Have you ever researched a big purchase? Looking for the smallest details, customer reviews, capability, compatibility, or whatever the case may be. We usually don’t put nearly that much effort into looking deeply at healthcare providers and organizations as we would a new car, and most of that might be due to the fact that information is not as readily available regarding the healthcare industry as just about any other industry out there. There is a level of trust and expectation that we afford those working to treat us. However, this is not the norm any longer. A group of payers, patients and providers have come together to change the way healthcare is handled and specifically how money is managed from within and without the walls of a care organization. The view is no longer fee-for-service but is now value based service. With a change in view comes a whole new outlook and creating goals for value-based purchasing in an organization.
It doesn’t take a rocket scientist to know that the cost of care has significantly increased over the last decade and longer. What many people are asking is if we, as patients, are receiving significantly more care for that upsurge in charges. Obviously, there have been great advances in recent years that have made treating illnesses more effective, provided a better quality of life for many and have eliminated procedures like exploratory surgery. But, this doesn’t account for the ever rising numbers each year, and one group that has taken note of these cost growths was the CMS (Centers for Medicare and Medicaid Services).
A normal way of practicing medicine, as well as keeping a business of doctors afloat, was to, within reason, perform as many tests, procedures and exams so as to bill patients and insurance. This wasn’t to scam patients, but it was the way that facilities stayed on top of the ever-rising costs. In part due to these kinds of practices is the exact reason why the above listed group of people got together and decided to change the system as a whole. Fee-for-services wasn’t working and was going to lead to rampant misusing of the reimbursement structure, and was also subjecting patients to unnecessary stress, appointments and costs, which didn’t help improve the care they were receiving.
The overhaul of the healthcare system is a simple two-fold mentality:
- Create a healthier population
- Lower the cost of healthcare
To change an ingrained design requires understanding the problems and setting goals to implement the new strategy. Some of the problematic results that occurred under fee-for-service treatments included things like hospital acquired conditions/infections, and readmissions to emergency or other facilities. Physicians weren’t necessarily treating the patient in a manner that would help them get better, thus the consequences were that patients weren’t getting better, and in some cases were getting worsening or new ailments. This perpetuated the problems of not helping a patient to get better and driving the cost of care higher.
Throwing everyone into a new system doesn’t come without its own set of headaches, too.
- Everyone is expected to go by the same basic standards
- Very little or no data or examples to follow
- Penalties established are severe and stiff
- Not every organization is able to implement new and costly software
- Short timeframe in which to comply
The value-based purchasing format is a very detailed, data- and time-intensive layout that monitors information being taken in and finds the inefficiencies and waste in order to eliminate them and provide the best care possible. CMS has the right intentions to want this applied across the healthcare board, but it can’t be employed by everyone the same. One of the biggest reasons that CMS wants to change the way that healthcare is being handled is the amount of taxpayer money that is spent each year. Combined Medicare and Medicaid costs in 2014, the latest numbers available, were over $1.1 trillion. Both had a significant percentage increase over the previous year, and those numbers were projected to grow each subsequent year.
Complaints that have been coming into the government have a particular edge to them, and one area of concern from the standpoint of the providers is that CMS rewards providers that had a high-cost performance record and reduced their overall costs, while penalizing low- and lower-cost providers who weren’t able to reduce their spending nearly as much. The same thing goes for organizations that are able to absorb the penalties when they either choose not to or are unable to meet specified requirements from CMS. Small, more tightly run organizations that are not able to meet requirements or handle being penalized are being forced to downsize, reorganize or close altogether.
Unfortunately, value-based purchasing and activities are more of a revolution to the healthcare system than an evolution. There is little room to argue, but it is for the best of everyone involved. Thus, it is essential that goals for value-based purchasing to be set within each organization. It is impossible to establish a set of goals that would work for each organization, because needs are different in each community and population. This is where the need for accurate data and the ability to interpret that data comes into effect. Value-based purchasing is going to be much more work, but will produce data-driven evidence that will not only help provide patients with a better level of care, but will remove wasteful spending and practices.
In ever revolution there are those fighting for the status quo, they might want to see the big picture, which is the long-term goal of providing better care at a lower cost. Change doesn’t come easily, and changes on these grand scales are going to come with a lot of growing pains as well as refinements as discovery happens over time. Setting goals for value-based purchasing and activities is going to make the move less laborious and stretched out as possible.