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AHLA's Speaking of Health Law
Value-Based Care: Latest Trends and Developments
CMS has a goal that by 2030 all Medicare fee-for-service beneficiaries will be in value-based care arrangements. This means that providers will be accountable for the quality and total cost of care. Rob Moss, Principal, SullivanCotter, and Maggie Martin, Chief Legal Officer, Oklahoma Hospital Association, discuss the current climate surrounding the health care system’s continued move toward value-based care. They focus on Oklahoma’s journey to managed Medicaid, approaches and best practices related to value-based care metrics and payer contracts, and workforce factors. Sponsored by SullivanCotter.
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Speaker 2:Support for A HLA comes from Sullivan Kotter, which partners with healthcare organizations to drive performance and improve outcomes. Through the development and implementation of integrated workforce strategies, the firm's proven approach helps organizations align their business strategy and performance objectives. For more information, visit sullivan kotter.com.
Speaker 3:Good afternoon, and thank you for joining us. My name is Rob Moss. I'm a principal , uh, at Sullivan Kotter. I lead our provider affiliation and optimization , uh, business, and am here today with , uh, Maggie Martin from the Oklahoma Hospital Association. And just by little bit way of introduction , um, uh, I've been with Sullivan Kotter now almost two years. And prior to that, I've spent most of my career in and around , uh, ambulatory planning, ambulatory strategy, and doing a lot of work around physician hospital integration strategy. And directly prior to joining Ascension, I was the Chief Strategy Officer for clinical and network services at Ascension. And with that, I'll hand it over to Maggie for an introduction.
Speaker 4:Thanks, Rob. Happy to be joining you today and having this conversation. So, as Rob said, my name is Maggie Martin. I am the Chief Legal Officer at the Oklahoma Hospital Association. Prior to that, I was at a law firm in Oklahoma City, representing a number of our member hospitals. And then I was in-house counsel at a large healthcare system for about 15 years. So I am a regulatory healthcare attorney. Um, I've done a lot of physician contracting , uh, both in-house and as outside counsel . Um, focusing a lot on different things, whether it be employment agreements, professional services agreements , um, even, you know, agreements with physicians through other healthcare transactions. Um, so I've been involved in that space a lot. And now my work at the hospital association is more so focused on advocacy , um, but also how do we work with our members and connect them with the agencies , um, that regulate them here in the state, and how do we have interactions between those different groups , um, and connect them all. So I've been kind of on both sides of , uh, the hospital world in-house and outside counsel , and now kind of in a different space, but still serving , uh, the same clients in a sense.
Speaker 3:Awesome. Thanks, Maggie. You know, as we've been advancing , um, our conversations around , uh, challenges , uh, relative to health system sustainability, we, we've had lots of conversations around , uh, workforce challenges, but one additional area that you and I have, have had a few conversations around were , is related to , um, how do we better align , uh, performance metrics and incentives with how health systems are being reimbursed by payers, and particularly, you know, in and around primary care. Um, and, and also as we continue to see market forces , uh, and shifting that really presses towards , uh, an inflection of, of moving towards value-based care. Um, we know that CMS , uh, has a goal by 2030 that a hundred percent of all Medicare fee for service will be in an accountable , uh, relationship for quality and total cost of care , um, um, AKA Medicare advantage. And , um, just recently, you know, I was at an event where , uh, Alex Azar , um, you know, touted that he , he thought that by 2027, even that Medicare Advantage would reach 70% of Medicare fee for service , uh, in , in that just a , a two year period of time. So I think that really, you know, puts forward this whole concept that not only will Medicare Pen Medicare Advantage penetration continue to grow, but we also have an aging population that keeps, that's aging into these Medicare Advantage years, and these populations are living longer. So all of that puts together, creates a need or a call to action around foundational readiness for , uh, how do we manage populations more effectively, which implicates the workforce, right? What are the number type and mix of providers we need, but also how do we compensate providers in the transition from , uh, volume to value in a more effective way? Uh , Maggie, what are your thoughts about some of these industry trends?
