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Value-based programs emphasize better care, enhanced health, and lower costs.
Hospital health systems benefit greatly from pharmacists in terms of quality, safety, and value. The value of the pharmacist is further demonstrated by linking clinical activities with patient and financial outcomes.
Value-based programs encourage paying providers based on the quality, rather than the quantity, of care they provide to patients. These programs reward healthcare providers with incentive payments for the quality of care provided to individuals with Medicare. The goals of these value-based programs include better care, enhanced health, and lower costs.
Payment Based on Value
Value-based programs were first established through the Medicare Access and Children’s Health Insurance Program Reauthorization Act of 2015 (MACRA). Under this act, value is emphasized over quantity. CMS established five value-based programs with goals to link provider performance of quality measures to provider payment (See Figure).1
The end-stage renal disease (ESRD) program is considered a first-of-its-kind in Medicare: the goal is to promote high-quality services to outpatient dialysis facilities treating patients with ESRD through pay-for-performance or value-based purchasing (VBP) programs. The hospital VBP program rewards acute care hospitals with incentive payments for the quality of care they provide to Medicare patients. The program’s goals include eliminating or reducing adverse events, establishing evidence-based care standards and protocols to improve patient outcomes, improving patient care experiences by enhancing hospital processes, increasing care transparency for consumers, and identifying hospitals that provide high-quality care at a lower cost to Medicare. It’s estimated that the total amount available for value-based incentive payments for 2019 is approximately $1.9 billion.1
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The Patient Protection and Affordable Care Act of 2010, also known as the ACA or Obamacare, includes many payment reforms to promote hospital efforts to address and prevent adverse events after discharge.2
One example is the hospital readmissions reduction program (HRRP) that gives hospitals a strong financial incentive to enhance their communication and care coordination, and collaborate with patients and caregivers on postdischarge planning.2 The HRRP uses the excess readmission ratio to help estimate hospital performance, and it is the ratio of predicted-to-expected readmissions.1 The following conditions and procedures are included in the HRRP: acute myocardial infarction, chronic obstructive pulmonary disease, heart failure, pneumonia, coronary artery bypass graft surgery, and elective primary total hip arthroplasty and/or total knee arthroplasty.
The 30-day risk readmission measures include all-cause unplanned readmissions that occur within 30 days of discharge from the initial admission and patients who are readmitted to the same hospital or another acute care hospital for any reason. Unfortunately, about 20% of patients are rehospitalized within 30 days after hospital discharge, with adverse drug events (ADEs) being the most common complication.2
Transitions-of-care (TOC) has been trending throughout the pharmacy profession and is an important process in the prevention of medication errors and ADEs. It is characterized as the movement of a patient from one set of providers or level of care to another and can involve patients moving to a different area of the hospital or being discharged into the community.
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Systematic problems involving TOC are often considered a primary cause of ADEs. Pharmacists can play an important role in TOC in the hospital setting. Medication reconciliation, structured discharge communication, and patient education can prevent adverse events after discharge. Inpatient TOC opportunities include daily medication education, prescriber order clarifications, renal dose adjustment, medication monitoring, and streamlining drug therapy.
Hospitals have also created TOC pharmacist positions as a new emerging opportunity. This may include collaborating as part of an interdisciplinary team and establishing TOC clinics or directing TOC programs.
The emergency department is a crucial part of TOC for pharmacists and can include adding drug therapies, removal of medications, dosage and strength corrections, and determining when the last dose was taken.
Other advantages of a pharmacist-directed TOC program include standardized medication reviews, consistent clinicians, access to all hospital providers, contact with outpatient pharmacies, and collaboration with case management. Patients taking multiple medications are at an increased risk of ADEs, and approximately 45% of ADEs that lead to hospitalization are preventable.3
One randomized multicenter study found that a comprehensive pharmacist intervention that included medication reviews, patient interviews, and follow-up care reduced the number of readmissions and emergency department visits.3 Pharmacists can play an extremely important role in the continuity of patient care at the time of discharge through counseling patients on their medications, assessing for duplication of therapy, providing educational materials, and addressing any concerns.
