Is the Future of Value-Based Payment at Risk?

By Dr. Susan Turney, Chief Executive Officer, Marshfield Clinic Health SystemThe U.S. healthcare economy is beginning an incredible transformation. If it continues at the current pace, in a few years from now we may hardly recognize the way healthcare is measured, billed and paid. Incentives will be better aligned, costs will be lower and care will have been improved.

The transformation we are talking about, of course, is the shift to value-based payment. What is in doubt, however, is whether this transformation can continue at its current pace. The future of value-based payment may be at risk unless industry comes together quickly to decide how information needed to support this model should be identified, sourced, accessed and shared.

Today, organizations across the country are experimenting with value-based payment models. Countless approaches are emerging for attributing providers, stratifying patients and assessing quality. Innovation is occurring rapidly.

So, what’s the problem?

While the multiplicity of approaches to developing these models is a good thing, some uniformity is needed to help the system run smoothly.

Think of it this way: Hundreds of innovators are racing to develop faster, smarter, safer cars. That’s great. But they all need to agree on speed limits, which side of the road to drive on, and when you can make a right on red. For the information stakeholders need to successfully implement value-based payments, there are no such agreements.

We have seen this very scenario play out before. More than two decades ago, when electronic transactions were first being implemented to administer fee-for-service payment models, organizations began using many different, often proprietary, approaches. Even with HIPAA standards in place, exchanging information without common rules of the road became cumbersome, automation was stymied and costs were too high.

To address this, the industry came together to create CAQH CORE. This collaboration brought health plans, providers, clearinghouses and other stakeholders to the table to hammer out common operating rules, most of which were ultimately codified as part of the ACA by the Department of Health and Human Services.

Thanks to these and other industry efforts, it’s working. Today, fee-for-service administrative information flows electronically and securely between health plans, providers and clearinghouses. And, use of manual phone, fax and mail processes has been sharply reduced.

Given this experience, CAQH CORE saw a similar scenario emerging in value-based payment. Following a detailed review of the operational challenges confronted by innovators and early adopters, CAQH CORE has released a report, “All Together Now: Applying the Lessons of Fee-for-Service to Streamline Adoption of Value-Based Payments.” The report identifies five areas where greater uniformity is needed for the value-based healthcare economy to thrive: data quality, interoperability, patient risk stratification, provider attribution and quality measurement.

Consider the alternative. Without consistency in these areas, a healthcare provider may have to juggle dozens of different approaches by the health plans it contracts with to exchange data about risk, quality and outcomes. Think traffic jam.

Should this occur, adoption of value-based payment programs may be slowed and its hallmark features made cumbersome and costly. Sound familiar?

While it may be too early for an approach such as operating rules to be useful in value-based payment, other approaches may help move the industry forward. For example, the CAQH CORE report suggests strategies such as pilot projects, greater information sharing, voluntary industry agreements and more industry education.

Other organizations, collaboratives and individuals are also showing leadership in this area. That is great news. The discussion around these issues is important. But it needs to go beyond discussion. Unless industry comes together to adopt common understandings and approaches, the true value of value-based payments will elude us.

Originally posted on Modern Healthcare: