By: Thomas Foels, M.D., M.M.M. Independent Health’s Executive Vice President and Chief Medical Officer
Health care now represents 17.8 percent of the Gross Domestic Product (GDP) in the U.S. Although the U.S. spends almost twice as much as other countries in health care in terms of GDP, reports show our country consistently performs worse in quality and outcomes compared to other industrialized countries.
The causes of and solutions to rising health care costs are complex, but one large contributing factor is the method and structure by which providers are reimbursed. A new method of paying physicians and providers is growing rapidly, and it has the potential to help rein in rising health care costs by paying providers not for volume of services, but for value and outcomes.
In the current fee-for-service model, virtually each health care service performed in a doctor’s office or hospital has a code which has a fee assigned to it. The more services performed, the more the consumer and insurer pay the physician.
A new, alternative payment model that is value-based, in contrast to traditional volume-based, has the potential to dramatically transform and improve health care delivery in our region and throughout the nation.
Value-based payment rewards physicians for providing patients with evidence-based medicine, while advancing safe, appropriate and effective care as opposed to a volume-based, fee-for-service model that rewards more – and often unneeded, duplicative and, in some instances, potentially harmful – tests, treatments and/or procedures.
In Western New York, Independent Health and some forward-thinking, high-performing physician practices and provider groups are on the leading edge of moving toward these alternative payment models. In fact, 65 percent of Independent Health’s members are already aligned with a primary care physician (PCP) or provider who is currently in a value-based agreement with Independent Health.
This transformation is consistent with Independent Health’s long history of collaborating with physicians on pioneering efforts to reward them for providing more preventive, proactive care to achieve better quality outcomes, improve patient satisfaction and lower the trend of rising medical costs.
Independent Health helped establish The Primary Connection, a collaborative of nearly 200 like-minded physicians from 34 practice groups to improve the way care is delivered, resulting in better coordination with specialists and other providers. By making changes such as follow-up care and patient education around proper emergency room utilization, the Primary Connection practices reduced unnecessary emergency room and urgent care center usage by more than 6 percent from 2016 to 2017.
As a result of closer collaboration and communication between the primary care and specialist physicians, as well as the use of a care-team approach, The Primary Connection physicians have decreased duplicative care and unnecessary visits to specialists by 16% from 2015 to 2017.
Another successful outcome has occurred with a series of value-based reimbursement programs with specialty physicians. For example, WNY Urology/Cancer Care has participated in a value-based reimbursement program that has assisted the group in achieving, and in some cases exceeding, national and local benchmarks for quality and efficiency. Not only are WNY Urology’s outcomes better than its peers, its cost-per-episode of treatment has declined 40 to 50 percent lower than peers for prostate cancer treatment.
Payment reform that truly improves the quality of health care, while driving costs downward, is imperative to the financial sustainability and economy of our nation and region. Independent Health remains committed, through initiatives like The Primary Connection and value-based payment for specialty care, to being a catalyst for change in revitalizing and growing primary care and successfully moving to a value-based model of health care delivery.
To learn more about the move to value-based payment models, download an Independent Health special report: A Catalyst for Change in Moving to a Value-based Model of Health Care Delivery.
Disclaimer: The above commentary entails the views of the author and not necessarily the views of the Buffalo Niagara Partnership.