Health plans

How Direct Contracting Initiatives Can Fuel Employer-Funded Health Plans

Execution of holistic care plans must occur in care networks where medical and non-medical resources are closely coordinated.

The COVID-19 pandemic has exposed and exacerbated system health equity issues that have long plagued underserved communities. Vulnerable populations have been severely affected by the pandemic, resulting in superior hospitalization and death rates among African Americans and Hispanic Americans, according to the Centers for Disease Control and Prevention (CDC).

Employers, community advocates and the public health sector are increasingly aware that implementing true value-based care (VBC) initiatives – to improve patient outcomes while reducing costs healthcare – will be difficult without also addressing issues of diversity, equity and inclusion (DEI) in the healthcare ecosystem.

Unlike traditional fee-for-service healthcare, VBC aims to proactively keep people healthy rather than engaging in reactive “sick care”. The holistic nature of GBV requires the ability to leverage social determinants of health (SDoH) to develop individualized care plans and inform population health strategies. VBC models that incorporate SDoH to promote health literacy and support DEI values ​​can achieve greater health equity, better patient outcomes, and lower health care costs.

Related: 3 Strategies for Employers Considering Value-Based Insurance Design

Yet VBC relies heavily on sharing data with community-based organizations (CBOs), including social service agencies, charities, foundations, and religious groups. Community organizations have SDoH data regarding environmental and social factors (such as income level, housing status, and access to healthy food), which research shows have a 80% impact on a person’s health.

Using SDoH data, employers and their administrative partners can take a holistic approach to the health of their employees and families. Even if an employer wants to efficiently administer value-based programs at scale, legacy administrative systems can make this impractical. A common barrier is the inability to integrate and manage a complex, multi-party care network while accommodating the event-driven and episodic demands of payment models that are no longer claims-centric. Another hurdle is the speed and digitization of complex data reporting and the inability to understand contract execution prospectively, rather than after the fact.

A framework that supports complex many-to-many hierarchies between network entities is needed. These relationships become important not only for onboarding stakeholders, capturing, digitizing and sharing complex data, but also for administering payments between entities.

By designing and implementing a Value-Based Benefits Administration (VBBA) model that integrates health at the “periphery” – that is, reaching patients at home and in the community, both physically and through digital technology – employers can more effectively address the welfare needs of vulnerable populations while better managing costs and tracking contract performance.

A successful VBBA requires a network infrastructure that enables many-to-many relationships between VBC stakeholders and their peers. These may include health insurance companies and third-party administrators (TPAs), risky entities such as responsible care organizations (ACOs), clinically integrated networks, separate programs for the management chronic diseases, primary care, managed care programs, social services networks and CBOs.

Administering direct contracts can be a huge challenge using traditional approaches and legacy systems that lack the reporting relationship structures needed to integrate stakeholders into value-based contracts. This hierarchical approach to onboarding partners, scaling contract operationalization, and sharing authorized data is a necessity for aligning the medical, social, behavioral, and environmental components of a healthcare administration. value-based program and high-performance networks that drive healthy patient outcomes.

A network of networks

Executing holistic care plans must occur in care networks where medical and non-medical resources are tightly coordinated within an infrastructure that aligns performance for healthy patient outcomes and financial risk management. By providing ecosystem participants with a strong onboarding model and the right supporting capabilities, employers and their TPAs ​​can successfully execute value-based programs that integrate holistic health.

These emerging care and payment models require real-time or near-real-time data status and exchange, a more forward-looking approach to reimbursement, and precision approaches to care team data sharing. Additionally, by engaging and integrating the patient into the continuum of care, employers will empower patients to be effective stewards of their own health.

While the transition will not happen overnight, every entity involved in delivering patient care will eventually become part of the networks that deliver VBC. A network is essentially made up of providers, facilities, suppliers, and caregiver organizations with which a health insurer or employer has contracted to provide health care services to patients. When an entity in a network is engaged in multiple networks with different contractual commitments with other entities, this creates very complex many-to-many relationships.

A network of networks is only possible with an infrastructure that supports both the complex hierarchies between the entities involved in VBC and the data infrastructure. Interoperability between these networks as well as legacy systems is only possible with an appropriate DaaS (data as a service) layer built on top of the data infrastructure.

Employers and their TPAs ​​can take advantage of such a robust data support/microservices/hierarchy infrastructure that facilitates faster scaling to expand direct contracting and VBC programs. This platform infrastructure can extend the capabilities of the TPA to seamlessly integrate data layers, and then extend that data layer either as DaaS or as PaaS (Platform as a Service).

Real-time healthcare requires an aware and adaptive technology infrastructure that supports complex relationships and datasets for the network and enhances them using publicly available datasets.

Employers are getting directly involved in demanding accountability for health care costs and promoting well-being. Supporting the hierarchical needs between the different entities involved in value-based networks, coupled with the data and microservices infrastructure discussed above, will accelerate VBC adoption and scale and enable employers to improve health outcomes while reducing the costs of care.

Lynn Carroll is the director of operations and Rahul Sharma is the general manager of HSBloxthat helps healthcare actors at the intersection of value-based care and precision health through a secure, information-rich approach to patient-centric, event-driven digital healthcare processes – empowering overall health in traditional care settings, at home and in the community.

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