Medicare Advantage’s reputation as a fast-growing, financially favorable marketplace combined with the double-digit increases in Medicaid enrollment have ramped up interest in value-based partnerships for these populations. But the complexities of managing Medicare and Medicaid populations are critical to understand to determine which populations to assume accountability for, what types of clinical programs to deploy, and when to launch them.
In managing Medicaid populations, for example, “You've got to get in, have fast impact, and drive quick change because individuals could lose their eligibility, move to the marketplace exchange, and move back again,” said Katherine Ziegler, senior vice president of population health at ConcertoCare, during Guidehouse’s 2021 Clinical Integration Summit. “It’s a different kind of management than with other covered lives.”
How can providers strengthen their ability to take on downside risk, and where should they focus their resources?
During the 2021 Clinical Integration Summit, industry leaders shared four key insights.
1. Be intentional in crafting your approach.
“This isn't something where you wake up tomorrow and say, ‘We're going to be a Medicaid ACO,’ and you hire a case manager, and you consider your work done and you go sign contracts,” Ziegler said. “You really need to be deliberate—to understand both the opportunity and the requirements to succeed. If you want to get into this, you need to develop a very deliberate strategy focused on the measures that matter.”
Today, nearly all states are aligned with a private Medicaid managed care model, but the quality metrics by which performance is measured—as well as the weighting of these measures—vary widely. “It’s important to understand which measures will define your success and then design your approach around those measures,” Ziegler said.
“You also have to understand who your customer is from a payer perspective—whether it’s the state or a managed care organization (MCO) intermediary—and what matters to them. This can get a little complicated, particularly if you participate with more than one MCO.” Further, the rules at the state level can change quickly, as providers saw during COVID-19. “You need to be ready for that flexibility,” she said.
2. Start with a pediatric population.
“Work your way up the age curve,” Ziegler said. For example, the ability to reduce premature births—a significant cost driver for Medicaid—will bolster performance under Medicaid managed care contracts. So will proficiency in addressing conditions such as asthma or the social determinants of health that contribute to higher healthcare costs in a pediatric population.
“Just like with adults, it turns out the kids who face housing instability are associated with a no-show rate that is two to four times higher than a population that has stable housing,” said Steven Spalding, MD, physician vice president of population health and director of the Division of Rheumatology at Akron Children's Hospital. “Food insecurity is by far the most common need that has been identified in our pediatric population, and just like with adults, it's been associated with increased emergency room visits and lower compliance with preventive services like well-child visits or immunizations.”
“Fee for service has been good to us for 130 years, but it doesn't necessarily result in the child health outcomes that we have a mission to improve,” Dr. Spalding said. “My hope is that the industry will start to see the value of investing in child health programs and incorporating that type of programming into value-based care strategies. If we're serious as an industry or as a society about improving health outcomes, and reducing or controlling costs, I'd ask you: Where better to start than with kids?”
Among adult Medicaid populations, Ziegler recommends focusing on conditions such as substance use disorder, diabetes, and behavioral health. “At a general condition level, those are the places where I’ve seen success.”
3. Build the right team to support the move to value.
“It takes a serious team across your organization to move forward with value-based payment models,” Dr. Spalding said. “This work depends on the support of strong champions. Oftentimes, we forget that or maybe take it for granted.”
In 2019, Akron Children’s Hospital, which employs more than 200 pediatric primary care providers, launched a pilot program to offer onsite well-child exams and virtual evaluation for minor illnesses in two school districts. The program substantially reduced healthcare costs for these children, 25% of whom did not have primary care providers. Today, Akron has embedded school health programs in 30 school districts across 150 schools. Key to the initiative: the depth of support received from physicians, clinicians, and administrators.
4. Design programs with the patient in mind.
“At the epicenter of all of these conversations—even around risk—leaders must consider: ‘What matters to the patient?’” said Lance Robertson, director at Guidehouse, and former Assistant Secretary for Aging for the U.S. Department of Health and Human Services.
As digitization of patient/provider interactions makes the industry ripe for disruption, new entrants are vying for purchasers’ premium dollars. These include Oak Street Health, which partnered with Walmart to offer primary care for seniors in retail clinics; ChenMed, whose concierge-style medical centers cater to Medicare Advantage; and VillageMD, which partnered with Walgreens to deploy a home-based approach to primary care.
Because disruptors have unprecedented access to capital to enhance patient engagement with the digital consumer experience, providers need to think carefully about the investments required to deliver the experiences consumers and their families desire.
Keep playing the long game.
As the Centers for Medicare & Medicaid Services aggressively shifts to managed care as its preferred model of care delivery, providers need to be prepared to both share risk with payers and understand where market opportunities for risk-sharing exist. They should also consider:
To help providers and payers broadly understand where they can most effectively uncover opportunities for payvider models—risk-based collaborations between providers and payers—Guidehouse evaluated more than 100 U.S. markets with a population of 500,000 or more based on market size and future growth as well as current-state value-based payment performance.
Our Payvider Market Index identifies markets that are ripe for payviders, those with potential for greater scale, and those that need the capabilities to better manage risk. Access the index.
Want to hear more from the experts who participated in our Medicare and Medicaid panel? Download Guidehouse’s 2021 Clinical Integration Summit on demand.