3 Challenges On the Road to Value-Based Healthcare

By , Former Chief Medical Officer and Vice President of Informatics and Analytics of Transcend Insights
Population Health & Wellness
3 Challenges On the Road to Value-Based Healthcare

3 Challenges On the Road to Value-Based Healthcare

By Thomas J. Van Gilder, MD, JD, MPH, chief medical officer and vice president of informatics and analytics

Affordable care won’t be achieved by cutting prices, but by applying a fundamentally different approach to healthcare. The current system reimburses based on tests and procedures, but within the next two years the U.S. Department of Health and Human Services has set clear goals to move towards reimbursement based on enduring results for patients. The shift to value-based healthcare will represent cost savings by avoiding expensive procedures, but the core motivation is to create a better patient experience through person-centric care. Three challenges face the industry through this transition: Improving outcomes for complex health conditions; Tracking hidden relationships between diseases and influencing factors, and; Optimizing healthcare utilization.

1. Improving Outcomes for Complex Health Conditions

The core of value-based healthcare is reimbursement based on health outcomes, instead of simply providing care services. Certainly, a physician’s work is always focused on health outcomes, but a new fiscal model would expand that emphasis to include data practices and technology.

Take Alzheimer’s as an example chronic condition with incredible complexity. A recent study from the University of Wisconsin calculated that early detection saves the state $10,000 per patient, and saves the patient $100,000 in treatment costs, plus substantial improvement in quality of life. When drugs are developed to target these early stages, the cost-savings for patients could reach half a million dollars.

Value-based healthcare and affordable healthcare go hand in hand. With 85% of US healthcare dollars spent treating chronic conditions, it makes fiscal sense to focus on improving outcomes for complex health problems.

2. Hidden Relationships Between Disease Processes and Influencing Factors

Nearly half of American adults have been diagnosed with a chronic health issue. While this is clearly a population-level issue, person-centric care is a part of the solution.

Physicians make some influencing factors like diet and lifestyle habits very clear: people with hypertension need to monitor diet and engage in appropriate physical activity, people with chronic obstructive pulmonary disease should not smoke, etc. Not only do people need to be aware of these relationships, but their care team needs to know whether they are being taken into consideration in day-to-day choices. The only way to successfully track influencing factors is through proactive, person-centric care that surveys the lifestyle, diet, and behaviors of each patient. Additionally, implementing interoperability, so that patient data is easily accessible by patients and their care teams, will allow more direct monitoring of influencing factors and disease progression.

3. Poor Health Habits Can Have Adverse Health Effects in Some People that Lead to Unpleasant and Expensive Healthcare Utilization

This is a two-part problem: unknown influencing lifestyle factors are often the cause of expensive hospital visits, and if those disruptive visits don’t show results, they make people reluctant to return when they need care.

A 2010 study found that 30% of healthcare spending is wasted on redundant or ineffective care as patients change physicians or hospitals. This inefficiency would be intolerable if patients were billed based on outcomes in a value-based healthcare system. Interoperability of electronic health records would go a long way towards addressing the cost of uncoordinated care because every visit would build on a central repository, with the results of previous tests accessible to those who need them.

Value-Based Healthcare through Data Collection

The solution to these three challenges of improving outcomes, monitoring influencing factors, and optimizing healthcare utilization begins with collecting and analyzing patient data. Understanding complex conditions requires monitoring many variables, including lifestyle factors. Uncovering hidden relationships between health and lifestyle choices requires diligent collection and analysis. Understanding when those choices and habits affect health will lead to more productive and cost-effective hospital visits. When those visits show great outcomes for people, they will be able to seek care as needed without dreading an unpleasant and expensive visit.

Ensuring that physicians and patients have a platform for collecting and acting on complete healthcare data is a move towards proactive, person-centric care. And acting on complete information reduces costs and moves us towards value-based healthcare.

Every care team member could benefit from using data to guide their decisions—how else will data help implement person-centric care at all levels?

Let’s discuss the solution to these challenges further – please join me at the Health Financial Management Association (HFMA) National Institute Innovation Lab, in Las Vegas, NV. I’ll be speaking during a panel session titled “Becoming A Value-Based Care Partner: Using Data To Identify Gaps,” on Wednesday, June 29th from 11:00 a.m. – 12:45 p.m.