Humana is one of the nation’s largest players in the Medicare Advantage market, with more than 4 million lives covered under those plans. Roughly half of those members see a primary-care physician who is engaged in some form of a value-based contract. According to its annual report assessing value-based contracting, Humana found that those members are getting preventive screenings at a higher rate than seniors in traditional plans and their overall cost of care is lower. Modern Healthcare Managing Editor Matthew Weinstock recently spoke with Humana Chief Medical Officer Dr. William Shrank about the drive to value-based care. The following is an edited transcript.
MH: What are some of the things that stand out to you from the annual review of value-based arrangements? Preventive screenings are up and some of the costs are lower, right?
Shrank: One important thing to recognize is that we at Humana and Medicare Advantage, in general, have been able to adopt and move more rapidly to progressive, value-based contracts than we’ve seen in other parts of the healthcare industry.
About two-thirds of our patients are now seen by providers in value-based arrangements, and nearly half of them are seen by providers taking meaningful downside risks and (who are) deeply aligned with us, financially, and with the patient financially, to deliver better care, more efficient care, more coordinated care, more preventive care, deliver better outcomes and at lower costs.
The other key thing to realize is that these transitions are hard. It’s not as though you flip a switch and providers can immediately transform how they deliver care, but we’re seeing now in these relationships that we’ve had for years and years … continued improvement in terms of the quality of care, in terms of outcomes and fewer hospitalizations, fewer visits to the emergency room. We’re seeing more and more savings, and we’re seeing our patients are having better experiences.
MH: The shift to value-based arrangements is sporadic. Given Humana’s experience, what are the biggest pitfalls that you see? What are some of those things that the provider community is having the hardest time adjusting to?
Shrank: It’s hard for providers who are straddling both a move toward value and continued participation in fee for service. Those providers that we see trying to be successful in both—it’s hard to do both at the same time. The providers that we’re seeing that have really great results are those that make the commitment, that make the jump.
Then overwhelmingly across the populations that they serve, they apply the same approach, the same philosophy, the same orientation, which is caring for the population with the aim of keeping people healthy, providing more care coordination, providing more touch points, focusing on quality and prevention in order to make sure that patients are staying as healthy as possible.
MH: How much do you nudge them and how do you do that in a cooperative way?
Shrank: The best way for us to participate with providers is to meet them where they are. Not to push them, but to understand that there’s a continuum. There are two ends of the spectrum, but providers can fall anywhere on that continuum of readiness and preparedness. It depends a lot on what the market in which they operate looks like and what other payers and what other arrangements are available to them. It’s our job … to understand where they are and where they’re comfortable today and where they’re willing to go.
Then it’s also our job to be responsive and nimble and flexible in terms of providing them with the data they want, in the way that they want it, to provide them with wraparound services that address the needs of our members, their patients.
If a provider says: We’ve got all the care-coordination services we need, that’s great. However, if they’d like us to provide more of those care-coordination services, that’s available. We can be more nimble. We can provide more services to the home. We can work to be true partners in how care is being delivered and how we support providers to fill in any gaps that they have, in terms of managing the health of our population that they serve.
MH: You’re doing some work on wraparound services on social determinants, right?
Shrank: Yes. That’s an area where we’re doing that pretty systematically across the markets in which we operate, and we’re eager to be a partner and to help facilitate our members, the patients of our physician partners, to get those referrals that they need.
MH: CMS officials talk about the inconsistent performance of some of the value-based initiatives the agency has rolled out. How can the industry get to a more consistent approach to value-based contracting nationally?
Shrank: It’s a challenge. What we saw (the Center for Medicare and Medicaid Innovation) do at the outset is offer a whole host of different models, a whole host of ways that providers can engage with the goal of both learning which are the models that are most effective, but also to build that sort of wildfire of opportunity and a sense of some inevitability that there is going to be this movement from volume to value.
However, there’s a lot that the private sector and private payers are in a better position to do. We can be a lot more nimble. We can be a lot more responsive. We can offer a whole host of different kinds of services that CMS is just not organized to do. CMS isn’t organized to be able to deliver networks of community-based organizations to address social needs. They’re not organized to deliver home-based care or care-coordination services. They’re not organized to wrap in utilization management as needed by providers or for prior authorizations seen by providers.
In a lot of ways, what we’re seeing is while CMS and the Innovation Center play this incredible role in helping to move the industry forward and to continue to educate and create a sense of urgency and inevitability of moving toward value, the models that are maturing are maturing faster in Medicare Advantage. We’re able to create deeper and more meaningful partnerships with providers.
A part of it is that we’re seeing more movement toward prepayment—global payments—the kinds of fundamental shifts in incentives where providers are oriented around the health of the population in a very deep way, and that CMS … has a lot of different steps along that continuum. That idea of moving providers to arrangements where they’re prepaid, where there’s some global capitation—there’s no question that’s where we’re seeing the most clinical innovation, the most clinical transformation, the most meaningful changes in how care is being delivered.
MH: We don’t know what’s going to happen at the Supreme Court and with the entire Affordable Care Act, but if the law is overturned then the work the Innovation Center has done would presumably go away because the underlying law would be gone. How worried are you about pullback on the federal level if some of these programs go away?
Shrank: It’s hard to comment on what would happen at a federal level, but I can say with complete confidence that from the perspective of Humana, and I’m going to say with very high levels of confidence from the perspective of other payers in the Medicare Advantage space, the partnerships we’re creating with providers, the alignment we’re creating and the richness of benefits that we’re seeing for our members, are all the proof we need. We’re not going to turn around based on the results of any legal cases. Our providers aren’t asking to go back either.
Our providers’ … work is much more aligned with why they went to medical school in the first place. They’re focused on taking the best care of the people that they’re serving, listening to their patients, understanding their patients’ needs, being more consumer-centric and more focused on really just optimizing health, rather than focusing on visits and our views.
MH: While there aren’t many silver linings to the pandemic, one thing people keep saying is that it has shown the necessity to accelerate the drive toward value-based arrangements. Can you talk about what you’re seeing among the providers you work with and what the pandemic has done in terms of the underlying metrics you may have in place for contracting?
Shrank: It is hard to talk about silver linings at a time that so many people are suffering. We are just all overwhelmed with gratitude around how providers, nurses, front-line healthcare workers have stepped up.
The partnerships that we’ve developed throughout this pandemic have really been gratifying, as is that sort of alignment around the mission. We have seen that those providers that were in arrangements where they’re prepaid, were unbelievably nimble.
Healthcare changed unbelievably in a matter of weeks. We saw doctors who were taking care of patients (where) 1% of their visits were telehealth, go to 95%. Care in the home was being delivered very differently. The types of contacts changed literally on a dime. Those providers that were in global payment arrangements had the financial stability to … not worry about the impact of doing the right thing for members.
Those stories are compelling as providers didn’t have to take risks to do the right thing. Others saw that the financial sustainability, the resilience that comes from a value-based contract, looks even more appealing.
There have been higher rates of conversations (with) providers coming to us and saying, “What can we do in the shorter term to address some of these resiliency issues, and try to move more rapidly to value-based care?” It’ll be really interesting as we go into next year to see how those numbers turn out.