By Brett Furst and Kevin Mehta, Payformance Solutions
The U.S. healthcare system has many strengths, but its ability to provide high-quality care for our country’s behavioral health patient population is not one of them.
For confirmation, one need look no further than our nation’s fairly feeble responses to the exploding mental health and opioid crises. For example, the chair of the U.S. Food and Drug Administration’s own opioid advisory committee recently blamed the agency itself for placing the interests of Big Pharma above public health, and in the process exacerbating the nation’s ongoing opioids epidemic.
In addition to the heavy human toll, behavioral health issues greatly contribute to another crisis that affects everyone who comes into contact with the U.S. health system: We have the most expensive health system on the planet, and don’t have the outcomes to show for it.
Mental health disorders top the list of the most costly conditions in the U.S. at $201 billion per year, according to Health Affairs. The economic toll of the opioid crisis alone has exceeded $1 trillion since 2001, according to research from nonprofit Altarum.
Nonetheless, we must not let this crisis go to waste (hat tip to Rahm Emanuel). The health system’s transition to value-based care presents an opportunity to re-orient U.S. healthcare in a direction that prioritizes behavioral health interventions.
As all healthcare stakeholders move to align their financial interests by prioritizing value over volume, we have an opportunity to identify and treat behavioral health needs before they escalate into more costly problems.
Here’s why: When healthcare organizations (HCOs) are reimbursed based on health outcomes, they are more incentivized to treat the factors – clinical or otherwise – that contribute to those outcomes. Clinical care, in fact, represents just 10 percent of the factors affecting premature death, according to the U.S. Centers for Disease Control and Prevention.
Sixty percent of factors impacting premature death are based on a combination of social/environmental factors (20 percent) and behavior (40 percent). For many HCOs, this is where the opportunity to reduce costs and improve quality is to be found: Treating behavioral and social problems that are often at the roots of many chronic medical conditions.
Following are three steps HCOs can take to get started.
Establish a comprehensive analytics approach: To achieve successful value-based care agreements, HCOs must first understand where risk and opportunity exist to boost quality and reduce costs. A good place to begin is to conduct a 36-month retrospective analysis of all episodes and performed procedures. This analysis will provide HCOs with comparative insights to help determine which patients, procedures and partners they can assume additional risk on without losing profitability.
In a nutshell, HCOs must strive to establish a comprehensive amount of knowledge about their patient populations and provider networks. By leveraging analytics, HCOs can mine historical data to design contracts that create alignment. Contracts that properly align network participants’ incentives, in turn, can lead to better behavioral healthcare coordination between HCOs.
Build a collaborative environment: When entering into value-based agreements, it is imperative that HCOs attain 100 percent clarity on exactly what is being measured and what constitutes success within the terms of the contract. These quality measures should be easy-to-understand and compute, so as not to burden administrative staff. Nothing will cause a value-based agreement to collapse amidst finger-pointing and recriminations more quickly than poorly conceived performance measures that fail to create alignment and transparency.
To simplify and avoid potential disagreements, we suggest that HCOs focus on a single metric – or as we call it, “one measure to rule them all” – across all clinical episodes: percentage of avoidable complications (PACs). PACs is the key indicator in measuring value relative to quality. In addition to its simplicity, PACs offer several other advantages, including that it is clinically derived and can be applied to any episode.
One key component of creating a collaborative environment involves migration to a common platform that enables all participants to gain real-time insights into care delivery. Because behavioral health patients represent a high-risk, high-cost population, it is critical that HCOs closely monitor these patients for possible interventions before conditions grow more acute and costs intensify.
Eliminate siloed data: One of the more contentious issues involved in negotiating value-based contracts revolves around agreeing on the data set that will serve as the contract’s basis. Too often, providers and payers each bring their own data sets to the negotiating table, and progress stalls as both sides haggle over the final agreement.
However, by working in a collaborative environment, payers and providers can avoid lengthy negotiations by agreeing to proceed with data they’ve previously submitted to the common platform.
Another key component of breaking down data siloes is the need to leverage broad, disparate categories of data. In addition to claims, HCOs should seek to gather data related to social determinants of health, clinical information from electronic health records and other factors. Admittedly, aggregating and scrubbing such a massive amount of data represents a challenge to many HCOs, so utilizing the data analytics expertise of an experienced third-party may be appropriate in some cases.
With Change Comes Opportunity
If allowed to fester, the nation’s behavioral health crisis will only grow more costly as we miss opportunities to integrate behavioral healthcare into the broader health system. However, we’re fortunate to currently be in the midst of the most substantial disruption to how healthcare is paid for in a generation – the evolution of fee-for-service to value-based reimbursement. This transition presents an opportunity we can’t throw away. Amidst this disruption, HCOs can improve their delivery of behavioral healthcare by commencing with the three steps above.
About The Authors
Brett Furst serves as chief strategy officer for Payformance Solutions, where he leads go-to-market strategy and sales execution to realize Payformance Solutions’ vision of payment transformation in the healthcare industry. He is a senior executive with over 27 years of experience in selling and managing technology solutions in the healthcare, manufacturing and CPG industries.
Kevin Mehta serves as chief technology officer for Payformance Solutions. In this role, Mr. Mehta focuses on building data-driven, turnkey software solutions that provide payers and providers with the technical tools and resources needed to design, evaluate, build, measure and negotiate value-based reimbursement contracts.