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Top challenges providers face in alternative payment models


Keep these challenges in mind when choosing an alternative payment model for your practice.

Top challenges providers face in alternative payment models

The Center for Medicare and Medicaid Innovation (CMMI) is promoting Alternative Payment Models (APMs) as a tool to reel in costs while improving patient outcomes. Now in its second decade, CMMI is continuing to expand APMs to drive health system transformation.

In 2022 and beyond, healthcare providers need to brace for new APM releases and significant changes in how CMMI is approaching them. In a recently released report, the agency identified several of these changes, including developing fewer and more parsimonious models, emphasizing health equity, and driving provider participation and minimizing selection bias.

One of the most effective strategies providers can use to prepare for APM shifts—and a possible acceleration of these models in the years ahead—is to apply lessons learned from providers who have already participated in APMs.

More specifically, providers should consider the key challenges these participants have encountered, so that they can proactively implement tools and workflows that will help them overcome similar challenges in future models.

Below are three of the biggest challenges providers have faced thus far.

Challenge 1: Resource constraints

Preparation for APM participation should start at least six months, and sometimes as many as 18 months, prior to the model’s start date. This preparation is labor-intensive and time-consuming. It includes:

  • Identifying a physician champion to support participation in the model and gain leadership buy-in.
  • Learning as much as possible about eligibility, practice transformation requirements, and model design.
  • Determining management and oversight responsibilities within the practice.
  • Collecting, monitoring, and assessing data that is relevant to model participation.

Once the program begins, the practice must implement practice transformation activities and continue to regularly monitor and assess their data. Most organizations will need to make changes to processes and workflows to improve program performance.

Due to the pandemic, the work associated with preparation and participation may be particularly challenging for practices due to staff shortages and burnout. Additionally, many practices have had to divert staff that normally work on APM administration to other needs.

Challenge 2: Complex and constantly evolving rules and policies

Navigating through regulatory and policy requirements associated with APMs can be challenging for providers. APM program rules are very complex, requiring providers to have a deep understanding of the current payment system, the new model’s design, and how their practice and patients may be impacted. Staying on top of regulatory and policy requirements is even more challenging for practices that are participating in multiple overlapping APMs.

Rules and requirements related to quality measurement represent another crucial but challenging aspect of program participation. Providers must continually track their performance towards the goals of the program and assess compliance with the APM rules.

APM start dates can change frequently, making it difficult for providers to plan and prepare. Most recently, in December 2021, Congress delayed the start date of the Radiation Oncology Model from January 1, 2022 to 2023.

Challenge 3: Data analysis and modeling

Measuring and monitoring data represents another challenge when it comes to successfully managing APM programs. Although CMS provides feedback reports for participants in some programs, the information is often limited. This restricts the data’s effectiveness as a useful resource to improve care delivery and anticipate financial impacts, and creates the need for healthcare providers to perform more data management on their own.

Additionally, while a practice’s EMR may have some of the data needed to help assess and model performance, the EMR will lack sufficient data about all of the healthcare utilized by patients across the entire care continuum. Many organizations will lack the bandwidth and expertise needed to collect, normalize, and analyze additional sources of data outside of the EMR.

How to overcome these challenges

Providers can avoid these issues by ensuring that the proper infrastructure is in place to prepare for, and administer, APM programs. Part of that equation includes determining if there are adequate resources to allocate to the APM. Practices should weigh internal management against working with an APM program management partner. A partner can provide expertise and education, including the data management capabilities, required for a successful program outcome.

It is also crucial for providers to identify a key stakeholder to support, motivate, and drive enterprise-wide participation in APM models. Since it can take a long time to achieve a return on investment in these programs, this program champion should evangelize small victories to help practice leaders see incremental value and grasp the potential for bigger gains. Stakeholders must be willing to do the hard work to improve care coordination, identify a preferred network, and manage the process through completion.

In addition to finding a program champion, providers need a designated person or team to manage the collection, monitoring, and analysis of program data. With limited resources and personnel, as well as limited EMR capabilities, analytics tools that specialize in APM participation and that provide summarized and trended information can help practices quickly and easily measure performance and reorient workflows when necessary to ensure a successful outcome in the program.

Alyssa Dahl, is the Senior Director of Advanced Analytics atDataGen. She is an industry leader in modeling and interpreting current key payment and policy issues impacting value-based revenue. Dahl has supported healthcare providers across the nation to maximize their potential for success in alternative payment arrangements and population health initiatives.

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