Moving Toward Value-Based Care and Payment

Abstract

What? what? what? These are the three questions that I continuously stress in a leadership course for graduate students in the Executive Master of Healthcare Administration program at the University of Iowa College of Public Health in Iowa City. What is really just the subject matter. So is a bit more important because it seeks to understand why the subject actually matters. Now is the most important question in determining a call to action is needed or some new knowledge emerges from the what and so what.To learn how the march toward value-based payment can be accomplished and benefit patients, the two feature articles in this issue from two of the largest and most prestigious health systems in the country are must reads. Of course, the ultimate goal of the value-based payment system is to bring to patients. There is little question that the healthcare system in the United States is the best in the world, especially when it comes to providing acute care services to those who have good access to the system. We have the best-trained physicians and caregivers, the most advanced technology, cutting-edge science, and, of course, amazing facilities. For those paying the bill, however, the value we bring is questionable. We spend more per capita on healthcare services than does any other industrialized nation. Yet, we struggle when it comes to measuring up with overall health status and how long we live.The movement toward value is not only important; it is imperative. The current payment structure and delivery model, rooted in volume, are inefficient and the ethics are questionable. According to the National Academies of Sciences, Engineering, and Medicine (2012), about 30 percent of health spending in 2009-roughly $750 billion-was wasted on unnecessary services, excessive administrative costs, fraud, and other problems. Healthcare is simply not affordable . . . not for the government, not for employers, and certainly not for families and individuals.We must change. If we don't, someone else surely will fill the gap.What?Both Banner Health Network (BHN) and Ascension are enormous healthcare systems. In comparison, the hospital I lead has just 50 beds. Grinnell Regional Medical Center (GRMC) in Grinnell, Iowa, is an affiliate of the Mercy Health Network (MHN) of Iowa, a 39-hospital system that operates jointly with Colorado-based Catholic Health Initiatives and Michiganbased Trinity Health. As a result of these relationships, I have some sense of how skill and scale matter when it comes to moving to value. MHN (and its parents) and GRMC have been on the value journey for several years as well. Although we have implemented many of the same strategies and enjoyed some success, I found both of this issue's features articles a valuable read.My first observation is that both BHN and Ascension recognize that moving to value is compelling not only from a business perspective but also from a mission perspective. Whether it is the Triple Aim for BHN or the Quadruple Aim for Ascension, the focus on value is clearly mission driven. In many respects, those of us running hospitals can say hallelujah to this. For the first time in the 25 years that I have been a hospital CEO, hospitals are aligning our missions of improving health with financial incentives to keep people healthy.For those still trying to figure out what all the value-based-care approaches are, Henkel and Maryland from Ascension provide a wonderful primer, from pay for performance to provider-sponsored health plans and shared savings to bundled payments. Both articles go into great detail outlining the reasons for embracing the value journey, strategies and tools, examples of success, and thoughts going forward. The value-based reimbursement subject is thoroughly covered.So What?Henkel and Maryland provide a great example of how the model works in their description of Ascension's success with MissionPoint, which is based in Nashville, Tennessee. …