Value-Based Care

Value-Based Care / en Sat, 26 Apr 2025 00:09:37 -0500 Thu, 27 Mar 25 15:35:32 -0500 AHA provides recommendations to PTAC to improve participation in population-based total cost-of-care, primary and specialty care models /news/headline/2025-03-27-aha-provides-recommendations-ptac-improve-participation-population-based-total-cost-care-primary-and The AHA March 27 made a series of <a href="/lettercomment/2025-03-27-aha-comments-ptac-total-cost-care-model-proposal">recommendations</a> to the Physician‐Focused Payment Model Technical Advisory Committee to address barriers to participating in population-based total cost-of-care and primary and specialty care models. The AHA urged the committee to adopt common principles that would support the implementation of alternative payment models. The AHA also recommended the removal of high and low revenue thresholds that inappropriately prevent certain providers from entering primary and specialty care models.&nbsp; The AHA urged an extension of advanced alternative payment model incentive payments as well as more sustainable reimbursement to better support the transition to value-based care.&nbsp; Thu, 27 Mar 2025 15:35:32 -0500 Value-Based Care AHA House Statement on “Improving Value-Based Care for Patients and Providers” /testimony/2024-06-26-aha-house-statement-improving-value-based-care-patients-and-providers �� Association for the Committee on Ways and Means Subcommittee on Health of the U.S. House of Representatives “Improving Value-Based Care for Patients and Providers” June 26, 2024On behalf of our nearly 5,000 member hospitals, health systems and other health care organizations, our clinician partners — including more than 270,000 affiliated physicians, 2 million nurses and other caregivers — and the 43,000 health care leaders who belong to our professional membership groups, the �� Association (AHA) appreciates the opportunity to provide feedback on the transition to value-based care.<h2>THE ROLE OF ALTERNATIVE PAYMENT MODELS IN VALUE-BASED CARE</h2>Our members support the U.S. health care system moving toward the provision of more outcomes-based, coordinated care and are continuing to redesign delivery systems to increase value and better serve patients. Over the last 14 years, many of our hospital and health system members have participated in a variety of alternative payment models (APMs).While the movement to value holds tremendous promise, the transition has been slower than anticipated and more needs to be done to drive long-term system transformations.There are principles that we believe should guide the development of APM design to make participation more attractive for potential participants. These include:<ul><li>Appropriate On-ramp and Glidepath to Risk. Model participants should have an adequate on-ramp and glidepath to transition to risk. They must have adequate time to implement care delivery changes (integrating new staff, changing clinical workflows, implementing new analytics tools, etc.) and review data prior to initiating the program.</li><li>Adequate Risk Adjustment. Models should include adequate risk adjustment methodologies to account for social needs and clinical complexity. This will ensure models do not inappropriately penalize participants treating the sickest, most complicated and underserved patients.</li><li>Voluntary Participation and Flexible Design. Model designs should be flexible, incorporating features such as voluntary participation, the ability to choose individual clinical episodes, the ability to add components/waivers and options for participants to leave the model(s).</li><li>Balanced Risk Versus Reward. Models should also balance the risk versus reward in a way that encourages providers to take on additional risk but does not penalize those that need additional time and experience before they are able to do so. A glidepath approach should be implemented, gradually migrating from upside only to downside risk.</li><li>Guardrails to Ensure Hospitals Do Not Compete Against Their Own Best Performance. Models should provide guardrails to ensure that participants are not penalized over time when they achieve optimal cost savings and outcomes performance. Participants must have incentives to remain in models for the long-term.</li><li>Resources to Support Initial Investment. Upfront investment incentives should be provided to support organizations in their transition to value-based payment. For example, to be successful in such models, hospitals, health systems and provider groups must invest in additional staffing and infrastructure to support care delivery redesign and outcomes tracking.</li><li>Transparency. Models’ methodology, data and design elements should be transparently shared with all potential participants. Proposed changes should be vetted with stakeholders.</li><li>Adequate Model Duration. Models should be long enough in duration to truly support care delivery transformation and assess the impact on outcomes. Historically, models have been too short and/or have had multiple, significant design changes even within the designated duration, making it difficult for participants to self-evaluate and change course when necessary.