GeBBS Healthcare Blog

“Work smarter, not harder.”  This age-old philosophy is the mantra behind value-based health care. After all, more health care doesn’t necessarily mean better outcomes – this much has been proven by evidence-based medicine time and again. As the fee-for-service model of health care slowly fades away, true value-based care (and all the benefits that come with it) is finally becoming a reality. Better coordination of patient care, communicating with patients, decreasing unnecessary and/or duplicate services – and incentivizing those who truly improve care (and not just those who deliver more) is happening across the country as health systems and providers shift models of care while desperately trying to preserve their reimbursement.

Telehealth is a key element of our country’s health care transformation – and health care providers, payers and patients are getting on board today more quickly than ever. After all, getting timely and convenient medical diagnosis and treatment using your computer, phone or tablet – anywhere, anytime, is of incredible value in our busy, technology-driven lives.

The shift to value in healthcare is no easy feat.  While the Centers for Medicare and Medicaid Services (CMS), accountable care organizations (ACOs) and healthcare systems are all working towards it, true success requires a commitment to collaboration, communication and transparency.

The data is clear – policymakers are making every effort to reduce healthcare costs, particularly as states struggle with significant budget deficits across the country. To do this, many state governments have elected to outsource the management of Medicaid and Medicare programs to managed care companies.  According to Modern Healthcare, 34% of Medicare beneficiaries are now enrolled in a Medicare Advantage plan, which is administered by a private payer. Similarly, 77% of Medicaid beneficiaries are enrolled in some form of managed care plan.

Earlier this month, CMS announced changes to future payments for Medicare Advantage plans that will take effect in 2020.  While a pay raise is part of the plan, what’s causing a stir is that payment will now be based on a higher percentage of patient encounter data (up to 25% from 10%).  Many (especially payers) have argued that encounter data is often incomplete and inaccurate when compared to diagnoses, since encounter data relies on provider documentation.

Balancing the competitive landscape that comes with physician practice consolidation combined with population health and the shift to value-based care is a lot to consider for busy hospital physician practices.  Add in the constant changes in regulatory guidelines, enhancing the patient experience and most importantly – a continued focus on quality and safety and most hospital administrators have little resources left to focus on improving the revenue cycle.

Lots of questions and headlines began swirling earlier this month after the Centers for Medicare and Medicaid Services (CMS) released its hospital star ratings – a “seemingly” simple system designed to help consumers make informed decisions about hospitals and the care they deliver.  While consumers are used to 5-star ratings for hotels and restaurants, the healthcare industry is clearly far more complex.  As such, a cloud of mystery and skepticism surrounds this incredibly powerful rating system – especially for the thousands of hospitals who participate in Medicare and are therefore automatically subject to stardom whether they like it or not.

Last week, CMS reported that 800 hospitals will be required to forfeit 1 percent of their reimbursement for missing the mark on reducing hospital-acquired conditions (HACs).  The race to eliminate preventable patient harm has always been a top hospital goal, but now it’s one tied to their reimbursement through the Centers for Medicare & Medicaid Services Hospital-Acquired Condition Reduction Program (HACRP). No matter how hard hospitals work to improve their performance, CMS will penalize the lowest performing quartile (25%) of hospitals annually.