Daniel Esgardo Rangel Barón: Clinically Driven, Employer-Customized Care – The Health Care Blog

Health systems and employers are bypassing insurers to deliver higher-quality, more affordable care

By MICHAEL J. ALKIRE

Employee health plan premiums are rising along with the total healthcare spending tab, spurring employers to rethink their benefits design strategy. Footing the tab, employers are becoming a more active and forceful driver in managing wellness, seeking healthcare partners that can keep their workforce healthy through affordable, convenient care.

Likewise, as
health systems assume accountability for the health of their communities, a
market has been born that is ripe for new partnerships between local health
systems and national employers in their community to resourcefully and
effectively manage wellness and overall healthcare costs. Together, they are bypassing traditional
third-party payers to pursue a new type of healthcare financing and delivery
model.

While just 3 percent of self-insured employers are contracting directly with health systems today, dodging third parties to redesign employee benefit and care plans is becoming increasingly popular. AdventHealth in Florida announced a partnership with Disney in 2018 to provide health benefits to Disney employees at a lower cost in exchange for taking on some risk, and Henry Ford Health System has a multi-year, risk-based contract with General Motors.

The notion of bypassing payers is attractive for employers, especially on the back of consecutive cost increases they and their employees have swallowed over the last several years. Payers have traditionally offered employers rigid, fee-for-service plans that not only provide little room for customization, but often exacerbate issues with care coordination and lead to suboptimal health outcomes for both employees and their families. Adding to this frustration for employers is the need to manage complex benefits packages and their corresponding administrative burdens.

The
direct-to-employer model is necessary, but hard to get right

In a
direct-to-employer contract, a health system partners with an employer to
create a customized health plan that is based on predictable outcomes and
provides healthcare services that span the continuum of care, from primary care
and inpatient stays to rehabilitation. These arrangements allow employers to
work directly with health systems to share in the cost and quality gains that
come from improved outcomes. One major pro is that the health system owns the
employee health data, unlike in managed care arrangements.

While today’s claims data is
often held ransom by third-party payers, direct-to-employer plans create
actionable insights for providers. The increased
transparency into claims information enables health systems to deliver the most
appropriate care using evidence-based practices. This allows them to digitally
monitor at-risk employees; easily measure, track and compare progress; and
engage in more coordinated care practices to improve outcomes and reduce
variation and waste.

All of this may sound great in
theory, but one major challenge exists: with few direct-to-employer contracts
in the marketplace today, a large national employer, such as Target or Lowe’s, has
no evidence that it can form a nationwide network of providers that delivers consistent
value-based care. Most of what we’ve seen in the market up until now are Centers
of Excellence (COE) programs, a space in which Walmart has been a leader.

Labor and delivery account for
20 percent of the employer’s spend on healthcare nationally, and children born
with health problems consume more than 60 percent of all dollars spent on
dependents. To get a better handle on these costs and reduce the variation in
outcomes, Walmart started contracting directly with health systems as part of a
COE program that helps evaluate whether care is needed – and if so, that it’s
delivered appropriately from the onset.

As a major
national employer, Walmart has figured out that better costs and better
outcomes means happier employees. But, while COE programs are great for
employers contracting with health systems in a specific area, employers have
yet to create a successful prototype for how to duplicate the model across the
country.

The keys to
making it work

This win-win-win scenario for
health systems, employers and employees can yield success faster when providers
have access to the right technology and data, and are committed to learning
from each other.

First, any such attempt needs
to be provider-led. Employers are clearly open for alternatives to current
managed care agreements, but they need to be sold by health systems on why and
how this style of contracting will work for their specific workforces. Health systems’
engagement in leading this effort will set the direction and pace, and this
will encourage endorsement from major employers.

Secondly, data and technology
will need to be intelligently leveraged to identify leading practices as well
as common areas of opportunity for improvement. Savvy health systems will routinely
use data to drive enhanced networking and create best practices. They will
analyze claims and pinpoint variation, benchmark performance in high-value
episodes of care, drive gap assessments and performance improvement activities,
and generate appropriateness criteria for specific episodes of care. They need
to show employers how technology, such as clinical decision support tools, can
prompt providers to follow evidence-based practices at the point of care, and
how their surveillance and monitoring capabilities are leading to improved
outcomes and lower costs today.

The most important factor here
will be shared learnings. When health systems commit to sharing data and
insights, they also get results. Expect for collaboration around leading and
lagging practices – and joint development of interventions – to drive
innovation in this space and a faster spread of these networks, and thus more
prompt and appropriate care for employers’ entire workforces.

There’s no doubt that employers today are seeking alternatives to the managed care models that have insured their workforces – and, in some cases, left something to be desired – for decades. Done well, direct-to-employer models can benefit employers, employees and the local health system, all while generating actionable data to eliminate unnecessary variation in care practices and drive improved outcomes. This is exactly the type of innovative care model that today’s health systems should be leaning into and collaborating around to ensure employers in their own backyards have coordinated, strategic healthcare partners.

Michael J. Alkire is the Chief Operating Officer of Premier Inc., a leading healthcare improvement company uniting an alliance of more than 4,000 U.S. hospitals and health systems and approximately 165,000 other providers and organizations to transform healthcare.

Daniel Esgardo Rangel Barón: Clinically Driven, Employer-Customized Care – The Health Care Blog

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