Cost Effectiveness of Health

Above and beyond in the Mile High City: Insights about the future of healthcare from HFMA’s 2022 Annual Conference

August 11, 2022 9:41 pm

In this special early-release episode, Brad Dennison, HFMA’s director of content strategy, interviews Jim Jacobson and John Becker of Vizient; and Chad Mulvany, vice president of federal policy at the California Hospital Association discusses surprise billing.

Erika Grotto: Above and beyond in the Mile High City, today on HFMA’s Voices in Healthcare Finance podcast, sponsored by Trilliant Health. Hello, and welcome to the podcast. I’m your host, Erika Grotto. Today is our first of two special episodes from our Annual Conference in Denver. On today’s episode, we have Brad Dennison, HFMA’s director of content strategy, speaking with Jim Jacobson and John Becker from Vizient about the cost effectiveness of health.

But first, we have a special edition of Beyond the News. While in Denver, our team met up with Chad Mulvany, vice president of federal policy with the California Hospital Association and a former HFMA policy director. If you listened to the last episode, you’ve already heard a bit of that conversation. In this segment, Chad talks about surprise billing with HFMA senior editor Nick Hut and HFMA policy director Shawn Stack.

Nick Hut: Chad, you mentioned the work you’ve been doing on the No Surprises Act. Shawn, you’ve done all manner of work on the No Surprises Act since those regulations were issued just about a year ago now. What are you guys expecting as far as upcoming developments, and what are you seeing as far as implementation of those regulations on the hospital end thus far?

Chad Mulvany: You know, I think No Surprises Act is going to be a busy late summer. So we have the interim final rule that was released last year. That final rule is now at OMB, so you know, I think we’ll probably see it in August. There’s also a notice at OMB related to advanced explanation of benefits for insured patients, so I would anticipate that’s going to come out the same time, so we’re going to get a double header. I think the advanced EOB is really going to be more of a request for information or how to create the insured good faith estimate and then transmit that to plans and then plans to take that data, turn it around and get it back to patient, the member within a prescribed time frame. So I think that it’s going to be a lot to dig into, particularly with the EOB, I think it’s going to be important for the provider community and the planning community to really weigh in and offer CMS, HHS a good description of both what the challenges are but also the focus on what the possible technical solutions would be for that data exchange, because I think this is a place where the agency clearly doesn’t have a good idea as to how to make this work.

Shawn Stack: No, I would agree. I think the advanced EOB is a very heavy lift for the industry given the extreme time constraints. I would not be surprised if this is delayed just a little bit. I know…is working very, very hard in collaboration with CMS, AHA, I’ve been on those calls. This is a very important build, and it is a very important build in the fact that we don’t want it to go wrong because it could really come back administrative burden not only for providers but in this case for providers and payers, and that would be detrimental.

Mulvany: The other thing I’d flag beyond the rules that we expect in August, September, is related to the self-pay good faith estimate because everybody’s aware that convening providers, ones that actually schedule service, will need to include the co-provider’s estimate legitimately by Jan. 1, 2023. And AHA and other have asked CMS for an extension of the enforcement discretion that’s been granted thus far, but there’s certainly no guarantee that CMS will waive that, or provide that additional enforcement discretion.

Stack: I would say most of our members are saying that they’re having a hard time getting that last 20% of their co-providers and co-facilities in agreement with providing the cost, and that’s a heavy lift. And they’re very, very nervous on what kind of provisions are going to roll out if they’re noncompliant because a co-provider won’t cooperate. So I think it’s a heavy lift for many to get that last—would you agree, Chad, to get that last amount of providers…?

Mulvany: I would completely, and you know, to the extent that there are hospitals out there that are working on this and really putting their shoulder into it, I would encourage you to start yesterday because it’s all well and good to hope for a sunny day, but if there’s rain in the forecast, you need to have an umbrella, because HHS or CMS might decide January 1, hey, we gave you a year to figure this out, you didn’t and now we’re going smack you with the authority that we have.

Stack: Yeah, I would say not really an umbrella because you might need galoshes anyway in case it’s not raining but there’s another storm. I mean, it’s going to come anyway, so this is not going to go away, so preparing now is just as easy as preparing six months from now, right?

Mulvany: Yeah.

Hut: And with the good faith estimate, they only had about three months to start implementing that for uninsured patients.

