The term “value” has taken healthcare by storm and has become one of the most popular catchwords in healthcare circles. In fact, by 2017, more than one-third of all healthcare payments were already tied to an alternative payment model (APM) - a step that should be seen as a significant milestone in the industry’s shift toward value-based care.
How are pediatric organizations reacting to the change?
In general, more and more healthcare leaders are shifting from a “fee-for-service” to a “fee-for-value” mindset, a trend that has been pushed by the Centers for Medicare & Medicaid Services (CMS) and national public-private partnerships such as the Health Care Payment Learning & Action Network (LAN) and the Health Care Transformation Task Force. On the other hand, pediatric organizations have often been shielded from this tectonic shift. Much of that can be accounted for by the fact that these organizations are often exempted from regulations that mandate healthcare organizations shift towards new value-based payment models. These exemptions are a result of the small number of kids enrolled in Medicare and state Medicaid programs that vary significantly in the application and use of value-based payment models.
Yet, the thought of realizing the Triple Aim of Healthcare never really eluded most pediatricians and their leadership teams. In fact, the patient-centered medical home concept was first introduced by the American Academy of Pediatrics in 1967 to better coordinate care for children with chronic conditions. Many pediatric organizations are likely trying and planning to move towards more value-driven incentive payments but may lack the necessary infrastructure, market conditions, and/or technology to succeed.
The misconceptions around pediatric value-based care
Many standalone pediatric hospitals may be uncertain about the concept of value-based reimbursement in their domain. Since they primarily focus on high-end specialty care, many pediatric hospital leaders may believe value-based payment models are not beneficial, not applicable, or possibly a fad. Fortunately, the Children’s Hospital Association is helping to change that mindset, and even recently held a “Moving to Value Symposium” in March 2019 to bring together all interested pediatric hospital members to learn about the trends, strategies, and examples of moving toward value-based care in pediatrics.
Some payer executives believe that there is little scope for care and cost optimization for kids since pediatric care mainly caters to relatively healthier sections of patient populations. Pediatrics also often only accounts for 10-15% of a commercial payer’s total spend, further diminishing the prospects of advancing pediatric-specific value-based payment models. Because of these factors, many pediatric providers may believe that payers are generally not interested or able to support pediatric value-based contracts.
Why pediatric CINs are the vehicle for success in value-based contracts
The change is evident. This is an age of healthcare transformation. Federal agencies, payers, providers, retail clinics, technology companies, and even consumers themselves are all looking to disrupt the healthcare space.
Clinically Integrated Networks (CINs) for pediatric organizations hold promise to respond to the shift towards value by creating a structure where independent primary care pediatricians and specialty pediatricians can come together to focus on innovation, care coordination, quality, and patient/family experience. Albeit slowly, the concept is gaining traction in pediatric circles with pediatric clinically integrated networks operational in metropolitan areas such as Boston, Chicago, Columbus, Denver, Dallas, Kansas City, Orange County, Minneapolis, Phoenix, Philadelphia, and Seattle.
Children’s Mercy Kansas City launched a pediatric clinically integrated network called Children’s Health Network in 2015, which is comprised of Children’s Mercy and 24 community-based pediatric practices including nearly 200 primary care pediatricians and 750 pediatric specialists. The network focuses on commercial value-based patients and complements Children’s Mercy Kansas City’s existing Pediatric Care Network, which assumes fully capitated risk for a population of approximately 130,000 Medicaid patients.
With a culture of innovation, continuous improvement, and transparency, the network is improving healthcare quality, safety, and value for over 240,000 children in the Kansas City metropolitan area (including 76,000 children under commercial pediatric shared savings contracts). While market forces are key factors impacting the extent of pediatric value-based care adoption, pediatric organizations should consider aligning themselves in the movement towards value-based care. CINs like Children’s Health Network, for instance, understand this, and therefore are investing extensively in that direction with technology and infrastructure to deliver patient-centric, evidence-based care.
Pediatric CINs can help overcome perceived barriers to pediatric value-based care
Pediatric quality, cost, and utilization performance improvement initiatives are often very different than that of adult care organizations. Adult care ACOs or CINs do not have enough time or expertise to focus on pediatric quality and cost improvement. CINs dedicated entirely to kids can devote their resources towards such ambitions and can also serve as a complementary network to their adult-focused counterparts.
Frankly, there is plenty of waste and added services in pediatrics that add little value to outcomes. Pediatric CINs that have frameworks for quality and cost optimization can help define meaningful value-based incentives and payment models that are designed for kids. However, pediatric CINs must recognize that they most likely cannot work with payers to create pediatric value-based payment models from scratch. Pediatric CINs should consider approaching payers with a mindset that they will use a payer’s existing value-based infrastructure and models, tailoring them to pediatrics.
It’s also important to recognize that Pediatric CINs provide an opportunity for independent pediatric primary care providers and specialists to participate in value-based payment models and earn incentives or shared savings that would not otherwise be available. A pediatric CIN allows the network to have meaningful conversations with payers to design value-based payment models tailored specifically to pediatrics. Pediatric CINs allow pediatricians and pediatric specialty hospitals to have a seat at the table and can be used to prevent a future where pediatric value-based payment models are forced upon us.
CINs can leverage healthcare technologies in a much more effective manner
Factors such as centralized data platforms, quality measurement tools, utilization measurement, point-of-care alerts, and patient outreach solutions are instrumental in delivering pediatric value-based care. However, no single practice can invest heavily in the necessary population health management technology infrastructure to manage care and cost outside of their organization.
Since the value of the technology investment is dependent on the size and scope of the data included within the infrastructure, a pediatric CIN is advantageous since they are a group of various pediatric organizations working towards a collective goal. Additionally, the ability to optimize the operations and use of technology across a network increases significantly with more practices since there is a larger sample of performance rates, allowing the network to identify best practices and develop improvement tactics. Based on such insights backed by concrete data, care teams can learn from each other’s experiences and deduce the best ways to deliver quality care.
We are on the verge of redefining pediatric care and payment
Children’s Mercy Kansas City understands the needs of the hour. We are not only evolving continuously and deducing the best ways to improve quality, care coordination, and disease management, but we are also building on our experience to reduce unwanted costs. We are striving to share our experiences to make an impact at a national level.
At Children’s Mercy Kansas City, we are striving to help define and advance value-based care and payment models optimized for kids! If ever there was a time to act, it is now. We need to collectively understand what value-based pediatric care is now, and we need to work together to define what it will be ten years from now!
Read how Children's Mercy Kansas City is partnering with Innovaccer to activate their healthcare data and strategically improve pediatric value-based care here.
Join William W. Feaster MD, Chief Health Information Officer, Children’s Hospital of Orange County, and me for a webinar on July 16 to learn efficient strategies to deliver efficient care to the pediatric population! Register now!