Focusing on Reducing Cost Alone is a Job Half Done.
Value-based care is often treated as synonymous with cost reduction. Even the terminology within alternate payment models, shared savings for example, emphasizes that benefits are found in saving money, and therefore reaping a financial benefit. Our latest ebook, Pulling Both Levers: A Four-Year Analysis of Medicare Cost and Risk Adjustment, uncovers how utilization management is only one of two levers that can, and should be understood and leveraged for success in funding (and therefore delivering) care.
The Growing Influence of Risk Adjustment
While risk adjustment is an intrinsic element of healthcare in the US, critically important to upside and downside risk-sharing models alike, it is often overlooked as an opportunity to support revenue and better engage with patient care.
The ACO Algorithm Simplified
Historic expenses, risk adjustment, medical expenses, and quality: each an element of the bedrock ACO algorithm. In our new ebook, we unpack each element, how they interact, and their short- and long-term ramifications on revenue and benchmarking.
The Relationship between Cost and Risk
Cost reduction through increasingly better utilization management has diminishing returns. Risk adjustment is capped at 3% a year. Each alone can move the needle on revenue for an organization, albeit within its limitations. However, when effective utilization management is employed alongside accurate risk adjustment, the delta between cost and reimbursement, improving benchmarking and impacting short and long-term revenue.
Identify Your Performance Pattern
In addition to offering insight into the algorithms that lead to care funding and the relationship between risk and cost, our latest ebook includes an analysis demonstrating it with real-world data from CMS. Controlling for short term variability, and population churn, our analysis illustrates four separate outcomes in performance year 1-2, based on benchmarks established in the prior two years (BY2-3). Every MSSP between 2014-2018 fell into one of these categories. Armed with this data and analysis, risk-bearing organizations can recognize their own circumstances and determine the best, strategic next steps for the coming years.
Download Pulling Both Levers eBook Part 1:
A Four-Year Analysis of Medicare Cost and Risk Adjustment
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