Stack: And if you’re looking at August—and I agree with Chad, unfortunately—but if we’re looking for an August date on this provision coming out, that doesn’t leave as much time if we have January 1 due dates, so there’s a heavy lift here for folks, and it’s not like we don’t have anything going on, right?

Mulvany: And there’s the whole continuing pandemic, which people in D.C. seem to have forgotten about, margin pressure, which we already talked about. I don’t know. A few things.

Stack: I am hearing from some of our different states that their state Medicaid programs are saying that in communication with the federal government on the PHE phase out that they’ve been given hope that PHE might not be phased out until January 1. But I am not hearing that on my side. I don’t know if you are, Chad, either. I’ve been hearing more of an October 15 phase out date, but we’ll see.

Mulvany: Yeah, I think October 15 is the only thing that we can count on seeing that we didn’t get six-day term notice. Anything after that is gravy, and honestly, I’m not in a position where I would even try to make an educated speculation.

Hut: Alright, guys, well, this has been a fantastic perspective from both of you. Shawn, we’ll talk soon. Chad, it’s been great having you, and hopefully we’ll get to hear from you again sometime during the road.

Mulvany: Yeah. See you in another 12-18 months. Good chatting with you, Nick, good chatting with you, Shawn, as always.

Stack: Absolutely. Thanks, Chad.

Grotto: If you attended HFMA’s Annual Conference in Denver, you probably heard our president and CEO, Joe Fifer, talk about the importance of turning our attention to the cost effectiveness of health. That’s a phrase you’ve heard on the podcast before, and we have a lot of great content around the topic, including a dedicated newsletter. We also held a pre-conference workshop in Denver around cost effectiveness of health. Afterward, Brad Dennison, HFMA’s director of content strategy, sat down with the presenters from that workshop. 

Brad Dennison: So, this is Brad Dennison. I’m the director of content strategy for HFMA. We’re here at the Annual Conference in Denver, and I’d like to welcome Jim Jacobson and John Becker from Vizient.

Jim Jacobson: Thank you.

John Becker: Hi. How are you?

Dennison: You guys were in yesterday for our cost effectiveness of health pre-conference, and we had several executives from the industry. You guys presented there. It was a great session. We got lots of great feedback, and I’m wondering if you could just do the mini version of what you did yesterday.

Jacobson: Sure.

Becker: Sure. I think we’ll cut it into three parts. First, it was a little different message for finance leaders. This isn’t just about cutting costs. This is also thinking about growth, short mid and long term, but maybe the first framing comment we had and discussion around was this idea that care continuum and the system of care is a lot more complex than it used to be. There’s new entrants. Each care site is getting more complex, and frankly, there’s a lot of shifting in care sites going on. Jim, you do a lot of work with our forecasts. Can you talk about the shifts?

Jacobson: Yeah. So we’re seeing a lot of lower acuity volumes shifting down or decanting out of higher acuity sites, so things that initially happened in hospital inpatient environments…or ASCs, surgical center volumes are moving to offices, and so what that’s meaning is that the volumes that are remaining in those sites are actually higher acuity. So the patients that were left in the inpatient environment are more complex, older patients. The surgeries being done in surgery centers are more complex than they were even two or three years ago. So there are all these shifts that are occurring, and that means that patients are interacting with health systems and competitors in different ways.

Becker: An excellent use of the word “decant,” by the way.

Jacobson: Thank you.

Becker: It works really well. Maybe the shift of why the disruptors are here: Healthcare systems—hospitals, physician groups, our leadership teams—did a wonderful job of focusing on the pandemic and ensuring that care was being provided in our hospitals, but what happened? A lot of care shifted outside the hospital, and there are a number of disruptors—some new entrants, some not new entrants—that came in and actually started grabbing market share, which is a risk to our healthcare systems.

Jacobson: So, we kind of view those in four buckets. John, do you want to take the first couple and I’ll take the next–

Becker: I get the first two archetypes. Number one, retail clinics coming in. This is the idea of the hospital, the CVS, the Walgreens providing what at first was lower acuity care, where they could make the diagnosis and have the prescription picked up, it’s turning into—with CVS and others—more disease management clinics, where they’re actually looking at long-term chronic care of diabetes, hypertension, etc. with ancillaries and all. So primary care should be the realm of physicians working with the health systems and the hospitals or independent groups. Now you have retail clinics, as one example, providing that primary care. Number two, big tech. So Amazon, Apple, Google, you can name all the big—FAMGA, and I’ll remember each of the FAMGA in just a second—but you’ve got Amazon as an example of a digital healthcare marketplace, a digital marketplace becoming a healthcare marketplace. They’re also now providing care in local communities directly with primary care. So this is what they do. They often do something for their own business or their employees, and they end up launching that business more broadly out to the communities. So Amazon is a provider of primary care. There are two more, Jim, this week around the disruptor circle.