Speaker 4:No , yeah, I've seen that too. And , um, uh, gonna continue to see more of it, especially as we see some kind of changes in Medicare Advantage. Of course, there was just a recent OIG opinion, kind of a work , uh, work plan audit around kind of MA and marketing. So I do see, we may see some restrictions around that. Um, and obviously a lot of that will depend upon what happens with the next administration. Um, but given that we do have an aging population and there we are continuing to see this move to value-based care, I think it's gonna continue to be something that we need to consider as industry professionals and in particular , um, healthcare attorneys that are working within hospitals and working with hospitals and physicians need to consider. Um, just, I think we're gonna , we're on the same trajectory that we have been for a while .
Speaker 3:Right. You know, it was interesting when we , uh, um, spoke earlier this year, you were , uh, telling me about Oklahoma's move towards , um, managed Medicaid. I wonder if you could share , uh, a little bit about that story and, and kind of what's happened to, to to date in the state of Oklahoma.
Speaker 4:Sure, yeah, happy to talk about that. So Oklahoma adopted managed Medicaid. We actually adopted the laws that enacted it back in 2022, but it wasn't until April 1st of this year that we actually had our first contract implementation. So we haven't even gone through one full year of managed Medicaid in Oklahoma. Um, but we are, you know, we hit the ground running. Um, it is, it is moving forward. And part of the , uh, statutory scheme that created managed Medicaid included a couple of things. One of them being that for the first few years, payment under managed Medicaid would be at 100% of the fee schedule. Um, knowing that there'd be kind of a set and kind of steady rate of reimbursement for the first few years of the program, but that eventually it will be moving to value-based care and value-based reimbursement, such that we will see the health plans that are administering managed Medicaid start to roll out that value-based , um, payment process and payment model here soon they will start moving to that. And so we haven't seen that yet, but it is on the horizon. And one other thing too, that Rob you and I haven't necessarily spoken about in some of our conversations, but I think it's important for this group and this conversation, is that one of the big key components of managed Medicaid in Oklahoma is that after the fourth year, 11% of the health plan spend in managed Medicaid has to be spent on primary care. So there have been a lot of questions around, okay, how do we, how do we look at that spend on primary care and how do we align that with value-based care plans so that there's maybe some sort of investment in or shared savings with providers as we look and seek to increase that primary care spend. So we're really in the initial phases of it, but as a hospital association, one of our goals is to say how can we , um, support our members, get them aligned with the healthcare authority , um, and the managed care plans that are administering the program such that when they start to roll out these value-based , um, reimbursement models, we need some consistency. We need to see that , um, all across , we, so we have three, we have three managed care entities that are administering managed Medicaid. We want to see across all three of those alignment in the , um, quality, maybe quality measures or whatever they put into these value-based plans so that we don't have our hospitals chasing three different value-based reimbursement models depending on the payer. Um, and in addition, as we look to this primary care project, if there is going to be investment in and shared savings with providers, and there's going to be some sort of value-based care tied to providers, specifically not just hospitals, then we need to see some alignment in that as well. Because if we have, say, 12 different value-based models that we're having to track across all of our systems, each hospital for example, that's a huge burden on the hospital and the staff, and I really don't feel it will move the needle on improving patient outcomes like it's intended. So Rob, I've, I've kind of talked through a lot of things. I've given you a broad brush, but , um, any questions about what I just mentioned or thoughts?
Speaker 3:No. Yeah, I , I, I, you know, it's, it's interesting. Um, you know, we've, we've found through , um, a lot of our work with , um, health systems across the US that, that you can, you can actually dilute effort <laugh> in , in many ways as it relates to moving towards value-based care and managing populations. And you can do it, as you mentioned, by having too many measures and too many metrics and too many difference because one of the challenges we, we see today is there's , um, a lot of disassociation or, or incorrect association between how we're paying providers and how we're being paid as health systems. And so the first step is a foundational readiness to align that. Um, it's also the amount of, of , uh, compensation that is , uh, i I would say at risk for value-based payment , um, is also important because it has to be enough to move the needle that it, that it's enough of the part of, of how systems are paid and how providers are paid that it , that it can make a difference. Um, and I think that, you know, one, one area we've seen when we work with our clients is we try to stay within five goals per provider. So we try to keep, number one, the , uh, measurements more simple , um, having effective systems in place to do the measurement and trying to create , um, realtime transparency so that the providers and the administration can see how progress is being made to those, those value-based goals.
