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6 mistakes you'll make with VBC (and how to avoid them)

By Daniel Kuzmanovich

March 2, 2022

After lots (and lots) of conversations about advancing value-based care, there are a few lessons learned from which we can all benefit.

4 principles to win physician buy-in for value-based care

Strategy Mistakes: most errors are made running up to the start line


1. There is no dock and no boat.

Thinking that fee-for-service and value-based payment are binary and one day the organization will step from the dock of fee-for-service into the boat of value-based payment is short-sighted. This line of thinking only impedes long-term success. Leading organizations realize they will be working under multiple, hybrid financing mechanisms for the foreseeable future.

Lesson learned: The journey to value is not binary or temporary.

2. Make sure all the right people are all reading the same sheet music.

Then check at least two more times. And then check again every time something changes. Organizations need agreed upon objectives and a leadership team (especially CEO and CFO) that's all on the same page. This leadership alignment is the foundation for successfully synchronizing the clinical and financial transformation.

Lesson learned: Going in unaligned—especially among the folks leading the change—precedes failure.

3. Be Goldilocks, not the tortoise or the hare.

There is no perfect calculation for moving into increased levels of at-risk payments. But we know when VBC becomes reality in a market, it happens fast. You can't afford to be the laggard but you're just as likely to make a mistake as an early adopter.

Organizations that do this right take on enough risk to learn and build momentum without compromising themselves or ending up in pilot purgatory. But, not so much that they are the first through the wall because data from the Medicare Shared Savings Program shows us that organizations with more experience in VBC typically do better.

Lesson learned: Being too slow or too fast—both are bad.

Execution Mistakes: even with the right strategy, you can trip running the race.


4. You get what you pay for.

VBC can be expensive. The key is to evolve the investment with the care and financing models. Attempting to build your population health capabilities on the cheap is great but leave yourself ample leeway in the budget to invest when and where it really matters. Note, not prioritizing what you are asking your clinical team to do is also underinvesting (because you are stretching your resources too thin).

Lesson learned: Under resourcing the transition to a new model

5. Get…and I cannot stress this enough…the DATA!

Yes, clinical data and payer data are both far from perfect. But don't let the desire for perfect data be the enemy of success. Take what you have, get started.

But, if there is a place to overinvest and then continue to improve the resources you are giving to your team, this is it.

Lesson learned: Better to act with the data you have and improve than wait for perfection.

6. Embrace treating different patients differently.

We all want patient-centered, high-quality, low-cost care. But what that care looks like for any individual patient is different. And that's a good thing.

Success under VBC requires designing a clinical model with the flexibility to match the right resources to the right patient, regardless of the payment model. That does not mean every patient should get a care manager. Instead, it means starting with tailored interventions for the sickest and highest risk patients. But don't stop there. Learn from your rising risk and highest risk patients as you evolve the care and payment model across the rest of your patient population.

Lesson learned: One-size-fits-all isn't patient-centered care.

Value-based care should be more than a buzzword

imageCommercial risk will either tip the industry towards value-based care or keep us in a world of hybrid incentives. It’s complicated, but is it possible? We think so. Learn how you can help push us towards a new cost and quality standard by visiting advisory.com/VBC.

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