I recently had the pleasure of attending two events in Washington, DC: West Health’s Healthcare Costs Innovation Summit and URAC’s Telemed Leadership Forum. As I reflect back on these events, it strikes me that, while the specific focus and substantive information presented at each was quite different, I heard the same theme running throughout both, loud and clear:
“The sooner we move entirely away from a fee-for-service pricing model towards a value/outcomes-based reimbursement system in the US, the better off our healthcare system – and the patients who use it – will be.”
~ Carrie Nixon
The opening remarks from Gary West, Founder of West Health, and Tim Lash, West Health’s Chief Strategy Officer, did not mince words. Both contended that the current state of healthcare in the U.S. delivers too little quality care at too high a cost, and that waiting for the politicians in Washington to deliver us from this healthcare crisis is not a viable strategy. They laid out their three “Common Sense Solutions” to the problem:
- End Fee-For-Service reimbursement and move to value-based care;
- Empower Medicare with the right to directly negotiate drug pricing; and
- Implement transparency in healthcare pricing
Former Administrator of the Center for Medicare & Medicaid Services Andy Slavitt went on in his remarks to identify what he termed the “Triple Threat to the Triple Aim,” a reference to the lexicon commonly used to describe the main tenets of the Affordable Care Act – improving the patient care experience, improving the health of patient populations, and reducing costs. Slavitt contends that the biggest threats to high quality, low cost healthcare in the U.S. include:
- Inequality and health disparities;
- “Revenue-thinking” as an all-consuming single-aim; and
- Politics and the politicization of healthcare
While featured speakers throughout the Summit recognized the important role that digital health innovations can play to address these threats, there was universal recognition that technology by itself can’t be the solution. This recognition was clearly shared by participants in the Telemed Leadership Forum days later.
In a panel discussion moderated by Rene′ Quashie, the Vice President of Policy and Regulatory Affairs for Digital Health at the Consumer Technology Association, panelists were quick to point out the promise of telehealth technology for addressing inequality of access to care, but were just as quick to caution that the Fee-For-Service reimbursement model positions telehealth as a mere commodity, creating a barrier to successful implementation. The real return-on-investment for telehealth and remote patient monitoring services is seen in models like the Medicare Shared Savings Program ACOs and Medicare Advantage plans, where increased utilization in the short-term may actually reduce costs over the long-term.
With the Affordable Care Act, policymakers have taken an incremental approach to weaning healthcare providers away from the Fee-For-Service model that has done so much damage to the U.S. healthcare system. The consensus among many forward-thinking leaders in the industry now appears to be that the time has come to eliminate “revenue thinking” and rip off the band-aid entirely with a full shift to outcomes-based reimbursement.