</li><li>Timely Availability of Data. Model participants should have readily available, timely access to data about their patient populations. We would encourage the dedication of resources from the Centers for Medicare &amp; Medicaid Services (CMS) (staff and technology) to provide program participants with more complete data as close to real-time as possible.</li><li>Waivers to Address Barriers to Clinical Integration and Care Coordination. This entails waiving Medicare program regulations that frequently inhibit care coordination and work against participants’ efforts to ensure that care is provided in the right place at the right time.</li></ul><h2>POLICIES TO SUPPORT HOSPITAL TRANSITIONS TO VALUE-BASED CARE</h2>Extension of Advanced APM Incentive Payments. The bipartisan Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) was also intended to support the transition to value-based care. MACRA provided advanced incentive payments (5%) for providers participating in advanced APMs through 2024. These payments were designed to assist with the provision of non-fee-for-service programs like meal delivery programs, transportation services, digital tools and care coordinators which promote population health, among other services.However, MACRA statute only provided the advanced APM bonuses through the calendar year (CY) 2024 payment period. We appreciate Congress acting through a provision in the Consolidated Appropriations Act (CAA) of 2023 to extend the advanced APM incentive payments at 3.5% for the CY 2025 payment period and again in the CAA of 2024 to extend through 2026 at 1.88%.While lower than the current 5% incentive payment rate, the incentive provides crucial resources. Because participation in the advanced APM program has fallen short of initial projections, spending on advanced APM bonuses has fallen well short of the amount the Congressional Budget Office projected when MACRA was originally scored. Repurposing the spending shortfall for APM bonuses in future years will serve to accelerate our shared goal of increasing APM adoption. We urge the extension of these incentive payments.Eliminate Low-Revenue/High-Revenue Qualifying Criteria. Congress also should urge CMS to eliminate its designation of ACOs as either low- or high-revenue. The agency has used this label as a proxy measure to, for example, determine if an organization is supporting underserved populations and/or if the organization is physician-led to qualify for advance investment payments. Yet, there is no valid reason to conclude that this delineation, which measures an accountable care organization’s (ACO) amount of “captured” revenue, is an accurate or appropriate predictor of whether it treats an underserved region. In fact, analysis suggests that critical access hospitals, federally qualified health centers and rural health centers are predominantly classified as high-revenue. Further, both low- and high-revenue ACOs are working to address health equity as part of their care transformation work; assistance investing in these efforts would help across the board. We urge the removal of problematic high/low revenue thresholds that preclude rural and critical access hospitals from obtaining necessary resources for infrastructure investment.Support Investment in Resources for Rural Hospitals. Congress should encourage CMS to continue its resources and infrastructure investment to support rural hospitals’ transition to APMs. According to a Government Accountability Office report, only 12% of eligible rural providers in 2019 participated in the advanced APM program; of those that participated, just 6% of rural providers participated in two or more advanced APMs, compared to 11% of those not in rural areas. These models are often not designed in ways that allow broad rural participation, and the AHA supports continued efforts to better support rural hospitals’ migration to advanced APM models. In particular, the AHA since 2021 has supported the establishment of a Rural Design Center within the Center for Medicare and Medicaid Innovation (CMMI), which would focus on smaller-scale initiatives to meet rural communities’ needs and encourage participation of rural hospitals and facility types. A Rural Design Center would help develop and increase the number of new rural-focused CMMI demonstrations, expand existing rural demonstrations and create separate rural tracks within new or existing CMMI models.We support the Value in Health Care Act (H.R. 5013/S. 3503), which would extend incentive payments, remove revenue distinctions and improve financial benchmarks to ensure participants are not penalized for success.