Navigating your advanced payment journey: Creating a focused strategy and rollout

Key influencers pointing toward evaluating your value-based contracts
Regulators are demanding that providers implement advanced payment programs to drive better health care outcomes. Many employer groups with a high population of specific surgical procedures and chronic conditions want bundled payment programs. Many providers use home-grown tools that aren’t maximizing the potential of their current value-based contracting (VBC) strategy.

There are four key phases of the advanced payment program development process:

  1. Create a focused strategy
  2. Develop a rollout plan
  3. Implement your program
  4. Maintain, scale and evolve

In part one of this two-part blog, we’ll discuss some basics and best practices of the first two phases based on Cleveland Clinic’s best practices and opportunities.

Value-based contracting basics
Let’s start with some basics. VBC focuses reimbursement on efficiency, quality and patient outcomes. Providing focused reimbursement helps to:

  • Accelerate adoption of outcome-based medicine
  • Move toward greater risk share
  • Align with regulatory programs

The most common VBC programs are:

  • Bundled payments: Patient-centric management of an episode of care (e.g., knee replacement). Emphasizes efficient, effective quality of care.
  • Population-centric payments (includes pay-for-performance and gain-sharing programs): Uses targeted reimbursement that aligns with best quality and patient health care outcome practices to help change behavior. Manages specific populations to reduce or eliminate scope of a specific health care event.

Moving from volume to value
Making a gradual transition to risk allows you to move from an activity-based model to a more engaged, coordinated and high-performing health care organization.

Seven key considerations

  1. Formulate a clear, focused program strategy that meets your organization’s strategic and business goals.
  2. Identify people, process and technology needed to model, build and implement the VBC program.
  3. Evaluate advanced payment programs from the standpoint of risk acceptance.
  4. Develop and align both clinical and operational care pathways.
  5. Analyze your region, membership, market and lines of business. What is the right balance between what the market wants and what it’s ready for?
  6. Develop an implementation and roll-out plan with room for growth.
  7. Plan for transitioning to efficient operational and financial administration to minimize disruption of existing payment processes.

VBC programs continue to evolve
Whether it’s a regulatory or commercial entity, VBC programs continue to evolve. The Centers for Medicare and Medicaid Services (CMS) announced the October 1 launch of an advanced alternative payment model for Bundled Payments for Care Improvement (BPCI). BPCI Advanced aims to support health care providers investing in practice innovation and care redesign, to better coordinate care, improve quality of care, and reduce expenditures. It’s a voluntary program that can be a gateway to providers into supporting a bundled program beyond the CMS program footprint that can also be leveraged across lines of business and other partners.

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About the author

david_mauzey-005 crop medium qualityDavid Mauzey
General Manager, Optum Network Payment Innovation

David leads the development of financial administration platforms used to execute value-based contracting programs. Prior to joining Optum, David spent 17 years working with an enterprise network administration and claim pricing organization. Serving as both Chief Operating Officer and Chief Information Officer, David gained a great appreciation for finding the right operational and technical balance that aligns to organizations’ visions. Today, David focuses on enabling organizations to better deploy their payment innovation strategies.

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