Early adopters of Value-Based Payment: A digital dialogue on what works

Oct. 28, 2016 / By Michael Keyes

Value-Based Payment (VBP) is top of mind for all who work with a Medicaid population in states across the U.S. Through its Delivery Service Reform Incentive Payment (DSRIP) Program and other VBP initiatives, New York State (NYS) has recognized the need to transform the payment of healthcare services in order to move away from the current system that more often than not incentivizes volume over value. This shift in payment is expected to facilitate a more integrated and community-based NYS delivery system that better serves the population while “strengthening the financial viability of the safety net.”¹

While noble and necessary, VBP requirements create some challenges that both payers and providers are currently working through. NYS’ policy requirement that 80-90 percent of medical expenses be made through VBP arrangements by 2020 has accelerated the pace of change and added to the challenges. 

Today, most NYS payers that 3M works with have approximately 20-30 percent of their medical expenses covered by VBP arrangements. They are struggling to develop a strategy that gets them to the 80-90 percent VBP by 2020. Providers, on the other hand—particularly those in larger consolidated systems experiencing a reduction in the volume of services—see VBP as a hit to their bottom line. 

At 3M, we generate population health analytics for 55 million lives in Medicaid, Medicare and Commercial populations across the United States. For five million of those lives, we directly participate in the design and measurement of the VBP arrangements in which the populations are enrolled.

We’re hoping to leverage that experience with VBP early adopters to create a dialogue around the challenges and opportunities facing the industry. We’ll be bringing you subject matter experts (whose names many of you will recognize) in a regular blog series to share what we know and what we’re learning across the country and in New York State in particular.  We hope to cover many of the concerns we’ve heard in the market and plan to inform our blogs with both data and opinion.  In the coming weeks, we expect to highlight:

• An industry scan on what’s worked and what has not
• Successful strategies for engaging providers
• Panel size thresholds for inclusion in VBP arrangements
• Contracting path to 90 percent
• Successful VBP model designs
• Data transparency

Your participation in the dialogue is crucial in achieving maximum value for all. Please share ideas for additional topics, your feedback on our data and your own opinions on the topic. Use the “comments” section below or contact us directly via our blogger profile pages.

While the challenges ahead are significant, we’re confident that state organizations like NYS Medicaid will be leaders in VBP contracting and the shift toward value-based care. We’re excited to be part of that transition and look forward to a lively dialogue. For now, stay tuned! 

Michael Keyes is an engagement leader for Populations and Payment Solutions at 3M Health Information Systems.

¹New York Department of Health. DSRIP, Shared Savings, and the Path towards Value Based Payment. New York, New York. Slide 2. Retrieved October 28, 2016, from https://www.health.ny.gov/health_care/medicaid/redesign/dsrip/docs/dsrip_vbp_webinar_slides.pdf