<h2>RECENT CENTER FOR MEDICARE AND MEDICAID INNOVATION (CMMI) MODELS</h2>Proposed Transforming Episode Accountability Model. On April 10, as part of the inpatient prospective payment system (PPS) proposed rule, the CMMI proposed a new mandatory payment model — Transforming Episode Accountability Model (TEAM) — that would bundle payment to acute care hospitals for five types of surgical episode categories: coronary artery bypass graft, lower extremity joint replacement, major bowel procedure, surgical hip/femur fracture treatment and spinal fusion. It would make acute care hospitals responsible for the quality and cost of all services provided during select surgical episodes, from the date of inpatient admission or outpatient procedure through 30 days post-discharge.The AHA has significant concerns with the TEAM payment model. We are supportive of the Department of Health and Human Services Secretary’s goal of moving toward more accountable, coordinated care through new APMs. However, CMS is proposing to mandate a model that has significant design flaws, and as proposed places too much risk on providers with too little opportunity for reward in the form of shared savings, especially considering the significant upfront investments required. If CMS cannot make extensive changes to the model, it should not implement it at this time. To do so would make TEAM no more than a thinly disguised payment cut, as it fails to provide hospitals a fair opportunity to achieve enough savings to garner a reconciliation payment.The proposal does not align with the principles we outlined above. For example, we have previously commented on the necessity for waivers to support care coordination, more gradual glidepaths to two-sided risk and reasonable discount factors to ensure financial viability. If anything, TEAM is a step backward with fewer waivers, shorter timelines to assume downside risk and more aggressive discount factors that make cost savings more challenging.Moreover, the tremendous scope of this rule and its aggressive 60-day comment period made it challenging to fully evaluate and analyze the proposal and its significant impact on hospitals and health systems. The five types of surgical procedures proposed for inclusion in TEAM comprise over 11% of inpatient PPS payments in 2023 — a staggering amount that does not even include the outpatient payments that would be at risk as part of the model. While the AHA worked closely with our hospital and health system members to assess the potential impact of TEAM on the important work they do in caring for their patients and communities, the incredibly short comment period severely hampered our ability to provide comprehensive comments.We strongly recommend that CMS make TEAM voluntary, lower the 3% discount factor and make several changes to problematic design elements.Proposed Increasing Organ Transplant Access Model. Just four weeks after TEAM was proposed, CMS proposed another mandatory payment model for kidney transplants. The Increasing Organ Transplant Access (IOTA) model would test whether performance-based incentives or penalties for participating transplant hospitals would increase access to kidney transplants for patients with end-stage renal disease while preserving or enhancing quality of care, improving equitable access to kidney transplant care and reducing Medicare expenditures. The model would run for six years, beginning Jan. 1, 2025. Hospitals eligible for participation would include non-pediatric transplant facilities conducting at least 11 kidney transplants during a three-year baseline period. It is anticipated that 90 hospitals would be required to participate.While we appreciate CMMI’s goals of increasing access to kidney transplants, we are again left questioning the model design elements and are concerned that the model as written may have unintended consequences by focusing so heavily on volume (namely sub-par matches). Also, as mentioned above, implementation of complex payment models requires significant time, resources and staffing on the part of hospital participants. But CMMI has proposed a start date of Jan. 1, 2025. Given the transformation that is already occurring nationally under provisions of the Organ Procurement and Transplantation Network Act, this aggressive timeline is untenable. Additionally, we are concerned that CMMI is again proposing mandatory participation. As mentioned in our principles, it is critical that organizations can assess whether models are appropriate to best serve the needs of their patients and communities. Therefore, participation should be voluntary.<h2>CONCLUSION</h2>The APM model design principles we outlined above would support more organizations’ abilities to provide accountable and coordinated care. The AHA urges Congress to extend APM incentive payments, for CMS to remove problematic high- and low-revenue thresholds that preclude rural and critical access hospitals from obtaining necessary resources for infrastructure investment, and for CMMI to make models such as TEAM and IOTA voluntary.The AHA appreciates your efforts to examine these issues, and we look forward to working with you. Wed, 26 Jun 2024 15:38:30 -0500 Value-Based Care House Ways and Means subcommittee holds hearing on value-based care /news/headline/2024-06-26-house-ways-and-means-subcommittee-holds-hearing-value-based-care The AHA submitted <a href="/testimony/2024-06-26-aha-house-statement-improving-value-based-care-patients-and-providers">comments</a> June 26 to the House Ways and Means Subcommittee on Health for a <a href="https://waysandmeans.house.gov/event/health-subcommittee-hearing-on-improving-value-based-care-for-patients-and-providers/">hearing</a> about improving value-based care. The AHA shared principles Congress should consider when designing alternative payment models to make participation more attractive for potential participants. Those principles include providing an adequate on-ramp and glidepath to transition to risk; including adequate risk adjustment; allowing voluntary participation and flexible design; balancing risk versus reward; and establishing guardrails to ensure participants don't compete against themselves when they achieve optimal cost savings and outcomes, among others.