Now What !?

At 7:30am on Wednesday, November 9th I received a Helen of Troy type text message: three simple words from a client that begged a thousand responses, simply asking, “now what?”

Unless you’ve been hiding under a rock for the past few Trump Winsweeks you are aware that healthcare in the United States is once again heading into turbulent policy waters with the election of a president whose political party has very different ideas about how to improve our healthcare delivery system. Or so we have been led to believe.

From what little is known to this point it is unlikely the Trump Administration will just blow up the Affordable Care Act in the first 100 days of its tenure. That is fortunate because, irrespective of your political beliefs, haphazardly dismantling the current system would undoubtedly result in unintended – and politically undesirable – consequences, potentially causing harm to millions of patients and healthcare providers.

That being said, there is no doubt substantial changes will be made and quickly by Washington, DC standards. If anything is predictable about Mr. Trump it is that he won’t be patient with bureaucratic efforts not quickly producing tangible results. Whether that impatience can be channeled into effective change management in a kingdom that literally thrives on maintaining the status quo only time will tell.

The next six months are going to be incredibly confusing and confrontational as we seek to consider and understand the potential ramifications of new health policy proposals. Speculation on the impact of such proposals will span from certain and imminent catastrophe to unbridled joy. Through it all be reminded that often in many ways the more things change the more they stay the same. To that point, in helping senior living organizations anticipate how to best position for changes in healthcare policy I think it is more prudent than ever to focus on what we know won’t change.

The accelerating demand for affordable housing, home and community-based services and healthcare resulting from the demographic realities of an aging population will not change. Underlying pressures such as technology and innovation driving up healthcare costs will not change. The growing impact of consumerism on healthcare will not change. Demand for qualified human caregiving resources outstripping supply will not change. The increasing burden chronic disease management puts on our delivery system will not change. I’m sure you can think of your own realities to add.

If you aggregate all of the environmental certainties shaping the healthcare industry today and in the future, logic dictates that value will continue to be at the center of new policy initiatives. And that means alternative payment models (APMs) will continue to garner support if not greater efforts to accelerate their adoption. Recall, the Medicare Access and CHIP Reauthorization Act (MACRA) provides substantial incentive for physicians to migrate into advanced APMs, and that legislation was passed by Congress with overwhelming bipartisanship. MedPAC, the nonpartisan legislative branch agency that provides Congress with analysis and policy advice on the Medicare program has also been very supportive of APMs.

So when answering the question, “now what?” my response is to continue developing organizational attributes that will build competitive advantage as a participant in APMs. Focus on the no regret investments that build enterprise value in the context of emerging care delivery models: e.g., demonstrating a commitment to continuous quality improvement; assess the value of specialization; improve productivity and reduce costs without impacting outcomes; develop an employee value proposition; build a robust cost accounting system; focus on beneficial referral relationships; measure and report on performance; invest in community-based downstream relationships.

A great way to learn more about what APMs entail – and to stay ahead of emerging research, ideas and discussion about their advancement – is to join the Healthcare Payment Learning & Action Network (HCPLan). This is a nonprofit organization that was launched by the Department of Health & Human Services in March of last year with a mission, “to accelerate the health care system’s transition to alternative payment models by combining the innovation, power, and reach of the private and public sectors.”

On October 25th of this year I had the opportunity of attending the fall LAN Fall Summit in Washington. The Summit brought together nearly 800 participants representing senior leaders from across the health care community, including providers, payers, employers, patients, consumer groups, health experts, and state and federal government agencies.

Here’s the singular most important message that I would like to share from my participation there: alternative payment models are not unicorns. They exist, they are being tested, learned from and gaining increased support daily. They are transcending the ideological spectrum of political discourse. The advance toward APMs is accelerating, and as shared above I do not see that being at all abated by the results of this presidential election. I can see the opposite effect taking shape.

Sadly, I believe there will come a time in the not too distant future when many nonprofit and smaller senior living organizations that depend upon post-acute/long-term care revenue for survival will find their organizations have waited until the decision of whether or not to participate in APMs has been taken out of their hands. For profit organizations are investing millions in learning how to compete and win under alternative payment models. If your organization is not taking steps to be equally competitive, then I would focus your energies instead on building acquisition value.

The first step in determining whether and how your organization can be competitive in a world of value-based care delivery models is to perform a gap assessment: what attributes must you have to compete under APMs compared to your organizational current state – and what investments are required to bridge that gap? Do you have the financial wherewithal to make those investments? How much time do you have to effectuate change?

That’s now what.

Cheers,
  ~ Sparky

Principles of Alternative Payment Models Framework

HCPLANGreetings PolicyPub patrons. I would like to take a moment and share with you a whitepaper recently published by the Health Care Payment Learning and Action Network. The purpose of the whitepaper is to provide a roadmap to measure progress and establish a shared language and common set of conventions to help facilitate discussion and debate regarding alternative payment models (APM).

A group that I have actively participated in since its inception back in March of this year, HCPLAN was established by the Department of Health and Human Services, “to help achieve better care, smarter spending, and healthier people.” It’s primary purpose is to serve as a convener and facilitator (as well as catalyst) in pursuing HHS’s stated goals of:

  • tying 30 percent of Medicare fee-for-service payments to quality or value through alternative payment models by 2016 and 50 percent by 2018; and
  • tying 85 percent of all Medicare fee-for-service to quality or value by 2016 and 90 percent by 2018.

    The whitepaper identifies seven Key Principles for the APM Framework that all healthcare providers should be aware of and understand:
  • Principle 1: Changing the financial reward to providers is only one way to stimulate and sustain innovative approaches to the delivery of patient-centered care. In the future … it will be important to monitor progress in initiatives that empower patients (via meaningful performance metrics, financial incentives, and other means) to seek care from high-value providers and become active participants in clinical and shared decision-making.

    Principle 2: As delivery systems evolve, the goal is to drive a shift towards shared-risk and population-based payment models, in order to incentivize delivery system reforms that improve the quality and efficiency of patient-centered care.

    Principle 3: To the greatest extent possible, value-based incentives should reach providers who directly deliver care.

    Principle 4: Payment models that do not take quality and value into account will be classified in the appropriate category with a designation that distinguishes them as a payment model that is not value-based. They will not be considered APMs for the purposes of tracking progress towards payment reform.

    Principle 5: In order to reach our goals for health care reform, the intensity of value-based incentives should be high enough to influence provider behaviors and it should increase over time. However, this intensity should not be a determining factor for classifying APMs in the Framework. Intensity will be included when reporting progress toward goals.

    Principle 6: When health plans adopt hybrid payment reforms that incorporate multiple APMs, the payment reform as a whole will be classified according to the more dominant APM. This will avoid double-counting payments through APMs.

    Principle 7: Centers of excellence, patient-centered medical homes, and accountable care organizations are delivery models, not payment models. These delivery system models enable APMs and, in many instances, have achieved successes in advancing quality, but they should not be viewed as synonymous with a specific APM. Accordingly, they appear in multiple locations in the Framework, depending on the underlying payment model that supports them.

    HCPLAN is open to anyone interested in being kept informed of and joining the conversation on HHS’s efforts to  develop new payment models intended to be structured around all of the buzzwords you’ve heard over the past five years now: e.g., value, quality, transparency, patient activation, evidence-based, and so on.

    What it is not, based on my experience, is a veiled promotional vehicle to evidence broad-based support of new payment models that go largely unchallenged. To the contrary, there is a great deal of practical concern being expressed supported by real life experience having already pursued new payment models – the good, the bad and the ugly. To participate in HCPLAN, just visit the registration web page.

    Cheers,
      ~ Sparky

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