Payer, ACO & Employer Convergence Drives Value-Based Care Success

Val connects payer, employer & ACO to find success in value based contracts

Heather Lavoie, Chief Strategy Officer

I introduced you to Val and her team last year. After their successful first year with the Theon® platform, we were anxious to see what they would do next.

To refresh our collective memory, Val reports to the chief medical officer of a payer with about three million members. Two years ago, the plan invested in the Theon® analytics platform to help reduce overall medical costs and improve quality of care. Specifically, Val was tasked with taking a holistic approach to population health management. By the end of the first year, through her focus on contract performance management, inappropriate emergency department use, readmissions, and prescription drug prescribing patterns, Val reduced overall claims costs by two percent and improved plan quality performance metrics.

Convergence and Transparency

Over the course of that first year, three things became clear to Val and her team:

  1. They needed the ability to align value-based provider contracts with employer group contracts to close critical gaps in delivering comprehensive, coordinated and cost-effective care to members.
  2. Contract performance management must align with and support population health analytics to deliver continuous improvement in cost reduction and member outcomes.
  3. Transparency into underlying data by all contractual parties is critical for value-based care success.

With these observations in mind, Val broadened her team’s focus and dove deeper into the Theon® platform’s capabilities and insights around contractual performance to discover points of convergence and success.

Complexity and Volume

Value-based contracts are on the rise. By 2020, more than half of a payer's providers will be under value-based payment models. These models typically evolve from year to year and contract to contract. Which means, Val and others like her need a tool that will grow with them and deliver deep capabilities around developing and managing multiple, increasing, ongoing contractual relationships, each with unique reporting metrics and risk arrangements.

Finding success within each contract is challenging. Understanding how to optimize each contract for future and ongoing success even more so. A successful contract means all stakeholders must benefit – providers receive shared savings, the payer reduces claims expense and members receive better care in a more efficient manner.

In addition, Val and her team wanted to bring employers into the equation in a more prominent role. She maintains employers are often overlooked in their ability to contribute substantively. For Val, evolving contracts must (where feasible) incorporate employer success as measured by lowered premium rate increases, declining medical costs and reduced employee absenteeism in addition to improving member satisfaction and overall quality of care.

Transparency Builds Trust

As complexity increases so does the need for shared transparency into supporting data and analytical insights. Sharing data builds trust, and contractual relationships built on trust stand a greater chance of success than those that do not. All stakeholders – payers, providers and employers – must be able to independently verify the relevant reporting metrics of each contractual relationship.

When physician leadership teams and employers can independently verify contractual status, they become equipped to respond and manage risk appropriately and successfully.

Even though employers do not have the same depth of medical data about their employees as providers or payers do, they have enough to gain solid competencies around key population health management strategies and actions that improve employee health while lowering related costs.


Bearing in mind their holistic approach, Val and her team began last year with a focus on one particular large employer, Acme, and the large ACO (Quality Care) that serves more than 65 percent of its employees. These employees represent 43 percent of Quality Care’s patients.

Val knew she faced obstacles in bringing together Acme and Quality Care. Her experience indicated employers were hesitant to invest heavily in an ACO model, and physicians were frustrated because, in the past, their data insights were often misaligned with employer-group insights, causing coordinated programs and approaches to be ineffective and disconnected.

However, knowing the Theon® platform provided Acme and Quality Care with transparent access to the same real-time, data-driven insights she had, gave Val and her team the confidence they needed to bring everyone together (Acme, of course, only has access to employee health information as governed by HIPAA).

Val trusted transparent insights would facilitate the likelihood of everyone arriving at a common set of findings and subsequent actions as they came together to evaluate their common population.

And they did.

Emergency Department Use vs. Urgent Care Use

One of the first things the group discovered is that many Acme employees were using emergency services for non-acute issues such as middle ear infections (otitis) and urinary tract infections. Val facilitated a discussion that led to five actionable outcomes:

  • Quality Care agreed to extend clinic hours from one evening per week to three.
  • Quality Care agreed to refer Acme patients to an urgent care center that is closer than the emergency department for most employees and is 15 to 25 percent lower in cost.
  • Acme agreed to communicate this information via workplace posters, employee newsletters and email communications.
  • The payer agreed to add the information to Acme employee profiles for payer phone representatives.
  • Val agreed to develop and propose a payer product to reduce or eliminate urgent care, after-hour co-pays for Acme employees/Quality Care ACO patients.

Emergency Department Use for Chronic Conditions

Another easily uncovered issue was the high rate of emergency department use for chronic conditions – a utilization trend that negatively impacted provider shared savings and contributed to increased premiums and absenteeism for Acme.

The team went into the Theon®platform together to quickly discover how many Acme employees had not been seen by a Quality Care PCP within the previous 12 months. Knowing they could not boil the ocean, the group targeted two high-cost conditions – diabetes and asthma - with the intent of expanding to more in six months.

To start, Quality Care agreed to outreach to these patients to schedule PCP appointments, an easy double win as they can also address outstanding preventive care gaps at these visits. Along with the newly expanded office hours, these visits helped reduce inappropriate (and expensive) emergency department use. The group agreed to re-evaluate in six months to consider the addition of an Acme-based employee awareness campaign.

Emergency Department Use for Mental Health Issues

While evaluating emergency department use, someone in the group noticed that many emergency visits were for mental health issues such as depression and anxiety. As they sat together and discussed as a team, they soon realized there weren’t enough mental health outpatient clinics in the area, which likely pushed people to the emergency department for their mental health care.

Val agreed to reach out to the payer's provider contracting unit to evaluate the possibility of an existing mental health provider expanding into Acme’s county. Quality Care agreed to study the feasibility of adding additional mental health provider staff to fill the service gap.

High-Cost Prescriptions

The Theon® platform highlighted a pattern of high-cost prescriptions. A quick drill-down into the underlying data revealed a handful of specialists at the root of the prescribing pattern.

The physician leader of Quality Care ACO agreed to reach out to the physician leaders of these specialty practices to understand the clinical need. When proven, Val reached out to her colleagues in pharmacy to see where there was room for improvement (formulary changes, for example). When not proven, Quality Care worked with the specialists to revise prescribing practices.

In Conclusion

When all stakeholders come together in a trusting relationship, supported through the transparent sharing of data, great things can happen.

Val and her team, along with Acme and Quality Care ACO, continue to succeed in their ability to tie contractual performance to outcomes and accountability, thanks, in part, to the transparency and data-driven insights delivered through the Theon® platform.

We cannot wait to hear what’s next.

*Val’s experience is an illustrative example based on the experience of a Geneia client. This information is provided for illustrative purposes only. Val is fictional and not intended to represent any specific person. Any direct similarities to any real person are purely coincidental and unintentional.

This blog was originally posted by Geneia, LLC. See related posts at https://www.geneia.com/Blog.


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