The Medicare Shared Savings Program: Four Tools for Better Profit Margins and High-Quality Care

If business executives were asked, “Does it make sense to accept anegative two percentmargin caring for the Medicare segment comprising the majority of your revenue?” most would say no, unless they were trading currency or selling screws. Yet health systems accept fee-for-service Medicare and Medicaid payment schedules that yield such meager margins.

面对如此微薄的利润，大多数医疗保健高管会有两种反应:照顾这些患者是他们专业职责的一部分，而照顾基本上是由政府授权的。现在，随着新的支付模式的出现，医疗保健可以为医疗保险和医疗补助患者提供第三个理由——潜在的两位数利润。

Historically, health systems have preferred to care for patients with private insurance because the reimbursement rates are higher. For example, in 2019,The New York Timesreported that Medicare will pay a hospital $17,000 for a knee replacement, compared to the roughly $37,000 the hospital makes for that procedure for a patient with private insurance.

Although providing care to Medicare patients is unavoidable for most health systems—as is earning less than a 1 percent profit while caring for this population—Medicare can be lucrative through value-based programs such as theMedicare Shared Savings Program(MSSP) and theBundled Payments Care Initiative. This article outlines how the shift to value-based programs helps healthcare organizations improve margins and take better care of patients and communities.

The Medicare Shared Savings Program: Shifting Healthcare Mindset from Volume to Value

In an effort to shift the mindset from volume to value, CMS created the MSSP in 2012, a payment model that financially rewards providers and health systems for delivering value, practicing evidence-based medicine, and helping patients reach optimum health. The shift tovalue-based care(VBC) requires health systems to provide the highest quality care at the lowest price in order to financially succeed.

At the American Hospital Association Regional Policyboard meetingin September 2019, CMS Administrator Seema Verma warned health systems that if they don’t transition to VBC fast enough, the government may get more involved—making it more difficult for hospitals to generate revenue. Recent revisions to the MSSP promoting a faster path to downside risk, coupled with significant hurdles to success in theMerit-based Incentive Payment System(MIPS) program, are driving health systems towards VBC.

Verma also spoke about the future of CMS and VBC: “Make no mistake—if your business model is focused merely on increasing volume rather than improving health outcomes, coordinating care and cutting waste, you will not succeed under the new paradigm.”

The MSSP is an opportunity for healthcare organizations to improve care and generate money in this new value-based model. By using broader amounts of data and improving data sources through four specific tools, the new VBC landscape allows health systems to increase their operating margins in a way they can’t under the fee-for-service (FFS) model.

Four Tools Critical for Success in Value-Based Care

To be successful in the new VBC landscape, health systems must utilize analytics tools for managing large amounts of data. Organizations coupling advanceddata analytics改变医生薪酬计划和护理提供模式的能力将会成功;那些不能很好地改变和管理数据的企业将会倒闭。

那么，卫生系统如何在新的VBC环境中创建成功路线图呢?There are four tools that are absolutely key to success in this new healthcare climate and within the MSSP:

#1: The Ability to Aggregate and Analyze Data

Why is data the differentiating factor in success and failure within VBC? Data analytics finds opportunities for cost savings and improved patient care. To achieve the best patient outcomes, health systems mustmine data传统的交易系统，如电子病历和点解决方案，不足以识别在价值为基础的世界中驱动成功的机会。2022卡塔尔世界杯赛程表时间

Figure 1. ACO measure analysis.

对数据的回顾性收集和分析有助于护理模式的持续改进。数据还推动了预测性分析工具的设计，以防止不良结果和更好的个性化患者护理;因为它允许一种“面向大众的礼宾式定制护理”，数据可以同时标准化护理和定制护理。

For example, specific Health Catalyst tools empower organizations to mine data effectively:

• Population Builder™: Stratification Module:根据无限个潜在变量，快速将患者分组。
• PMPM Analyzer: Mines insights from claims data and identifies opportunities to reduce total cost of care.
• CORUS^®Suite:通过基于活动的成本计算解决方案管理护理成本，该解决方案确定患者护理的真实成本。
• Touchstone™: Allows systems to measure themselves against external benchmarks from similar organizations.
• Hierarchical Condition Category Insights: Accurately stratifies patients according to risk, ensuring appropriate care and payment.
• Community Care Analytic Accelerator: Displays clinical and financial metrics in customizable dashboards appropriate for clinicians, clinical administrators, or executives.