Jacobson: Yeah, the venture capital private equity firm center investing big dollars into medical groups that are offering personalized service and experience for patients in the market that frankly, our health systems aren’t always able to do. They tend to be big ships that turn very slowly, and we’re seeing a lot of investment dollars put into practices that can meet patient needs in a different way. And the fourth and final one is—

Becker: We can call it Optum.

Jacobson: –is the payers as providers, right? But it’s folks like Optum and others who are investing heavily in physician practices and coming in and trying to disrupt and ultimately affect use rates and where services are being delivered as they try to manage patient lives in a different way.

Becker: And at SG2, part of Vizient that Jim and I help lead, we do a lot of market demand forecasting and market planning, and you’ve been seeing claims data right now that volumes are rolling with these disruptors in most major markets. So this is not something that could be happening. This is something that is happening right now, and we can see its market share in the claims data. So maybe what’s the mandate for health systems and for finance leaders is to think differently about growth. Maybe Jim I’ll take the first two and you can grab the last one. We usually thought about growth and building a care continuum or a system of care as new markets, new services, new technologies, new service lines—that’s multi-year growth, to build new things, to offer new capabilities. Mid-term growth for the finance leaders and for strategy is thinking about your existing care continuum, your existing chasse, your system of care and offering it to the market in a different way through payers. So work with employers. Do more novel value-based care contracting. Most importantly, I think, given what’s happening with finances right now in healthcare would be the short term.

Jacobson: Yeah. People need cash now, right, and so they would need near-term growth and that really means that you’ve got to reach new patients through advanced technology to be able to reach those patients. You’ve got to then optimize the things that you have in place today. You have to optimize your physician network to make sure you’re reducing leakage and ensuring that your patients are staying within the system.

Becker: If you think about this maybe for finance and for strategy planning, there are four P’s of growth. Longer term is partnerships, building out the system of care. Midterm is working with payers differently. Short term is patients and providers. So a really easy thing to think through as finance leaders is, have you covered all those four P’s or are you just thinking about those more traditional realms of growth?

Jacobson: That’s a rapid—

Becker: Rapid fire reconstruction.

Dennison: That’s a great flyover. So obviously, cost effective care is an area that HFMA is really putting its shoulder into right now. In fact, I think the first three big things we did at this conference between the pre-conference and our first two speakers, which were Zeev Neuwirth—Dr. Zeev Neuwirth—yesterday evening and our CEO Joe Fifer this morning, their themes were clearly around cost effectiveness of health. And you were at Zeev’s session yesterday. What were some of the big takeaways from that?

Becker: Yeah, I’m looking in my notebook and I have two circled, starred things next to me. One is, he opened with “The future’s already here, it’s just not evenly distributed.” That’s kind of what we see even in those disruptors. Some markets aren’t seeing some of these disruptors here, but many markets are, so the future disruption, how we’re going to deliver care, it’s already here. It’s just not an even distribution across the board. His other comment I love is “frustrated awe.” He was talking about all these different interviews he had done with healthcare leaders, and there’s an awe of, look at the great work we can do and what is the possibility, the frustration of not getting it done. Jim, what did you have?

Jacobson: He touched on this as well, but I think to your point around cost effectiveness, we’ve talked to our clients for many years about building the right system of care, getting the right access points for their patients. Essentially aggregating assets to be able to comprehensively deliver care for your patients. The really hard part, once you have it, is to actually optimize it and have patients in the right place at the right time and have the right service model, the right provider model for them. And that’s hard work, and that’s the cost effective part of that, right, getting people to the right places, ensuring that you’re providing care in the right sites with either consumers paying the right price and that you have the right model of caretakers to be able to provide.

Becker: We’ve for years in healthcare been trying to optimize or iterate on a broken system, and I think this conference is doing a great job of pointing out that there are things broken about the system. We need to really think differently. I liked his comments in that opening session around the reframe roadmap, this idea of reorienting or thinking, redefining the problems and then redirecting strategies, tactics and resources. For CFO or finance leaders, there’s been a lot of talk at this conference so far about the finance chief or lead’s role in being a resource allocator to ensure that you’re putting your bets in the right areas. Also the last quote—this is a Don Berwick quote, and I love it—“The status quo has many lobbyists.” Jim was a lobbyist, by the way.

