- Commercial health plans have offered providers in value-pay arrangement varying degrees of flexibility.
- Health plan support has included changes in telehealth, benchmarks, performance penalties and advanced payments.
- More flexibility is being sought for downside risk and repayment of advances.
In June, just as New York was coming off its COVID-19 pandemic peak, one commercial health plan held a meeting with Mount Sinai Health System executives scrambling to treat the largest concentration of cases in the nation. The health plan wanted to discuss the provider’s adherence with quality measures.
“It was far from post-[pandemic] at that point,” said Robert Fields, MD, senior vice president and CMO of population health for Mount Sinai. “It seemed somewhat out of touch, honestly.”
The ability of commercial health plans to adjust their quality-based payment programs to accommodate effects of the COVID-19 pandemic could have huge effects on provider efforts. Although only 30% of commercial revenue is now in alternative payment models, providers say the expensive infrastructure to continue such models needs to be protected, as hospitals face unprecedented financial pressures.
However, the response of commercial health plans to the pandemic and provider requests to accommodate its myriad effects on their value-based pay arrangements were not uniformly bad.
What commercial plans have offered
“We have seen the full gamut among both our commercial [health plan] partners and our Medicare Advantage partners, from intense understanding and redesign to absolute no change at all,” Fields said in an interview.
Pandemic responses by some of Mount Sinai’s commercial health plan have included:
- Adjusting internal quality benchmarks to account for its effects
- Switching to regional benchmarks to account for areas’ differing pandemic effects
- Focusing measurements on telehealth or other changed provider approaches
Regarding the local market benchmarking, Fields said, “you’re taking into account [the] utilization patterns of your peers in the same market, so presumably they would have been impacted similarly by COVID.”
All five of the health system’s commercial contracts include value-based components, including all with potential for upside bonuses and a couple with downside risk.
Similarly, Trinity Health, which includes 1.3 million patients and $10 billion of revenue in value-based payment models, has obtained varying degrees of commercial health plan flexibilities in areas that include:
- Suspending 2020 performance-related penalties for clinically integrated networks (CINs) and clinicians
- Suspending quality assessment and reporting requirements
- Providing CINs with upfront and advanced payments
“Health plans agree that they can, or will, figure out a way to give us forgiveness on any payments that we owe them for 2020,” Harpreet Cheema, vice president of product and development for the Michigan-based health system.
Commercial health plans also have broadly increased their support for telehealth offered by Trinity, said Emily Brower, senior vice president of clinical integration and physician services. That allowed the health system to boost clinician support to some of the 23 states it operates in where demand increased as the pandemic unfolded.
Advanced payments were frequently mentioned as a health plan response in a compilation of health plan responses to the pandemic created by America’s Health Insurance Plans.
However, many of Trinity’s commercial plans have said they expect its providers to repay those after the pandemic, Cheema said.
“We said, ’If you’re going to make an advanced payment, we may not be in a position to pay you back, depending on how long the pandemic lasts and what the effects of it are on our system,’” Cheema said.
Where health plans have fallen short
Health plans have not yet decided whether to offer other flexibilities Trinity has requested, including:
- Suspending downside financial risk for clinicians
- Eliminating 2020 from any future benchmark baselines
Although some commercial health plans have increased their telehealth payment rates for Trinity, they have not decided whether such increases will continue long term, Cheema said.
Some commercial value programs use a fixed spending trend, which has resulted in large provider payouts due to pandemic-driven patient avoidance of care.
“We are seeing some resistance to paying because the changes in utilization patterns that weren’t predicted,” Fields said.
None of the health plans that include downside risk arrangements have offered any pandemic-related leeway to Mount Sinai. However, the huge decreases in utilization, so far, appear to limit the likelihood that any penalties will be activated for the health system for 2020.
Volume-related downside risk could be a bigger issue in markets outside of New York, where Fields has heard from hospital colleagues that their elective surgery volumes are at 110% of pre-pandemic levels.
In contrast, Medicare has offered a wide range of flexibilities and suspension of financial risk for providers in its health plans.
But that flexibility has not fully extended to its Medicare Advantage (MA) plans. One challenge that may have limited the ability of MA plans to offer quality-related flexibilities is the lack of changes to measurement-driven star ratings for those plans, Fields said.
Trinity has found MA plans, at least, are willing to suspend downside financial risk for clinicians.
“On the commercial side, I’m a little more surprised because they have a ton of flexibility, and they could be more reasonable than some of them have been,” Fields said.