There is increasing consensus that value-based care (VBC) holds multi-dimensional promise to improve care delivery, reduce costs, and increase physician satisfaction. In primary care, for example, CenterWell – the largest provider of senior primary care – has achieved significantly improved health and cost outcomes with a patient-centered VBC approach. It’s good news, and there is no lack of desire from providers and payers to lean in.
But when it comes to actually setting up and managing VBC programs, it is a case of “easier said than done.” Few medical practices possess the resources and expertise needed to bear the complex suite of responsibilities that VBC demands. Meanwhile, payers have difficulty analyzing performance and contracting across various providers, which makes establishing uniform, predictable, and successful VBC outcomes incredibly challenging.
Subsequently, VBC contracts are notoriously difficult to create, implement, and support for all parties involved. And while that is certainly true in primary care, it is even more acute in specialty care. To understand why, consider some of the challenges that value-based care implies:
Risk management – VBC arrangements often involve shared risk between payers and providers, where financial outcomes are tied to achieving beneficial health outcomes plus cost savings. Managing this financial risk effectively requires sophisticated, fit-to-purpose actuarial capabilities and risk assessment technology, which very few practices and payers possess.
Data sufficiency – Just as 1,000 flips of a coin provides greater statistical accuracy than one flip, the larger a volume of data payers and practices have, the more accurately they can assess and benchmark provider performance, costs, and patient health outcomes. But few practices have a sufficiently large patient pool under one payer to do this, and even large national payers struggle to amass data sets large enough in the specialty space to drive adequate statistical probability. Neither payers nor providers typically have the robust data analytics capabilities needed to create reliable, long-term VBC models.
Operational burden – Moving from a fee-for-service reimbursement model to a value-based care model is a fundamental shift that requires comprehensive changes in patient engagement, care coordination, technology, billing, and revenue collection. Implementing these changes is complex, costly, and time-consuming for providers.
As if that were not enough, there are also regulatory compliance issues, multiple stakeholder relationships to balance, and serious challenges providing sufficient financial incentives to justify the investments that practices must make to participate in VBC programs. In aggregate, these concerns make building a network of committed providers a huge challenge, throttling access to the high-quality, affordable care that VBC promises.
Value-based healthcare success requires scale
The not-so-secret ingredient to success in value-based care is, of course, scale. CenterWell Health, whose success I referred to above, employs more than 30,000 clinicians and generates billions in annual revenue to rely upon. That makes handling the demands of VBC far more achievable.
Even with subspecialty care, whose complexity makes VBC harder to implement, success is possible with enough operational girth. Larger practices often have the revenue, patient population, staff size, and operational expertise to take on the VBC challenge and win.
Without a large scale of patient volume and critical resources, it is very difficult for practices to carry the operational burden of value-based care.
To expand VBC access, we need to enable smaller practice
So where do we go from here? How can we expand access to value-based care beyond the nation’s largest healthcare providers and payers? And while we are at it, how can we replicate primary care success stories in specialty areas like cardiology, nephrology, and oncology, where there is more cost variation for different therapies and relatively low patient volumes?
One answer to this dilemma is to involve third-party VBC enablers, who can overcome many of the challenges I stated above. Companies like Wellvana, Pearl Health, and Aledade in primary care, plus Strive, CardioOne, and others in specialty care mitigate the complexities of VBC implementation, providing a pathway to scale for smaller practices. Here’s how:
1. Management – Third party enablers coordinate on behalf of all patients so that practices have a uniform way of managing their patient population, instead of struggling with different risk and reimbursement models for every patient, based on their payer. This allows smaller practices to focus on what matters—improving patient care and outcomes, while payers avoid having to contract separately with every practice.
2. Technology – Third party enablers provide data analytics and other technology solutions to streamline the operational complexities of VBC, taking the responsibility to develop such tools off payers and providers’ plates.
3. Risk sharing – Many third-party enablers also shoulder a significant share of risk across multiple provider groups, payer contracts, and patient populations. Aggregating patient data and risk across groups allows for more statistically accurate insights and improved reliability for both payers and providers. By managing multiple payer contracts and patient populations, enablers can better overcome challenges such as cost variation and low patient volumes in specialty care.
For these reasons and more, payers often actually prefer to contract with third party enablers rather than directly with practices. The management is easier, the risks are distributed, and the relationships are therefore likely to be more stable.
VBC enablement can make the largest impact in specialty care
Achieving meaningful progress in value-based care nationwide requires scalable solutions that can support large and small providers alike. While expanding access to VBC in primary care is indeed an important goal, we must keep in mind that the vast majority of healthcare expenses are in specialty care areas like oncology, where costs continue to rise without improved patient outcomes. It is in specialty care that the role of third-party enablers is most vital to achieve whole-person, value-based care for large and small payers and practices.
VBC will remain “easier said than done,” but with third-party enablers, we have a viable path to effectively and affordably improve patient outcomes — in both primary and specialty care.
Photo: Anastasiia_New, Getty Images
Dr. Lalan Wilfong is the Senior Vice President of Value-Based Care at Thyme Care and a practicing medical oncologist/hematologist at Texas Oncology. A long-time leader in value-based care, Dr. Wilfong advocates for patient-centered care and is committed to improving patient outcomes by aligning their goals, values, and treatment options with innovative care models. He co-chairs the Community Oncology Alliance Payer Reform Committee and serves on the ASCO Drug Shortages Committee. Previously, he held leadership roles at The US Oncology Network and Texas Oncology, spearheading initiatives like the Oncology Care Model and Enhancing Oncology Model.
Dr. Wilfong completed his medical training at UT Southwestern Medical School and holds a B.S. in mathematics from Texas Tech University. Recognized for his contributions to teaching and patient care, he has authored over 50 papers and abstracts and remains a prominent voice in advancing value-based cancer care.
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