Employer considerations before adopting a value-based MSK benefit plan

The promise of value-based care is to deliver the best outcomes at a lower cost. Providers are incentivized to keep members healthy by proactively managing the health needs of the members, delivering high quality care while reducing the use of unnecessary tests and treatment.

Self-funded employers have a lot to gain from this model in higher quality, better experience and outcomes and reduced costs. However, it requires a shift in their thinking from the way benefits are designed and delivered today.

We think the effective implementation of value-based care for self-funded employers would require at least three considerations-

  • Value-Based MSK Plan Design
  • Value-Based MSK Network Design
  • Value-Based MSK Care Delivery

Value-Based MSK Plan Design

Unlike traditional plan design approaches, value-based plan design should be focused creating member experiences which encourage them to utilize high value services that produce better outcomes.

Benefit-AnalysisIt is important to carefully deliberate the implications of such design to ensure you have the systems and resources necessary to fully implement the design and your design fits within the culture of your organization.

Benefit administrators should also be cautious about how they communicate the value proposition of this model, if not done well, it may look like a restrictive narrow network.

They can integrate financial incentives such as lower premiums, lower copay, cash or gift cards, and focus on communicating the value proposition such as unique experience, plan of care, coordinated care etc. to encourage employees to use the system to achieve the desired results.

Value-Based MSK Network Design

Employers can explore value-based care products through a health plan or a direct contract with a health system in an area where they have a large geographic footprint.. Either way, while designing networks, have an open discussion about how the providers can leverage what they’re already doing to deliver an improved experience for the employees.

network designWhile there are several models which they can use for contracting, one possible model is risk adjusted monthly rate per member for primary care, FFS with reference pricing for urgent care and severity adjusted episodic rate for scheduled inpatient care.

Each model should include adjustment for quality. Instead of using all CMS quality measures, the plan administrators can choose to focus on the measures that are important for their organization. For instance, if surgeries make up a big part of your costs,  you may want to pay higher to providers who have lower surgical complication rates because their outcomes are better.

Providers engaged in value-based care are likely to have a lot of data about your employees, you should seek assurance from them about their data security policies, procedures as well as reports on third party audits.

Value-Based MSK Care Design

Value-based care design requires that providers provide both longitudinal, relationship based care management, and short-term, goal-oriented care management. By applying risk stratification, providers should identify members, their concerns and the level of care needed for each cohort.

In value-based care, the providers should be utilizing multiple channels (text, emails, portal, home visits, group visits etc.) and include chronic care management, behavioral health, self-management and medical management.

ACO care delivery model for employersCare coordination services are important components of value-based care delivery.  Providers may want to reduce the cost of care by steering members to their internal network, but it should not be done at the expense of member’s experience. The care coordination design should improve the transitions of care where the physicians are working more closely with hospitals and emergency departments, as well as with high volume specialty service providers.

Employers should ask for better data sharing on clinical, operational, financial data as well as reporting on quality measures such as HEDIS.  Other metrics impacting employee experience such as same-day appointments, doctor follow-ups, plan adherence, care plan per member, health performance against goals etc. should be checked against claim data to get a real-time insight into care delivery.

Value-based care holds a great promise for employers. It is designed around the specific needs of your employees who benefit from a team that coordinates their care, and technology that connects them and their providers with information to help get the right care — it is also going to reduce the costs for you.

Talk to us about how our comprehensive MSK solution can reduce costs, improve health outcomes and provide you better visibility &  control over your musculoskeletal benefits.

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Employers should leverage ACO networks for better performance

Narrow networks are back in vogue with health plans, trying desperately to offer a lower cost product.  A narrow network focused on maximizing discounts by partnering with limited providers is likely to fail in the long run.

For employers, this discussion needs to move away from ‘narrow’ to more about a care delivery model that provides the highest value and most efficient performance to their employees.

Such high performance networks (HPN) should combine desired market coverage with member focused care delivery models, and provide a strong foundation to move the needle on cost and quality.

Accountable care organizations (ACOs) are quickly evolving as HPNs that employers should explore. ACO is a health care system that partners with employer (or other payers and TPA) to develop a model that aligns financial interests with delivery of effective and quality care for specific population.

Why is it important?

ACO care delivery model for employersNo health plan can consistently deliver on cost, quality and experience if it does not have an aligned provider network.  Traditional fee for service delivery system (such as PPO), is not aligned with employer or employee’s needs. The results of such misalignment is there for everyone to see.

A true ACO on the other hand can be aligned with employer’s specific interests and values, its geography, and provider, service, payment preferences etc.



What about multi-location employers?

If you have employees working in multiple locations, you may find it challenging to partner with each ACO separately. In that case, you may explore partnerships with a TPA that provide a layered network on top of these ACOs to deliver consistent quality and experience to employees dispersed over wide geographies.


What will be different?

Data SharingACO data sharing

Since ACO technology foundation is based on sharing data between providers, employers will get more real-time data about claims, admissions, readmissions etc.


ACO Care CoordinationBetter Member experience
The member experience is likely to significantly improved, since employers can influence clinical and operational processes based on their specific needs.


Employer ACO network
Care Coordination
ACO provide care coordination across entire spectrum of care. This will lower costs, and provide better member satisfaction.


Goals and MetricsACO Goals and Metrics

With this model, you can create goals and metrics that will define and measure success. These metrics include HEDIS, Star Ratings or other custom criteria defined by employers.


ACO Payment modelsNew Payment Models
This model offer a variety of payment methods including performance contracts, bundled payments, shared risks, capitated budgets below PPO rates.


It is time for employers to explore plans built on high performance ACO based networks. Contrary to traditional PPO plans, this will provide you a health care delivery system that aligns all parties’ financial interests, clinical processes and operations to deliver cost effective, quality care around a commonly accepted set of goals for improved results.