The key--as the authors note--is that these changing conditions must be exogenous. If patients become more severely ill due to poor clinician care during the episode, clearly this should not be risk adjusted. The authors argument to incorporate exogenous factors (e.g., unemployment, housing eviction) into risk adjustment is sensible, but it's not clear how many exogenous factors could truly be identified. Additionally, loss of employment may make people switch insurers in which case an episode may terminate if the new payer does not have episode data from the previous payer.
Solution to misaligned incentives: incentivize holistic care
The authors provide clear examples that more holistic and integrated care can produce improved outcomes and reduce cost. However, this isolated cases do not mean that it always will. The authors argue that providers should be rewarded for "remote patient monitoring, assembling care teams to manage data workflows, and creating evidence-driven equity plans." These, however, are just different process measures to evaluate and do not actually incentivize improved patient outcomes or reduced cost (which are the twin ultimate goals). The authors also argue for incentivizing integrated practice units (IPUs). However, CMS has already had a number of integrated care initiatives such as accountable care organizations (e.g., Medicare Shared Savings Program) and the Multi-payer Advanced Primary Care Practice Demonstration. The latter is based on the patient-centered medical home model but showed little cost savings or quality improvements.
Institutional inertia solutions: Use plan-do-study-act (PDSA) cycle
The author's proposal for quality improvement to happen through the plan-do-study-act (PDSA) is a good one in theory. The authors also argue for more reimbursement for information sharing activities. In fact, I would believe many provider health systems are already doing a lot of PDSA and some information sharing as well. However, having CMS requiring provider to enact a PDSA activities, likely would not change behavior and would just result in a documentation exercise, imposing additional cost on providers. While PDSA is very useful at the provider level, I am a bit skeptical that payer incentivization of PDSA would make a major difference in practice.
In short, I agree that the authors have identified some short-comings of the current alternative payment models approach. Many of the suggestions they make are very reasonable at the provider level, but likely would not be impactful if these were simply payer mandates. Still, I applaud the author's efforts to have creative thinking on how to improve APMs.
Originally posted at Healthcare Economist.
The views expressed herein are those of the author and not necessarily the views of FTI Consulting, Inc., its management, its subsidiaries, its affiliates, or its other professionals.
