Health Care Leaders Push Forward on Value-Based Care Amid Challenges

Value-based care remains a top priority in the shifting landscape of US health care, as emphasized during a recent session at the National Association of Accountable Care Organizations (NAACOS) fall conference.¹

The discussion brought together payers and providers to explore the challenges and opportunities in improving patient outcomes while reducing health care costs, with a focus on aligning reimbursement models to encourage quality care over service volume.

Many patients are unaware of value-based care options, resulting in unnecessary emergency department visits. | Image credit: Kirsten D:peopleimages.com – stock.adobe.com

Geoffrey Nicholson, MD, senior vice president and chief clinical officer of population health at WellSpan Health, emphasized that managing financial sustainability during this shift is no small task.

“It’s important to give ourselves some grace on just how hard this is,” Nicholson said, highlighting the strain from labor shortages, rising costs, and other challenges. Despite these difficulties, Nicholson noted that value-based care aligns with the way providers prefer to practice, adding, “It’s the type of care I want to give as a physician and receive as a patient.”

The shift to value-based care is also evident beyond Medicare programs, with private insurers making strides in reforming payment models. Jamie Reedy, MD, MPH, chief population health officer at Horizon Blue Cross Blue Shield of New Jersey, described Horizon’s efforts to incorporate value-based agreements into their care models, noting that 80% of the program’s commercially insured lives are cared for by primary care physicians under value-based agreements. Despite progress, significant obstacles remain, especially in aligning specialty care with value-based goals.

“Specialists want to provide great outcomes, but it’s extremely hard under the current payment models, and many practices aren’t structured in a way that supports team-based care,” Reedy noted.

According to Reedy, Horizon is developing new performance-based payment programs to incentivize specialists to focus on high-value care, including preventive treatments and reduced overutilization. As health systems and insurers seek to expand value-based care across all patient populations, both Nicholson and Reedy acknowledged the need for innovative partnerships and sustainable models to meet evolving challenges.

Financial pressures also complicate the transition. Many health systems rely heavily on commercial payers to subsidize underfunded government programs like Medicare and Medicaid. With 30% of patients generating 70% of revenue, cross-subsidization raises concerns about sustainability. The COVID-19 pandemic further exposed risks in payment models, as providers with capitated payment arrangements fared better early on but struggled when patient visits surged post pandemic. Future economic models are expected to move beyond simple shared savings, focusing on risk-sharing frameworks that account for the unique value both payers and providers contribute across service lines and specialties.

Data integration also emerged as a key hurdle. Building a seamless data infrastructure that links claims and clinical data across payers and providers takes time and effort, but it is essential to managing patient risk effectively. Additionally, many patients remain unaware of value-based care options, resulting in unnecessary emergency department visits. Efforts to educate patients and direct them toward high-performing providers have shown promise but require precise targeting to succeed.

These insights from the NAACOS fall conference align closely with strategies outlined in the NAACOS ACO Drivers for Success report, which emphasized the importance of data integration, team-based interventions, and fostering a high-value care culture.² Both the conference discussion and the report highlight the importance of working across multiple payers to streamline care and improve financial outcomes. The report also showed how data-driven strategies—like embedding pharmacists and integrating clinical insights—are essential for advancing value-based care, echoing the conference’s focus on leveraging partnerships between payers and providers.

They both also underscore the challenges of engaging specialists and aligning care models to manage costs effectively. While the report identified specialist engagement as a critical but underdeveloped area, Nicholson and Reedy emphasized the need to balance investments and avoid duplication of services to prevent inefficiencies.¹ As the shift toward value-based care continues across the country, finding the right balance between investments, data integration, and patient engagement will be essential for long-term success.

References

1. Matthews M. Nicholson G. Reedy J. Payer perspectives on advancing value-based care. NAACOS webinar. Presented October 18, 2024. https://www.naacoslive.com/archive/8993
2. Klein HE. New report highlights data-driven success strategies for ACOs. AJMC^®. September 26, 2024. Accessed October 23, 2024. https://www.ajmc.com/view/new-report-highlights-data-driven-success-strategies-for-acos