On Value Based Care - An Opinion
As the US health system is overburdened by the expense of running its operations, alternatives are being tested with some success.
In 2018, Warren Buffet exclaimed, “Healthcare is the tapeworm of the American economy” when he announced Haven on MSNBC. By 2021, 20% of America’s GDP is driven by the healthcare business. In some cases, the spend on health in the USA is larger than total GDP of entire nations to include India, where the population is significantly larger. Think about that. |
A fact that may not be well known or popular when discussing the costs of healthcare in the United States is that Americans are living shorter lives when compared to peers in other countries. Americans are living less healthy lives too. To make matters worse. there is also a by-product to all of this. It can be considered an epidemic where 66.5% of all bankruptcy filings are caused by medical expenses. More than half.
Employers are also being burdened. A fully funded health benefit package, (or hybrid), with an insurance company can impact revenue. Health benefits may take up to 8% of corporate gross revenues. This costs are rising and its effecting all realms to include low-income citizens, small business, and entrepreneurship, and government budgets. We expect it to have long term and broad implications for these rising costs.
Of late, common terminology in all households is 'social determinants of health.' In 2008, the World Health Organization identified that the Social Determinants of Health factors were responsible for the bulk of diseases and injuries. Population health addresses groupings of people typically in a geographical area but it can also include a subset of disease like asthma or heart disease. It is intended to deliver the management of health services with scientific methods of preventive, therapeutic, and diagnostic to improve health and wellbeing. In 2006, the term accountable care organization or ACO was dubbed and refers to a group of coordinated health-care practitioners that collaborate to be responsible to patients. The concept has now evolved into value-based purchasing. Health care providers are accountable for both the cost and quality of care they provide. The idea is to stop wasting time and money with inappropriate care and identify and reward the best-performing providers. Health economics and outcomes research (HEOR) is a discipline that is used to complement traditional clinical development information (i.e. efficacy, safety, quality) to guide decision makers regarding patient access to specific drugs and services. We can say with full confidence that change is of a-foot.
In this country, during the turn of the 20th Century, the government initiated programs to help the elderly and disabled. The expansion moved into supporting labor, as the infrastructure of the country was being built. War veterans and the cost of healthcare became a more serious matter and the government launched the VA. As the concept of a national health system rose to debate, it was met with opposition by the American Medical Association (AMA), as its primary adversary. Employee-based health care programs were designed specifically as thousands of men were working on the Colorado River Aqueduct Project and the Henry Kaiser project known as the Grand Coulee Dam. During WWII, U.S. businesses were prohibited from offering higher salaries. As an alternative to attract the best and brightest, the employer-sponsored health insurance was launched. Soon after, Kaiser Permanent Health Plan was launched and become the foundation for managed care, HMOs and PPOs. Today, we have the ability to have a real time benefit checks while pressures continued to unfold to lower pharmaceutical prices.
The COVID pandemic has exposed the most glaring issues of the U.S. Healthcare System regarding the inabilities to deliver. The contradictions are almost incomprehensible like clinician to patient clinician count, protective gear, patient education, costs of illness on society, etc. While it has highlighted advancements in collaborations, medical research, private-public partnerships, technology, data rich resources and communications. Capitalism and politics remain central and critical parts. From the private-public collaborative point of view, alternative payment models are in test-mode and Center for Medicare and Medicaid Services (CMS) once again is at odds with the medical community. In fact, MGMA has voiced deep criticism over value-based care. Even upon the date of this writing, it was stated by Medical Group Management Association (MGMA) that only five models have shown statistically significant savings, and of these five, only three have been expanded on a national scale. Just a handful have seen significant improvements on quality metrics.”
We feel strongly that experimenting with different models is an important as the delivery of healthcare itself. Two emerging value-based models for pharmaceuticals are outcome-based contracting (OBC) and indication-based management (IBM). In 2019, a new trend emerged: tying reimbursements for expensive medications to care outcomes. In January, AstraZeneca and UPMC Health Plan built an experimental contract to offer a drug to heart attack patients to reduce the impact of subsequent cardiovascular events. The goal is to improve patient access to costly treatments via lower out-of-pocket costs. This explicit use of value-based payments for pharmaceuticals specifically is relatively new.
Predictive analytics can support patients with chronic disease and may also help with cost reduction. Data can be used to identify which patients are may be headed in the wrong direction. This would flag and then trigger an intervention before its too late. Obviously, this helps the patient significantly as it would also control the costs through prevention. Today, preventative healthcare resources are still limited. If the focus were on heart failure, COPD and diabetes only, these diseases represent the most expensive and the most common. To intervene involves very close monitoring to avoid hospitalization and even death.
Clinical decision support (CDS) materials are used through the E H R systems to help store data, identify insights, and send actionable alerts, all in real time. CDS is very promoting and although there are short sighted downs ides to include to many alerts, once addressed, the concept is of great value to everyone. An attribute to be applied to CDS would be artificial intelligence where a system can synthesize all this data, machine learning where is becomes adaptive learning and with the support of a virtual assistant, can deliver data and make recommendations in real time with a degree of confidence. This had been the vision for IBMs Watson and although it was not perfect, the substance of personalized care to patients began to become a realistic part of the medical consciousness.
