Blue Promise: What is Value Based Care?

The health care industry is changing so that patients get more value from the money they spend. This movement is appropriately called “Value Based Care” and it aims to compensate doctors based on the impact they have on their patient rather than the number of services they perform – which is called “Fee-for-Service.” In this episode of Blue Promise, Dr. McCoy talks with Jack Towlsey, BCBSTX DSVP Health Care Delivery, about the impact that Value Based Care will have on the average consumer.

Blue Promise is an online video blog that aims to address complicated health issues with candid conversations from subject matter experts. New editions are published regularly and are hosted by Dr. Dan McCoy, Blue Cross and Blue Shield of Texas' Chief Medical Officer and Divisional Senior Vice President of Texas Market Strategy.

Show Transcript
DAN: Hello I’m Dr. Dan McCoy and welcome to Blue Promise. I’m here with Jack Towsley, who’s our Divisional Senior Vice President. Jack, what are you in charge of here at Blue Cross?
JACK: Provider Network, Dan. I concentrate on making sure that our provider networks from one end of the State to the other have adequacy and the cost that our customers expect.
DAN: So, one of the things that our customers are talking really a lot about is this concept of value based care, but what is that?
JACK: Value based care is changing the way that we purchase care from our providers, going from what we currently do, which is fee for service, and moving into a different structure, a different arrangement with the providers, whether they’re hospitals or physicians and changing what we pay for, to make it more of a value equation instead of a volume equation.
DAN: So when I was in practice. I was one of those fee for service guys, ‘cause when a patient came in, I would do my care and then I would submit a bill. So, how does value based care look different for a consumer in a valued based care model fee for value model?
JACK: Well, to the consumer, its still - go to the physician, go to the emergency room, go to the hospital, have a procedure, go to the imaging center. They’re still receiving care the same type of way, but the payment on the other end is what changes. It changes the way that the physician is now thinking about other care and other arrangements that the patient has received. The imaging center is held accountable for what they’re delivering back to the patient. So it’s changing on the back end, the payment side, but not necessarily on the front end.
DAN: So I guess the patient maybe will experience a different experience, though, right? I mean, their doctor is gonna be focused on maybe outcomes and overall value as opposed to just how much throughput gets through their office. Is that kind of what you’re saying?
JACK: Yeah, that’s exactly right. So the hope is, that by aligning the financial and the clinical incentives for the provider, that the provider is more thoughtful, that the physician is thinking about well, where is this patient in their care, what gaps in care are there, what else could be done for that patient and being more thoughtful in helping guide the patient to a better outcome.
DAN: Now, you and I both have a little gray hair, okay. So this is not, in some respects, a new concept. I mean, I heard something like this back in the nineties. So why is it different today? I mean why do most people that this is going to be the real deal this time around?
JACK: Well, it’s a good question. And back in the nineties, the ideas of value based care - it was there in a different form. It was called capitation or different names. The concepts were right, but we weren’t quite there yet with having the sophistication of the data systems, the identification of what the needs are and being able to facilitate and provide that, particularly to the physicians. So the physicians, we were putting them in a place where we were saying provide better value, provide better outcome, but we weren’t giving them the information that they would need to make a better decision, so the concept was right but it was too early to actually do it right.
DAN: And that’s when people talk about delivering data, right? So people that are discharged from the hospital or if they refill their medicines and those are the kinds of things a doctor can use that data to help make a decision.
JACK: Yes, exactly. That’s what gives the full picture of the patient to the physician so that they can make that better decision on where that patient is in their care needs so that they can insert and direct the patient in the right place.
DAN: So I can see now why I think that patients would like that experience because now all of a sudden their doctors have aligned incentives around getting their outcomes better and their overall value. But why would a customer want to be a part of those models? I mean, adding that data, that sounds a little expensive, so why would a customer want to be a part of that?
JACK: Well, for a customer better value is better outcome, lower cost. So that value equation to the customer should be their employees are healthier, more productive, but also their health care expenses should more controlled and manageable. Duplicate tests – maybe those are eliminated, but also going to the right site of service, understanding what the right options are for the patient, identifying patients that maybe they need a little extra coordination to avoid a readmission to a hospital those sorts of things translate to our customers to a better savings.
DAN: So that’s value based care. It really kind of has better value not just for the patient, but also for the customer
JACK: Exactly.
DAN: Great. Jack thanks for being here today and thanks for joining us on this episode of Blue Promise.
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