A Journey from Volume to Value-based Care

By Michael Renzi, DO, FACP | Published 11/27/2016 0

If you are thinking about applying for a value-based incentive program, you will want to ask yourself some key questions first.

In 2010, the Centers for Medicare and Medicaid Services Innovation Center (CMMI) launched out of the Affordable Care Act (ACA) to reform the healthcare industry. This initiative is a vehicle for the government to put money aside every year to test what works and what doesn’t work, in an effort to move the healthcare industry towards a better quality of care at reduced costs. It’s an iterative learning process for the industry. As an example, CMS started out with the Medicare Shared Savings Program (MSSP), then added the track three option, and most recently came out with the next-generation accountable care organization (ACO) model.

It’s an exciting and at times daunting path we’re traveling down. This past spring, CMS issued the Medicare Access & CHIP Reauthorization Act (MACRA), emphasizing alternative payment models (APMs), and essentially saying

“we’re going to slowly push everyone towards risk whether you like it or not, but if you’re ready, here are some models you can adopt.”

Practices like mine that have jumped quickly on this shift to value-based care are themselves experimenting. These are uncharted waters, and no one knows what best practices will emerge, though there are some predictions we can make. My practice has participated as an MSSP ACO, in commercial and Medicaid shared savings programs, and was recently accepted to participate in the Million Hearts Model. We have not always been successful, but we’ve learned a lot along the way.


Practice history

I started out running my practice as an independent physician until 2004 when I joined Advocare, a fully integrated independent physician group of more than 500 providers. My practice was able to capitalize on the benefits of finance and scale that come from that size of an organization. This alignment became the perfect federated model, bringing efficiencies to the entire group while allowing me to focus on patient care and growth. The Advocare group also had the resources to apply for and participate in some alternative payment models, like Million Hearts and an MSSP ACO.

It was after the passage of the ACA that I saw the fee-for-service (FFS) payment model would morph into some else. Existing practice setups would have to evolve to handle the technology and clinical changes required to succeed in the new world. Advocare practices were being encouraged to achieve Patient-Centered Medical Home (PCMH) status, but I wanted to go beyond simply getting a certificate and actually transform the way my practice delivers medicine.

My strategy had two prongs executed in parallel. The first part was changing operations – transitioning workflows that were inefficient, and implementing lean six sigma thinking. This included a hyper-focus on the patient experience. The first step I took was to make sure each person in my practice was working at the top of their credentials. Everyone in the office, from the person checking patients in to the office manager to the medical staff, have a clearly defined role in how they impact patient care and satisfaction. The office staff became a team charged with the task of implementing technology and clinical workflows to support this new system. We changed from a culture of high volume and exhaustion to a culture of, “yes we can help you,” and data-driven clinical decision support. We found a way to get standardized quality at every visit encounter.

At the same time, I needed to prepare the practice to deliver value-based patient-centered medicine, and gear up for the transition from FFS to value-based payments. Our ability to move quickly allowed us to become early adopters for alternative payment models as the industry slowly add value based payments to their existing FFS schedules. In preparation for the next movement towards more downside risk and capitated models, we will put price transparency at the forefront.


Bumps on the value-based care road

The first experiment for me was participating as an MSSP ACO as part of Advocare. This was a learning experience because I realized that while my practice was part of the broader team, all of the incentives of the players weren’t necessarily aligned at the inception of the MSSP. I saw this within my own practice, where providers had report cards and metrics that didn’t sync up with the focus of other providers in the MSSP. We didn’t end up realizing enough savings and elected not to renew for the next 3-year period. It came down to the fact that any of the value-based performance we may have realized individually may have been neutralized by fee-for-service mindsets still in place with the group.

Parallel to my experiences in the MSSP, I decided to participate in several commercial shared savings programs. Horizon Blue Cross Blue Shield presented their Horizon Healthcare Innovation program to Advocare for their commercial and Medicare Advantage products. The per member per month (PMPM) payments, quality metrics goals, and bonus for cost of care reduction were exactly in line in what I was trying to achieve. As part of the MSSP, we would have to wait for any money to come back to us. The advantage of the commercial shared savings program was up-front PMPM payments that we were then able to quickly reinvest in the practice in technology, point-of-care solutions, and other improvements in our EHR. We also used the experience as a beta model to reach PCMH level III status.

