Population Health, as defined by the Center for Disease Control (CDC), “brings significant health concerns into focus and addresses ways that resources can be allocated to overcome the problems that drive poor health conditions in the population.”
The goal of population health is to help coordinate health systems, physicians, post-acute entities, employers, insurance payors, and other organizations to work together to improve the health outcomes of the communities we serve.
The Department of Justice (DOJ) and Federal Trade Commission (FTC) have also developed a population health model called the Clinically Integrated Network (CIN). This model is defined as “an active and ongoing program to evaluate and modify practice patterns by a network’s physician participants and create a high degree of interdependence and cooperation among the physicians [and hospital] to control costs and ensure quality.”
The transition to value-based care revolves around a recalibration of how healthcare is measured and how payments are reimbursed. The traditional model, known as fee-for-service, simply assigns reimbursements based on what services a healthcare organization provides. But in value-based care, reimbursement is contingent upon the quality of the care provided. Because value-based care is tied to patient outcomes, better quality of care results in higher reimbursement.
Quality of Care
The DOJ and the FTC have approved the CIN legal arrangement that allows hospitals, physicians, and post-acute entities to collaborate on improving quality of care on behalf of insurance payors, employers, and employees and beneficiaries. The most successful quality networks are physician led and professionally managed. By partnering physician networks with strong administrative leaders, the highest physician quality services are achieved. The physicians commit “sweat equity” in striving to improve performance. Some examples include physicians serving on committees as well as enhancing their day-to-day clinical services.
Facing cost saving pressures, physician groups, health systems, post-acute entities, and insurance payors are looking for creative ways to curb spending. At the same time, the government payors and Medicare are doubling down on provider risk contracting. Self-insured employers are also focusing on utilization control as price sensitivity is increasing with their employees and with consumers.
What should a practice or health system consider when enhancing their care models to include value-based care? To help answer that question, we will review how these value-based care models are different, as well as their associated reimbursement contracts and potential benefits.