Speaker 4:Yeah, I think that makes a lot of sense, Rob, to keep it as simple as possible because it's hard to really see progress when you're chasing down too many goals or too many targets. Um, and I think ultimately the goal would be here in our state, but I think it's also CM S's goal, especially if you look at the new team model that they , um, just released , um, in one of the most recent fee schedules around , um, uh, certain sur cer certain surgical procedures. The goal is to really improve patient care, reduce costs , and improve quality too. So if you're chasing too many targets, it's really difficult to do that. I think it's, you know, even in your own personal life, if you think about your own personal goals, how hard it is to chase down too many and you're not really moving the needle or making any progress. And so it would be our hope that we have, you know, a small number five, I think is great, Rob, of identifiable goals because we really feel like those can be met and accomplished, and you can see some progress. Um, one of the things here in Oklahoma that we're really thinking through is how do we as a state move up in our health rankings? We're, we're 47th right now, we're very low. We would like to be even in the low forties, just getting to 40, you know, we've had talks about 35 by 35. That's a very ambitious goal. But, you know, at the root of this, and at the core of this is how do we create a healthier population? And we can do that through value-based care, through improved quality. And so that's one of our goals too, as we're thinking through this, is what can really we really do to move the needle and improve the health of Oklahomans and those that our hospitals are serving.
Speaker 3:Yeah , that's, it's a great ambition, Maggie. And, and again, you know, Oklahoma, you , you, you're challenged too because you've, you do have , um, rural populations mm-hmm <affirmative> . That don't have equal access to care. Right. And I think , um, that's the one thing that intrigued me about your managed medicaid program is the ability to, to have better reach and primary care across the entire state.
Speaker 4:Yeah. And that's the goal is to, how can we reach across the entire state , um, with value-based care, but also with our primary care? So how do we increase primary care spend in our state in a meaningful way and in a way that's regionalized to each area? So what may be a best strategy for our big metros, so around Oklahoma City, around Tulsa, might not be the best strategy for some of our more , uh, rural populations within the state where there aren't as many , um, you know, as the , the needs are just completely different because the populations are different. And so we really wanna be able to tailor how we handle that primary care strategy to each kind of rural region and the people that live there and what their needs are, whether that be transportation, whether that be , um, getting OB services restarted in that community. You know, just some things like that.
Speaker 3:Right. You know, Maggie, getting back to , um, sort of , um, metrics again , um, was thinking about , um, you know, one of the trends that we're seeing is, is a little more emphasis from health systems trying to be more strategic about these, these value-based quality metrics and, and thinking through how they're truly aligning with system level goals, but also payer contracts. And it, it , and , and it's about, you know, selecting the right metrics, but it's also a process over time. Um, as you work through and and see improvements, then there's a progression where you move to additional or new metrics. And that the metrics that were once in place become sort of core expectations , um, that they're , they're not , um, I would say , um, at risk anymore. They're just assumed as part of , uh, healthcare delivery. And that's how we continually move to advance the, the provision of primary care and healthcare towards managing populations have, have , has the state thought through that iterative process and, and how you might help your health systems work through that.
Speaker 4:The state has not, but that's something that we are thinking about as an association is how do we kind of get , um, best practices and metrics selections kind of embedded , um, within our hospitals and start utilizing those and then improve upon those going forward. And I think one thing that, you know, Rob, you and I have talked about and I feel is, is important too, is for our hospitals to look at their , um, first of all, have their, have the conversation between legal , um, your reimbursement group, your pay , the group that does your payer contracts , um, have all those groups within your facility have a conversation so that they can all kind of come together and know this is what we're expected to do. Um , this is what's expected in our contracts. This is what's expected by the state. This is, this is kind of where we have to go. And so how, because oftentimes, especially when I was in house and I would be drafting a physician employment agreement, for example, I didn't know what our reimbursement contract said, if there even was value-based language in there, I had no clue what it was. And I , um, wouldn't have even thought to ask at that time because it was still so fresh and new when I was at that point in my career, kind of the concept of value-based care. Um, and so getting those groups together and bringing them all to the table, I think is key. And ensuring that you have that alignment within your system so that , um, your, your physicians or your providers or those you're contracting with their actual employment agreements align with the , uh, metrics that you have to meet as a hospital or as a system. Um, it's very important that you have that alignment , um, so that you can kind of meet those goals. Did that help answer your question, Rob <laugh> ?
