An “A-Ha!” Moment!

In our country today, the face of healthcare is dramatically changing, and as providers, we recognize the need to address the reality that the current business models within which we have practiced for years have now become obsolete.

 Why We Welcome Many of These Changes!

Because health care costs in the United Sates are much greater per capita compared to the systems in other advanced countries, yet we do not deliver better results.  This is because:
    1) the US employs a fragmented, chaotic health care delivery system that     incentivizes providers to perform high service volume rather than     delivering high quality care,
    2) our system uses too few primary care providers and too many specialists, and finally,
    3) our current system is “provider-centered” as opposed to being “patient-centered”. 

It is time for a change to this bloated, wasteful healthcare system!  

A Formal Call To Action!

In 2010, the signing of the Patient Protection and Affordable Care Act (PPACA) formalized these trends.  The PPACA focuses mainly on health insurance regulation and the expansion of coverage, but also addresses our healthcare delivery system’s role in the escalation of health spending; the law’s major effort in this regard is to change the way providers are paid.  This effort involves the transition to reimbursement methods such as shared savings, payment bundling, and capitation models.

The Call is Answered!

On January 26, 2015, Sylvia Mathews Burwell, the Secretary of Health and Human Services, announced that starting in 2016, Medicare will base 30% of its payments on how well providers care for their patients, and by 2018, that goal will be increased to 50%, using alternate payment models such as Accountable Care Organizations and bundled payment arrangements.  This percentage was at 0% in just 2011, and currently is approximately 20%. 
These are the most aggressive value-based payment goals in the history of the United States. 

Producing additional billable services for our patients used to be seen as “profit centers”, but under value-based reimbursement models, are now actually

considered to be “cost centers”.  The shift is from a focus on quantity of care to the focus on quality of care.  The challenge we face is to convince specialists to cooperate within this model of value-based payments because they currently still receive a majority of their reimbursements as volume-based payments.  We need to prove to them that their future success depends on coordinating care and reducing costs!