JUL 29, 2014 10:25am ET

Three Keys to Successful Payer-Provider Collaboration

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Encouraging providers and payers to collaborate is top of mind for me these days. As a practicing physician and a vocal advocate of improving care through population health management (PHM), Iím acutely aware of the benefits collaborating with payers can bring--and has already brought--to my patients, my practice and those of many of my peers.

Fortunately, we are seeing increasing levels of payer-provider collaboration in the healthcare industry. These two historically antagonistic groups have started to reach across the negotiation table to figure out how to work together to improve clinical, financial and patient experience outcomes. This unprecedented cooperation represents significant progress, but we still have a ways to go. In a climate where the costs of healthcare are skyrocketing and providing high-value healthcare has become an imperative, both payers and providers have important roles to play. Healthcare transformation wonít occur unless both groups step up to play those roles.

Providersí and Payersí Roles in Value-based Collaboration

Providersí role in value-based collaboration is delivering high-value care, which means putting the solutions and processes in place to optimize clinical, financial and patient experience outcomes. The wraparound term that I use to describe this effort is population health management. However, putting a PHM infrastructure in place can be costly for providers and their organizations--particularly for primary care physicians who are already being squeezed financially. Asking a group of physicians to make a significant investment is a hard sell.

A complaint I often hear from physicians goes something like this: ďThe government and other payers claim that Iím not doing a good enough job taking care of my patients. What theyíre really saying is that I need to invest my own resources into my practice to purchase technology, hire care managers, etc. In a fee-for-service world, that means that I spend more and get paid less to generate cost savings that will only be realized by the payers and the employers.

Thatís where the payers must come in. Payers need to develop reimbursement models that align provider incentives with value-based care. In other words, the payersí responsibility is to develop reimbursement models that are outcomes-based so that physicians are willing and able to invest in resources that will enable them to achieve the Triple Aim.† Their role is not to insert themselves into the relationship between patient and provider. I think most people can agree that the relationship with the patient is primarily owned by the physician (Iíve been practicing for 15 years now, and Iíve had a lot of patients change health plans, but they donít leave my practice.).

Keys to Collaboration

I practice in an area of Michigan where numerous local providers offer value-based incentives, and Iím part of a progressive PHO that helps coordinate our collaboration with payers. Over the past several years, Iíve had the opportunity to witness the evolution of these reimbursement programs. Based on what Iíve experienced and what I see in the industry today, here are some key points to consider when it comes to payer-provider collaboration:

1. Payer organizations drive better outcomes when they coordinate their efforts to develop value-based reimbursement models. Todayís payers are developing a wide variety of quality incentive programs. Some programs focus on closing care gaps. Others focus on utilization rates. The result is that incentives for population health management are fragmented. No single program reimburses for the end-to-end PHM workflow--and this makes it difficult for physicians and practices to embrace value-based reimbursement. Practices canít devote the resources needed to put the pieces in place to do PHM well without first reaching a critical reimbursement mass: a minimum level of reimbursement for a network or practice from multiple payers. If payers coordinate their efforts to ensure that, together, their programs reimburse for more PHM workflows and outcomes, providers will have the critical reimbursement mass they need to invest in value-based care.

2. Sharing data is very important. For a long time now, payers have been performing analytics on a fairly complete set of claims data about their members. Theyíve been able to create risk models, perform financial analytics and gain a deeper understanding of which of their patients would benefit most from additional services. Sharing all of that information with providers can have tremendous value. On the other side of the equation, providers--particularly those participating in value-based purchasing contracts--have begun to collect data about their patients. Because this data is often both clinical and administrative, it tends to offer richer insight into each patientís care history than the claims data payers rely on. When payers and providers share data they can use a more complete data set to work collaboratively and improve the quality of care delivered.

3. Payer collaboration with providers tends to be most successful at the organization--rather than the practice--level. This means that PHM execution will move forward fastest where payers work with physician groups like IPAs, PHOs, CINs, ACOs, etc. These physician organizations can represent the voice of the physician community to the payers while providing technology education and consulting on best practices with their physician members. For some payers, this collaboration can be a little uncomfortable, because--letís face it--many of these organizations were originally formed to improve physiciansí ability to negotiate with payers for better reimbursement. But the reality of value-based care is this: Todayís payers should encourage providers to organize because provider organizations can help their physicians deliver more effective and comprehensive value-based care.

Paul Taylor, M.D., is an internal medicine physician at Mercy Health and CMIO at Wellcentive, vendor of a platform offering a suite of population health management software.

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