Healthcare Business Trends

Expert: Outlook for Value ‘Quite Unknown’ Under New President

January 24, 2017 12:24 pm

Robert A. Berenson, MD, a Fellow at the Urban Institute and a keynote speaker at an upcoming HFMA conference, says the healthcare value movement still has a ways to go to realize its full potential.

When it comes to the move toward value in health care, “Aspirationally, we’re there. Operationally, we’re a long way away,” says Robert A. Berenson, MD, Institute Fellow with the Urban Institute and a keynote speaker at HFMA’s upcoming National Payment Innovation Summit (Feb. 8-10 in Dallas).

As providers of all types face increased pressure to take on greater levels of risk for the value of care and service delivered, “I’d say maybe 25 percent of healthcare organizations are able to do that,” says Berenson (pictured at right)

. “And the theory of taking small baby steps to move healthcare organizations toward increased risk taking has not been particularly successful. 

“You don’t really change behavior unless you’re deep into adopting a new payment model.”  

Meanwhile, the outlook for payment reform under the administration of President Donald Trump is “quite unknown at this moment,” Berenson says.

“On one hand, you’ve got the president saying he sort of likes Medicare the way it is and doesn’t want it touched much. On the other, you’ve got proposals from legislators—including Tom Price [nominated as secretary of the U.S. Department of Health and Human Services]—for overhauling Medicare.”

Yet Price, a U.S. congressman from Georgia and an orthopedic surgeon, supports the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), which scores physicians on quality performance, Berenson says.

Taking Stock of the ‘Value’ Movement

Berenson will offer his perspective on what lies ahead for federally driven healthcare reform during his luncheon keynote presentation, “What’s Next for the ‘Volume to Value’ Movement,” to be held Thursday, Feb. 9.

Berenson is highly regarded for his expertise in healthcare policy, particularly Medicare, and has served under two administrations. During his keynote, he’ll share an analysis of what changes may be in store for Medicare, the future of the Center for Medicare and Medicaid Innovation, and prospects for alternative payment models under the new administration.

Strong clues regarding the direction of the push for value—which typically has been defined as the quality of care provided relative to cost but increasingly is viewed in terms of the patient experience as well—will be evident during the first weeks of the new administration, Berenson says.

For example, “It’s very clear that the new secretary-designee is not in favor of any [bundled payment] demos that are mandatory. He’s already announced that he will eliminate those.”

Meanwhile, the majority of healthcare organizations still have “one foot on the dock and one in the boat” when it comes to the move toward value. 

“What we have lacked is any consensus over when and how to move into a value world,” Berenson says. 

“A lot of healthcare systems are not convinced how significant the move to value will be, so at the same time they’re producing performance measures and trying to find the low-hanging fruit of unnecessary spending, they’re still reasonably trying to function in a fee-for-service world.”

As a result, most health systems and physician practices are not ready for the move toward value on a larger scale.

“I don’t think we’re anywhere close to being able to pay for outcomes,” Berenson says. “What we are paying for, in terms of value measures, is not necessarily what patients care about or what impacts quality of care.”

A Murky Forecast

A recent Kaiser Family Foundation poll indicates the top healthcare issue Americans want the new administration to address is rising out-of-pocket costs—a view shared across party lines. Repeal of the Affordable Care Act ranked as the fourth-highest priority among all respondents and the second-highest priority for Republicans surveyed.

With the National Payment Innovation Summit taking place about three weeks after Trump’s inauguration, Berenson’s study of the administration’s stance on value could provide much-needed direction for healthcare leaders.

“There’s more confusion than anything else [over the outlook for value], and that confusion is in the healthcare C-suite as well,” Berenson said during an interview in mid-January. 

Amid the uncertainty, healthcare leaders can do much to affect outcomes and reduce waste—even under traditional payment models.

“Everybody has this new magical thinking about value-based payment models. Meanwhile, we’re missing opportunities within legacy payment models to improve value,” says Berenson, whose research has included a focus on ways to modernize Medicare to improve care quality and enhance efficiency.

“You can produce a lot more value than what we are currently getting from physician fee schedules and plain old DRGs.”

About Robert A. Berenson: In 1998-2000, Berenson directed the Center for Health Plans and Providers under the Health Care Financing Administration, now the Centers for Medicare & Medicaid Services, where he oversaw Medicare payment policy and managed-care contracting. In 1993, he co-chaired initiatives under the Task Force on Health Care Reform.

Berenson also is a board-certified internist who practiced for 12 years in a group practice in Washington, D.C., and is a Fellow of the American College of Physicians. He has served as an adjunct professor for the University of North Carolina School of Public Health and the Fuqua School of Business at Duke University. In 1998, he co-authored The Managed Care Blues & How to Cure Themwith Walter Zelman. Berenson’s work also has been published in numerous healthcare journals.

The Urban Institute, based in Washington, D.C., is known for its evidence-based economic and social research. Urban Institute scholars collaborate with policymakers, community leaders, practitioners, and the private sector in finding solutions to challenges in an increasingly urbanized environment.

As a senior fellow for the Urban Institute, “I am able to provide a (sometimes) listened-to, contrarian voice in current policy discussions on how to reform our current inefficient health care delivery system,” Berenson writes in his bio.

Jeni Williams is a healthcare freelance writer based near Chicago. Follow Jeni Williams on Twitter @EditorJeni.

Interviewed for this article: Robert A. Berenson, MD, Institute Fellow, Urban Institute, Washington, D.C.


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