InHealth Advisors is pleased to bring you a monthly summary of the latest thought leadership, news, and transaction activity in value-based care (VBC). To assist busy healthcare executives in following VBC developments in a time-efficient fashion, we have assembled brief descriptions of and links to a curated list of the most insightful developments in VBC and provider alignment.
Summary of October 2023 VBC Trends
This edition explores emerging questions about the utility of value-based care. Skepticism notwithstanding, providers are investing in capabilities to scale VBC, with Geisinger leveraging the Best Buy’s Geek Squad to help with patient medical device setup and use. Additionally, payors are touting the financial success of their VBC reimbursement programs. Finally, retailers are entering into or exploring transactions to acquire providers in the VBC space—highlighted by Walmart contemplating a ChenMed acquisition.
Thought Leadership
Questioning Value-Based Care (HFMA)
This thought-provoking article from HFMA provides interesting perspectives on the performance of VBC to date. It quotes a few voices that have expressed skepticism about the utility of VBC, particularly focusing on limited success in controlling costs (the featured voice is the head of a purchasing group representing employers that spend over $350 billion on healthcare annually). The alternatives to VBC contemplated in the article represent more of an aggressive shift in care delivery, including: toothy regulation to control healthcare prices and a significant reallocation of funds from specialty to primary care. Employer-sponsored plans have seen success in direct-to-provider contracts for elective surgeries and primary care centers of excellence that direct specialty referrals based on quality. The latent theme running through the piece is not that limited success in VBC should lead to re-embracing the fee-for-service paradigm—much to the contrary, the anxious voices around VBC are calling for a more forceful approach in changing healthcare payment and delivery models.
Provider Initiatives
CommonSpirit Health Launches Value-Based Care Platform (Fierce Healthcare)
CommonSpirit developed a systemwide platform for supporting best practices in VBC. The platform appears to fill the role of a centralized management services organization geared to helping providers in value-based arrangements. The capabilities the organization brings to employed and independent partners of CommonSpirit include “advanced population health analytics, network management, care coordination, data management and analytics, technology infrastructure, reporting and more.” The development of the organization represents a step we have observed many systems taking to consolidate and streamline efforts to succeed in value-based reimbursement.
Geisinger Expands Best Buy Partnership (Becker’s Healthcare)
In order to better serve its patients with chronic conditions, Geisinger is leveraging Best Buy’s famed Geek Squad to help setup specialized medical devices and provide education on their use. Through this partnership, Geisinger’s patients have experienced a reduction in the time to have remote monitoring devices running, resulting in an improved treatment adherence rate. This partnership illustrates how retail organizations are increasingly leveraging their infrastructure for healthcare purposes in an effort to bolster financial performance.
Payor Updates
Value-Based Care is Saving Payers Billions (Becker’s Healthcare)
This helpful summary article provides links to recent press releases from payor organizations touting the success of their efforts in VBC. The article highlights the payors’ successes in and cost reduction and shared savings. The article touches on four payor programs from the Mid-Atlantic region, Florida, North Carolina, and Minnesota. Having reviewed the linked payor press releases in greater detail, curiously absent from all was commentary on patient satisfaction. Nonetheless, they demonstrate the bottom-line potential of VBC programs.
Transaction Activity
Walmart Exploring ChenMed Acquisition (Healthcare Dive)
In another instance of retailers seeking to enter primary care, Walmart is exploring the possibility of acquiring ChenMed, a practice focused on population health and VBC for Medicare Advantage patients. Retailers are targeting primary care practices given the potential for synergistic selling of pharmaceuticals, medical devices, and other health-related consumer goods. It is still early to tell if this investment thesis will pan out, as the other similar acquisitions by Walgreens (VillageMD) and CVS (Oak Street) were relatively recent. Nevertheless, health systems must take note, given the diversity of new players seeking to control the upstream portion of patient care.
Walgreens Taps Pearl to Accelerate Value-Based Care (Fierce Healthcare)
In addition to practice acquisitions, retailers are also targeting partnerships with platforms for success in maximizing the potential of value-based reimbursement arrangements. This article details Walgreens’ new partnership with Pearl Health—a VBC enablement firm for primary care. Pearl provides financial support to primary care practices by bearing downside reimbursement risk, while providing a technology platform for tracking the key metrics associated with success in VBC. Through the partnership, Walgreens seeks to leverage Pearl’s expertise in VBC and secure potential streams of new medical services (e.g., medication management for Pearl’s at-risk patient population). Conversely, Pearl’s platform can be deployed to the many new primary care providers acquired by Walgreens in the VillageMD transaction (particularly those involved in the ACO REACH model—Pearl’s primary area of focus).
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