Over the last two decades but mostly since 2010, the culture of medicine has changed to a 'team-based care' approach. As the cost burden shifts more and more onto the patient, we see an economics shift into the demand side as well. The pandemic has given us some unfortunate circumstances but "as necessity is the mother of all invention," so will new pricing models for affordable healthcare become reality. We are very optimistic.
Employers are also being burdened. A fully funded health benefit package, (or hybrid), with an insurance company can impact revenue. Health benefits may take up to 8% of corporate gross revenues. This costs are rising and its effecting all realms to include low-income citizens, small business, and entrepreneurship, and government budgets. We expect it to have long term and broad implications for these rising costs.
Of late, common terminology in all households is 'social determinants of health.' In 2008, the World Health Organization identified that the Social Determinants of Health factors were responsible for the bulk of diseases and injuries. Population health addresses groupings of people typically in a geographical area but it can also include a subset of disease like asthma or heart disease. It is intended to deliver the management of health services with scientific methods of preventive, therapeutic, and diagnostic to improve health and wellbeing. In 2006, the term accountable care organization or ACO was dubbed and refers to a group of coordinated health-care practitioners that collaborate to be responsible to patients. The concept has now evolved into value-based purchasing. Health care providers are accountable for both the cost and quality of care they provide. The idea is to stop wasting time and money with inappropriate care and identify and reward the best-performing providers. Health economics and outcomes research (HEOR) is a discipline that is used to complement traditional clinical development information (i.e. efficacy, safety, quality) to guide decision makers regarding patient access to specific drugs and services. We can say with full confidence that change is of a-foot.
In this country, during the turn of the 20th Century, the government initiated programs to help the elderly and disabled. The expansion moved into supporting labor, as the infrastructure of the country was being built. War veterans and the cost of healthcare became a more serious matter and the government launched the VA. As the concept of a national health system rose to debate, it was met with opposition by the American Medical Association (AMA), as its primary adversary. Employee-based health care programs were designed specifically as thousands of men were working on the Colorado River Aqueduct Project and the Henry Kaiser project known as the Grand Coulee Dam. During WWII, U.S. businesses were prohibited from offering higher salaries. As an alternative to attract the best and brightest, the employer-sponsored health insurance was launched. Soon after, Kaiser Permanent Health Plan was launched and become the foundation for managed care, HMOs and PPOs. Today, we have the ability to have a real time benefit checks while pressures continued to unfold to lower pharmaceutical prices.
The COVID pandemic has exposed the most glaring issues of the U.S. Healthcare System regarding the inabilities to deliver. The contradictions are almost incomprehensible like clinician to patient clinician count, protective gear, patient education, costs of illness on society, etc. While it has highlighted advancements in collaborations, medical research, private-public partnerships, technology, data rich resources and communications. Capitalism and politics remain central and critical parts. From the private-public collaborative point of view, alternative payment models are in test-mode and Center for Medicare and Medicaid Services (CMS) once again is at odds with the medical community. In fact, MGMA has voiced deep criticism over value-based care. Even upon the date of this writing, it was stated by Medical Group Management Association (MGMA) that only five models have shown statistically significant savings, and of these five, only three have been expanded on a national scale. Just a handful have seen significant improvements on quality metrics.”
We feel strongly that experimenting with different models is an important as the delivery of healthcare itself. Two emerging value-based models for pharmaceuticals are outcome-based contracting (OBC) and indication-based management (IBM). In 2019, a new trend emerged: tying reimbursements for expensive medications to care outcomes. In January, AstraZeneca and UPMC Health Plan built an experimental contract to offer a drug to heart attack patients to reduce the impact of subsequent cardiovascular events. The goal is to improve patient access to costly treatments via lower out-of-pocket costs. This explicit use of value-based payments for pharmaceuticals specifically is relatively new.
Predictive analytics can support patients with chronic disease and may also help with cost reduction. Data can be used to identify which patients are may be headed in the wrong direction. This would flag and then trigger an intervention before its too late. Obviously, this helps the patient significantly as it would also control the costs through prevention. Today, preventative healthcare resources are still limited. If the focus were on heart failure, COPD and diabetes only, these diseases represent the most expensive and the most common. To intervene involves very close monitoring to avoid hospitalization and even death.
Clinical decision support (CDS) materials are used through the E H R systems to help store data, identify insights, and send actionable alerts, all in real time. CDS is very promoting and although there are short sighted downs ides to include to many alerts, once addressed, the concept is of great value to everyone. An attribute to be applied to CDS would be artificial intelligence where a system can synthesize all this data, machine learning where is becomes adaptive learning and with the support of a virtual assistant, can deliver data and make recommendations in real time with a degree of confidence. This had been the vision for IBMs Watson and although it was not perfect, the substance of personalized care to patients began to become a realistic part of the medical consciousness.
Over the last two decades but mostly since 2010, the culture of medicine has changed to a 'team-based care' approach. As the cost burden shifts more and more onto the patient, we see an economics shift into the demand side as well. The pandemic has given us some unfortunate circumstances but "as necessity is the mother of all invention," so will new pricing models for affordable healthcare become reality. We are very optimistic.
Connect
Business Partnership or Inquiry |
Social Media |
|
