Developing Your Value Proposition Timothy P. McNeill, RN, MPH
What is a Value Proposition A value proposition is the service or feature that makes an organization attractive to potential customers The value proposition is the key driver that will influence a customer to want to do business with your organization Tip: Take the perspective of the customer when developing your value proposition. Design your services in a way to meet the customer s need even if it is not convenient to provide services the way the customer wants. This may require a culture change
What Are the Considerations in Creating Value Drivers impacting the customer Payment reform Risk-based contracting Potential competitors Quality of service History of providing services Expertise in a specific area Key stakeholders and influencers
Business Acumen and the Value Proposition Define your value proposition based on your strengths and capacity Identify the need that you intend to solve in the marketplace Package your services and present the offering to potential customers Your value proposition outlines the need you are addressing in the market and defines WHY the customer should buy services from you.
Example of Limited Value I am the Director of XYZ Agency. We have a 50 year history of serving older adults and persons with disability in our region. We have a group of contractors the provide home and community-based services and deliver evidence-based programs Why would I buy services from this organization?
New Service: Managed Network of HCBS Providers
Defined Value Proposition
MTM s Preventive Care and Care Transitions Services
Example: Evidence-Based Program Value
Example: Presenting Value to the Customer
What Are the Considerations in Creating Value Drivers impacting the customer Payment reform Risk-based contracting Potential competitors Quality of service History of providing services Expertise in a specific area Key stakeholders and influencers
Shift Toward Value-Based Purchasing Health Reform efforts are shifting the current system from Fee-For-Service to one that provides incentives for outcomes. A Value-Based Purchasing system provides financial incentives for outcomes (Value) Payment is tied to better outcomes instead of units of service There is a detailed assessment of clinical quality and total cost of care Rewards are tied to success with quality and cost
Shift Toward Value-Based Purchasing The current system is changing from Fee-For-Service to payment for outcomes. A Value-Based Purchasing system provides financial incentives for outcomes (Value) Payment is tied to better outcomes instead of units of service There is a detailed assessment of clinical quality and total cost of care Rewards are tied to success with quality and cost
Where are there costs in the system A system that pays for value will focus on where the highest cost drivers are. Complications related to chronic disease Institutional Care (Acute and Post-Acute Care) Ambulatory sensitive ED visits / admissions Preventable Readmissions
Value under Payment Reform Success in Health Reform requires the adoption of a population health approach Population health includes the following elements: Analyzing the population to determine which groups pose the most risk for reduced quality and/or increased costs Developing interventions to address the targeted population Monitoring the outcomes for these groups from an established baseline Value is created in population health when an organization can define how they can impact high-risk groups
New Business Opportunities Abound The shift towards financial incentives that align with preventing costs has created new business opportunities MACRA Merit Incentive Payment System (MIPS) Must Improve quality and reduce costs or face a reduction in Medicare reimbursement Providers will be compared with comparable providers High performers will receive higher reimbursement and low performers will receive a penalty Failure to report automatic penalty Alternative Payment Models (APMS) ACOs, Bundled Payment, CPC+
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Market Opportunity Analysis Hospitals in your market Readmissions / Admissions ER Utilization Post-Acute Care Provider Network Physician market Hospital-Owned Practices Independent Practices Specialists vs Primary Care Accountable Care Organizations Bundled Payment programs Managed Care Organizations
CMS Medicare Chartbook: https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and- Reports/Chronic-Conditions/Downloads/2012Chartbook.pdf
Nearly 70% of FFS Medicare has 2 or more chronic conditions
Per Capita Expenditures increase as the conditions increase
CMS Analysis: Social Determinants of Medicare Advantage Plan Performance
CMS Analysis: Social Determinants of Medicare Advantage Plan Performance
2019: Expanding Health Related Supplemental Benefits The previous regulations limited supplemental MA plan benefits to health-related services. There were specific limitations on supplemental benefits that include daily maintenance. This requirement prevented some plans for designing supplemental benefit packages that included non-skilled services that could reduce readmissions or improve health outcomes.
Value May Change based on the Customer ACOs 31 ACO quality measures Bundled Payment 90-day financial risk period Medicare Advantage Plans HEDIS, STAR Ratings Supplemental Benefits Rule Change Physicians MIPS Medicaid Managed Care Plans Medicaid Expense reduction
Provider MIPS Categories applicable to CBOs Quality Diabetes outcomes Depression screening Fall risk Advancing Care Information Referrals to community programs Send a summary of care Improvement Activities Care transitions documentation Engagement of community for health status improvement Evidence-based interventions to promote self-management Chronic care and preventive care management 26
Value Proposition May Adjust with Policy Changes CMS Rule Change regarding Medicare Advantage Supplemental Benefits Health Plans can use supplemental benefits to support health improvement and cost reduction This policy change impacts the value of a service but should be presented differently depending on the customer being addressed.
2019 Re-interpretation of the Supplemental Benefit Under this reinterpretation, CMS would allow supplemental benefits if they are used to diagnose, prevent, or treat an illness or injury, compensate for physical impairments, act to ameliorate the functional/psychological impact of injuries or health conditions, or reduce avoidable emergency and healthcare utilization.
CMS Rule Changes Effective Date The Supplemental Benefit and Uniformity Flexibility rules take effect for the 2019 benefit year. 2019 Bid review correspondence will be sent by June 30, 2018. 2019 MA Plan bid training began April 2018 MA plans are preparing their 2019 bids for submission later this year (2018).
Bipartisan Budget Act of 2018 Signed into law Includes the Chronic Care Act Changes required by the Bipartisan Budget Act of 2018 take effect beginning 2020, and subsequent plan years
CMS Guidance Memo Released April 27, 2018: CMS released guidance on services that can be included as a supplemental benefit. Key categories include: Adult Day Care Services In-Home Support Services Support for Caregivers of Enrollees Stand-alone Memory Fitness Benefit Home & Bathroom Safety Devices & Modifications Transportation 31
MA Plan Benefits in the News
MA Plan Benefits in the News
Questions Tim McNeill, RN, MPH Phone: (202) 344-5465 Email: tmcneill@me.com