Emory's ticket to value-based care: Medicare Advantage

How Emory Healthcare used Medicare Advantage to fuel its value-based payment strategy

Academic medical centers (AMCs) are feeling tension as health care transitions away from the traditional fee-for-service model, three health care executives write in NEJM Catalyst.

AMCs "may be at a structural disadvantage under alternative payment models" (APMs) given their multiple missions of furthering patient care, teaching, and research, along with their complex patient populations, write CareMore Health System CEO Sachin Jain; Emory Healthcare President, CEO, and Board Chair Jonathan Lewin; and Emory interim EVP for Health Affairs Michael Johns.

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Yet as the industry transitions to value-based care, AMCs can find opportunities to thrive under APMs that take advantage of some of their key strengths, including their expansive primary care and multispecialty-group practices and their affiliations with integrated delivery networks.

Going with MA

After surveying the value-based care landscape, Emory decided to offer Medicare Advantage (MA) plans through an alliance with CareMore called Emory Healthcare Network Advantage. The decision was based on four key reasons:

  • Providing financial flexibility. Most APMs still have some aspects of fee-for-service payments. While such APMs "shield physicians from the full financial risk of capitation, they also limit the capacity for innovation," the executives write. By contrast, MA's 100 percent shared risk gave Emory more financial resources, and its prepayment plans allowed the system more flexibility "to invest in new clinical capabilities and experiment with new strategies," the executives say.

    To that end, CareMore worked with Emory to establish coordinated care centers, train and integrate physicians tasked with caring for patients with multiple complex conditions into Emory's care teams, and adopt new technologies. 

  • Focusing on high-risk patients. MA helps to align Emory's financial incentives with its goal of improving care for patients with or at risk of developing chronic conditions, the executives write. For instance, it allows for special-needs plans to provide certain elderly patients "with benefits and clinical services specifically tailored to their clinical conditions," and its risk-adjustment methodology "does not penalize providers for focusing on high-risk, high-cost patients."

  • Aligning across payers. MA allows Emory to experiment with a single delivery model across multiple payers—an effort that can pay off in other alternative payment contracts as well, the executives say. The payers involved in Emory Healthcare Network Advantage "are developing shared expectations about payment reform and making preliminary agreements regarding quality-measure benchmarks."

  • Setting up for success. "As experiences with alternative payment models evolve, the most progressive approaches will move away from fee-for-service and toward population-based payment," the executives write. They say that capitated and population-based payments "will become commonplace among Pioneer and Next Generation ACOs" in the near future, and that MA will best prepare Emory to succeed in those payment models.

As of March, Emory had enrolled more than 13,500 patients under shared-saving contracts with multiple insurers. MA patients currently account for 14 percent of Emory's total business, and the system expects that percentage to grow going forward.

"To be sure," the authors note, "Medicare Advantage is not the only payment model AMCs and other delivery systems can draw on to move toward value-based care. Nevertheless, it may be attractive to physician organizations and health systems that wish to expand their capacity for risk-based contracting" (Johns et al., NEJM Catalyst, 4/28).

From Medicare ACO to Medicare Advantage

Many of the population health early adopters that tried the Medicare Shared Savings Program are now starting to aggressively add lives through Medicare Advantage.

Find out why the number of enrollees in MA is expected to double by 2020 and why MA could be a great opportunity for your organization.

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