Jacobson: I was.

Becker: “The status quo has many lobbyists, but a better future has very few.” I think what we need to do at Vizient as SG2, what HFMA needs to do is be that lobbyist for a better and different future, and to help our members, our hospital and health system leaders think differently.

Dennison: Our CEO Joe Fifer this morning kind of laid out how we think about cost effectiveness of health this morning. One of his slides showed statistics on value-based care and then about 11% of contracts now are at that level, after all these years of talking about value, and here we are. And he coupled that with, I think that the pandemic forced people to start thinking about it again, and now what’s happening in the economy maybe making that dissipate. I’ve heard a lot of comments about, we’re just trying to get through to the next fiscal year. So 11% of contracts. Where is this headed, and how important is that component to cost-effective care over the next 10 years?

Becker: I’ll get on my soapbox first and Jim will follow and correct me. Value-based care is right, and it’s good. I was in a session with Advocate Aurora, and their conversation around the full continuum engagement in value-based care, VBC, is really important. They have 3 million patients in value-based care contracts. I can tell you in talking with health system leaders during COVID, those healthcare systems that relied solely on fee for service, and the fee for service engine is turned by volumes, by surgeries, by procedures that often are subsidizing medical care in the hospital, when those surgeries went away, guess what happened. The bottom fell out of the financials for the hospital. Those healthcare systems that had value-based contracts that were capitated, that had per member per month or paid them differently to manage the total cost of care didn’t have the same problem because they had different incentives in that part of their business. So VBC actually was a hedge against some of the problems associated with COVID, the lack of ability to do the surgeries. It’s also, long term, the only way we’re going to control paying for the cost of care. You have to start paying differently.

Jacobson: I remember the SG2 executive summit, which is something we do every year—what was our theme, maybe 2012, John? Volume to value?

Becker: Yup.

Jacobson: We’ve been talking about this a long time, and you’re right. We’re not where we need to be. And I’ll say one thing that we have always encouraged our members to do and continue to do is practice a little bit. You have to try out different models and figure out what works and build those capabilities. And those are both not just how you move patients through the system and your providers work with them, but it’s also your internal analytic capabilities and financial models to be able to make it work, and you need to practice. You need to play around in a few options before you continue to grow it.

Becker: Yeah. Maybe two thoughts, one pretty basic. But it was brought up from the leaders at Advocate Aurora. Think about your own employees. Most healthcare systems, hospitals have a large employee base and often they’re self-insured depending on the time. Start playing with VBC obviously around your own employees. The other is, through the pandemic, I think we’ve pulled back the curtains on some real problems with health equity and social determinants of health. Value-based care aligns very well with solving for social determinants or health equity issues. You start to invest differently in the community when you can not worry about getting paid for every click in the system or every time you provide care, but you’re managing the wellness of the population. You start to invest in education. You invest in disease management programs. You invest in prevention in entirely different ways, and you look for ways to solve for that that fee for service just doesn’t give us. Let’s just be honest about that. Fee for service does not incent managing health equity or social determinants.

Jacobson: In some of these disruptors that we’re seeing—ChenMed is a good example—it’s a care advantage play base for them. And it’s all about value. And we’re seeing—a thing that health systems can look at is a lot of these disruptors are doing it really well. And there’s a lot to learn from these newer and non-traditional competitors that health systems can learn from.

Becker: And I think the healthcare systems—we started with disruptors. There is a bit of an attack on their front door around how technology plays or VCPE money can come in and roll up physician groups and IT-enable them and help them manage patients in a different way. The healthcare systems in a way that care continuum, that system of care being all things to all people is being used against them. But really, if you want to be a value-based care provider, you have to have all of those care sites—partnerships, ownership, alignment, IT enablement. So as you shift toward VBC—value-based care—that system of care is an asset for the healthcare system and maybe some of the disruptors are going to have to think how they work differently with those healthcare systems. Another reason to step into VBC, maybe.

Dennison: Jim and John, thanks for joining us today.

Jacobson: Thanks for having us.

Becker: Thank you.

Grotto: Since the onset of the pandemic, deferred care has emerged as one of the most significant challenges in healthcare, and several times in Denver I found myself in conversations with people about the best ways to get patients back in for the care they need. One of those people was Jason Nardella, senior vice president of product strategy at Trilliant Health. We talked about where things are today and his thoughts about improvements for the future.

