Advanced technology will help drive reimbursement change

Originally published in Medical Economics

Stephen Ondra, MD

Limited by the slow pace of change in traditional reimbursement models, shifts in the paradigm for patient care have also lagged far behind the possibilities created by transformative technology. The COVID-19 pandemic has changed that, catalyzing improvements in reimbursement by both commercial and government payers, not only for traditional telehealth but for other technologies that are advancing how we think about patient monitoring and care.

While the pandemic has accelerated the acceptance of telehealth and remote patient monitoring, the groundwork was already being laid even prior to COVID-19. According to McKinsey, U.S. consumer telehealth adoption began to skyrocket from 11 percent in 2019 to 46 percent currently. Due to the needs created by the pandemic and the expansion of reimbursement for telehealth services, providers have rapidly scaled offerings and are seeing 50 to 175 timesthe number of patients via telehealth than they did before.

In addition to the explosion of telehealth usage by patients covered by both Medicare and commercial health plans, U.S. policymakers have also embraced reimbursement for additional technology-enhanced methods to remotely monitor patients and identify those who could have care intervention prior to and potentially preventing a full clinical deterioration. Such approaches not only provide a more convenient way for patients to be monitored, but also improve the efficiency of the system and the value of care delivery services by offering the information required to get the right level of care to the right patient at the right time.

As patients and providers become more comfortable with a combination of traditional approaches to care, telehealth and remote patient monitoring technology, healthcare coverage will become more convenient, efficient and higher value. That’s good news in the effort to lower the nation’s healthcare costs while raising the level of patient care experiences and outcomes.

Innovations drive care up, costs down

Telehealth, however, can only begin to address the fundamental challenges of provider shortages and care access and changes the care paradigm in limited ways.For the most part, these services are a virtual version of the current reactive paradigm of care delivery – patients get sick and then seek care.We still need better ways to identify patients earlier in the course of an illness to provide more proactive and even preventive care.

That’s where next generation technology developments come in. Continuous remote patient monitoring (cRPM) is an important addition to traditional telehealth sessions for patients with chronic health issues. cRPM continuously monitors vital signs while the patient is at home and alerts the provider if health deterioration begins to occur – often before the patient feels any symptoms. The data shared gives the provider the necessary information, early-on, to determine the best treatment for the patient.

cRPM advances how we can improve care, especially for the five percent of chronic conditions responsible for driving 50 percent of healthcare costs. While this group has long been dominated by heart disease, cancer, end stage renal disease, and other conditions, the continued spread of COVID-19 has also created a need and opportunity for using cRPM to improve care and outcomes in this group. Too often, we have seen COVID-19 patients identified only after they have become profoundly ill and require urgent care. Respected health care authorities like the National Cancer Institute and the National Institute of Biomedical Imaging and Bioengineering of the National Institutes of Health are taking notice. They’ve engaged a company called physIQ to develop an AI-based COVID-19 Decompensation Index. This digital biomarker identifies patients at risk for a rapid decline due to COVID-19, expediting the delivery of care much sooner in the process.

By providing continuous multi-parameter vital signs that establish an individualized baseline for each patient, cRPM provides a biomarker that can deliver an earlier warning than previously possible with simple point measurements such as temperature and SpO2, which are lagging or insensitive indicators of COVID-19 decompensation. Such data can then allow providers to intervene faster when a COVID-19 patient begins the cascade of health complications. This early warning system also makes it possible to surveille patients who are at home, sparing much needed and increasingly overwhelmed hospital resources.

Value-based reimbursement = The new norm

In order to continue to fund and advance these types of cRPM and other AI-based care delivery innovations, the reimbursement model must change in ways that enable and encourage their broader utilization. Now that Medicare’s fee-for-service program covers telehealth, we can anticipate that its use – along with complementary technology – will grow.

In addition to the recent expansions by health insurers for telehealth and cRPM, there have also been new incentives for value-based reimbursement. As payers move away from traditional fee-for-service, volume-based care reimbursement to more outcome driven value-based approaches, financially stressed providers are more actively considering alternative payment models.

UnitedHealthcare, the nation’s largest health insurance company, is one example.

The company – which works with more than 110,000 U.S. physicians and 1,200 hospitals – currently has more than 1,250 accountable care programs, which the insurer says pay more than $80 billion annually to providers via some form of value-based contracts. The value of these contracts is nearly half (45 percent) of the company’s annual medical spend. Other payers like Cigna, Anthem, the Aetna unit of CVS Health and many BlueCross BlueShield plans are also moving at least half, and in some cases much more, of their reimbursements to alternative payments tied to quality and value.

Transformative models focus on prevention

Paradigm-shifting technology will be an important enabler in the transition to value-based reimbursement and related care models. The ultimate goal is to improve health outcomes and the care experience, while also saving money through more efficient targeting of care resources.

With technology becoming more integral to everyday health care, transformative approaches will continue to further improve the value and quality of the care patients receive. As opposed to conducting mere “spot checks” of health status at a fixed point in time, cRPM and AI-based solutions that continuously monitor the physiologic status of at-risk populations can yield more proactive and actionable insight. This in turn can help direct health care resources to where and when they can best intervene to control and even prevent illnesses.

Such technology can also benefit hospitals, doctors, and other healthcare providers who are signing alternative payment model contracts that link reimbursement to improvements in care outcomes and value – rather than volume – of services.

Conclusion

The future looks bright for further adoption of telehealth and the use of technologies such as cRPM. These and other innovations will become part of a portfolio of technology and other care model change-enablers destined to improve care outcomes while creating a more cost-effective solution to soaring U.S. health care costs and the finite resources that have been stretched even further due to the impact of COVID-19. As we move toward value-based reimbursement models, providers, insurers, and payers will need more proactive approaches that can measurably improve outcomes, save lives, and lower overall healthcare costs – often from the convenience of a patient’s home.

Stephen Ondra, MD, is a leader in health care delivery, technology, strategy and innovation. His career spans the entire health care space from neurosurgery practice, to health system leadership as chief medical officer of Northwestern Memorial Hospital and then as CMO of one of the nation’s largest health insurers, HCSC.He also served in government as senior advisor for health affairs to the Secretary of Veterans Affairs and in various healthcare roles at the White House in the Executive Office of the President for Barack Obama. He is the founder of North Star Healthcare Consulting LLC, and a senior advisor to physIQ.