Providers Lagging with Value-Based Care, Consumer Strategy

February 12, 2020 - When it comes to adopting value-based care and developing a consumer strategy, providers are significantly further behind compared to payers, according to the tenth annual Industry Pulse Report from Change Healthcare and the HealthCare Executive Group.

The survey of 445 healthcare leaders from payer, provider, and third-party vendor organizations found that 13 percent of provider respondents are operating under straight fee-for-service compared to just 4 percent of payer respondents.

Most providers either received most of their revenue from fee-for-service payments linked to quality (43 percent) or alternative payment models (43 percent). Only 2 percent of providers had full capitation.

Payers were significantly more likely to have implemented alternative payment and full capitation models, with 62 percent operating APMs and 9 percent in full capitation.

Quality measures are holding providers back from adopting value-based reimbursement and care models, the survey showed. Providers were significantly more likely to cite unclear or conflicting performance measures as their top barrier to value-based care adoption. The provider respondents also more frequently said regulatory changes and political uncertainty and lag time between action and clinical outcomes impacted their adoption of APMs.

Meanwhile, payers felt more challenged by a lack of or limited health IT infrastructure. Payers respondents were also more likely to cite financial risk concerns as a top barrier to value-based care adoption.

Payers and providers also did not align on healthcare consumerism strategy, the survey uncovered. In the survey, 100 percent of payer firms reported having some formal consumer-centric strategy, with most (70 percent) either working on nascent or intermediate strategies.

On the provider side, however, 14 percent of respondents said they had no formal consumer-centric strategy, while 34 percent were developing a nascent strategy, 36 percent an intermediate strategy, and 18 percent a full strategy.

To get further along the value-based care and consumerism journeys, payers and providers agreed that each has a significant role to play. For example, with consumerism, both types of respondents said payers were best positioned to provide cost and quality data consumers, while all respondents favored providers nearly 3 to 1 in who was best positioned to support the consumers on their healthcare journey.

Currently, payers are significantly more likely to offer government-driven ratings to consumers, and providers are significantly more likely to provide consumer reviews, the survey found.

The majority of payers and providers are also giving consumers patient satisfaction scores (70 percent of payers and 81 percent of providers), while some are proving health outcomes data (42 percent of payers and 49 percent of providers).

The survey results indicated that there is room to improve the consumer-centric strategy on both sides of healthcare, and all respondents agreed that plain-language explanation of benefits and simplified benefit explanations were the two financial and billing improvements that would drive consumer satisfaction.

The two groups also saw eye to eye on non-clinical improvements, with the top five being:

• Online appointment scheduling
• Plain-language medical information
• Consumer access to EHR and provider notes
• Telehealth and other remote access options
• Non-clinical services (e.g., transportation, nutrition, housing)

While providers agreed with payers on the top two financial and billing improvements, the respondents also placed greater importance on improving the identification of in-network and out-of-network providers and consolidated billing from multiple providers. Payers were more likely to select the elimination of surprise billing than their provider peers.

Additionally, for increased value-based care adoption, providers were significantly more likely to want payers to standardize quality and outcomes data. Providers also believed that sharing performance data (15 percent) and co-developing bundled payments around episodes of care (15 percent) would improve value-based care implementation.

On the other side, payers were more likely to think that co-developing management programs and developing application program interfaces (APIs) would drive value-based care adoption. These were among their top recommendations for value-based care adoption, as well as standardization of quality and outcomes data (19 percent) and co-development of bundled payments (15 percent).

The survey also found that, compared to last year’s results, all respondents were less likely to ask payers to co-develop risk management programs. More payers in this year’s survey were also more interested in sharing health outcome data.

“This year’s report provides a fascinating look at where healthcare is in 2020,” David Gallegos, SVP of consulting services at Change Healthcare, stated in a press release. “In our 10 years of fielding this research, I don’t think we’ve seen healthcare industry leaders so polarized on some strategic issues and so tightly aligned on others. These insights can help foster a dialogue between payers and providers about their priorities, driving collaboration to advance solutions on those issues in the year ahead.”