Risky business for providers: Building value-based and market-based models

In a previous post, we outlined the five key actions needed to begin and successfully take on patient medical risk in a value-based reimbursement environment: Market Assessment; Strategic Structure; Population-Based Planning; Financial and Capacity Planning; and Value-Transformation Road map.

Our first action is Market Assessment. Assessing your market requires knowing how funds flow across the marketplace and who the payers and products are. This information is important since local market forces influence how payers do business and what products are offered.

All health care is local. The models of care and service vary greatly from state to state, and even between communities within close proximity to each other. As my colleague, Cynthia Kilroy counsels: “The local dynamics are unique to their areas and one model does not fit all.”Miles Snowden, MD, MPH, CEBS Chief Medical Officer, OptumHealth

But don’t ignore national trends. Though local phenomena are primary drivers, leaders would do well to remember the axiom, “Think globally, act locally.” National regulations, such as Medicaid expansion, may drive more volume for the historically low-reimbursing program. That will stretch provider resources. According to some estimates, the Medicare/Medicaid dual eligible demonstration projects happening around the country could cause senior-focused accountable care organizations (ACOs) to lose 20 percent of their enrollees. Fewer enrollees means less opportunity to spread medical risk across a patient population.

With market perspective in mind, the next post will cover Strategic Structure and how organizations should set themselves up for success as they take on increased patient medical risk.

For more information on the need for market assessments within risk-bearing provider organizations, please download the white paper: The Next Stage of Value Transformation.


“Risky Business” previous posts:


Miles Snowden, MD

3 thoughts on “Risky business for providers: Building value-based and market-based models

  1. Pingback: Risky business for providers: Strong leaders, appropriate structure needed | Healthcare Exchange

  2. Pingback: Risky business for providers: Population-based planning in provider risk-bearing arrangements | Healthcare Exchange

  3. Pingback: Risky business for providers: Planning for financial realities and capacity downturns | Healthcare Exchange

Leave a Reply