Value-based Care Industry Update – Elevance Health & Integration Opportunities – Part 2

In our previous Forum Interview [see Value-based Care Industry Update – Elevance Health & Integration Opportunities – Part 1 – 27 September 2023], we alluded to the CMMI [Center for Medicare and Medicaid Innovation] issuing an ambitious goal to shift 100% of Medicare beneficiaries into Accountable Care Relationships by 2030. I'm not sure we can accomplish this in seven years, as it's certainly ambitious. Researchers estimate that the number of patients treated by physicians within the value-based care landscape could roughly double in the next five years, which would represent about a 15% growth rate. That sounds interesting, but it's quantitatively opaque. I'm grappling with where we are now to provide perspective on doubling. What do you think of this ambitious goal put forth by the CMMI?

You said that CMS [Centers for Medicare & Medicaid Services] is sending a clear signal that valuebased care is the future. CMS has tremendous data, more so than anyone, to help drive decisionmaking. A recent article about the Medicare Innovation Lab, which was created to test better, cheaper ways of delivering healthcare, mentioned that it actually ended up increasing direct spending by more than USD 5bn in the first decade, rather than lowering it. We're talking about the CMMI, which initiated dozens of experiments testing different changes to healthcare delivery. It was expected that the experimental care models would save USD 2.8bn in the first decade under the CBO [Congressional Budget Office] assumptions, and instead cost USD 7.9bn to operate care models that delivered just USD 2.6bn of savings, so net-net it lost USD 5.3bn. I don't know if that's a fair way to characterise the situation because the devil is in the details. If you're going to operate an experimental care model, it costs money to establish it and there isn't an appreciation for the alternative cost of care. Saying, "We saved USD 2.6bn but it cost USD 7.9bn, so we lost over USD 5bn," ignores the reality that the care delivery could have cost USD 9bn otherwise, so all of this seems convoluted. Can you help set us down the right path?

Medicare has set a goal to have 100% of the Medicare beneficiaries into Accountable Care Relationships by 2030. What does it mean by that?

What is the appetite of physicians to embrace value-based care models, who may be the gating factor for its acceleration. The adoption remains uneven, and not all PCPs [primary care providers] have or want value-based care models. We need to remember the demographics of physicians, nurse practitioners and nurses. What needs to happen to drive positive change across the provider landscape?

If we're in a community with more Medicare and Medicaid payer mix, and we've moved to a sharedrisk or a provider PMPM [per member per month] model, is a positive outcome that we begin to really take care of those who are most vulnerable and who appear in the emergency department, so we're not seeing them in the network over and over? Right now, the system appears to do the bare minimum and just wants to get them out the door, but then you see them again. With a PMPM model, will we actually care for the most vulnerable in society in a better way? Is that an outcome tied to embracing valuebased care?

It is difficult to change patient behaviour, so let's get to the heart of an important issue as we discuss value-based care. We have people tragically addicted to drugs and we have people suffering from severe mental health disorders. In both groups, people tend to be stuck in a self-destructive cycle. If I ran a hospital, my number one concern would be, "How do I keep these costs out of my hospital, but still take care of people in need, to create a better society?" How are hospital executives thinking about what needs to be done to care for these particular patient cohorts that could derail their P&L?

Do you think there will be a carve-out for a small percentage of individuals to sit outside of your risk pool that you just know are going to challenge your operating costs?

Tackling the US healthcare system with respect to the approach to care and reimbursement is a daunting task. As we consider where value-based care models can be implemented more easily, which areas of the healthcare system do you see as the most likely avenues to spearhead that drive? In terms of the types of value-based models – whether bundles, shared savings, shared risk or global capitation – which model do you think will take hold the best?

When you think about the full capitation model – especially with respect to PCP relationships – does this potentially bring us back to a kinder approach to care, where doctors invest in patient relationships to maintain them?

Do you believe providers are ready to embrace value-based care, in terms of being able to take on and properly manage risk? What technological investments, policy developments, labour and midlevel management training must providers undertake to best position themselves to be successful in a value-based care competitive landscape?

We've discussed providers, so I want to focus on payers. How are managed care organisations driving increasing value-based care model adoption? Which managed care organisations do you think are doing the best job implementing value-based care, without placing excessive operational stress on providers?

You talked about UnitedHealth and Optum, and UnitedHealth is one of the largest employers of physicians. The DoJ [Department of Justice] wants to take a closer look at the USD 3.3bn proposed acquisition of Amedisys by UnitedHealth, and characterises the deal as the latest example of a massive healthcare conglomerate using anti-competitive mergers to increase their market dominance. What's going on here? We're trying to implement value-based care. The Amedisys acquisition is tiny relative to UnitedHealth. Is this a slanted perspective when it's looking at these vertical integration proposals? As we assess different value-based care models, payers integrating providers seems fairly logical. What's your take on it?