Value-based models: What place does workers’ compensation insurance have?

Focus on case management

Sarasota, FL (WorkersCompensation.com) – With value-based payment models becoming increasingly prevalent across all areas of healthcare, many are wondering where workers’ compensation fits in.

Many think of value-based contracting as something related to case rates, pay-for-performance, risk-based payments, risk-reward models, lump sum payments, and an outcomes-based payment model. To a certain extent, this is all true, but when you dig deeper, you should think of value-based contracting as an umbrella term rather than a single idea.

Workers’ compensation organizations must consider value-based payment models to improve care while keeping costs under control.

According to a Coventry Brief, five elements are needed to create a meaningful Value-Based Care Model (VBC) for workers’ compensation.

1. Remove the financial incentive to treat more to move away from volume-based or performance-based contracts. The VBC model eliminates the payment structures that reward activity over outcome.

2. Predictive pricing for providers and payers: This requires an agreement with providers that determines what is needed to treat a common illness or injury and how to return the injured worker to the condition they were in before the injury. Data collected over time helps payers and providers better predict the cost of treatment.

3. Alternative to fee-for-service: When a payment is made for each service, there is a perverse incentive to do more to get paid more. Value-based payment models are designed to pay for better outcomes, regardless of the services required to achieve that outcome.

4. Shared opportunities for providers and payers: This concept focuses on the risk-reward ratio and highlights the shared goals of providers and payers. Payers working with providers to pay incentives for outcomes must be part of any plan. This allows networks to retain good providers who make the extra effort to achieve positive outcomes, such as helping the injured worker heal naturally rather than using surgical interventions and getting them back to work as soon as they are ready. For this to work, appropriate payment models must be in place, but it is doable.

5. Results orientation: The model should be adapted to provide the right mix of services so that the individual can achieve the best outcome.

With these core principles intact, it’s fair to consider the approach that value-based payment models offer. Value-based payment models fit well with workers’ compensation because money is not an issue in workers’ compensation. Plans pay for the medical care and resources needed to help the injured worker return to work.

Care case managers are central to achieving positive outcomes while limiting costs. They do this on an individual basis by making early contact with an injured worker and ensuring medical care is provided to stabilize the injured worker and help them move through the system in a coordinated and safe manner. Resources are obtained to help the injured worker be self-sufficient and overcome obstacles that prevent them from returning to gainful employment. Working with a team of professionals such as medical specialists, therapists, vocational specialists, employers, claims adjusters, and the injured worker is critical to achieving outcomes that enable the injured worker to find gainful employment while addressing their limitations. Case managers are committed to helping patients achieve their goals and document outcomes throughout the injured worker’s journey.

Have value-based payment models already arrived in your practice area? Let me know how you work with this new care model and what results you see. You can reach me at [email protected]

Reference:

Defining Value-Based Contracting requires more than just a few papers: https://www.coventrywcs.com/sites/default/files/2022-05/Coventry-Value-Based-Contracting-Whitepaper-20170601.pdf