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The American Journal of Managed Care October 2015
Scalable Hospital at Home With Virtual Physician Visits: Pilot Study
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The Path to Value Through the Use of Holistic Care
Roy A. Beveridge, MD, Chief Medical Officer, Humana
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The Path to Value Through the Use of Holistic Care

Roy A. Beveridge, MD, Chief Medical Officer, Humana
An analysis of the healthcare industry shift from fee-for-service to value-based reimbursement and how this change creates a more holistic approach to patient care.
What will the future of healthcare look like in 20 years? Hold that thought. Before we predict the future, we must show we’ve truly learned from the past.
It’s no secret we have challenges that need to be solved, and the readers of The American Journal of Managed Care (AJMC) know this all too well. Our transaction-driven, fee-for-service model has helped contribute to the unconnected, fragmented healthcare system that has led to these challenges.
As a physician who has practiced oncology for more than 20 years, the fee-for-service model—although still in wide use today—does not support the holistic, customized approach physicians must take to help their patients achieve health in today’s consumer-driven world.
This episodic-driven model also incentivizes transactional activity and does not reward physicians for the value they bring to a patient’s life. It’s not the system that’s required to address the chronic condition epidemic, where 75% of our annual healthcare spend—$2 trillion—is for people with multiple chronic conditions.1
With 10,000 people turning 65 every day, many of whom have multiple chronic conditions, the time has come to hasten this needed evolution.
Paving the Way
For the last 20 years, AJMC has been making a valuable contribution to society by articulating the case for encouraging providers and physicians to move from a fee-for-service model to a value-based reimbursement model. Although it has not been an easy trek, the light at the end of the tunnel is becoming more luminous day by day.
Take the leadership displayed by HHS Secretary Sylvia M. Burwell, who earlier this year set a goal of connecting 30% of fee-for-service Medicare payments to value-based models by 2016 and connecting 50% of payments to these value-based models by 2018.2
I’ve experienced firsthand the power of value-based reimbursement across 1 million of my company’s Medicare Advantage (MA) members.3 Collectively, these MA members experienced fewer emergency department visits and fewer inpatient admissions than those in fee-for-service settings, while being served by providers who experienced higher Healthcare Effectiveness Data and Information Set Star scores than providers outside of value-based settings. Because of this, we paid physicians more than $76 million in bonuses.4
But this is not about just a single company; it’s about an industry and government that is transforming, through collaboration, to meet the health needs of the 21st century patient. This industry transformation is driving higher quality at lower costs.
Meet the Need
The adoption of the value-based model and the importance of quality that the HHS is looking to drive are reflective of the needs of the patient, provider, and physician communities we serve.
Today, people are asking for—and it’s up to us to deliver—predictable pricing, high-quality care, and a seamless customer experience. The “retailization” of the healthcare system, where consumers have the power to choose from different MA plan options, is fostering a competitive environment where innovation determines success. In this environment, competition is not only challenging health plans to compete with each other and against traditional Medicare, but health plans are also using the value-based model to build healthier, sustainable populations.
Many physicians are enthusiastic about improving quality, but they frequently lack the foundational ability that allows them to manage populations in a value-based model. Given the current fragmented system, these physicians don’t know when their patient—who they see twice a year for 10 minutes—had their last mammogram or colonoscopy or if they are taking their medication.
In a value-based model, the primary care physician is figuring out, “How do I do things so this 75-year-old woman who has diabetes doesn’t get pneumonia or isn’t hospitalized?” It’s going beyond the standard examination and helping the patient manage their diet and weight so she does not have diabetic complications. If we expect providers and these physicians to transition to value, industry must deliver the clinical capabilities necessary to support the holistic approach that’s essential to this model.
Providers, health plans, and physicians must become more integrated by continuing to build trusting, collaborative partnerships that put the patient at the center. These partnerships are also critical for building clinical capabilities such as data analytics. Without this trust, we can’t build the clinical foundation necessary for the holistic approach.

Copyright AJMC 2006-2018 Clinical Care Targeted Communications Group, LLC. All Rights Reserved.
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