Value-based care will add fire to physician burnout

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The goals of value-based reimbursement models can be broadly stated as having two goals: deliver care to some agreed upon standard, and reduce/slow healthcare cost growth.

In theory, as these models evolve, physicians who do not meet the criteria could be penalized either through lower reimbursements (downside risk) or removal from certain networks. The implementation of value-based reimbursement models rose to address significant periods of healthcare cost growth outpacing inflation. To date, the actual savings and care improvement have been slower than expected in many cases and, unfortunately, may be exacerbating another healthcare trend: physician burnout.  

In a recent analysis of CBO data, Avalere reports that the aggregate ACO savings through the Medicare Shared Savings Program have underperformed projections by around $2 billion. The news wasn’t all bad as the analysis reported that by year four of participation, the average ACO produced savings. In some additional positive news, ACOs in downside risk models performed favorably by generating more savings over the length of the study. While Avalere’s research indicated that these models do produce savings compared to projected benchmarks, the saving weren’t as substantial as expected or projected. 

RTI Consulting highlighted additional challenges in effective value-based contracts in their study of the State Innovation Models (SIM) initiatives. The SIM program intends to empower states to reduce costs for Medicare, Medicaid, and private plans through the development and promotion of alignment of alternative payment models. RTI Consulting found several reasons that SIM initiatives haven’t hit the mark.

One of the most relevant reasons being that private payers want to maintain their flexibility and autonomy to do their own thing with value-based payment models. Relevant to this is the finding: on average physicians are contracting with more than seven payers and over one-third are contracting with more than 10 payers. The desire of some payers to keep aspects of payment and data fragmented is one problem the SIM initiatives are facing. This also underscores another rising issue in healthcare: physician burnout.

Scary picture for the future

The incidence of physician burnout has gained more attention, particularly as bodies like the AMA report that burnout rates have risen between 30 percent to almost 60 percent in some specialties, up substantially from 2013. The Agency for Healthcare Research and Quality (AHRQ) studies the five causes of clinician burnout: family responsibilities, time pressure, EHRs, the low pace of control, and chaotic environments. Clinicians are being asked to do more than direct care delivery. While AHRQ’s buckets indirectly reference value-based payments, the next round of survey data will likely highlight financial and varying care standard concerns as major areas for physician burnout.

To date, the consequence of clinician burnout hasn’t been a reduction in care quality but has caused some to leave the field and it is intuitive that at some point the pressure will impact care delivery.

The combined studies by Avalere and RTI Consulting form a potentially scary picture for the future of value-based reimbursement and physician burnout. If it actually takes four years to effectively learn how to succeed in one value-based model and physicians are in between five to seven payment arrangements (let alone 10), the burnout rate can only go up. What will exacerbate burnout rates is how these payments models will evolve to include downside risk.

Not only will physicians be responsible for providing care to different standards to maintain reimbursement but failure to do so may negatively impact their personal and practice finances. Money is a massive stressor to most American families introducing meaningful financial risk to physicians will almost certainly create a new category of AHRQ’s burnout reasons. While there are some signs that CMS is going to slow down some of the momentum to paying for value and making things simpler for physicians in terms of reporting, that might just push out the learning curve and doesn’t address what other payers might be doing with providers in the present and near term.

Value-based reimbursement isn’t going away. Healthcare cost growth is unsustainable and there is a significant amount of waste in the system that needs to be addressed. Healthcare needs more accountability to outcomes and there is unwarranted clinical variation that needs to be removed from the system. The faster the industry pays more rationally and resets the cost curve, the sooner we can double down on reducing provider burnout.

The problem is that the pace and implications of value-based reimbursement may expedite the growing burnout problem to a point where value-based reimbursement models will fail in markets that can’t retain enough physicians.

Three ways to address the conflict

There are no easy answers to manage these two conflicting problems. However, the following are meaningful steps both payers and clinicians can take to begin to address this potential risk to the healthcare system.

1. Define the problems physicians are trying to solve. While payers are taking nuanced approaches at risk metrics/services around conditions like diabetes, hypertension, and COPD, ultimately the point of changing the financial arrangements is to improve care for these patients so they have higher quality lives and lower costs. Payers have demonstrated an aversion to linking measures with other payers to protect their proprietary pricing strategies. However, broad agreement should be reached to alleviate some of the variation forced on providers that can contribute to burnout. The amounts at risk could vary by condition as payers have different populations with different needs but protecting unique measures over overall improvement of care and provider satisfaction is unproductive and risky.

2. Recognize there is a learning curve to value-based reimbursement. Avalere’s analysis suggested there is some learning curve to reaching successful risk bearing arrangements.  Both payers and physicians need to recognize that changing the incentives in healthcare and care delivery requirements requires a reorientation that needs some two-way education. This is particularly true if the goal of both sides is both short-term and long-term success.  Empowering all parties with the relevant data to identify, assess, and address current issues is critical and even more imperative if both parties can’t be patient. 

3. Acknowledge the physician’s time is in some ways fixed and something must give.  A critical source of provider burnout are family responsibilities and time pressure.  Adding anything new to physicians should require a trade-off. Take something off physicians’ plates, or burnout is only going to increase. Identifying resources or areas that require less attention is a critical and honest way for both payers and clinicians to come to terms about what sacrifices they are willing to make for value-based payment models to be successful and improve patient health.

Thomas Friedman is the Group product manager in payer and community health at Relias. He brings executive experience working in healthcare payer strategic planning, finance, government affairs, and analytics having most recently served as the director of policy, planning, and analysis for the State Health Plan of North Carolina.