Speaker 3:Yeah. Yeah, absolutely. Maggie , we've touched on this before too, like, I think , um, a lot and a lot of times we, you , you , you mentioned something just a moment ago that that sort of triggered a thought around, we've had a conversation not just about employee providers, right? And, and how we look at different , um, incentive structures and, and employment agreements , uh, for employee providers, but there's also , uh, a host of affiliated providers that we need to be aligned to these same goals as well. Um, and when we're looking at, you know, I think traditionally when we've looked at co-management arrangements, we, we certainly have looked at metrics in there, but one of the things you and I have been knocking around is even in professional services agreements, should we be comp contemplating metrics and performance metrics that align those affiliated providers to the same goals and objectives that you're trying to do , um, at the health system and at the state level?
Speaker 4:Oh, yeah, Rob, and I think that's a great idea. And I think as much as you can get provisions in the contracts with your affiliated providers , um, that align with your goals, the better. I know it's sometimes a struggle. Those groups, those physician groups can tend to be fairly powerful and negotiations aren't always , um, easy <laugh> , so to speak. But, you know, I think if you start the trend of saying, we're going to start embedding these , um, goals and these metrics within our professional services agreements, for example , um, and they're gonna , they're gonna be standard, and that's what you're gonna do across all specialties. Um, when you're engaging with those types of providers, then you have that consistent messaging of this is what we expect from our providers. If you're going to be practicing medicine at our hospital, we expect you to meet these metrics and they're part of our arrangement with you , um, for payment. You need to be meeting these because that's how we get reimbursed. And if we can't get reimbursed appropriately, then how are we going to actually pay you the providers what you say you want in this contract? And so there has to be that alignment there, otherwise there's gonna be huge gaps and disparities , um, between what the hospital is receiving from the payers and what the physician is expecting and , you know, and their reimbursement from the hospital.
Speaker 3:Yeah, that's great, Maggie. I , I , you know, it , again, it's, it's aspirational and certainly , um, these relationships , um, can, the power that you referenced is , is real <laugh>. Um , and sometimes , um, you know, the, the, the negotiations are, are are challenged, right? But again , uh, one of the key things that we at least have to move towards is that the entire , uh, clinician ecosystem is aligned and moving in the same direction. I think that's the only way we're gonna move the needle to, to manage these populations , uh, more effectively.
Speaker 4:Yeah, I agree, Rob, and one of the things I kind of kicked around with you and I, you know, I, who knows how this would work, but I know that as we move towards more value-based , um, care metrics, we're gonna have to get creative and think outside the box. And one of the things I've thought about is how could you maybe modify medical staff bylaws to include some of this as a requirement of having medical staff appointment to a facility? Could you take it down to that ul granular of a level and not have it be necessarily in the contract, but it's part of your medical staff bylaws that you're expected to hit these metrics. And so you, you'd, you know, assess that through your peer review process , um, and work through it that way. Um, that's just something to consider. I don't even know how that would work. 'cause I haven't seen anybody do that yet. If they have, I would love to talk to them. If you're listening to this and that's something you've explored, let me know, because I think it would be, it's an interesting concept to kind of kick around, but I do think we're gonna have to get creative in how we do this , um, to ensure that we're successful.
Speaker 3:Yeah. I think , uh, one other thing I , you know, I I keep on thinking, going back to the, the concept of the workforce we're gonna need in the composition of the workforce. And we've chatted about this as well. Um, and I, I, I feel like, you know , um, and , and you're mentioning bylaws too, started making me think about , um, um, apps , um, or APCs, whatever you, <laugh> vernacular you want to use. But how do we, how do we create , um, uh, an opportunity where we can really have , um, providers performing top of license and creating the access needed to, to, to again drive , uh, the goals of population health?
Speaker 4:Yeah. I think performing at the top of license is, is essential, but I think every state's gonna deal with their struggles around scope of practice in Oklahoma, we've had our own unique struggles , um, around a PRN scope of practice in particular. Um, and, and getting them to the point where they're practicing at the top of their license. Um, I think every state's gonna vary on that, but I do think it's, you know, it's an important thing that we have to think about as we move to value-based care. And as we try to seek to increase primary care, particularly here in our state, that's one of the struggles, is how do we address the scope of practice issue , um, especially in our A PRM population. Um , and another thing too to consider , um, because obviously there's gonna need to be some sort of peer review and monitoring around that. Um , the federal laws don't contemplate peer review protections for a , um, allied health practitioners or, you know, that typical group of staff. They're more for physicians. And even Oklahoma law, up until just recently only had peer review protections for physicians, we did just have a modification to our own state law that expanded that peer review protection to allied health providers. So now our APRNs, our PAs, our CRNAs, can all be covered under peer review protections in the state of Oklahoma, but that's just our state. So we don't have those HWA protections that would be great as well. And so I think as to , we're looking at expanding, you know, giving more responsibility to these allied health practitioners, and how do we really look at the whole continuum of care and the care teams that we put into place. Um , I think that's something to consider, consider at the federal level as well, is how do we get additional protections for those allied health professionals at that level?
