How Home-based Care During Covid Improved Value-Based Care Adoption

Oct 29, 2021 at 10:34 am by pj




Over the past year, consumers have embraced the digitization of services of every kind as the pandemic has reshaped how businesses meet consumer needs. In turn, businesses had to rethink how to fulfill consumer expectations while addressing serious health risks associated with exposure to COVID-19. Healthcare providers, patients, and payers found they needed to do the same.

Like other businesses that depended on physical consumer traffic – including transport, live entertainment, drinking and dining, and brick-and-mortar stores - when elective and non-emergency healthcare services halted in early 2020, fee-for-service models –where patients were required to visit practices in-person – saw massive drop-offs. Accounting for 39 percent of healthcare payments, fee-for-service care financial models cratered; a recent AHA report stated that hospitals and healthcare systems lost at least $323 billion in 2020. 

At the same time, the pandemic served to further catalyze the adoption of value-based care analytic models in several important ways. Due in large part to vaccine shortages, the entire US population was risk-stratified, and cohorts were identified and prioritized to receive the initial wave of vaccines.  The process continues today, as states turn to CDC guidelines to prioritize cohorts for booster shots according to age, health risk factors, chronic conditions and social determinants including race, residence, and type of employment. This model of balancing demand with capacity is a central feature of population health management in general, and value-based care in particular to optimize allocation and utilization of resources.

Meanwhile those providers already operating under partially or fully capitated business models, receiving a risk-adjusted per member per month payment, found revenues much more predictable despite the loss of foot-traffic, but were faced with coming up with strategies to manage risk in populations who were avoiding timely testing and treatment, particularly for detection and management of early stage chronic disease. And all providers faced needs to find ways to address rising behavioral health issues caused by isolation, financial, and social anxiety.

Value-based care for providers is the path to translating early intervention into healthcare savings.  Comprehensive value-based care requires identifying health risks early and managing chronic conditions consistently. It necessitates active monitoring of an individual’s health and the earliest possible interventions that are proven to avoid more costly intervention later. Ensuring patients receive excellent care, informed by medical evidence to avert serious conditions and their corresponding high costs, is a key driver of value-based provider revenue.

The providers who adopted value-based care models before the onset of the COVID-19 pandemic benefitted from far greater consistency of revenue and have experienced far less disruption to their operations, even as patient volumes have continued to be lower throughout 2021. Provider organizations engaged in value-based care contracts are taking a longer view of revenue recognition; they remain focused on patient outcomes over time, because payment and incentives are linked to measures that indicate sustained patient and population health.

Providers who had previously focused on whole-patient-care, managing patients based on conditions and treatment opportunities, and not just on symptom presentation, were most ready to respond during the pandemic. For example, these practices were able to reach out to patients with a history of depression and anxiety to assist with the emotional and behavioral effects of the pandemic. Those that had adopted modern care management technology were also able to maintain communications with patients with chronic conditions and provide personalized recommendations on managing exposure in alignment with their individual risk profile.

The pandemic has changed the way the industry looks at value-based payments. Before the onset, payment models that introduced financial risk appeared less attractive than volume-oriented, fee for service. But when visit-based fee-for-service business models cratered, it became the “risky” proposition, with nowhere to turn in a pandemic economy. It’s no wonder that some providers outwardly admit they regret deferring decisions to embrace value-based care.

The telemedicine revolution also benefitted enormously due to the precipitous decline in in-person visits. Faced with the need, like so many other businesses, to reinvent product delivery as an online service, both payers and providers suddenly embraced a technology that had long been underutilized through underfunding . With Medicare and HIPAA rules relaxed during the pandemic, telemedicine saw a tsunami of adoption. Patients, who as consumers were already well acquainted with online services, and as employees or family members were increasing accustomized to online video chat, were pre-acclimated for online office visits, having long associated visiting the doctors office with poor parking, long waits, and limited service.

From seasonal hay fever to continual monitoring of diabetes and home care for cardiac rehab, a set of technologies was unleashed at the scale needed that connected patients to their providers. Discussing lab results and scans didn’t necessarily require the patient to go in and risk exposure to COVID-19, any more than it actually did before COVID-19.  Both parties found telemedicine offered more convenience, and as a result, more follow-ups and connections could be scheduled. In the value-based care model, the more access a patient and provider have to one another, the easier it is to identify and act on those crucial early interventions.

As the delivery of care has changed, so do the reimbursement model providers need to embrace moving forward. COVID-19 has provided a tipping point for the adoption of value-based care. With more patients accustomed to receiving care remotely, the unprecedented disruption to the access of care and the incredible speed required to adapt have left permanent, remarkable impacts that support value-based care adoption.


Malcolm Costello is SVP, Population Health at Cedar Gate Technologies. Visit Cedar Gate Technologies | Home