What comes after APM?

What comes after APM?

Knowing more about our patients than just their disease.

A conversation with Craig Hostetler, Executive Director at Oregon Primary Care Association (OPCA)

Today’s conversation is with Craig Hostetler, who previously shared the idea that we need to go beyond the Alternative Payment Methodology (APM) to truly affect the quality of health care. The grand vision is true value-based health care. But what does “value” mean? Health care value implies that we have a way of measuring both the care actually delivered and the resulting health of different kinds of patients. If you think about it, different types of patients carry different health risks and have various social characteristics that affect how sick they are and how easy it is to treat them. The catch is that right now we cannot really measure how those two factors affect care delivery.

At the APM pilot’s kick off meeting in 2013, experts gathered together to think about what health care delivery should look like. Those close to primary care in safety net populations envision a value-based payment system—such value-based payment would financially reward better patient health outcomes.

But before the state can hold health centers accountable to cost, quality, and access, Craig explains that we have a serious issue to address. “The game, set, and match of transitioning into value-based pay,” says Craig “is that we don’t know how to adjust for anything but medical severity.  For example, imagine it would take the same time and resources for a medical team to help a homeless person to lower their hemoglobin A1c, which is one of the key indicators of uncontrolled diabetes, as it would to help a steadily employed person in housing. Clearly your assumption would be off.” What he means is this assumption could be ignoring that perhaps the homeless person has severe and persistent mental illness or food insecurity issues (which would make it difficult to monitor and control A1c because of limited reliable access to food).

To estimate the effort a clinic spends on treatment, and thereby ‘reward’ them with value-based pay, the reimbursement rate would need to factor in those patient characteristics. Indeed, a JAMA article (Hong et al. 20101 warned that “one potential risk of not adjusting for patient panel makeup is undervalued quality ranking for primary care physicians who work in community health centers or those who take care of minority and non–English-speaking patients.” Essentially, if health centers move into value-based pay or public quality recording without adjusting for socioeconomic characteristics, health disparities could increase.

Keep in mind that even a safety net clinic must remain viable to keep the doors open. Essentially, in this scenario, health centers would have two choices: get really good without new resources to address disparities in patient characteristics, or manage their payer mix so they do not have as many difficult patients. Putting in place value-based pay, without a way to account for patient differences beyond how severe their medical condition is, could set up a rush away from serving homeless or other complex patients.

In our next post, we will continue this discussion by explaining how technology and some key business changes can be put into place to address this conundrum.

Continue reading the next part of this post here

1Hong CS, Atlas SJ, Chang Y, et al. Relationship Between Patient Panel Characteristics and Primary Care Physician Clinical Performance Rankings. JAMA.2010; 304(10):1107-1113.