How employer-sponsored episode programs are rewarding patients and high-performing providers

Commercial health plans and self-insured employers are increasingly pursuing episode-based arrangements with providers after seeing varied levels of success with other value-based care efforts. While the main purpose of these efforts is to lower the cost of care and create healthier plan members, the majority of these arrangements unintentionally place burdens—both operational and financial—on the providers that actually deliver the care. Modern Healthcare Custom Media hosted value-based care and provider leaders to discuss how episode-based arrangements can produce desired outcomes while simultaneously diminishing operational and financial burdens.

To access the full webinar, visit: www.modernhealthcare.com/EpisodeProgramsWebinar.

1 Episode-based payment programs differ from traditional fee-for-service reimbursements

An episode-of-care payment covers the care a patient receives during the entire course of treatment for a specific illness, condition or medical event, in contrast to traditional fee-for-service reimbursement, which pays providers separately for each service. For example, an episode-of-care payment can include all physician, inpatient and outpatient care for a pregnancy, hip replacement or heart attack. Instead, costs are bundled and paid as one service to one or multiple risk-bearing provider entities. For providers that successfully deliver highvalue care under a target episode price, the savings can be substantial.

2 Episode-of-care programs are helping employers and employees save money

Today, employers spend an average of $10,850 per employee on healthcare and can expect to see a 6.1 percent increase in medical spend if current plans are left in place. Episode-of-care programs led by large employers such as the State of Connecticut employee health plan are creating the ability to negotiate a payment for a more comprehensive unit of service, which will likely be less than fee-for-service payments. In addition, the number and type of episode programs available to employers and providers is expanding to include both specialized procedures and chronic conditions—and range from ongoing treatment for diabetes to orthopedic surgery.

3 Episode-based programs align multiple stakeholders

All stakeholders, including patients, providers, and employers stand to benefit from episode-of-care programs. Patients have reported increased satisfaction, due mainly to increases in coordinated care and reduced gaps in treatment. Providers benefit from better patient outcomes, revenue and market share opportunities with employers, and improved transparency across the care continuum. Employers benefit from more predictable costs, reliably high-value providers and a healthier workforce.

4 Episode models highlight the need for clinical and social care coordination

Episode-based payment models, by accounting for the financial cost across an entire health event, must necessarily adapt to the needs of the patient within and beyond the clinical setting. Providers that are successful under episode-based arrangements are those that build care coordination capabilities or partner with vendors to coordinate clinical and social care across episodes. By addressing the social determinants and other gaps where patients meet their biggest barriers to optimal health, patients avoid adverse events such as readmissions, seek the right care locations, take their medications as prescribed, and be motivated and capable to maintain their own health.

5 Provider innovation can help employers decrease costs, while helping their patients and practice thrive

Since low-value providers must be financially motivated to become high-value providers, it's essential to engage physicians, clinicians and other caregivers to assess services provided and the tools used to ensure all stakeholders align and thrive under value-based models such as episodes of care. Using that knowledge, they can then survey the payer landscape, evaluate risks and rewards, find the right partners and when the time is right, advance their journey to providing the highest value care possible.