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GE Healthcare Camden Group Insights Blog

The Move from Volume to Value: Now is the Time for Change

Posted by Matthew Smith on Jun 2, 2016 12:19:54 PM

By Daniel J. Marino, MBA, MHA, Executive Vice President, GE Healthcare Camden Group

Healthcare delivery (and physician reimbursement specifically) is undergoing unprecedented transformation. While most physician practices still operate largely in a fee-for-service ("FFS") world, government and commercial payers alike have signified their intent to reimburse physicians and other providers based on value.

Thriving in an Uncertain World

Many physicians recognize that the FFS system is imperfect at best, but the evolving value-based reimbursement system is ill-defined, leaving physicians facing a great deal of uncertainty. During this time of uncertainty, medical practices have opportunities to improve performance and position themselves for success in the rapidly changing healthcare market. It is natural to begin focusing on clinical measures and outcomes as a means for proving value, but it is just as important to remain financially viable during the transition. By understanding the structures of evolving reimbursement methodologies, changing health plan dynamics, and developing market trends, we can thrive in this uncertain world.

The Department of Health and Human Services’ (HHS) is actively involved in the fundamental shift in reimbursement, moving from volume to value in Medicare payments, reinforcing the shift to value-based care. Organizations that begin to incorporate strategies around the “value proposition” will be in the best position to meet industry demands for value-based reimbursement. This will require a dedicated strategic “call to action” across organizations and their provider community.

Controlling the Momentum of Change

There remains a fundamental question regarding how quick an organization should move to value-based care and controlling the momentum of change. Although some of the drivers are market dependent, others are based on embracing key concepts around the “triple-aim principles” and preparing the organization for the future. High-performing organizations are building their clinically integrated networks, forming ACOs, and incorporating reimbursement programs around bundled payments and minimal risk-based contracts, while still reaping some opportunities from the current fee-for-service contracts. 

The transition into value-based care is a paradigm shift of culture, care model redesign, reimbursement, and quality outcomes that takes time. Organizations that begin to plot the “value-based care” path now, while fee-for-service is still their predominant reimbursement, will be in the best position to refine their care delivery models and protect their revenue streams. It will come down to embracing the concepts of patient-centered care while focusing on improving access and reducing the cost curve. Health systems must begin to squeeze operating costs out of the system and incorporate patient-centered care models focusing on an “ambulatory-focused” model of care that carefully manages transitions across the continuum.

Balancing Risk

Many commercial payers in some markets have already begun the transition, with many more to follow.  A strong value proposition along with creating the patient-centered strategy is key to finding the right “change momentum” for your organization. Focusing on providing the value proposition, engaging physicians to lead the care redesign, and incorporating programs such as bundled payments and shared savings help to make sure organizations appropriately embrace the pace of change within their market. It also ensures the organization can maintain a steady forward pace by balancing appropriate risk with solid potential for clinical and financial gains.

Volume to Value


Marino_Dan.jpgMr. Marino is an executive vice president with GE Healthcare Camden Group with more than 25 years of experience in the healthcare field. Mr. Marino specializes in shaping strategic initiatives for healthcare organizations and senior healthcare leaders in key areas such as population health management, clinical integration, physician alignment, and health information technology. With a comprehensive background in all aspects of practice management and hospital/physician alignment, Mr. Marino is a nationally acknowledged innovator in the development of Accountable Care Organizations and clinical integration programs. He may be reached at daniel.marino@ge.com.
 

Topics: HHS, Bundled Payments, Department of Health and Human Services, Value-Based Reimbursement, Value-Based Care, Daniel J. Marino

Moving from Volume to Value: The Time for Change is at Hand

Posted by Matthew Smith on Jan 28, 2015 4:24:00 PM

By Daniel J. Marino, MBA, MHA
Senior Vice President, The Camden Group

volume valueThe Department of Health and Human Services’ (HHS) press release on Monday announcing its fundamental shift in reimbursement, moving from volume to value in Medicare payments, reinforced the shift to value-based care. As discussed in our “Top Ten Healthcare Trends to Watch in 2015,” organizations that begin to incorporate strategies around the “value proposition” will be in the best position to meet industry demands for value-based reimbursement. This will require a dedicated strategic “call to action” across organizations and their provider community.

Even with the HHS announcement, there remains a fundamental question regarding how quick an organization should move to value-based care and controlling the momentum of change. Although some of the drivers are market dependent, others are based on embracing key concepts around the “triple-aim principles” and preparing the organization for the future. High-performing organizations are building their clinically integrated networks, forming ACOs, and incorporating reimbursement programs around bundled payments and minimal risk-based contracts, while still reaping some opportunities from the current fee-for-service contracts. 

The transition into value-based care is a paradigm shift of culture, care model redesign, reimbursement, and quality outcomes that takes time. Organizations that begin to plot the “value-based care” path now, while fee-for-service is still their predominant reimbursement, will be in the best position to refine their care delivery models and protect their revenue streams. It will come down to embracing the concepts of patient-centered care while focusing on improving access and reducing the cost curve. Health systems must begin to squeeze operating costs out of the system and incorporate patient-centered care models focusing on an “ambulatory-focused” model of care that carefully manages transitions across the continuum.

HHS will begin to set clear goals and a timeline that guide their movement from fee-for-service to fee-for-value for Medicare reimbursement. Many commercial payers in some markets have already begun the transition, with many more to follow.  A strong value proposition along with creating the patient-centered strategy is key to finding the right “change momentum” for your organization. Focusing on providing the value proposition, engaging physicians to lead the care redesign, and incorporating programs such as bundled payments and shared savings help to make sure organizations appropriately embrace the pace of change within their market. It also ensures the organization can maintain a steady forward pace by balancing appropriate risk with solid potential for clinical and financial gains.

Daniel J. Marino, The Camden GroupMr. Marino is a senior vice president with The Camden Group with more than 25 years of experience in the healthcare field. Mr. Marino specializes in shaping strategic initiatives for healthcare organizations and senior healthcare leaders in key areas such as population health management, clinical integration, physician alignment, and health information technology. He may be reached at dmarino@thecamdengroup.com or 312-775-1701.

Topics: HHS, Bundled Payments, Department of Health and Human Services, Value-Based Reimbursement, Value-Based Care, Daniel J. Marino

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