Physicians and payers should seek to build relationships on three foundational factors: transparency, competence, and motive.
Payers and providers, especially physicians, have historically suffered from adversarial relationships that inhibit their ability to collaborate and improve care delivery.
The reasons for the lack of trust from the parties are numerous- and in some cases well-founded. But the shift to value-based care brings the potential to overcome these barriers and establish new relationships based on a shared commitment to enhance patient outcomes and continuously improve processes.
Given the central role they play in care coordination and oversight, primary care physicians (PCPs) play an important role in the shift to value-based care. Chronic conditions, developmental disorders, and behavioral health issues account for the majority of costs in the health system. As the PCPs are most responsible for these types of patients, they will assume greater financial risk. In short, when it comes to chronic care, PCPs are the No. 1 risk-bearing entity for the patient.
Because PCPs and other providers under value-based care arrangements assume a portion of the risk previously borne by payers, trust becomes a critical issue between the two parties. After all, how can providers feel any level of comfort taking on more risk if they cannot rely on the information they get from payers about that risk?
While there’s no need to delve deeply into the roots of physician-payer mistrust, it does help to briefly examine how we arrived at today’s state of affairs in order to find a way forward. Much of the acrimony stems from the nation’s seemingly never-ending healthcare-cost escalation, as well as each side’s attitudes about practice variation.
As a result of these concerns, payers began to use a variety of tactics that physicians perceived as heavy-handed, including claims analysis and denials, prior authorizations, and narrow networks. Physicians perceive practice variation as professional judgment and a response to the unique needs of each individual patient. Payers often attribute practice variation to failure to follow population-level clinical evidence, outdated knowledge, hubris, or even greed.
According to a viewpoint recently published in JAMA by representatives of several payers, to progress beyond the trust issue, physicians and payers should seek to build relationships on three foundational factors: transparency, competence and motive.
Transparency: Value-based agreements cannot exist without a deep dive into all participants’ data, so the need for data-sharing may be the most important factor motivating physicians and payers to re-examine the nature of their existing relationships.
Bundled payments, which entail that all parties involved in an episode of care receive a one-time all-inclusive payment for services rendered based on estimated cost, provide an initial building block to obtaining greater transparency. The basis of bundled payment contracts is the underlying procedure and diagnosis codes that correspond to all of the procedures, services, and other elements included in the bundle.
Some bundled payment contracts are essentially black boxes, with physicians never explicitly informed of all the billing codes that govern the contract. By developing bundled payment contracts to be more transparent, data-sharing among physicians and payers can form the basis of improved, collaborative, and mutually beneficial relationships.
Competence: The power to understand one’s own, and the other party’s strengths and weaknesses, is an important part of building trust. At its most basic level, competence requires executing basic processes in a consistent, predictable, and reliable manner. Taking it a step further, it requires strong communication through actions, incentives, and reporting to support and reinforce the competence of the other party. For example, physicians expect payers to pay claims, facilitate prior authorizations, and communicate policy changes, while seeking input from physicians on how changes will affect their processes and workflows. Payers expect physicians to follow best clinical practices, achieve quality measures, and refine practices as new evidence comes to light. These practices must not be seen as table stakes but rather as ways for physicians to obtain more influence over the payers’ policy changes. In the end, the recognition of competence is like respect: It is earned, not given.
Motive: Understanding motive begins with self-reflection, as well as considering the other party’s perspective. The JAMA viewpoint authors recommend physicians and payers adopt a perspective of “assuming positive intent” to realize that behavior is guided more by context and incentives than motive. Inevitably in most human endeavors, there is a gap between intent and effect, and physicians and payers would do well to keep that in mind when assessing the other’s actions.
In the interim, a neutral third-party “referee” that brings payers and providers together can increase the velocity at which trusting relationships are built. This neutral third party can assist with data harmonization, baseline measurement, and bundle definition while keeping both parties informed of opportunities to improve processes and enhance outcomes. Encouragingly, as large health systems increasingly begin to sponsor their own health plans, both parties are likely to find common ground around shared experiences.
Damage that can–and must–be repaired
It’s taken a long time and numerous steps for the physician-payer relationship to fracture, and the cracks won’t be sealed overnight. Nonetheless, it is a relationship that needs to be improved if the U.S. is to have any hope of escaping its current healthcare morass of high costs and less-than-stellar population health. Breaking down the walls of mistrust begins with transparency, and the data-sharing that’s required to reach successful value-based contracts provides a real opportunity to repair damage to the physician-payer relationship.
Kevin Mehta serves is chief technology officer for Payformance Solutions. In this role, Mr. Mehta focuses on building data-driven, turnkey software solutions that provide payers and providers with the technical tools and resources needed to design, evaluate, build, measure and negotiate value-based reimbursement contracts.