As organizations plan for the transition of reimbursement from fee-for-service to the wide array of alternate payment arrangements, much of the focus in on decision support tools, analytics, and financial reserves (see Is Your EHR Up To The Challenge Of Value-Based Reimbursement? and The Value-Based Reimbursement Steeplechase). But, even with the right tools and a financial cushion, the right management team at clinical service organizations is key to making a reconfigured delivery system work.
The “human factor” in making VBR successful was the focus of the discussion, Building The Human Talent You Need To Succeed With Value-Based Reimbursement, led by four chief executive officers at The 2018 OPEN MINDS Performance Management Institute— James Stewart, President & CEO at Grafton Integrated Health Network , Joseph Rutherford, MBA, Chief Executive Officer at Gracepoint; John D. Young, LCSW, Executive Director at Rockbridge Area Community Services; and April Lott, LCSW, President & CEO, Directions for Living. Their advice? Focus on finding the “right” team, build cross-departmental training, and move to performance-based compensation.
Cultivate the right type of executive team—Having the right people on your team is essential to making VBR work. VBR is a system transformation, in both management and in care delivery. The new management team has to be entrepreneurial, forward-thinking, able to take on risk, and team-driven. Managing based on metrics is critical. Ms. Lott talked about changing the dynamic on the executive team so that they were telling her what to do, rather than waiting for her direction. Mr. Rutherford talked about fostering trust and communication among the executive teams so that projects don’t go off the rails due to lack of communication.
Cross-department training—VBR takes each individual out of their siloed role and forces them to have a greater understanding of how the organization operates through its interface with consumers. Clinical staff need to understand the payment models, why outcomes matter, and how that will affect how they deliver services. Management staff needs to understand (and measure) clinical operations and workflow, consumer experience metrics, and payer perspectives. The overall cultural shift is moving from an organization that facilitates multiple independent service transaction, to an organization that is a unified service system. The presenters noted that it is very important to get staff buy-in on this fundamental shift. Ms. Lott’s organizations developed a new training program for new staff that focuses more on what the whole organization is doing, rather than just teaching the person their role. Creating a high-performing service system means making shared decisions across all teams in the organization.
Create performance-based incentives for your staff—Ms. Lott explained that with the move to VBR, there has been a higher level of burn out and compassion fatigue among staff. One way Directions for Living is working to address this challenge is through performance-based incentives for staff for meeting higher standards. And Ms. Lott explained that the incentive doesn’t have to be attached to a bonus payment. One thing they’ve found is that their younger (millennial) staff are better motivated by extra personal days, than an extra check. Mr. Rutherford also implemented a performance-based compensation system at Gracepoint. When he first arrived at the organization, the no-show rate was at 40%. By creating a $1,500 quarterly bonus for staff for hitting their productivity standards, no-show rates dropped to 18% to 19%.
Right now, only about one-third of specialty provider organizations have VBR and for only a small portion of their revenue (see Value-Based Reimbursement—The Numbers Are In).
The transition from traditional service delivery models, to a model focused on the health of a population with reimbursement based on performance, is a huge leap both in concept, and on the ground. New infrastructure for information and financial management is critical—but long-term sustainability will only be possible in the organizations that have a team that embraces the concept of new possibilities.
For more on the cultural transition to a value-based health and human service system, check out these resources in the OPEN MINDS Industry Library:
- The Value-Based Reimbursement Steeplechase
- Taking A Functional Approach To Succeeding With Value-Based Reimbursement
- Practice Makes Perfect
- The Race For Value-Based Reimbursement Continues
- What’s In Your Management Toolkit?
- How Do You Engage Employees & Improve Performance?
- Jumping The ‘Strategy-To-Execution Gap’?
- The Strategic Challenges On The Road To Value-Based Reimbursement
- Even ‘Change Management’ Is Changing
- 3 Steps To Leading A Digital Transformation In Your Organization
And for even more on addressing the challenge of culture, join me at The 2018 OPEN MINDS Strategy & Innovation Institute for the session, “How To Manage A Community-Based Workforce,” featuring Chris Copeland, Chief Operating Officer, The Institute for Community Living (ICL), Naomi Weinstein, VP, Innovation, The Institute for Community Living (ICL), and Boris Vilgorin, Healthcare Strategy Officer, NYU McSilver Institute.