will also impact future value-based care adoption.
To manage the shift to value-based care beyond 2019, many healthcare leaders plan to benchmark their performance. About 21 percent of respondents said their organizations will be more focused on benchmarking their success against their competitors next year.
“As VBC models continue to evolve, not only are we seeing a new level of care, but also a pressure to drive down costs and an increased focus on preventative care management,” he stated in a press release. “As of 2019, only 56 percent of US hospitals are participating in value-based purchasing models. As VBC programs become more widespread, providers will need to benchmark their performance in order to remain competitive. This survey shows that having the right resources – staffing, compensation, IT and software – will be key to the success of VBC programs.”
Date: october 04, 2019