&nbsp; Additionally, the AHA was critical of the Centers for Medicare &amp; Medicaid Services' newly proposed Transforming Episode Accountability Model — a mandatory bundled payment model — and suggested CMS make participation voluntary along with a host of other changes. The AHA also questioned design elements of CMS’ proposed Increasing Organ Transplant Access model, a mandatory payment model for kidney transplants.&nbsp; Wed, 26 Jun 2024 14:36:55 -0500 Value-Based Care House Energy and Commerce Health Subcommittee holds hearing on value-based care /news/headline/2024-06-13-house-energy-and-commerce-health-subcommittee-holds-hearing-value-based-care The House Energy and Commerce Health Subcommittee June 13 held a <a href="https://energycommerce.house.gov/posts/chairs-rodgers-and-guthrie-announce-health-subcommittee-hearing-on-cms-innovation">hearing</a> about transitioning to value-based care. The AHA submitted a <a href="/testimony/2024-06-13-aha-statement-energy-and-commerce-subcommittee-assessing-value-based-care">statement</a> to the subcommittee for the hearing, expressing support for value-based care and sharing principles the Center for Medicare and Medicaid Innovation should consider when designing alternative payment models. Those principles include adequate on-ramp and glidepath to transition to risk; adequate risk adjustment; voluntary participation and flexible design; balanced risk versus reward; guardrails to ensure participants don't compete against themselves when they achieve optimal cost savings and outcomes; and upfront investment incentives.&nbsp; The AHA also expressed concerns with the Centers for Medicare &amp; Medicaid Services' newly proposed Transforming Episode Accountability Model — a mandatory bundled payment model — and suggested CMS make participation voluntary along with a host of other changes. Additionally, the AHA questioned design elements of CMS’ proposed Increasing Organ Transplant Access model, a mandatory payment model for kidney transplants.&nbsp; &nbsp; Thu, 13 Jun 2024 16:01:54 -0500 Value-Based Care AHA Comments on CMS’ Proposed Transforming Episode Accountability Model (TEAM) /lettercomment/2024-06-10-aha-comments-cms-proposed-transforming-episode-accountability-model-team June 10, 2024The Honorable Chiquita Brooks-LaSure Administrator Centers for Medicare &amp; Medicaid Services Hubert H. Humphrey Building 200 Independence Avenue, S.W., Room 445-G Washington, DC 20201Submitted ElectronicallyRE: CMS-1808-P, Medicare and Medicaid Programs and the Children’s Health Insurance Program; Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals and the Long-Term Care Hospital Prospective Payment System and Policy Changes and Fiscal Year 2025 Rates; Quality Programs Requirements; and Other Policy Changes, (Vol. 89, No. 86), May 2, 2024.Dear Administrator Brooks-LaSure,On behalf of our nearly 5,000 member hospitals, health systems and other health care organizations, our clinician partners — including more than 270,000 affiliated physicians, 2 million nurses and other caregivers — and the 43,000 health care leaders who belong to our professional membership groups, the �� Association (AHA) appreciates the opportunity to provide feedback on the proposed Transforming Episode Accountability Model (TEAM).&nbsp;We are submitting separate comments on the agency’s proposed changes to the inpatient and long-term care hospital prospective payment system (PPS).We are supportive of the Department of Health and Human Services (HHS) Secretary’s goal of moving toward more accountable, coordinated care through new alternative payment models (APMs). However, we have deep concerns regarding TEAM. CMS is proposing to mandate a model that is has significant design flaws and, as proposed,&nbsp;places too much risk on providers with too little opportunity for reward in the form of shared savings, especially considering the significant upfront investments required.&nbsp;If CMS cannot make extensive changes to the model, it should not implement it at this time. To do so would make TEAM no more than a backdoor payment cut to hospitals, as it fails to provide hospitals a fair opportunity to achieve enough savings to garner a reconciliation payment.Additionally, the programmatic details of TEAM are almost identical to previous iterations of the CMS Innovation Center’s (CMMI) episode-based APMs,&nbsp;including Bundled Payments for Care Improvement Advanced (BPCI-A), and Comprehensive Care for Joint Replacement (CJR).