Today’s network sizes determined by value
November 15, 2016
Unfortunately, many of us remember the late 1990s and early 2000s when we used the term “narrow” networks, which were designed to be very narrow to decrease cost by decreasing utilization and trading volume for pricing. They worked. We saw a reduction in spend, but many argued this model withheld needed services. Those of us in these narrow networks as providers also felt the pressure to decrease utilization, without consideration of what was right for our patients.
Whether true or not, patient advocacy groups began to accuse the industry of preventing patients from getting the care they needed by restricting access to providers. Very few narrow networks that only focused on utilization survived. Historically where networks were designed to only focus on cost, we got just that, lower costs, but not necessarily increased value. Even though these networks did create cost savings, they were portrayed as being very patient unfriendly and choice limiting.
As healthcare continues to change and evolve, the “high value” networks of today have truly changed in form and function. As value has three components, quality, cost, and satisfaction, the emphasis today is much more focused on how we design and create incentives to drive improvements in all three areas. When we look at network development, we identify many aspects that are important, which were not considered in the past. Technology and thinking have progressed, and there is more insight into controlling costs by increasing appropriate services and clinical management. Delivering the right care, at the right time, at the right place, by the most appropriate provider, in the right way, has become the mantra.
Wrapping needed services around the patient and their provider is also a component of today’s model that did not exist in the past. Clinical integration allows for shared information and greater focus on the continuum of care. Psychosocial components are addressed along with the biomedical needs. The network development of today is more attuned to creating the value and delivery mechanisms that meet the needs of those we serve. These present day, high-value, clinically integrated networks are broader in scope and depth than previous and are delivering on the Triple Aim.
Hopefully we have move past not only the former narrow network model, but also that name. The size of today’s networks will be driven by value, not pricing. In a period of value-driven healthcare, we need to continuously focus on creating high-value, clinically integrated networks, and frame our language to denote this change. It is important to help educate the environment on this shift of thought and activity. If we don’t, the new models and networks will carry the albatross of days, and terms, gone by.
This To The Point was written by Jordan Asher, MD, MS, Chief Clinical Officer and Chief Innovation Officer. You can read more of Dr. Asher’s thoughts on value-based healthcare and healthcare reform at his blog, The Positive Contrarian.