According to a recent survey by KPMG's Healthcare & Life Sciences Practice, only 15 percent of the 164 healthcare professionals surveyed said their finance departments can support alternative payment models such as capitation, bundled payments and quality-based payments.

Nevertheless, the push toward value-based reimbursement is strengthening each day, especially given the mandate by Health and Human Services (HHS) that has set a goal of tying 85 percent of all traditional Medicare payments to quality or value by 2016 and 90 percent by 2018. How can healthcare executives prepare their teams for a transition to value-based reimbursement and minimize risk in the process?

Jeb Dunkelberger, Executive Director, Accountable Care Services & Corporate Partnerships at McKesson, offered to map out these roadblocks to help executives build successful transition plans. Here are the crucial barriers he identified and what executives can do to overcome them.

Q:How can providers integrate value-based care at the patient engagement level?

Dunkelberger: Healthcare organizations are now incentivized to deliver high-value care, and in most instances providers recognize financial and clinical benefits with chronically ill patients, and especially those with multiple chronic conditions. The ability to engage and educate patients, actively manage disease, and incentivize good behavior are all criteria of a successful engagement program.

Leaders can answer this challenge by starting in a low-risk setting and developing the required skill sets to manage and engage patients. A great example of a low-risk platform for testing patient engagement is seen in models such as Patient-Centered Medical Homes and MSSP ACOs, which can be set to have no down-side financial risk. In these programs, a percentage of shared savings can be rewarded to the organization if it successfully implements a program by fulfilling all clinical benchmarks while decreasing costs for that given demographic.

In addition, providers must now approach disease management in a more collaborative way, and will gain the most traction in engaging patients by coordinating their care across a multidisciplinary team that includes physicians, nurses, pharmacists, dieticians, therapists, and psychologists. By shifting the focus to building a care team and engaging patients in their care plans, rather than just treating a condition, patients and providers can better manage their conditions.

Q:How can providers minimize financial challenges from the transition to value-based reimbursement?

Dunkelberger:Value-based reimbursement comes in many shapes and sizes, and I believe things such as pay-for-performance, bundled payments, capitation, and global budgets all come with their unique set of challenges and subsequent set of solutions. These challenges also change vastly based on the payer contract and the patient demographic and disease states being managed.

My suggestion is to start targeting a narrow set of diseases and patient groups in your practice for improvement, and prepare for the financial risks that may be part of accepting a higher-risk form of reimbursement. Make sure to select conditions in which you have already developed a best-practice approach and have a plan to minimize complications. And before you can implement, you have to know what and how to measure various key benchmarks that demonstrate program success, address preventable complications and minimize risk.

Q:How can providers best prepare their internal teams for value-based reimbursement?

Dunkelberger: Set a strong mission and clear goals for the organization. Change can generate confusion, and the biggest mistake an organization can make is to not spend enough time on preparation. Ways to enable change management include educating and enlisting key leaders in the decisions that drive the necessary changes required by the selected value-based reimbursement programs, and enlisting staff to set, measure and track key performance indicators.

Engagement of personnel also ensures a level of buy-in and improves dialogue between staff members and patients. The culture must shift to successfully implement and subsequently provide rewards in a value-based reimbursement. Don’t underestimate the amount of change that is needed and the amount of education and clarity that is required to become a next-generation care delivery system. Hospitals, health systems and practices alike must now consider including support-service providers beyond their four walls to fill in any gaps in the care team, such as the need to improve nutrition screening, monitor patients remotely or deploy a chronic care management service program.

Q:What does the value-based reimbursement movement mean for revenue cycle management?

Dunkelberger: Revenue cycle management will continue to be a focus as clinical documentation, claims management, collections and even compensation will need to change as larger percentages of reimbursement will be tied to value-based reimbursement.

The successful groups today are the ones taking early steps to change, are trying new models of compensation and are simply not waiting for change to be forced upon them.

CMS has laid a clear path for where it intends to take reimbursement models and commercial plans have already implemented similar programs in most states. The early movers will be rewarded and the clinical delivery system will improve overall, with the innovators leading the charge.

Q:Any other high-level observations about value-based reimbursement?

Dunkelberger: Redefine the term “healthcare provider” to become a “care team provider” and focus on leveraging care providers across the system to build a longitudinal care plan for patients. In addition, strive to minimize avoidable complications through efficacious, evidence-based outreach programs.

Engage patients and allow them to improve their disease condition through the utilization of the most cost-effective interventions. Once your programs begin to see marginal success, begin to take risk in those areas and allow yourself to become accountable for the continual delivery of effective care while being financially rewarded for improving the health of your populations.

Looking for additional direction on value-based reimbursement models? Download the From Volume to Value – Ready or Not (PDF, 1.4 MB) white paper from McKesson Business Performance Services.

Jeb Dunkelberger

About the author

Jeb Dunkelberger is the Vice President of Accountable Care Services and Corporate Partnerships for McKesson's Business Performance Services division. In this role, Jeb integrates a plethora of health care stakeholders in revolutionary care delivery models designed for the evolving complexities of today's health care sector. Formerly, Jeb served as Executive Director of Physician Engagement for Accountable Care Services, where he was responsible for physician recruitment, alignment, and engagement, as well as managerial oversight within multiple health care delivery models. Jeb holds health degrees from Cornell, London School of Economics, and Virginia Tech and brings close to a decade of experience in the healthcare sector.

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