Blog Post

In purchasers' shoes: Key takeaways from our Provider of Choice Summit payer panel

By Selena MooreMallory KirbyDeirdre Saulet

July 28, 2021

    At Advisory Board's 2021 Service Line Provider of Choice Summit, a panel of purchaser experts discussed health plans' priorities when assessing provider organizations for partnerships. Panelists included:

    • Christoph Dankert, Carrum Health's SVP of Provider Partnerships
    • Natalie Trebes, Advisory Board Director of Health Plan Research
    • Ben Umanksy, Advisory Board Expert Partner
    • Deirdre Saulet, Advisory Board Expert Partner (moderator)

    Here's what our experts say makes providers an attractive partner, the tactics that purchasers are using to direct where their employees and members receive care, and how your program can meet their expectations.

    Panelists' comments have been summarized for brevity

    Access the Covid-19 service line impact guide

    Purchasers' top priorities for managing specialty care

    Purchasers prioritize three goals for specialty care: prevent unnecessary care, achieve high quality outcomes, and steer patients to appropriate providers. To steer patients to the right provider, purchasers must assess potential partners on their ability to meet shared goals, such as unnecessary care avoidance, cost containment, and better outcomes.

    Dankert: Self-insured employers are beginning to approach provider partnerships through the same lens they consider other vendor decisions: with priority placed on reliable partners who can deliver high quality outcomes in a cost-efficient manner. There are two components to employers' definition of high quality:

    1. The level of care and invasiveness of treatment matches patients' needs.
    2. If a procedure is needed, providers perform the intervention skillfully with few or no complications.

    Covid-19 accelerated self-insured employers' appetite for patient steerage, with employers growing more intentional about employee health benefits and where employees receive specialty care.

    Umansky: While some health system executives have shown interest in taking advantage of employer partnerships, others express continued hesitation that such arrangements could "take the juiciest parts from their business." Depending on the impact to volumes and reputation, purchaser steerage has the potential to benefit health systems but could also send patients to your competitor down the road—or across the country.

    Purchaser strategies to drive high-value specialty care

    Purchasers' strategies are driven by their larger goals of lowering the total cost of care while ensuring quality outcomes. Some of these tactics are in the early stages of development and require more investment to move the dial on purchaser priorities.

    Strategy 1: Address the social determinants of health (SDOH)

    Though there are many unknowns for how purchasers will integrate health equity into their long-term strategy, panelists agreed that both health plans and employers are moving towards addressing SDOH because of the outsized impact they have on outcomes, as well as health care spend.

    Trebes: Health plans are increasingly active in the SDOH space. They're starting to build frameworks that interact with all aspects of the health system in an effort to be seen as a "health services" company and not just health insurance, and to help achieve better patient outcomes while simultaneously driving down costs. For example:

    1. A national health plan designed diagnostic codes for recording social factors, such as homelessness and food insecurity, to generate an evidence base for ROI to prove that social spending is medical spending.
    2. Health plans are considering incorporating SDOH into risk-adjusted payments in the future.
    3. A Medicaid health plan in Texas deployed a coordinator to support members with children attending virtual school for the first time.
    4. A health plan invested in a job program to hire members who were out of work during the pandemic.

    Dankert: Employers are cognizant of SDOH and care coordination as they assess providers' ability to achieve higher quality outcomes at a lower cost. While Carrum Health is dedicated to care coordination and assigns a care specialist to each active member, they also expect providers to support and navigate patients.

    Umansky: Health system executives are also interested in addressing SDOH but may not feel as comfortable in this space—potentially because managing SDOH does not necessarily result in recognition or financial rewards from purchasers.

    Health plans need to double down on their commitment to addressing SDOH and reward provider organizations who share this priority. Providers should think about their relationship with patients and take actionable steps to manage SDOH before their window of influence closes.

    Strategy 2: Steer patients to high-performing providers

    Purchasers traditionally manage costs through tools like product design and reimbursement policies. However, many purchasers realize that they are at a breaking point for shifting costs onto consumers, so we're seeing less interest in HDHPs and increased deployment of Centers of Excellence (COE) models.

    Dankert: When considering a potential COE partner, employers want to steer their patients to high value providers to reduce health care costs without compromising quality. Carrum Health, for example, connects a consortium of employer partners to their national COE network and assesses provider performance and partnership opportunities at scale.

    Trebes: Health plans also look for proof of performance through measurable, comparative quantitative metrics.  Especially as price transparency rules take effect, provider organizations need to craft their own narrative and document quality and performance metrics that will prove their value proposition to purchasers beyond cost.

    Strategy 3: Incorporating telehealth into care pathways

    Health plans and employers consider virtual care an up-front gatekeeping mechanism that can help steer patients to the most appropriate and necessary care. For example, many health plans are building integrated products with virtual primary care offerings through partner vendors or self-owned primary care groups.

    Even prior to the pandemic, Carrum Health leveraged virtual visits in their bundles, particularly for orthopedics and musculoskeletal patients, to conduct remote evaluations and determine appropriate follow-up care.

    Umanksy: There are continued questions of where virtual care is a viable substitute for specialty services and who should make those decisions. Providers need to think about where and how they can influence those decisions.

    Advice for service line leaders and strategists

    Panelists concluded the session by sharing a single piece of advice to service line leaders and strategists.

    Establish a set of metrics that you can track for ROI to craft your narrative to health plans.

    Increased transparency around unit of cost service data will likely increase rate negotiation conversations between payers and providers.

    With price as the most readily available data point to compare providers, it may be tempting to overlook other indicators of value, such as quality and access.  Proactively track other metrics, like quality indicators related to outcomes or patient experience, to quantitatively support your value proposition with additional metrics besides unit cost services.

    Keep an eye out on direct-to-employer opportunities in your market – even if it doesn't seem like a major trend yet

    According to Dankert, over 80% of employers nationally express interest in using a COE model in the future. Whether or not employer COEs are already in your market, start preparing now for how you'll distinguish your organization from competitors three to five years into the future.

    This may mean exploring the "new world" of value-based care and bundles while keeping a foot in the "old world" of fee-for-service for now.

    Do not confuse excellence with exceptionalism

    If you cannot meet purchasers' goals, purchasers will find a partner who can – so take control of the narrative. Start by communicating purchaser priorities to your C-suite to gain executive buy-in on meeting purchaser demands.

    Make sure that you clearly define your value proposition and can effectively communicate to purchasers why you are the best and not just better than your competitors to gain a seat at the table and win on patient steerage. 

    Access the Covid-19 service line impact guide

    guides

    As elective procedures restart, you’ll need to weigh the impacts of Covid-19 on individual service lines. Different services will likely take different paths to volume recovery, face distinct challenges in clearing volume backlogs, and see some unique impacts to longer term demand.

    Access the guide
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