Elizabeth Oyekan, PharmD, FCSHP, CPHQ, is the vice president of the Access Experience Team at Precision Value & Health.
Over the last 10 years, there has been a concerted effort to transform our health care system from a focus on volume to a focus on value, with an emphasis on clinical outcomes as well as the financial aspects of care, leveraging alternative payment models (APMs). However, the progress to adopt APMs as a vehicle in this quest has been relatively slow, with fee-for-service (FFS) remaining the dominant payment model a decade later.
However, over the last few weeks, in the midst of the coronavirus disease 2019 (COVID-19) pandemic devastation, health care is seeing some compelling aspects of APMs that are causing FFS practices and providers, payers, and pharmaceutical manufacturers to take notice. Following are 4 emerging trends from APM practices — trends that are enabling APMs to be better prepared to deliver high-quality and more affordable care to their patients amid this pandemic.
I. Preventing the backward slide of the value-base care initiative
Recently, there has been unparalleled regulatory flexibility issued by the Centers for Medicare and Medicaid Services (CMS) to help ease the burden on the health care system and support patient and provider needs. In particular, CMS is focusing on preventing the derailment of 1 of its most important priorities — moving the health care system from volume to value, leveraging value-based models and APMs in this quest. To prevent a major backward slide with this initiative and focus, CMS has granted the following exceptions from reporting requirements and extensions with respect to upcoming measure reporting and data submission:
At this time, CMS is evaluating additional opportunities addressing financial risk issues, down-side risk mechanisms, and reporting burdens amid this pandemic that have been recommended by the National Association of Accountable Care Organizations (NAACOS), the Health Care Transformation Task Force, and many other organizations to prevent the derailment of the significant process made by APMs in the quest toward value-based care.
II. Infrastructure elasticity to address population needs
Physicians and health care practitioners participating in APMs have been able to leverage their value-based care infrastructures and business capabilities to more effectively manage the COVID-19 crisis while managing the flood of emergency COVID patients at the same time. In a survey of 245 health care organizations conducted by Premier Inc., about their value-based strategies and tools to manage the COVID-19 surge, 82% of the networks in APMs reported the use of care management support to manage COVID-19 and other patients compared with 51% of practices not in APMs.1 Other value-based tools leveraged by the APMs included
By having these population health infrastructures in place, as well as the data analytic tools to help identify potentially high-risk patients that team members can reach out to and address needs via telemedicine/phone, APMs have been more likely to prevent the need for high-cost visits (ie, urgent care and emergency room). APMs have been able to keep these services for patients who actually need them, while meeting member needs in the safety of their home during this pandemic.2
III. Value-based mindset
Over the last several years, APMs have been incentivized and accustomed to focusing on providing high-quality health care while controlling costs through reduction in unwarranted utilization (eg, high-cost visits and hospitalizations, expensive therapies that are not evidence-based, operational efficiencies), with an emphasis on the total cost of care. Currently, and post pandemic, organizations will be seeking opportunities to recover from devastating financial losses. In addition to the support needed from the government, many APMs are taking their focus on value to the next level to mitigate some of their losses, including amplified surveillance to reduce unnecessary high-cost visits, increased focus on the use of biosimilars and evidence-based therapies, and reducing unwarranted variation in care and processes to name a few.
IV. Alternative source of income
Many APMs are continuing to provide quality and preventive care services to their patients while managing the influx of emergency COVID cases, which will contribute to their measures and possibly their bonus payments (pending some CMS COVID-related regulatory changes). These bonus payments are another source of revenue for these entities compared with their FFS counterparts whose income solely depends on volume.
The elasticity in the APM infrastructure to more effectively identify potentially high-risk patients and outreach to them, the capabilities to support patients’ needs leveraging telemedicine, the ongoing focus on creating value, and the potential for an alternative source of income has FFS providers looking at APMs in a new light. Some practices are contemplating the possibility of piloting and experimenting with the APM concept of value-based care as an opportunity to make their practices more resilient and better prepared for future uncertainties. And this is making payers and pharma take notice. So, could COVID-19 become a catalyst for the movement of more practices and health systems from being entrenched in the FFS world to exploring value-based care? Will a small silver lining from COVID-19 be a renewed interest in the shift from volume to value leveraging APMs? More to come.
1) CMS Announces Relief for Clinicians, Providers, Hospitals and Facilities Participating in Quality Reporting Programs in Response to COVID-19. March 22, 2020. Accessed June 9, 2020. https://www.cms.gov/newsroom/press-releases/cms-announces-relief-clinicians-providers-hospitals-and-facilities-participating-quality-reporting.
2) Premier Inc. Survey: Clinically Integrated Networks in Alternative Payment Models Expanded Value-Based Care Capabilities to Manage COVID-19 Surge. May 13, 2020. Accessed June 9, 2020. https://www.premierinc.com/newsroom/press-releases/premier-inc-survey-clinically-integrated-networks-in-alternative-payment-models-expanded-value-based-care-capabilities-to-manage-covid-19-surge.