Providers, payers need to mend relationships to make value-based care system successful

For most of my 18 years as a practicing neurosurgeon, I couldn't fathom working for a health insurance company. What sort of industry, I thought in those pre-2010 days, would be so coldly efficient as to reject anyone with a pre-existing condition as a part of its business model?

Then the Affordable Care Act passed, and five years later, I work for the nation's largest consumer-owned health insurer, an organization with 15 million members.

Why the change?

We live in a time when the individual mandate, guaranteed issue and broad consumer protections are the law. Insurers must now provide coverage for people who didn't have access before, even those with pre-existing conditions.

Consumers benefit from the lowest possible premiums, with payers' administrative costs limited to 15% of premiums for most programs. Providers must care for millions previously locked out of the healthcare system.

As an industry, we have arrived at a moment when even fee-for-service stalwarts see the handwriting on the wall: The current reimbursement system is not sustainable. We must find better ways to align the interests of patients, payers and providers.

I realized, as did many of my colleagues across our industry, that the time is now for value-based care to achieve the “triple aim.” To do this we must mend frayed relationships. In short, we have to work together. But the devil is in the details.

Shifting incentives from a model that rewards volume to one that rewards value is a high-wire act. There's a jumble of terms for reimbursement and delivery alternatives—ACOs, HMOs, medical homes, bundled care and others—to help us make this transition. But our system is too big and complex for one model to solve the problem.

At Health Care Service Corp., we are pursuing value-based care because we want our members to realize the best outcomes for the dollars spent on their care. About 30% of our membership is now served through contracts with value-based payments, and that number is growing.

As the operator of Blues plans in five states, we serve diverse populations. Layered atop this complexity are the differences among providers—their integration, technological capabilities and ability to share risk. To create winning collaborations, HCSC uses a portfolio of arrangements that meet providers where they are.

For example, Blue Cross and Blue Shield of Illinois has been collaborating for nearly five years with Advocate Health Care on an accountable care organization. It has reduced key utilization measures such as emergency room visits and inpatient admissions for 360,000 members while keeping them healthy. It's a collaboration with an integrated hospital system that was making investments in value-based care even before the ACA.

In Texas, several hospital-centered ACOs are already in place, but we added to this when Blue Cross and Blue Shield of Texas recently introduced several physician-led models. One example is a collaboration with the Texas Medical Association, the largest state medical society in the U.S. Called TMA PracticeEdge, it will allow independent doctors, who make up two-thirds of Texas' physician workforce, to engage in the value-based care movement.

ACOs aren't the only solution. To manage chronic disease in Illinois, Montana, New Mexico and Texas, we implement medical homes. In Oklahoma, we participate in the Comprehensive Primary Care Initiative, a CMS program that fosters collaboration to strengthen primary care. Our HMO networks in Illinois, which include 700,000 members, have for years improved outcomes at lower costs while scoring well in member satisfaction.

An often-quoted adage holds that one should be the change he wishes to see. That is why in 2009 I left medical practice to serve in Washington for three years with the Obama administration. Then, after returning to the private sector as a hospital executive, I crossed to the payer side in 2013. I couldn't resist the opportunity to redefine the zero-sum game that payers and providers often play.

Our industry is catching on. My colleague Dr. Scott Sarran and I are serving on the Health Care Transformation Task Force, a coalition that brings together providers, payers, employers and patient groups to advocate for an industrywide shift to value-based care.

We must all work together to make healthcare more equitable, accessible and sustainable. I became a physician to help patients. They are the reason we as healthcare leaders must succeed in changing our system.