I'm here to tell you that value-based care is just a silly fad that's eventually going to peter out. Oh, and keep chasing your dream of owning a little independent practice with no affiliations ... insurers and hospitals should never work together ... and nurses should just follow the doc's orders and try not to rock the boat.
OK, I'm joking. But paging through Huron Healthcare's CEO Forum report yesterday, I was surprised to read that there are hospital execs out there who still think that all the transformation happening around them will eventually pass, and they can go back to ringing the register whenever someone gets sick. And those who do get it are going nutso trying to toe the line between fee-for-service and value-based care.
"We definitely have a foot in two worlds. And on any day it's problematic," James Skogsbergh, president and CEO of Advocate Health Care, says in the report. "When we look at our utilization numbers, for instance, we feel schizophrenic. This number is good — no it's bad! — no it's good!"
Huron sat down to chat with leaders from 11 hospitals and 20 health care systems, representing $37.5 billion in net patient revenue, last October, and recently released some of the sound bites from the get-together. A couple of years ago, the same discussion centered around conceptualizing how to reinvent the way health care is delivered, Jeff Jones, managing director of Huron Healthcare, told me by phone yesterday. The next year, it was all about planning.
But this time around, CEOs were knee-deep in experiments that they hope will radically change their organizations — partnering up with insurers to share data, finding ways to bring primary care to the patient at home, and strengthening ties with physicians. Overall, there seemed to be a overarching tone of optimism from hospital leaders, whereas in the past there was more uncertainty and skepticism about what the future might bring. Jones believes that executives must have that sort of hopeful disposition to succeed in today's marketplace.
"A CEO who is setting that optimistic tone is going to create the right kind of energy and the right kind of focus on how to succeed through this transition," he says. "Undoubtedly, there are going to be bumps along the road, but if CEOs are projecting optimism and sharing the dream of what's possible, that's what's going to inspire their people, and that's what's going to inspire their patients to want to be a part of their health systems. Optimism is absolutely paramount at this point, balanced with the right dose of realism."
As hospitals move into this next phase of change and risk losing money when visits plummet, they need to react fast, Jones says. Figure out the right metrics to track your progress, create a learning organization that can quickly correct its course before losing too much money, and gauge how much that learning curve will cost.
Physician employment and alignment was a big topic of conversation at the CEO Forum. Hospitals are scrambling to employ doctors, looking to gain market share and better coordinate care, and many doctors are seeking the comforts of employment. Pulling physicians from every which way can create chaos, though. WellStar Health System in Georgia has whittled its physician compensation plans from 18 down to just three. Others, such as the Carilion Clinic in Virginia, have shifted payment models to reward teamwork — every doc in the group has to hit a certain level on the scorecard before anyone gets a bonus.
Other hospitals are struggling to get all the new docs on the same electronic medical records. "Go to a single vendor for your EMR or you will have tremendous operating problems down the road," says David Bernd, president and CEO of Sentara Healthcare in Virginia.
When it comes to doctors, employment is a two-way street, and providers should be careful not to send the wrong signals that might cause clinicians to scurry to a competitor.
"As physicians assemble into accountable care organizations and begin to respond to changing incentives, they may realize that the hospitals they've been aligned with are not the most desirable place to refer because they are higher cost and lower quality than available alternatives," says Patrick Charmel, president and CEO of Griffin Health Services Corp. in Connecticut. "This will be a disruptive force."
As with physicians, hospitals are seeking ways to partner with insurers to share data and risk. Using caution about calculating those risks and constantly communicating is key to making such arrangements work, says one CEO. Some are wary of trying similar arrangements with multiple payers, for fear of "putting all their eggs in one basket," according to the report. Starting your own health plan, too, is an option, but that can make it impossible to work with other insurers who are now direct competitors. Some hospitals don't really have a choice, though.
"Capturing revenue and margin by going upstream toward insurance models is a critical and urgent strategy for our organization," says Dan Wolterman, president and CEO of Memorial Hermann Healthcare System in Texas.
The slow evolution of health care IT is an area of frustration for some leaders, too. One participant in the forum suggested that getting the government to set up health information exchanges, as it did with the phone system, might be the only way to get "the progress we need." Few hospitals are motivated to develop a statewide HIE, Charmel says, for fear that it might "undermine their earlier 'electronic handcuffs' strategy of connecting community physicians to their hospital information system exclusively to ensure physician loyalty." How can patients be expected to champion their health and wellness when they can't access simple information?
"I can go to Cairo and put my debit card in the ATM and it shows me how much money I have, but I can't go across town and access my health record," says Al Stubblefield, president emeritus of Baptist Health Care in Florida.
Despite any skepticism and schizophrenia, CEOs did seem to have a general consensus that something has to change, and the fee-for-service model isn't going to last.
"In the previous two years, there was a sense in the discussion that there may be an opportunity on the horizon to make some important changes, but there was so much back in 2010 and even 2011 that was either unknown or was not yet defined that the CEOs were much more guarded in terms of what they thought could happen," Huron's Jones told me. "What we've seen over the last 18 to 24 months is, while we don't have clarity by any stretch in how all these changes are going to play out, I think there has been clarity that change is going to happen and it is expected, and they've moved into a mode of if that's what's going to be required, let's make the most of this opportunity to really improve the industry for the better."