Advice for Bundled Payments: Dave Terry on The Shifting Risk Landscape

For the inaugural edition of our “Advice for Bundled Payments” blog series, we sat down with our CEO and Co-founder, Dave Terry. Dave has spent more than 20 years in healthcare, developing skills and a passion for helping change the way physician groups and health systems manage care and risk through payment reform. We asked Dave about his thoughts on the healthcare industry as a whole and how bundled payments fit into its future.

Q: Since the first BPCI Advanced opportunity opened in January 2018, a lot has happened in payment reform. From your perspective, what are the key trends to watch now?   

A: 2019 is a critical year for providers who are interested in innovating through risk-based programs. This year already CMS has introduced several new up and downside risk models, the Primary Care First and Direct Contracting models. We’re currently in the last enrollment period for the voluntary BPCI Advanced program. We also know other programs are on the way, including several mandatory programs: a radiation oncology bundle, expansion of the CJR program, and a re-introduction of the cardiac EPM initiative.  

From this, we can see that more risk is being shifted from payers to both providers and employers. CMS has said that it wants 100% of providers participating in two-sided risk models by 2025; at the end of 2018, that number was around 30%. We can only expect that mandatory programs will be the primary accelerator toward this goal.

As we saw with BPCI Advanced, there is a lot of interest in these risk-based programs; nearly 1,500 providers began the voluntary program last October. Providers should be ready for models with real risk, but also to aim for real rewards if they succeed at helping their patients get better and get back home as quickly and safely as possible. 

Q: What advice would you share with providers looking to move toward risk-based programs?

A: We strongly encourage providers to get engaged with the voluntary Medicare programs that are most relevant for them.  Whether its BPCI-A, the Oncology Care Model, CPC+ or an ACO, Medicare is sharing more data and has more contract transparency than any other payer in the market.  Even if a provider chooses not to participate, using the data to better understand your performance relative to the market and the rules of a given program is hugely valuable.  We also encourage providers to proactively participate in these voluntary programs where it makes strategic and financial sense, because they are a great way to learn, improve, and engage patients and providers in new ways.

Q:  As risk shifts to providers how can they protect themselves from losing their shirt?  

A: First, we believe it is really important that they understand the rules and terms of each program they are entering and how those fit with their capabilities and historical performance. In other words, providers should ask, do we have wind in our sails or headwinds in this particular program? 

As providers take on multiple voluntary and mandatory alternative payment models with real downside risk in them, obtaining stop-loss protection from a traditional insurance carrier will also be increasingly important.

Q: What about the future of healthcare gets you energized? 

A:  It’s clear that the shift from fee-for-service care to value-based care is not slowing down anytime soon. Balancing risk, care management and improvement will be a challenge. At Archway, we see that challenge as a great opportunity. Finding ways to help providers and employers innovate to better serve their patients– and be rewarded for it – fuels our enthusiasm.

We’ve got great people working on this in data analytics, technology development, program design and clinical process improvement to help them get there. I’m proud of our work, and I’m especially proud of the providers we work with who are innovating to improve patient care.

Want to more advice about bundled payments? Contact a member of our value-based care team with your questions.