Hospital Impact: 2 keys to Revere Health's value-based shift

headshot of Lexi Argyle
Lexi Argyle

The rising cost of healthcare in the U.S., and the requirement for insurers to cover high-risk patients under the Affordable Care Act, are causing an increase in insurance premiums everywhere. Benchmark silver plans under the ACA are expected to see an average premium increase of 22% in 2017.

This can negatively affect healthcare organizations as patients look to find the best care at the lowest cost, and it can negatively impact businesses that are covering the cost of health insurance for employees. The shift in healthcare from volume-based to value-based means the traditional fee-for-service model, a payment system in which providers are compensated for each service rendered, will soon be unsustainable.

To combat this issue, healthcare organizations like Revere Health, the largest independent physician group in Utah, are moving from fee-for-service to fee-for-value models, where payment for work is based on improving a patient’s health at a lower cost. This incentivizes healthcare providers to keep costs low while improving the quality of care patients receive. It also focuses on preventive practices and encourages coordinated care between providers.

The future of the ACA is uncertain given the outcome of the recent 2016 presidential election, but Revere Health is continuing its value-based care initiative independent of changes to the law. Healthcare systems that deliver the best care at the lowest costs are the ones that will be successful, and patients will seek them out in the long term regardless of what happens to healthcare laws at the federal level.

Revere Health is the first healthcare organization in Utah to be accredited as an accountable care organization by Medicare. As an ACO, Revere Health actively measures and monitors quality and health outcomes, and reports that data for review and comparison of healthcare providers across the country. Each year since Revere Health’s accreditation in 2012, it has seen increasing success in the improvement of care and cost reduction.

“In 2015, our efforts to provide value-based care resulted in quality scores among the top quartile of all systems,” said Revere Health CEO Scott Barlow. “We also lowered the cost of care by 8.8% for our Medicare Shared Savings (MSSP) population based on the cost trajectory of health systems in the area. Only 30% of 392 MSSP groups nationwide met the threshold for shared savings, and Revere Health was in the top 25% of those that did qualify, and the only system in Utah to qualify.”

Systems that successfully improve the quality of care while saving costs will reap financial rewards and grow market share in the healthcare industry.

“Value-driven care systems act as an incentive to improve patient outcomes while providing care at a lower cost,” Barlow added. “It’s an incentive to learn about and consider the cost of care when helping a patient make treatment decisions.”

Data analytics

Success in a value-based model requires that organizations acquire and analyze more data. Value-based care improves the cost and quality of care, but cannot be done without a data-driven approach.

Cost: Measuring cost involves identifying all the components in a patient’s treatment plan. Looking at each component at an individual level helps determine where you can achieve savings.

For example, after completing the same surgery, one orthopedic provider might send his or her patient to a skilled nursing facility. Another provider might use outpatient physical therapy instead. Both methods achieve the same results for the patient, but one comes at significantly lower cost.

Quality: The fee-for-value model no longer pays providers based on the quantity of procedures they perform. Instead, providers are compensated for the quality of services provided and the status of a patient’s outcome.

Patient outcomes are determined by the full cycle of care and patient satisfaction rather than on a per-visit basis. Measuring health and recovery status is essential to determining the success of these outcomes. Revere Health providers track outcomes including hospital readmissions, emergency care visits and success rates of procedures and treatments, all of which are indicators of a patient's overall health over a period of time.

Clinical processes

A value-based care approach requires the support of all providers, clinical staff and hospitals, along with each patient, evaluating clinical processes.

“Documenting processes and measuring variation can help identify those that are inefficient and the least cost-effective,” Barlow explained. “Analyzing clinical processes is critical to implementing necessary changes.”

To accomplish these changes, Revere Health implemented an internal system that involves every employee in the process. It rewards those who contribute to better quality care and cost savings. Not only do these methods help Revere Health prepare for the future of healthcare, they also help its patients receive the best possible care.

Revere Health’s internal value-based care initiative and changes to its own healthcare delivery system to reduce cost and improve quality will contribute to success with federal and commercial payer value-based care initiatives, but is an initiative that Revere Health is choosing to implement independent of potential healthcare reform.

Lexi Argyle is a communications and public relations professional who specializes in healthcare.