Why Value-Based Care Is the Future of Medicine

In a recent interview hosted by HealthLeaders, Chan Chuang, MD, FCCP, FACP, Envision Healthcare’s Chief Medical Officer and Medical Group President, discussed value-based care’s place in healthcare’s present and future, comparing it favorably to fee-for-service models and explaining how hospitals and health systems can leverage value-based care to enhance care quality while ensuring the viability of their services now and into the future.

Value-based care is the growing alternative to healthcare’s traditional fee-for-service payment model as the industry seeks to evolve to a more effective healthcare delivery system. Instead of paying providers for the sheer quantity of healthcare services performed, value-based arrangements incentivize providers on the quality and/or effectiveness of that care. Centers for Medicare & Medicaid Services’ (CMS) Innovation Center recently accelerated this transition by publishing a 10-year strategic roadmap that prioritizes value-based care.

“For healthcare leaders who are not yet there, now is the time to embrace the value-based journey and refocus efforts on putting the patient first,” says Chan Chuang, MD, Chief Medical Officer and Medical Group President at Envision Healthcare. Below, Dr. Chuang addresses key highlights in the landscape of value-based care, the critical role clinicians will play in bringing about that future, and the importance of innovative care models such as integrated care and the Emergency Triage, Treat, and Transport (ET3) model.

Q: When discussing healthcare’s future, value-based care always comes up. How do you describe value-based care, and what makes it so critical to the evolution of our healthcare system?

A: Given how our current healthcare system, care delivery and reimbursement model are structured, our country is faced with an unsustainable cost structure of increased healthcare spending coupled with relatively low health outcomes. The U.S. ranks close to last among developed countries in terms of health index and life expectancies. The pressure to shift to value-based care is not only about putting the patient-clinician relationship at the forefront but also about making care more accessible, affordable and sustainable while improving patient outcomes and the overall health of our communities.

One area in which we can see the value-based equation in action is the focus on appropriate sites of care. An example of this is the move of select elective surgical cases from higher-cost inpatient settings to ambulatory surgery centers (ASC). ASCs have demonstrated to be a more convenient setting for patients, a more efficient model for surgical cases and a lower cost of care environment, all while yielding the same or better clinical outcomes. COVID-19 has also shifted how patients and clinicians approach and embrace alternative care settings, such as virtual healthcare, urgent care clinics and in-home care. Aligned with the right incentives, these care models allow patients to receive the most appropriate care when and where they need it while achieving the Triple Aim: improved patient experience, improved population health and stewardship of our resources.

Q: What are the major advantages of value-based care as opposed to a fee-for-service model?

A: Value-based care enables us to pivot to a model that is more sustainable for patients and clinicians, one which is also grounded in scientifically proven data points that more care doesn’t equal better care.

From the clinicians’ perspective, our goal is to provide the best possible care to patients and make sure they are set up for success throughout their care journey. Value-based care aligns with that effort because it prioritizes reimbursement for positive clinical outcomes, allowing for investment into healthcare infrastructure that focuses on the health of the population. More importantly, it encourages every stakeholder in the healthcare system to be more intentional about how they support clinicians in the delivery of patient care.

Healthcare systems and providers who participate in an alternative value-based payment model differentiate themselves and put themselves in a stronger business and financial position to lead the healthcare industry, especially in the current environment where we are faced with significant clinician and nursing labor shortages, increased patient volume lability and uncertainty, and declining fee-for-service reimbursement.

From the consumers’ vantage point, in the ideal value-based world, patients will be able to spend more time with their physician and/or care team, be motivated to improve their health outcomes with lower cost-sharing responsibilities and have better experiences without being rushed through the healthcare delivery system.

Q: How is Envision positioned as a leader in the value-based care movement?

A: Our medical group of nearly 25,000 physicians and advanced practice providers is uniquely positioned to deliver high-value care given our scope of services and impact on some of the highest acuity of clinical conditions and urgent medical needs in the healthcare environment. With strong clinical thought leadership and critical partnership with other healthcare providers, including hospitals and Emergency Medical Services (EMS) agencies, Envision is continually evolving its care delivery model. Our teams are already driving innovative changes to meet the unique needs of our communities.

One example of innovation is our partnership with EMS agencies, in which we care for patients through CMS’ Emergency Triage, Treat and Transport (ET3) program. When paramedics respond to a call, they can consult our emergency physicians to determine the most appropriate care plan for a patient, which can include traditional transportation to the hospital, transporting the patient to an alternative care destination for lower acuity symptoms or treating the patient in place (typically at home). Through these virtual consults, our physicians can ensure patients get a more detailed assessment, receive time-sensitive care and instructions, and benefit from any needed care coordination. We are now partnering with EMS to provide these services in 15 states with an average response time of fewer than three minutes, resulting in treatment-in-place of nearly 60 percent of the calls, with a more than 95 percent patient satisfaction score. Under this model, when we are able to care for patients while avoiding transport, EMS will continue to be incentivized for their work while also being mobilized back into service sooner to respond to another emergency call. Even when higher acuity patients require transportation to the emergency department, we are accelerating care coordination and hand-offs because we have already assessed patients’ conditions. 

In addition, given our multispecialty orientation, we also focus on delivering high-quality integrated care within a health system. For example, our emergency departments and radiologists work together to ensure stroke care is managed in a timely fashion and allow for potential benefits from thrombolytics; our anesthesiologists and hospitalists partner to drive enhanced and early postoperative recovery protocols that lead to shorter hospital stays and reduced readmissions for surgical patients; our maternal-fetal medicine (obstetrics) and neonatal services unify under our “Heartbeat to Home” program to stabilize infants needing intensive care and facilitate their transition to home with virtual care follow up; and emergency medicine and hospitalist services coordinate to accelerate throughput and care plan hand-offs for those needing inpatient care. These are examples of how Envision contributes to value-based care (higher quality, lower cost) for individual patients and the health outcomes of the communities we serve.

Q: What advice would you share with hospital leaders who may be hesitant about this transition, or conversely, those who are ready to get started but aren’t sure where to begin?

A: Value-based care is here to stay, and I believe many people are excited to embrace it. We see it in the growth of Medicare Advantage, which has 45 percent penetration compared to around 25 percent ten years ago, as well as with the explosion of newer payment models through Accountable Care Organizations (ACOs) and bundled care during the last several years. At the same time, there are disincentives in play, such as penalties (or non-payment) for unnecessary hospital readmissions. While building care models to support ACOs can be complicated, narrowly focusing on programs to reduce readmissions can be a much easier place to start. Consider engaging and collaborating with your hospital medicine team and care managers to build a stronger care transition program on patient discharge, or consult with your anesthesiologists on implementing postoperative care with enhanced surgical recovery pathways. There are many other ways to start approaching the journey to value, but standing still is not one of them. As hospital executives prepare for changes ahead, it’s also critical to engage the medical staff and clinicians to help lead the charge. Value-based programs’ successes have largely been anchored on clinician champions and advocacy and aligning the incentives to ensure engagement and commitment to drive the necessary changes. 

When it was first proposed in 2006, the conversation around value-based care focused on its potential viability as a reimbursement model. It’s no longer a question of “if” but “when.” Under the CMS Innovation Center’s new strategic plan, care delivery by 2030 will look quite different than it does today. By readily embracing value-based care and partnering with organizations who are working toward its full adoption, healthcare leaders will be putting their patients first while simultaneously ensuring the long-term viability of their services.