&nbsp;However, we are concerned that the programmatic details of TEAM are almost identical to previous iterations of bundled payment models like CJR and BPCI-A, which, according to CMMI’s own report, have neither generated significant net savings nor met statutory criteria for expansion.1&nbsp;In particular, the relevant statute at 42 U.S.C. 1315a(b)(2)(A) directs the agency to “focus on models expected to reduce program costs under the applicable subchapter.” Yet, according to the most recent data from CMS, CJR reported cumulative losses of $142.6 million to the Medicare program in its last year and may have widened disparities in&nbsp;lower extremity joint replacement (LEJR) rates for some populations.2 BPCI-A generated a net loss of $114 million in its third year, and beneficiaries reported unfavorable results for functional status and care experience measures.3 Thus, because TEAM is based on the extremely similar BPCI-A and CJR models, and because those prior models failed to meet statutory criteria for expansion as they failed to reduce program costs and generate net savings, we have serious concerns that the agency is stretching its legal authority.&nbsp;Moreover, in not accounting for lessons learned from previous models, we feel the agency has missed a critical opportunity to move bundled payment models forward in a meaningful way.Moreover, the tremendous scope of this rule and its aggressive 60-day comment period has made it challenging for us to fully evaluate and analyze the proposal and its tremendous impact on hospitals and health systems. The five types of surgical procedures proposed for inclusion in TEAM comprise over 11% of inpatient PPS payments in 2023 – a staggering amount that does not even include the outpatient payments that would be at risk as part of the model. While we worked closely with our hospital and health system members to assess the potential impact of TEAM on the important work they do in caring for their patients and communities, the incredibly short comment period severely hampers our ability to provide comprehensive comments. That said, it is clear a number of changes need to occur to make this model feasible.<h2>Make Participation Voluntary</h2>The proposed rule would mandate TEAM participation for all acute care inpatient PPS hospitals in select geographies. However, mandatory participation is not practicable or advisable.&nbsp;Many organizations are neither of an adequate size nor in a financial position to support the investments necessary to transition to mandatory bundled payment models. Requiring hospitals to take on large, diverse bundles would require more risk than many can manage, threatening their ability to maintain access to quality care in their communities. We strongly urge CMS to make model participation voluntary and allow&nbsp;organizations to select the episodes for which they feel they can improve quality of care and best impact cost savings.<h2>Lower the Discount Factor</h2>The proposed rule includes a very aggressive 3% discount factor given the context of other TEAM design features.&nbsp;Indeed, based on our analysis, each of the five clinical episode categories would have most of the episode spending accounted for by the anchor hospitalization or outpatient procedure, with three of the five having at least three-quarters of spending accounted for by the anchor hospitalization or outpatient procedure. This is extremely problematic as hospitals do not have an ability to decrease the anchor hospitalization payment amount, which leaves virtually no opportunity for them to achieve efficiencies and meet, let alone exceed, the proposed 3% discount factor. Thus,&nbsp;we recommend that a discount factor of no more than 1% be applied.<h2>Modify Several Design Elements</h2>The proposed rule has several problematic design elements delineated below and explained more thoroughly in the attached. If CMS cannot make significant changes to our concerns below, the agency should not implement TEAM. At the very minimum, CMS should:<ul><li>Revise the risk adjustment factor.&nbsp;We recommend that the risk adjustment factor capture complication or comorbidity/major complication or comorbidity (CC/MCC) flags from the anchor hospitalization and hierarchical condition codes (HCC) flags three years prior to the hospitalization.</li><li>Establish Longer Glidepath to Two-sided Risk. We recommend extending the upside-only glidepath to a minimum of two years.</li><li>Revise the Low-volume Threshold. We recommend CMS increase the low-volume threshold to ensure statistical significance, establish separate thresholds within each episode category and fully exclude organizations not meeting those thresholds from participation.</li><li>Make Participation for Safety-net, Rural and Special Designation Hospitals Upside Only. According to our analysis, these organizations are projected to have the most significant financial losses, and they already serve more complex patient populations often with lower margins.</li><li>Exclude Hospitals Participating in Other APMs. CMS is creating “double jeopardy” for organizations participating in multiple APMs, and thus should exclude participants in accountable care organizations (ACOs), the States Advancing All-Payer Health Equity Approaches and Development (AHEAD) model, and the Increasing Organ Transplant Accountability model (IOTA).