HCI3 Update from the Field: Payment Reform Efforts are Having a Really Positive Effect

Submitted by francois.debrantes@hci3.org on Friday, August 5, 2011 - 01:00

HCI3 Update from the Field – Newtown, CT

In a week in which gloomy news has been followed by gloomier news, we were privileged to witness how payment reform efforts are having a really positive effect – some of our implementation partners got together earlier this week to share some lessons learned from rolling out episode of care payment, and they were truly encouraging. First, the focus on managing a patient through a complete episode is prompting physicians and hospitals to communicate. They're sharing best practices; they're finding internal variation in processes and fixing them. And they're measuring and monitoring the health and well-being of the patient from beginning to end. Some orthopedic surgeons are collecting data on their patients that are yielding deep insights on how to better match patient needs with implant type. Some hospitals are engaging LEAN and Six Sigma teams to improve effectiveness and efficiency. Health plans are enjoying a richness and closeness in dialogue with their network that hasn't happened in a long time. And we're also discovering some interesting nuggets. For example, using a DRG-based formula for some procedural episodes might be an impediment to capturing additional payer savings. In some instances, working directly with physicians can be a more powerful way of moving the market than getting the hospitals involved. Solutions, to be effective, have to be crafted in a way that meets stakeholders where they're at while nudging everyone in the right direction.

What this means to you – American ingenuity, baked deeply into the entrepreneurial spirit that has made the US such a great country, is being fully unleashed by these payment reform activities. For plans and providers, the crushing weight of the fee-for-service boulder is being lifted, and you can see and feel the excitement, the hope, and the real progress being made. Unsurprisingly, this rapid change isn't occurring in large health plans or provider organizations, because they've crushed themselves under the weight of bureaucracy, and the false comfort of the status quo. It's happening in smaller plans and provider organizations who are closer to the ground and the pulse of the country, and not afraid to make a change. As this cycle of change continues, look to them as the real leaders of tomorrow, because if history teaches us anything, the leaders of yesterday are, in fact, yesterday's news.


Francois de Brantes
Executive Director
Health Care Incentives Improvement Institute, Inc.
w: www.hci3.org