We’ve been talking about deferred care since pretty much the beginning of the pandemic. Some of it has picked back up. We’re not quite to 2019 levels. So let’s talk for a minute just to lay the groundwork—where do we stand today? Do you have any statistics on that?

Nardella: I think the broader view of health systems now in 2022 is, we’re at the end of what’s seeming like a business cycle where all of our payers to pharma companies to medical device—everybody has made a ton of money and it’s the hospitals that are sort of left behind here. A lot of it has to do with meeting that patient demand and making sure the patients can come back in. As far as delayed care, we’ve seen across the board, and I know you’ve done a segment on this earlier around cancer screenings, and all of them have been down since 2019 levels and they’re even going down from 2022 to 2021 as well. The only areas where we seem to get some bounceback is actually some of the easier colorectal screenings that can actually be done at home. And those have been sort of a great success, but that has been the least amount of decline year over year from a cancer screening point of view. There is a bright spot, though. I think PCP utilization in females age 20-49 is the only bright spot where we’ve actually seen an increase in utilization or an increase of engagement with that patient population in 2020 and 2021 compared even to 2019 levels.

Grotto: Why do you think that is? Is it that healthcare organizations are better at engaging people in that population, or are those people just more engaged already?

Nardella: My fiancé would say that it’s because females take care of themselves a lot better than men, and I would tend to agree with her in a lot of those situations, but the complexity and I think the willingness to sort of take care of themselves proactively, especially in that age group, has been sort of demonstrated across not only PCPs but with OBs. And they’re also the group that is more likely than not to participate in behavioral health too. And so there is very much a willingness to continue to see the doctor and to take care of oneself and to notice the fluctuations and try to take care of themselves proactively knowing that we’re not all invincible and we can’t stay healthy forever.

Grotto: How do you think we’ll get where we’re going? With some of the changes that have come about as the result of the pandemic, we made some adjustments because of safety when we needed to, but some of the changes that have been made have been kind of great, so where do you think we’re going to land in the end and how do you think we’re going to figure it out and strike that balance?

Nardella: I hope that we’re all within sort of an operations side of things, finance side of things, figuring out parts of the necessary either paperwork or prework or things that always typically happen within the doctor’s office or within the waiting room. Thinking about ways to handle that more digitally and a lot more conveniently for folks. I think what you outline there is what a lot of folks are saying was preventing them from getting back into healthcare, which is like, “I don’t actually want to be around a bunch of sick people when there’s a highly contagious airborne virus floating around everywhere. I would rather just be by myself or in a safer area and then go in whenever I need to and then come out again.” That idea is something we’ve been kicking around and what we’ve started to think of is, how do the providers actually break out of their doctor’s offices. Have they actually go start to see more people? Do we do more work fairs? Do we have more mobile clinics that we can actually go to the people, have them just come in and be seen, engage in healthcare, start to get their medical plans again, and then be able to have some semblance of a start back to sort of normalcy at least from seeking healthcare. You know, going to the patients, kind of creating that environment where it is convenient and safe for them is really going to be the bar that everybody’s got to hop over here. Telehealth is one way of doing it again, but it does not take the place of seeing a doctor in person, actually having that conversation, actually seeing the nurse when you need to. And actually a survey that came out from the University of Chicago, one thing that has not changed over time is the people’s trust in their providers and in their nurses. Both before and after the pandemic, more than 80% of all survey respondents said they have high trust in both their doctors and their nurses. Compare that to hospitals and health systems, which have actually gone down over time, around 72% for hospitals, 64% for health systems. It’s the doctors who are going to be able to pull us out of this. It’s the nurses that are going to be able to help engage folks and get them more comfortable to come back into healthcare and really prevent what could be a really kind of terrible sort of boomerang wave in the future if we don’t start caring for ourselves, we don’t start getting back on that preventive medicine. Everybody’s going to become more acute and a lot more of the diseases and the things that could be caught early on are going to manifest and get a lot worse, which makes it harder to treat in a community and also worse off for all of us consumers out there.

Grotto: Do you think at this point that people are afraid to go in? Are they trying to avoid the risk of getting sick at this point in 2022? Or is it something else?

