Health Tech, Hospitals

Intermountain CEO: You Don’t Have To Be a Payvider to Reach Scale in VBC

The advancement of value-based care cannot and should not exist solely in a payvider model, Intermountain Health CEO Rob Allen argued in an interview last week. Having its own health plan made things “a little easier” when Intermountain began getting serious about at-risk contracts, but achieving success in value-based care “is more about your commitment to the approach” and forging strong relationships with payers of all types.

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The value-based care movement has been around for decades, but it’s still struggling to reach real scale. 

In order to increase the scale of at-risk models, providers and payers need to come together and collaborate on a shared approach, said Intermountain Health CEO Rob Allen in a recent interview. The interview was meant to address ways for big systems to save money in the post-pandemic economic climate.

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In that context, Allen argued that the advancement of value-based care cannot and should not exist solely in a payvider model.

Intermountain Health is a 33-hospital health system serving Utah and six other nearby states. The health system operates its own health plan, called Select Health, and it also accepts other insurance plans. Having its own health plan made things “a little easier” when Intermountain began getting serious about at-risk contracts, but achieving success in value-based care “is more about your commitment to the approach,” Allen declared.

“We have our own insurance company that serves 1.1 million lives, but we have contracts with other insurers as well. You don’t have to be the payvider to get into this — in fact, many insurance companies are looking for value-based arrangements,” he said.

Before forging partnerships with payers interested in value-based care models, providers need to ask themselves what kind of value the two parties will be coming together to create, Allen pointed out. In conversations about value-based care, people often focus on value in terms of the payer’s saved costs. While this is important, Allen argued that it’s not the core issue at hand.

In his view, value-based care is primarily about creating alignment between patients and their care providers. When all aspects of a patient’s care are comprehensively aligned, things always become easier for the payer — whether it’s an insurer, employer or the government. 

“When the journey, the connectivity and the alignment allows for more efficiency, then I think you’re lined up to truly create value,” he said.

If providers are committed to truly creating value, then they have to think about segmenting the market, Allen declared. This means defining which patients should belong to their value-based group and which patients belong in the fee-for-service group. Being clear on these distinctions gives health systems a better ability to effectively allocate staff and resources, Allen pointed out.

He also noted that segmenting your market could also give way to innovative new service lines. For instance, Intermountain launched Tellica Imaging, a company dedicated to outpatient imaging services, in 2021. Tellica’s imaging centers are focused only on Intermountain’s value-based and cash-pay patients — the sites have value-based contracts with Select Health and other insurers including Medicare, Medicaid, Samera Health and EMI Health.

Seven Tellica sites are open today, and the health system has plans to stand up 25 imaging centers in total. These centers offer flat fees for imaging services — a CAT scan is $350 and an MRI is $550. 

Tellica has saved Select Health $5.1 million in imaging costs since its first center opened in 2021, Allen declared. As for Intermountain’s cash-pay patients, Allen said the centers have saved them $4.4 million dollars. He also pointed out that Tellica’s sites increase accessibility, as most patients can get their imaging done the day after they try to make an appointment.

“What’s the value chain — is it to the insurance? We’re delivering it. Is it to the patient? From a finance perspective, we’re delivering it. Is accessibility the value chain? We’re delivering it. Is the value chain a satisfying experience? We’re delivering it. Tellica is hitting a lot of those marks,” he claimed.

Providers need to be hitting these marks across a patient’s entire care journey, not just their imaging experience. To do so, providers have to prioritize strong, collaborative relationships with payers of all sorts, he argued. 

This is why Allen believes that being a payvider isn’t the key to success in value-based care. Intermountain’s value-based contracts with outside insurers are just as important as its contracts with Select Health, he said.

“Value-based care is a little easier if you’ve got your own bubble to start in, but I think other health systems have to approach it largely the same way with partners — whether you have your own payvider setup or whether you’re a smaller piece of the whole puzzle. You still have to have the partners to get it done,” Allen declared.

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