While half the money from the commercial programs was reinvested back into the business, it was important to me to redistribute the rest of the payment to my practice’s team members—and not just the clinical team. I wanted to incentivize everyone moving forward, and reinforce the idea that every staff member impacts the outcomes of the patient experience and patient satisfaction.

Most recently, we applied and were accepted to the Million Hearts Model, which is expected to reach 3.3 million Medicare beneficiaries over a 5-year period, beginning this year. This program aims to prevent a million heart attacks in 10 years. It’s also a primary care model, focusing on patients who are at risk, but who have never had a heart attack. Practices will get PMPM upfront payments for that population, plus FFS dollars for exceptional performance.

Right now, we’re on target to go to risk with CMS-initiated programs like CPC+ as well as commercial payers and are testing waters with shared premium risk arrangements. We’re in the process of having these discussions and expect to take on more downside risk in 2018.


Making the decision to participate

Not all CMMI programs are created equal; some are much easier to get into than others. For example, the Million Hearts Model is relatively easy because providers are given a module they can plug their data directly into. There are not the same technology barriers that other programs have, such as interoperability, quality data capture, and automated reporting. Here are the top three considerations that practices often overlook:

  • Participation in CMMI programs will be relative to the size of provider, so you should pay attention if your panel has more than 10% Medicare patients; any less than 10% and these programs may not be worth it.
  • People forget to consider the administrative burden of participating in new payment programs. Some programs can be highly administrative in terms of compliance, and that time and money needs to be accounted for when considering which programs to participate in.
  • There is also an education piece that is very important—figuring out how your practice will track and report quality in order to not only comply with MACRA but financially benefit from it.

I recommend asking yourself these key questions before applying for a value-based incentive program:

  • What are the mandatory models, and which models are likely to become mandatory or achieve widespread adoption?
  • How much risk am I willing and able to take on and how much risk must I assume to avoid a penalty?
  • How will my staff workflows need to evolve to meet the requirements of the program?
  • How much additional staffing and technology will be required to succeed in the program?
  • Most importantly, can we structure our participation in the program in such a way as the cost to administer the program does not exceed the potential revenue?


Can the average doctor achieve success?

In my mind, there are 4 essentials for success with CMMI initiatives and new payment programs overall. For most programs, the basic things physicians should have in place to succeed are a certified EHR, knowledge of the patient population, knowledge of the operational impact on your practice, and the right mindset. The right mindset is obviously the most challenging part for physicians, but may be framed with the questions:

  • How would the care in my practice change if my payments were based on quality at the best cost of care, instead of the number of visits I do each day?
  • How much more would my mindset change—and my willingness to innovate—if I were able to generate more income for succeeding, or lose income for missing the mark for cost of care?

It is an exciting and financially opportune time to be in medicine. I am a strong advocate of taking an educated risk on new CMMI and commercial payment models, and I am already seeing the rewards in my practice of having been able to participate in these models early on. The industry is moving towards downside risk and capitated models, so the faster you can gain value-based care experience, the better. Healthcare transformation is happening quickly, and patients, providers, and payers will all benefit from the transition from volume to value.

Michael Renzi, DO, FACP

Website: http://www.challc.net/

As Chief Medical Officer for Continuum, Dr. Renzi constructs, implements, and oversees the company’s Population Health Management Service, including programs involving patient-centered medical care, healthcare information technology, and shared savings reimbursement models.

Certified by the American Board of Internal Medicine and a Fellow of the American College of Physicians, Dr. Renzi received the Laureate Award from the American College of Physicians in 2013, and was awarded the Volunteer Faculty of the Year Award in 2002 and 2003 by the University of Medicine and Dentistry of New Jersey (now Cooper Medical School of Rowan University).

He received his bachelor’s degree at Lafayette College and earned his doctor of medicine degree at Philadelphia College of Osteopathic Medicine. After completing his residency in internal medicine at Cooper University Hospital, Dr. Renzi joined Advocare Heights Primary Care, where he now serves as vice president. His clinical interests include adolescent medicine, psychiatry, asthma, and dermatologic procedures. At Advocare Heights Primary Care, Dr. Renzi conducts clinical trials on diabetes, lipid disorders, atrial fibrillation, osteoarthritis, and community-acquired infections.

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