Dr Charles Fazio: Building Trusted Relationships in the Move to Value-Based Care

The healthcare industry has been slow to innovate, but it is doing a better job of picking up speed. However, as the industry continues its move to value-based care, health plans need to build trusted relationship for the move to be successful, Charles Fazio, MD, MS, medical director of HealthPartners, Inc, said at America’s Health Insurance Plans’ National Health Policy Conference.

At the meeting, Dr Fazio sat on a panel that discussed alternative payment models and the move to quality and value.

AJMC: What is the importance of building trusted relationships during the move to value-based care?

Fazio: Clinicians and care systems, probably with good reason, have some mistrust of some of the data they get. It isn’t always straightforward, they don’t always feel like it represents what really happened, and if you use it for the basis of how you pay them, the stakes go up even higher. And if you associate it with quality and how you pay them, the stakes are higher yet. And so we’re willing to invest as much time as we have to, to bring the reports, that people digest the reports, that people see how they compare to other reports they get and what else they know about their practice to get to a point of comfort that what we’re telling them actually reflects what goes on day to day.

If we spend that time and if we have risk arrangements that get more complex over time based on what s involved, the trust and the complexity can grow together and people that are willing to can take more financial risk knowing that there’s a potential for reward and a potential underneath to innovate.

It’s a long-winded way to say: take some time to get to the trust, if you get to the trust then you can take the payment models somewhat out of the way and allow people to innovate.

AJMC: From your perspective, what has been the progress in implementing alternative payment models in the US? How are we doing?

Fazio: It’s varied depending on the market that you’re in. And it’s varied because of how complex it can be. So any given care system works with 5, 10 different providers? That means they probably have 5, 10 different payment models. Within any given payer they could have more than 1 model let alone across payers.

So it’s been slow because it’s so complicated. It’s also been slow because if we started over and completely redesigned how we were paying people, the care system wouldn’t look the way it does now. People would provide care differently when the model is different. So one of the other complexities is: how do you get to the other side? When will the payment models change sufficiently that I think I want to change the design of my care model? And it’s hard to do that. You want to be absolutely sure that you can trust all of your partners and that we’re not going back.

And until you can do that, you’re really hesitant to make a lot of other changes and commitments. But as an example, there’s a practice we work with that would lessen the number of physicians it plans to hire and hire more advance practice nurses if they knew we were moving to a population-based payment and that all their payers were moving to a population-based payment. You do more outreach, you do more e-mail, you do more telephone visits with people. But if the thing we pay most consistently for is a visit, then you get visits.

AJMC: What is HealthPartners’ Total Cost of Care tool and how is it being used?

Fazio: So it takes all the patients that attribute to a practice and looks at all the cost for all the care that they have received and divides it up for the practice every which way.

How many outpatient visits were there and how costly were they? How often did people go to the emergency room? How often were people hospitalized? And how does all that compare with a similar population? There’s nothing that’s done in isolation—it’s always in comparison to something else? What’s the use of pharmacy look like? Whenever it’s a clinical service, we try to differentiate between how many units of something did you use and how expensive were those units.

In addition to looking at cost, we look at quality. How was the care for people with chronic diseases and what’s the health of the population overall? And how is that changing? The other thing we’ll look at, we’ll tell you about all the bundles and episodes that you’re patients experienced even if you didn’t do them. So, I send you to have your hip replaced, how did that turn out? And what did that cost? And if our practice uses 3 or 4 different orthopedists to do hip replacements, how did they compare one to the other? We’d like to give you some idea of the cost and quality between them so maybe you make a choice next time. Don’t you want the best quality and the lowest cost when you make that kind of referral?

There’s amazing amounts of detail about the practice and the patients, including opportunities, if you’re interest, to either bump the quality or lower the cost.

AJMC: How do providers handle that information, the idea that they’re getting information on the episodes of care for a patient even if it’s not their episode of care?

Fazio: One example is a group practice that noticed that patients with arthritis that were referred to see a particular rheumatologist group were really expensive compared to the points of comparison. So they went to that group and looked underneath and tried to say, “Why is that?”

Well, when someone needed an injectable medication, the rheumatologist group was sending the patients to an expensive place to get the injectable rather than using the less expensive place. They were also using a lot more high-tech imaging—MRIs and things—on their people relative to comparison practices. This practice just stuck out compared to any other point of comparison. So they went to that practice and said, “You’re making us look bad. You’re driving up our cost and there’s no evidence you’re getting any better results even though you’re spending more money. We either need you to make an adjustment, or we’re probably going to change where we send our patients.”

If we change what the rewards are, people start to behavior differently.

AJMC: How is being part of the Health Care Payment Learning and Action Network helpful to you?

Fazio: The network is still early, it’s just starting to produce white papers and learning products, but the vision for what the network will produce is a series of recommendations about some of the background stuff in how we pay for care and how we measure quality.

It’s the sort of stuff where I have the total cost of care formula and everybody on my panel [at AHIP] probably had their own formula. Everybody who was in the room, if they represented an insurer, probably has their own formula. Well if you’re coming to me with 10 different formulas, I just don’t have the time to figure out if they’re all telling me the truth, or my perception of the truth. What if we all let go a little bit and with the things that come out of the Learning and Action Network that apply across the board, adopted practices consistent with those recommendations?

So I explained how we give you a report, if you’re a care system, of all of your patients. How do we decide that it’s your patient? Because the patient doesn’t pick. The patient just goes to your practice. And there’s formulas that we use—I think it’s different from the formula that Blue Cross uses; I think it’s different from the formula Health Care Service Corporation uses. What if we all said, “It’s stupid to have 100 different attribution formulas: let’s all use the same one.” So no matter who the care system is, they know we’re assigning patients back to them the same way.

There’s an awful lot of that methodology underneath the alternative payment methods and wherever we can, what if we all used the same thing? I think that’s the point and I think that’s what one of the greatest innovations could be, so that at some point in the future, we’re way more aligned in how we do this.

It shouldn’t be a point of differentiation, how clever I can be when I pay you. The point of differentiation if I’m a health plan ought to be plan design and member services and how good a job I do at being a plan and not how creative I can be in how I pay for care. Let’s standardize how we pay for care and leave the creativity and the competition to other stuff.

AJMC: How can healthcare move to a more consumer-based environment? Should it move to a more consumer-based environment?

Fazio: I think as a plan whenever we can we’re bringing the consumer point of view into things. As a care system, whenever we can we’re bringing the consumer point of view into things. I think healthcare delivery, healthcare financing, historically, has been slow to change, so I think there’s things we know that the consumer would like and we haven’t been as rapid as some other industries in getting there, but I think we’re picking up a little bit of speed.

What consumer wouldn’t like to get care at home if they could rather than going to the office? How do we make sure that’s in their contract? How does the care system make sure that it’s something they can accommodate? Or that the person can just buy from some sort of retail care? How do we share information so that wherever a patient goes, there’s a complete view of them? So that it’s more consumer-centric than it is?

I think we’re listening; I think we can listen even better? And I think we can innovate faster. But we’re in that direction.