HRRP appears to be effective in reducing hospital readmission rates of Medicare patients and is associated with effective TOC outcomes; however, the program has been criticized because it penalizes hospitals caring for more vulnerable patient populations. Therefore, hospitals now receive bundled payments for targeted illnesses that cover all costs associated with patient care for a 30-day period.2
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The value modifier (VM) program measures the quality and cost of care provided to individuals with Medicare and determines the amount of payments to physicians based on their performance. The hospital-acquired condition (HAC) reduction program saves Medicare approximately $350 million annually and encourages hospitals to enhance patient safety and reduce the number of hospital-acquired conditions after surgery.1
Alternative Payment Models (APMs) have become popular within value-based programs. Here the payment is linked to effective management of a population or episode of care. Bundled payments involve payments for an episode of care, and medical home models are characterized by a team-based approach to comprehensive primary care coordinated by a primary care provider.
Population health has become an important aspect of value-based programs. It is an intensive focus on the overall health of a population to improve care, reduce costs, and promote wellness. Comprehensive services include specialty care, hospital care, post-acute care, patient education, and self-care resources; the focus should be on the highest-risk patients to help manage costs. Pharmacists can be key leaders in interdisciplinary patient care teams that include medication therapy management, disease state management, wellness promotion, medication management during TOC, population health research, and pharmacoeconomics.4
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1. Centers for Medicare & Medicaid Services (CMS). Value-based programs. Accessed June 4, 2019.
2. Agency for Healthcare Research and Quality (AHRQ). Readmissions and adverse events after discharge. Accessed June 4, 2019.
3. Ravn-Nielsen LV, Duckert M, Lund ML, et al. Effect of an in-hospital multifaceted clinical pharmacist intervention on the risk of readmission: a randomized clinical trial. JAMA Intern Med. 2018;178:375-382.
4. Sanborn MD. Population health management and the pharmacist’s role. Am J Health Syst Pharm. 2017;74(18):1400-1401.How Baptist Health South Florida Does It
Madeline Camejo, PharmD, is the vice president and chief pharmacy officer at Baptist Health South Florida (BHSF), Miami. BHSF currently participates in the shared savings and risk contracts in both the commercial and Medicare Advantage insurance plans, she says. BHSF is part of an administrative services only (ASO) agreement, which is an arrangement by which an organization funds its own employee benefit plan such as a health plan. With ASO arrangements, an outside firm is hired to perform specific administrative services, and the employer takes full responsibility for claims made to the plan. The ASO plans usually cover short-term disability, health, and dental care benefits.
The value-based programs at BHSF are interdisciplinary and include physicians, nurses, pharmacists, social workers, and care coaches. “Pharmacy supports chronic care management, TOC, disease management (chronic heart failure and diabetes), and data analytics,” says Camejo. Population health plays an important role, and the Baptist Health Quality Network (BHQN) staff is part of this team. Hospitals must find the format that works for their system and their population, she says. However, there isn’t a one-size-fits-all when it comes to implementing programs.
“Staff education and engagement is critical. When you have a well-educated team across all clinical areas, it will be a natural turn in mindset from fee-for-service to value-based care,” Camejo says. It is also important to consider workflow when implementing value-based programs. The staff should become accustomed to searching for care gaps, completing healthcare economic evaluations, and participating in holistic care (eg, chronic care management) versus disease-specific management through a team approach to patient care.
The contracts BHQN supports are considered accountable care organization (ACO) contracts. BHQN is not classified as an ACO, but instead acts as the clinical delivery arm of the contracts that Baptist Managed Care signs. There is a bundle focused on total knee and hip, but pharmacy is not part of that program. Moving forward, pharmacy could play an integral role in this process through TOC to prevent hospital readmissions due to ADEs.
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Health systems need to find the format that works for them and their population of patients to ensure that the program is manageable and feasible. You take a team approach to overseeing the care of the patient. One pharmacist leads the value-based team and eventually a pharmacy technician can assist with medication management. There is limited information available regarding the ratio of pharmacists-to-patients that should be established for population management. “In order to expand pharmacy impact with regard to value-based/population management, I think any clinic we develop should evaluate metrics from the contracts and bundle programs and ensure we include measures to show return on investment. Also, there may be opportunities to have pharmacy informatics collaborate with BHQN data analytics to further explore things we can be doing with value-based programs and data,” says Camejo.