Nardella: As somebody who flies a fair amount, I think that there is a lot of the population or a significant part of the population who still really is trying to avoid getting COVID at all risks. They could be sick, or there’s sort of a genuine fear of COVID. I think that’s certainly an issue. I think personally for a lot of other folks, it is getting back into the habit of things. A story that I have is that I moved from Boston to Minneapolis and I just recently got a new dentist. And it’s not because I don’t like the dentist. It’s not because I didn’t think I needed the dentist. It’s because I just didn’t have that relationship. I didn’t have somebody that I could go to that knew my medical records and that I could get in there. It’s the habitual part of self-care that I think makes it really work, and because we’ve had a year, two year stint where we’ve broken out of a lot of our habits both good and bad, that is a big real hangup to people coming back and utilizing healthcare the same way they did either in 2018 or 2019.

Grotto: Well, it will be interesting to see what comes in the next handful of years, though I know being at Annual Conference amongst all these eager HFMA members, I’m hopeful that there are people who are working hard to improve things. So Jason Nardella, thank you so much for joining me.

Nardella: Thank you, Erika.

Grotto: Trilliant Health’s proprietary analytics platform produces a comprehensive understanding of local market dynamics providing exponentially better data insights to maximize returns from growth strategies. Visit for more.

Voices in Healthcare Finance is a production of the Healthcare Financial Management Association and written and hosted by me, Erika Grotto. Sound editing is by Linda Chandler. Brad Dennison is our director of content strategy. Our president and CEO is Joe Fifer. A big thanks to our sponsor for this week, Trilliant, as well as all of our business partners that helped make the Annual Conference a success. You’ll be hearing from more of them in future episodes, so there’s no better time than now to hit subscribe in your favorite podcast app. Don’t forget, you can get transcripts of each episode as well as links to additional resources on our website. And if you’d like to talk with our team, reach out. You can email us at [email protected].

In remarks shared at HFMA’s recent Annual Conference, President and CEO Joe Fifer talked about the importance of turning the industry’s attention to the cost effectiveness of health. Jim Jacobsohn and John Becker from Vizient were speakers at a special pre-conference session around the topic and were featured on a recent episode of HFMA’s “Voices in Healthcare Finance” podcast.

Shifts in care make way for disruptors

The healthcare system is more complex than it’s been in the past, and some of the shifts that are occurring have made room for disruptors to grab market share, Becker said.

“Things that initially happened in hospital environments … are moving to offices,” he said. “So the patients who are left in the inpatient environment are more complex, older patients. The surgeries being done in surgery centers are more complex than they were even two or three years ago. So there are all these shifts occurring, and that means that patients are interacting with health systems and competitors in different ways.”

Becker and Jacobsohn discussed four types of disruptors that  present challenges for legacy systems:

1.      Retail clinics, which used to focus on lower acuity care, are shifting their focus toward disease management.

2.      Big tech companies such as Amazon and Google are creating digital healthcare marketplaces.

3.      Private equity firms are investing in medical groups that offer personalized service to patients.

4.      Payer-provider entities are investing in physician practices.

The time for value is now

In order to remain competitive and provide high-quality patient care, hospitals and health systems should be strategizing around cost effectiveness of health, Jacobsohn said.

“We’ve talked to our clients for many years about building the right system of care, getting the right access points for their patients,” he said. “The really hard part … is to … have patients in the right place at the right time and have the right service model, the right provider model for them.”

Becker and Jacobsohn commented on how long it’s taking for the industry to embrace value-based care and how doing so has been advantageous for hospitals and health systems. Shut-downs during the early days of the pandemic proved financially disastrous for hospitals that relied on fee for service, but those with value-based contracts had an easier time, Becker said.

“The fee-for-service engine is turned by volumes, by surgeries, by procedures that often are subsidizing medical care in the hospital,” he said. “When those surgeries went away … the bottom fell out of the financials for the hospital. Those [health] systems that had value-based contracts that were capitated, that had per member per month or paid them differently to manage the total cost of care didn’t have the same problem because they had different incentives in that part of their business.”

Building a better future

Becker and Jacobsohn advised healthcare organizations to move thoughtfully and practically toward value.

“We’re not where we need to be,” Jacobsohn said. “We have always our members to … practice a little bit. You have to try out different models and figure out what works and build those capabilities.”

He also advised looking at disruptors to see what they’re doing well, while Becker talked about an advantage legacy systems have over newer competitors.

“If you want to be a value-based care provider, you have to have all of those care sites, partnerships, ownership, alignment, IT enablement,” Becker said. “So as you shift toward value-based care, that system of care is an asset for the healthcare system, and maybe some of the disruptors are going to have to think how they work differently with those healthcare systems.”

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