As the healthcare industry continues moving toward value-based care delivery, provider organizations can no longer afford to think about clinical integration in the abstract. Thriving in a dynamic reimbursement environment characterized by alternative payment models requires strategic, financial, and clinical integration across a full continuum of healthcare services. Organizations that cannot offer a comprehensive suite of services to their patients could soon find themselves at a competitive disadvantage.
The critical question facing the leaders of those organizations is: “Do we build, buy, or align with existing organizations to provide missing services?” The answer will vary across providers and markets. But before that question can even be asked, organizations need to get a better grasp their existing capabilities and the dynamics of their markets.
Understand the role of primary care.
Success in a value-based payment environment depends on being able to attract patients and control costs, and that starts with a tightly integrated network of primary care physicians (PCPs). Primary care is the front door to the health system, and with increasing numbers of patients being covered by health plans, demand for primary care services is growing. PCPs should be incentivized to control costs and share the system’s goals for promoting value, including directing patients to specialty providers and services with a track record for delivering high-value care.
Identify gaps in service.
Organizations can’t fill holes in their service offerings until they know where they are. A gap assessment can help leadership identify their organization’s current clinical resources and compare them to the capabilities it requires. Depending on the comprehensiveness of their clinical portfolio, organizations might need a more robust network of primary or specialty care providers, a broader complement of ambulatory care programs, or services for chronic health management and post-acute care.
Project the timing of market demands.
Once those services have been identified, an organization must determine how quickly the reimbursement environment in its market will transition to value-based payment models. Given CMS’s intention to base a substantial portion of its payment on performance by 2019, and commercial health plans’ tendency to follow CMS’s lead, the next 3 to 7 years are likely to see a significant shift to value-based reimbursement.
The pacing of that transition will vary by market. But organizations should examine their regional payer and provider landscape for clues about their market’s readiness for value-based payment, with a particular focus on:
- Level of consolidation among market players. Consolidated providers are generally better able to adapt to changing health plan efforts.
- Organizations’ historical willingness to develop or participate in different reimbursement models. Health plans are more likely to pilot new reimbursement models in markets with health systems that have demonstrated an openness to alternative modes of reimbursement.
- Level of clinical integration among healthcare providers in the market. Markets with significant provider integration are often more responsive and may be better prepared for value-based care delivery.
Identifying gaps in a clinical portfolio is the first step in deciding how to fill them – whether by developing services, acquiring them, or aligning with an organization that offers them. In an upcoming blog post, we’ll take a closer look at these options and how organizations can choose the path that’s best for them. In the meantime, download your copy of Build, Buy, or Align: Creating Clinically Integrated Health Systems.
Published March 16, 2016