Value-Based Care Stunted by Misaligned Payer-Provider Relationship

A misalignment between payers and providers on their definitions of value, frequency of communication, and trust in their partnership is impeding value-based care efforts, according to research from Insights by Xtelligent Healthcare Media.

The goal of the latest report, Payer Perceptions of Value-Based Care, was to understand payer-provider relationships help payers succeed in alternative payment models. Results highlight four key areas: value-based care model participation rates, resources needed from providers to succeed in these models, confidence levels in their provider partnerships, and the impact of COVID-19 on provider partnerships.

General themes emerged around the level of trust, frequency of communication, and alignment in value-based care goals. All were construed differently between payers and providers.

Only 11 percent of private payers had a lot of trust in their small and large physician groups, and none had high levels of trust in their hospital or health system partners. Providers also showed low levels of trust as only 6 percent had a lot of trust in their public payers.

Similarly, private payers had low levels of trust in their provider partners: 18 percent had a lot of trust in small physician groups, 19 percent in large physician groups, and 12 percent in hospitals. Four percent of providers reported the same level of trust in their private payers.

“There are pockets of resistance,” pointed out the manager of innovative payment models at a regional, non-profit health plan during qualitative follow-up. “Generally speaking, most providers see the value in value-based care. But getting it down to the point where you're making changes can be difficult. We're trying to get providers to be paid less over time.”

The lack of trust may also be tied to mixed levels of communication. Providers less likely to report frequent communication than payers are. While this is likely because payers are not necessarily communicating with frontline physicians, who ultimately are the individuals most impacted by value-based contracting. So frustrations emerge when conversations about adjusting their practice take place without them.

Public payers report communicating with their small physician groups weekly while private payers most commonly communicate with these physicians monthly. Both public and private payers primarily communicate with large physician groups or hospitals on a monthly basis.

Yet 38 percent of providers said they do not communicate at all with public payers and 32 percent said they do not communicate with private payers at all.

A lack of trust and limited communication lead to a misalignment in value-based care goals, limiting the success of these initiatives.

Only six percent of providers felt fully aligned with their public payers and five percent feel the same about their private payers. Meanwhile, 14 percent of public payers felt fully aligned with small physician groups and none felt fully aligned with large physician groups or hospitals.

Private payers were slightly more optimistic, as five percent felt fully aligned with small physician practices, large physician groups, and hospitals. But this was not a huge level of alignment. Most payers and providers feel a disconnect. If these two parties cannot align their goals surrounding value-based care, conversations about contracting will continue to be a challenge.

“Even if we are philosophically aligned, there’s always the other stuff that needs to happen. I don’t want to say bureaucracy, but boxes have to be checked,” highlighted the program manager at a national for-profit health plan in qualitative follow-up. “There are certainly some practices that conversation tends to be more narrowly focused on the contracts, but it helps when goals are aligned."

Value-based care success is contingent on effective payer and provider partnerships. Improved communication to better align the two parties is critical in the industry’s transition away from fee-for-service reimbursement.

Payer Perceptions of Value-Based Care highlights payer participation in innovative payment models, payer trust levels in provider partners, and the impacts of COVID-19 on payer-provider relationships. The full report can be found here.