Value-Based Transformation Needed in Post-Acute Care as Population Ages

With the American population aging, the healthcare system will need to undergo a transformation, HHS Secretary Alex Azar said when he spoke before the Health Care Association/National Center for Assisted Living at the beginning of June. He emphasized the need for change among in post-acute care.

Azar noted that younger baby boomers will require more healthcare services than older boomers as they have higher rates of chronic conditions at a younger age.

“So, all of this is reason to believe that change is necessary, but these changes represent an opportunity, too,” Azar said. “I believe we can all agree that a key element of positive transformation for our health system must be moving from the system we have used for decades, paying for sickness and procedures to paying for health and outcomes.”

In his speech, Azar explained 4 areas that should be emphasized throughout this value-based transformation. The four areas included:

1. Maximizing the promise of health information technology (IT)
2. Improving transparency in price and quality
3. Pioneering bold new models in Medicare and Medicaid
4. Removing government burdens that impede care coordination

As for health IT, Azar discussed the importance of developing an interoperable health records system that would span all care settings. With such a system, patient information, such as their medication list, can be stored and accessible for all doctors or providers that a patient sees—minimizing the opportunities for mistakes and inaccuracies.

Additionally, Azar specifically identified CMS’s introduction of the new proposed payment system, the Patient Driven Payment Model (PDPM), for skilled nursing facilities (SNFs) as how the value-based transformation will be initiated.

Azar reiterated how the PDPM proposal explained its intentions for initiating the change in the healthcare marketplace.

“We want to work collaboratively and transparently, which is why we issued an advance notice of proposed rulemaking,” he said. “We will listen to comments from stakeholders. But we aren’t afraid of rethinking a whole model of payment if the status quo could be improved for patients.”

The PDPM would pay providers based on the patients they treat and through a quality assessment that will be simple and gather the necessary information. This would be a positive and significant shift in how SNFs are currently paid, according to Azar. Also, The PDPM aims to reduce the paperwork burdens that providers are often faced with through a reduction of $2 billion over the next decade.

Azar concluded with a positive outlook on the future and transformation of the healthcare system that will provide better care for lower costs.

“Some of the necessary changes won’t be so comfortable for entrenched players. But those who are interested in working with us to build a new system will have unprecedented opportunities at hand,” concluded Azar.