Speaker 3:That's a great point, Maggie. You know , um, you know, I think, again, as we started, we've, we've, we've touched on that , you know, we've, we've, we've been on a journey towards value-based care for quite some time. <laugh> as a , as a health system Yeah . <laugh> across the us and, and who knows , um, you know, each market, each um, state , um, probably will have varying degrees of, of magnitude and impact of value-based care just based upon several different , um, factors. But, but you know, there's definitely a call to action around readiness, right? And, and starting to get ready. And one of the foundational things that we've seen is just being more intentional about thinking about value-based metrics , um, and how , um, as an organization, as healthcare organizations, we can better align around , uh, the incentives that are in our payer contracts and how we , uh, measure performance at the, at the , um, provider level and how we incentivize and pay providers relative to that. And, and a lot of that is, is tough work, right? Just to really understand the managed care contracts that you have to be able then to prioritize those incentives in those agreements and understand which ones are translatable and, and are , um, can, can be, you know, achieved if you will, by through the care teams. And then there's, alongside that, as we do better alignment there, there's an adaptation of the care team that has to happen along the way to facilitate the achievement of those measures as well. So we as an organization view that as sort of foundational readiness, no matter to what extent , um, the organization or the market moves towards value-based care. That's just in , in our mind, just good business practice and certainly helps create a readiness as you start taking on more risk populations with the increasing MA populations. Maggie , I wonder , wonder from your perspective, what other , what , what you would add to that and, and some other areas of readiness that we could , um, pass on to our listeners?
Speaker 4:No , I agree, Rob. I think readiness is key in having these things in place now , um, and getting kind of these, these structures and processes in place so that your, your legal team is communicating with your payer provider team , um, those that are actually negotiating those contracts that you're having regular conversations between those groups. You know, I know everyone's always, you know, adding another meeting onto your calendar isn't always the best thing. But I think you need to ensure , uh, internally as a hospital , um, or as a provider group or wherever you are, that you're, you're having that alignment between, you know, what the people drafting the physician employment agreements are doing, and the people that are negotiating the payer contracts are doing. Because you want to ensure that you are , um, appropriate appropriately aligning your reimbursement to whatever comp you're paying to your providers. Um , that needs to be clear how that's going to play out. So I think any sort of pre-work you can do preparation, getting those kind of things set into place , um, will help as we continue to see more movement towards the value-based care kind of , um, process and, and state of being, which I think will eventually end up in, it'll be our, it'll be our new normal , um, at some point here soon.
Speaker 3:Excellent, Maggie. Well, any other closing thoughts for today? Um, I think that was the agenda you and I wanted to, to share today. But if there, are there other things that came up in conversation you think we should , uh, we should , uh, uh, discuss?
Speaker 4:I can't think of anything else, Rob, at this time. I'm just thankful we got to have this conversation. I appreciate you and Sullivan Kotter , um, inviting me to join you on this podcast. Um, I always enjoy chatting with you and I appreciate all the services Sullivan Kotter provides , um, to our member hospitals, and I appreciate our partnership as well. So it's always a pleasure, Rob, to, to chat with you and to talk about , um, these concepts and these topics.
Speaker 3:Well, thank you Maggie. I , I, I too enjoy , uh, the time we get to , uh, to connect and, and speak. And so thank you very much for joining today and, and we thank our , uh, the folks that are, are listening into our podcast. Uh , we hope you find it enjoyable. And if you have any questions, I'm sure you can find a way to contact Maggie or myself. We appreciate it. Thank you.
Speaker 4:Thank you.
Speaker 2:Thank you for listening. If you enjoyed this episode, be sure to subscribe to ALA's speaking of health law, wherever you get your podcasts. To learn more about a HLA and the educational resources available to the health law community, visit American health law.org.