The industry’s evolution to value-based care payment models has been a constant journey for many healthcare organizations for more than a decade. Healthcare providers across the wide spectrum of the field have been learning as they go, building on successes and failures. But when it comes to evaluating the industry’s progress so far, if you’ve seen one successful value-based care model, it just means you’ve seen one successful value-based model. That’s because some organizations, states and industry sectors are further along than their counterparts or have unique factors affecting these markets.
The movement toward value-based care and population health management, or community health management, is also incredibly local in its orientation. The ubiquitous bumper sticker phrase sums it up nicely: “Think globally, act locally.” With that in mind, CEOs should not only approach value-based care initiatives with the big picture in mind but also with an internal focus on what fits their organization’s unique characteristics such as size, location, culture and payer mix. Today’s healthcare CEOs also play a critical role in courageously leading their organizations into these new, vital frontiers.
A Multidimensional Work in Progress
Howard University Hospital is an academic training, urban hospital located on the campus of and owned by a historically black college and university. It is the only facility of
its kind in the United States. Howard also serves as the primary essential-access hospital in Washington, D.C.; approximately 75 percent of the district’s vulnerable population seeks care at Howard. With these distinctive attributes in mind, Howard has embarked on several value-based care and community health initiatives, including engaging in discussions with managed care organizations and configuring them to be more integrated so they can build the infrastructure needed to support these goals.
As an essential-access nonprofit hospital, Howard’s payer mix is primarily governmental, with over 85 percent comprising the traditional and managed care aspects of Medicaid and Medicare. Howard has begun to have conversations with local Medicaid MCOs about what they can do in partnership to reward and incentivize behavioral changes around how care is delivered and managed.
At the same time, Howard is striving to create a more integrated model between the operations side of the hospital and faculty side of the university’s College of Medicine. This will better position the institution to create the infrastructure needed to partner successfully with MCOs to implement value-based care models, including care delivery and treatment, and install reimbursement strategies and the appropriate technologies and analytical capabilities needed to support value-based care.
Howard is not as far along as other organizations in these initiatives. It continues to push forward with these goals while navigating a constant challenge for most organizations and especially for an academic training hospital: balancing mission while also generating a margin. Like other organizations, Howard is still figuring out how to succeed within an industry marked by changing payer dynamics while at the same time competing in today’s very competitive market. Indeed, these are multidimensional endeavors.
Needed: Courageous and Creative Leadership
These also are not endeavors for the meek. It will take creative leadership and courage to lead the movement to value-based care. In addition, the CEO can lead the journey to value-based care and population health in the following ways:
Coach, guide and set the culture. As goes the top of the organization, so goes the rest of the organization when it comes to introducing and supporting new organizational initiatives. The CEO—along with the board of trustees—must play an intimate role in modeling the organization’s vision and setting expectations for desired outcomes. When organizations move into unknown and uncomfortable areas, it is the CEO who must create space within the organization for courageous leadership.
Once an organization starts down the path to value-based care it is the CEO’s role to keep the momentum going. It is the CEO who must drive the organization forward—to coach and guide and model for staff the confidence that the organization is heading in the direction it needs to survive, thrive and serve the best interests of its community and patients. It is the CEO who has to stand up and say, “This is important for us. It’s important for our community, and we’re going to persevere through it.”
Recruit physician champions. These initiatives will not succeed without buy-in from physicians. This is inclusive, not exclusive work, and it requires collaborative partnerships. Clinicians must be involved intimately in value-based care and community health strategies, including their leadership, and it is the CEO’s role to invite them.
Build a team. Leading today’s healthcare organizations into a new era may require different expertise and fresh perspectives. A CEO needs to build an appropriate team to lead and support the move to value-based care and population health management. This team might require nontraditional or new leadership roles, and existing leadership teams may need to be reconfigured to support this work.
Whether an organization is in an urban or rural area, value-based care is not going away. The movement toward these models is going to come in some way, shape or form because consumers, payers and the market all are demanding it to improve patient care and satisfaction and control escalating costs.
No matter where organizations are on their journeys to value-based care, CEOs must focus their teams, dedicate resources, recruit the needed expertise and seek out the unique industry partnerships that will help them succeed with these initiatives. CEOs can’t shy away from this challenge. They must grab it and go.
James A. Diegel, FACHE, is CEO of Howard University Hospital in Washington, D.C. (jimdiegel@yahoo.com).