How providers, payers and pharma can work together to drive the transition to value-based care

Value-based Care Scrabble
Payers, providers and drugmakers can all play a role in driving value-based care, industry leaders said during a panel discussion Friday.

WASHINGTON—As the healthcare industry continues its transition away from traditional fee-for-service models, policymakers and other stakeholders can take steps to ease the growing pains.

On Friday, the Healthcare Leadership Council convened a panel of leaders in the provider, payer and pharmaceutical space to discuss the challenges these three groups face in the transformation to value-based care models and how each would like to see those changes continue to progress.

Andrew Baskin, M.D., national medical director for clinical quality and policy at Aetna, said it ultimately comes down to effective payer-provider collaboration. High-level alternative payment models, like accountable care organizations, operate more effectively when these two groups can bring their strengths together to achieve shared goals.

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Providers bring a strong community presence and have preexisting relationships with individuals, while payers can provide a more population-based viewpoint and have experience in financial risk management. When those viewpoints are aligned, accountable care is at its most effective, he said.

“These relationships have been evolving over time,” Baskin said, but accelerated far more rapidly under the Affordable Care Act.

The main challenges, according to Baskin, lie in unclear or inflexible regulations; for instance, programs like the 340B drug discount program can discourage insurers from embracing value-based frameworks. Some discounts in value-based care contracts could be construed as kickbacks, and guidance on data-sharing is often unclear, he said.

Helen Macfie, chief transformation officer for the Los Angeles-based MemorialCare Health System, stressed the value of continued support for innovation and sharing best practices in value-based care, particularly through the Center for Medicare & Medicaid Innovation.

She said that MemorialCare, which operates ACOs and other value-based programs, is “bullish” on bundled payments and has seen the benefits of such programs by voluntarily deploying them. Other providers view value-based care programs similarly.

“[Bundled payments] get specialists together with providers to do something really cool,” she said.

But Macfie agreed with Baskin that certain regulations can hinder provider performance in value-based programs. For example, the 3-Day Rule for skilled nursing facilities—which requires Medicare beneficiaries to undergo a hospital stay of at least three days in order to get coverage for their SNF stay—is significant barrier.

The continued evolution of the Medicare Access and CHIP Reauthorization Act (MACRA) will also play a role in this issue, and Macfie said she and other providers hope that it stimulates the development of further advanced payment models.

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For pharmaceutical manufacturers, the concern is how they can best interact with patients and providers in these value-based models, said Mitch Higashi, Ph.D, vice president for health economics and outcomes research at Bristol-Myers Squibb. Higashi said that pharma companies would be able to take on some of the financial risk, but doing so could be inappropriate.

He offered an example of a program where a drugmaker would offer patients rebates for medications or treatments that were ineffective. However, he said the rebates could set the drug pricing floor too low and could appear to be a kickback to encourage prescriptions. The Department of Health and Human Services Office of Inspector General, he said, could provide guidance on how these relationships would work.

Value-based care programs also must be analyzed more closely with regard to how they affect patient-centered quality measures, he said. This is especially key as value assessments need to keep pace with innovation.

“Patients are necessary partners in developing measures of value,” Higashi said.