&nbsp;</li><li>Revise Quality Measure Set. At the very least, we recommend excluding the three measures CMS is considering for TEAM that have not yet even been adopted for the inpatient PPS quality reporting program.</li><li>Lower Composite Quality Score (CQS) Threshold.&nbsp;Under the proposed approach, model participants would only receive a full reconciliation payment if their CQS is in 100th percentile nationally, essentially meaning that the CQS would serve only to decrease a participant’s reconciliation payment.</li><li>Waive Applicable Fraud and Abuse Laws.&nbsp;We recommend waiving physician self-referral laws and anti-kickback statutes so that organizations can form the financial arrangements necessary to implement the proposed rule.</li><li>Extend Certain Waivers to Support Care Delivery. We urge CMS to give providers maximum flexibility to identify and place beneficiaries in the clinical setting that best serves their short- and long-term recovery goals.</li></ul>The changes we recommend would help facilitate hospitals’ success in providing quality care to Medicare beneficiaries, achieving savings for the Medicare program and having an opportunity for reward that is commensurate with the risk they are assuming. Our detailed comments are attached. Please contact me if you have questions or feel free to have a member of your team contact Jennifer Holloman, AHA’s senior associate director of policy, at <a href="mailto:jholloman@aha.org">jholloman@aha.org</a>.Sincerely,/s/Ashley Thompson Senior Vice President Public Policy Analysis and DevelopmentCc:&nbsp;&nbsp;&nbsp;&nbsp; Elizabeth Fowler, Director, Center for Medicare and Medicaid Innovation (CMMI)_________1 https://www.cms.gov/priorities/innovation/data-and-reports/2022/rtc-2022 2 https://www.cms.gov/priorities/innovation/data-and-reports/2023/cjr-py5-ar-findings-aag 3 https://www.cms.gov/priorities/innovation/data-and-reports/2023/bpci-adv-ar4-findings-aag Mon, 10 Jun 2024 10:55:23 -0500 Value-Based Care 3 Keys for Hospitals to Achieve Sustainable Financial Stability /aha-center-health-innovation-market-scan/2024-05-28-3-keys-hospitals-achieve-sustainable-financial-stability <div class="container"><div class="row"><div class="col-md-8"><img src="/sites/default/files/inline-images/3-Keys-for-Hospitals-to-Achieve-Sustainable-Financial-Stability.png" data-entity-uuid="75291288-19b0-4b25-bb1f-efeaf6fded22" data-entity-type="file" alt="3 Keys for Hospitals to Achieve Sustainable Financial Stability. A calculator sits on a surgical table surrounded by forceps, scalpels, and other surgical tools." width="100%" height="100%">No one said it would be easy for hospitals and health systems to achieve financial sustainability in today’s ecosystem.The nation’s aging patient base, rising costs, staffing shortages and evolving reimbursement models represent a handful of major challenges plaguing providers.So, what will C-suite executives need to do in the coming years to create a foundation for long-term financial sustainability? And what kind of savings should organizations target between now and then?For starters, organizations will need to realize cost reductions of 15% to 20% by 2030, a new <a href="https://www.oliverwyman.com/our-expertise/perspectives/health/2024/april/5-ways-hospitals-can-cut-costs-achieve-long-term-stability.html" target="_blank" title="Oliver Wyman: 5 Ways Hospitals Can Cut Costs, Achieve Long-Term Stability">Oliver Wyman analysis</a> suggests.<h2>Persisting Revenue Uncertainty Poses a Huge Challenge</h2>That’s a sizable percentage under any circumstances, but doubly so with revenue uncertainties mounting.The end of stimulus funds and reimbursement enhancement from public health emergencies will reduce safety valves, the report notes, while the restart of Medicaid redetermination has pushed millions of patients out of that program. This could lead to greater long-term costs associated with preventable emergent care.The long-term impact to future net revenue due to the large number of Americans shifting out of commercial insurance to Medicare is another huge issue to consider. Before the pandemic, 59% of America’s insured population were enrolled in commercial plans, the report states. By 2030, this figure is projected to drop to 55% as Medicare enrollment swells.That 4% difference will have a significant negative impact on health care organizations’ revenues as tens of millions of patients opt into Medicare coverage when they become eligible. Combined underpayments from Medicare and Medicaid were nearly $130 billion in 2022, up from $76 billion in 2019, notes an <a href="/fact-sheets/2022-05-25-fact-sheet-majority-hospital-payments-dependent-medicare-or-medicaid" target="_blank" title="Fact Sheet: Majority of Hospital Payments Dependent on Medicare or Medicaid">AHA Fact Sheet</a> released earlier this month.<h2>3 Key Savings Areas in Need of Innovative Strategies</h2><h3>1 | Optimizing high-value operations.