Paul Keckley: 'Devil's in the details' of plans to speed value-based payments [Interview]

The Obama administration's formal kickoff last week of an initiative to speed up the transition from fee-for-service to value-based models was big on showmanship but short on details, policy expert Paul Keckley told FierceHealthcare in an exclusive interview.

Keckley, (pictured right), managing director at the Navigant Center for Healthcare Research and Policy Analysis, said the Health Care Payment Learning and Action Network, a public-private collaboration of 2,800 healthcare stakeholders, is an encouraging sign that the government is moving in the right direction, but the initiative lacks a lot of information.

"As a D.C. resident for a decade, you always see this happen," he said. "You have a 'Kumbaya' moment; you have a big photo op; you draw a lot of spotlight on what you're trying to do. You appoint a lot of task forces and you say, 'come back and tell me how,'" he said. "I think they have to think more deeply about how it's going to be implemented--not whether, but how."

Still, the announcement of the network indicates that the Centers for Medicare & Medicaid Services (CMS) recognizes it needs to get employers and private health plans on board in the value-based transition, because otherwise providers will address alternative payments incrementally and avoid taking too much risk, Keckley said.

The Department of Health and Human Services announced in January that it plans to shift 30 percent of Medicare provider payments to alternative models by 2016 and half of all payments by 2018. But that begs the question: "how exactly do you measure that?" Keckley asked, adding, "The devil's in the details."

Hospital groups were also somewhat skeptical of the plan, with the Federation of American Hospitals writing that "it is important that Medicare take the time to test new approaches and ensure that only reforms proven to be efficient and effective are put in place," FierceHealthFinance reported.

However, it may be easier for providers to reach those benchmarks if they isolate "big-ticket items," such as open-heart surgeries and hip replacements, for value-based payments, Keckley suggested.

"If the measure of success is how much of your revenue is at-risk, some hospitals and doctors can isolate that down to your cardiology program, maybe some of your cancer program, maybe some of your women's health," he said. "You've got to leave the rest of it alone if you think about it."

He also predicted that the network's task forces are likely to produce recommendations for how to fix some of the mechanics of CMS' regulations. For example, they may recommend that the government change the Medicare Shared Savings Program formula so individual enrollees know they're actually part of an accountable care organization or ask CMS to help minimize the liability inherent in risk-sharing.

"There will be a laundry list of these things, where you can see technical corrections to some of the things that CMS is doing that would make it more palatable for the private sector to do it," Keckley said.

The federal government has made significant strides in the past two months to encourage the healthcare industry to adopt the value-based transition, he said, adding that the next six months will be even more pivotal.

"You have to give credit, the CMS folks know that you need a big tent, and they've got to bring the market along," Keckley said. "I think that's precisely the effort at this point--how do we get, in the community, the providers to think that alternative payments, the transition from volume to value, is not just about Medicare patients, it's about all patients. That's going to be totally dependent on how employers and health plans respond to this."

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