#2: The Ability to Align Financial Incentives Between Payers and Providers

MSSP方法在经济上奖励以最低成本提供高质量、适当护理的提供者。简而言之，提供者通过提供高质量、低成本的护理而在经济上受益，无论提供的护理量有多大。

#3: The Ability to Engage Patients in Behavior or Lifestyle Modifications

卫生系统如何有效地吸引患者参与?一种方法是与一些公司合作，通过不断提醒和具体指导来对患者的生活方式管理决策负责。这太难了。使用数据前瞻性地确定需要额外教育或支持的患者是任何成功的患者参与项目或工具的关键组成部分。其次，在护理过程中寻求家庭成员、朋友和社区卫生工作者的帮助是非常有效的。

#4: The Ability to Garner Support from Clinicians and Encourage Them to Lead the Shift to VBC

Clinicians must lead the change from FFS to VBC; however, getting clinicians on board is no easy task. In an era in which most clinicians associate data analytics with the EMR andoutcomes metricswith clinically meaningless box checking, healthcare must educate its workforce about the real value of data analytics. When done well, data empowers clinicians to answer their own questions and ultimately provide better, more efficient care. Over time, clinicians learn to trust the analytics tools and drive a culture of data-driven decision making.

Mastery of MSSP Tools and Strategy Scale to Other High-Risk Areas

Once health systems have experience and success increasing revenue with the MSSP, they can apply these same tools and expertise to higher-risk programs, such asMedicare Advantage(MA), Medicaid, and commercial plans. The limited downside to the MSSP makes it an ideal training ground to master the capabilities needed to succeed in value-based programs. Second, the MSSP allows systems to increase margins in the Medicarepopulation.

当医疗系统参与ma项目时，会有更大的财务风险和回报。ma是一个医疗保险受益人由私人保险公司管理的项目。在过去，在MA中盈利的卫生系统要么是幸运的，要么是首先学会了如何通过MSSP等项目取得成功。有时，获得硕士项目奖金的医疗系统无法解释他们是如何做到的。当卫生系统将他们通过MSSP开发的相同工具和技能应用到组织的其他领域和其他项目(如MA)时，他们更愿意承担风险，从而产生更高的利润和更少的浪费。

Saving Millions with a Data-Driven Approach to the Medicare Shared Savings Program

One organization’s experience shows how health systems can makereal gains通过MSSP。Mission Health, a health system in North Carolina, knew it could increase profits through the MSSP by taking a more data-informed approach. The health system formed one of the largestACOsin the country,Mission Health Partners(MHP), ultimately caring for 90,000 Medicare patients.

After forming MHP, its leadership team created a comprehensive, strategic plan to garner better access to real-timedata. With data driving the MSSP strategy, MHP discovered ways to transition the initial progress into long-term success (Figure 2), consistently identifying opportunities foroutcomes improvementand improving the health of Medicare patients in western North Carolina.

Figure 2. An ACO MSSP sample visualization.

A Data-Driven Health System Self-Evaluation Is Key to Moving Forward in VBC

Mission Health’s MSSP success started with a roadmap that led to a clear goal—increase profits through the MSSP by improving VBC. All healthcare organizations must have a clear understanding of where they are today in the journey from FFS to VBC and where they want to be in 5, 10, and 15 years. Command of data informs the roadmap on how to get there.

It is important to financially understand the impact of moving 40 percent of overall revenue to a value-based product such as the MSSP. Assuming system revenues of $4 billion, $1 billion of that revenue is generated by Medicare patients (40 percent). Assuming a 1 percent margin in the Medicare FFS model, profits equal $10 million. If the same system participated in the MSSP and achieved quality goals in the 67^thpercentile while reducing the total cost of care by 4 percent, it would receive a cash payment of almost twice that realized in the FFS model (this is all assuming that the system understands its true costs of delivering care and really makes 1 percent Medicare margins).

The Opportunity for Healthcare Organizations to Thrive in VBC Landscape

Which organizations will survive the payment model shift?Data analytics是任何向前发展的卫生系统的基础性资产。它是在新的基于价值的范式中支持成功路线图的方向。

随着医疗保健不断从农民田间学校向VBC发展，包括像MSSP这样的新的CMS项目，卫生系统的新一天正在到来。要在支付模式快速变化的时代取得成功，卫生系统必须有能力汇总和分析数据，调整支付人和提供者之间的财政激励措施，让患者参与到自己的行为改变中来，并在努力创建提供VBC的文化时获得临床医生的支持。

Calculate the Financial Impact of Your MSSP.

Additional Reading

Would you like to learn more about this topic? Here are some articles we suggest:

1. ACOs and CINs: Past, Present, and Future
2. Healthcare’s Next Revolution: Finding Success in the Medicare Shared Savings Program
3. Population Health Management: A Path to Value
4. Value-Based Care: Four Key Competencies for Success