</h3>Traditional process redesign in four core areas — staffing, perioperative services, length of stay and administrative functions — will be effective. However, leaders should target annual savings beyond the traditional 5% to 7% range due to broad changes in the field.Perioperative services are often rife with value-generation opportunities that can be captured through greater throughput. Focus areas could include operating room specialization, eliminating unused block time in schedules or turnover-time reduction. Enhancing sepsis detection, managing toward a discharge date, standardizing discharge rounds and optimizing the post-acute network are all high-impact levers for reducing length of stay.<h4>Takeaway</h4>Staffing poses the most immediate challenge. Redesigning key processes and team-based care can bring relief to a tired workforce and reset the cost structure, the report states. In nursing, for example, organizations can create specialized teams or designate individuals to facilitate higher volumes of task repetition. This will result in greater familiarity and efficiency. These teams can get more done at a higher-quality level.For example, a centralized virtual nurse hub to manage the discharge process across multiple units or hospitals can result in significantly shorter time to discharge for patients and higher satisfaction for floor nurses.Other areas to explore include automating standard processes and leveraging hybrid teams across roles and modalities to provide a new avenue to pool resources. Telesitting, for example, reduces the need for in-person sitters while reducing falls, and virtual stroke teams can provide 24/7 consultation while reducing shift coverage requirements for physicians.<h3>2 | Rethink and redeploy sites to align with changing care delivery and payment models.</h3>Care continues to shift out of traditional cost centers as less-invasive treatments develop, payer pressures intensify and new technological developments enhance feasibility of care at home. As a result, health systems should reframe how they deploy and plan for future brick-and-mortar locations.<h4>Takeaway</h4>Three groups of sequential tactics can reshape the use and scale of physical care delivery sites while generating estimated savings of 7% to 8%, the authors note.<ul><li>Shift care to the best, lowest-cost site.</li><li>Create focused centers of excellence where volume allows.</li><li>Optimize bed mix and consolidate footprint based on utilization trends.</li></ul><h3>3 | Treat value-based care like a service line.</h3>Executing against all the cost transformation challenges you face will be difficult, especially given the variability of each organization’s starting point. Value-based care models can help close the gap.<h4>Takeaway</h4>Build a chassis around prevention and wellness. The goal should be to keep patients out of expensive inpatient settings. Designing care models and investing in the right capabilities enables systems to achieve long-term sustainability. A system managing the care of 50,000 Medicare patients, generating savings of $2,000 per member per year, produces $100 million in incremental revenue opportunities, the report explains.Additional insights are available in the <a href="https://www.oliverwyman.com/our-expertise/perspectives/health/2024/april/5-ways-hospitals-can-cut-costs-achieve-long-term-stability.html" target="_blank" title="Oliver Wyman: 5 Ways Hospitals Can Cut Costs, Achieve Long-Term Stability">full Oliver Wyman report</a>.</div><div class="col-md-4"><a href="/center" title="Visit the AHA Center for Health Innovation landing page."><img src="/sites/default/files/inline-images/logo-aha-innovation-center-color-sm.jpg" data-entity-uuid="7ade6b12-de98-4d0b-965f-a7c99d9463c5" alt="AHA Center for Health Innovation logo" width="721" height="130" data-entity- type="file" class="align-center"></a><a href="/center/form/innovation-subscription"><img src="/sites/default/files/2019-04/Market_Scan_Call_Out_360x300.png" data-entity-uuid data-entity-type alt width="360" height="300"></a></div></div></div>.field_featured_image { position: absolute; overflow: hidden; clip: rect(0 0 0 0); height: 1px; width: 1px; margin: -1px; padding: 0; border: 0; } .featured-image{ position: absolute; overflow: hidden; clip: rect(0 0 0 0); height: 1px; width: 1px; margin: -1px; padding: 0; border: 0; } Tue, 28 May 2024 06:15:00 -0500 Value-Based Care CMS leaders provide update on strategy to support value-based specialty care /news/headline/2024-04-02-cms-leaders-provide-update-strategy-support-value-based-specialty-care At the Health Affairs Forefront <a href="https://www.healthaffairs.org/content/forefront/cms-innovation-center-s-strategy-support-person-centered-value-based-specialty-care">blog</a>, officials from the Centers for Medicare &amp; Medicaid Services provide an update on their strategy to support value-based specialty care through the CMS Innovation Center. The updates focus on efforts to enhance specialty care performance data transparency; maintain momentum on acute episode payment models and condition based models; create incentives within primary care for specialist engagement; and create incentives for specialists to affiliate with population-based models and move to value-based care. Tue, 02 Apr 2024 16:02:00 -0500 Value-Based Care