SOURCE: Healthcare Financial Management Association

Healthcare Financial Management Association

September 09, 2016 10:10 ET

Environmental Assessment Maps Transition to Value for Healthcare Organizations

WASHINGTON, DC--(Marketwired - September 09, 2016) - Although the details of new payment approaches that will replace fee for service in U.S. health care are very much in flux, the pace of change is accelerating and the roadmap for navigating the transition is becoming clear. Those are the conclusions of Health Care 2020: Transition to Value, a new report published by the Healthcare Financial Management Association.

"Forward-looking organizations are not waiting for a tipping point that will only be identified once it's in the rear-view mirror," says HFMA President and CEO Joseph J. Fifer, FHFMA, CPA. "They are collaborating with other stakeholders, embracing consumerism, and taking the actions recommended in this report to prepare for value-based payment now."

This is the first in a series of four reports that comprise an environmental assessment designed to guide healthcare organizations in their strategic planning efforts over the next several years.

To download Health Care 2020: Transition to Value, visit

Key takeaways in the 15-page report include the following:

  • The financial incentives in the Medicare and CHIP Reauthorization Act (MACRA) will accelerate the transition to alternative payment models, not only in the public sector but in the private sector as well.
  • ACOs and bundled payment arrangements will evolve quickly in the private sector as providers and health plans gain experience; models that prove effective will quickly gain widespread adoption. Providers who are not yet in value-based contracts should be looking for health plan partners willing to experiment with new pay models so they can hit the ground running when value-based payments become the norm.
  • As value-based insurance design takes hold, it will speed consumers' understanding of the variation in price and quality of services among providers. Health systems that cannot offer high value in certain specialties may need to seek partnerships or consider exiting some service lines.
  • Deep understanding of market-specific consumer price sensitivity and preferences related to convenience and access will convey competitive advantages for both health plans and health systems. To make themselves attractive partners to health plans looking to maintain low premiums, health systems will need to understand both their per-unit price relative to their competitors and the overall cost of care for an episode-and determine what they can do to reduce production costs and overall episode prices.
  • Given that regulators have shown they will aggressively challenge mergers that excessively concentrate market power, healthcare organizations should be ready to demonstrate how a merger will increase value to healthcare purchasers (e.g., employers, individuals) and the broader community.
  • Health systems that cannot offer remote monitoring and other technology-enabled care delivered at or near a patient's home will be at a competitive disadvantage as such care becomes standard practice.

In addition to providing background and context for these key messages, the report also identifies six organizations to watch for their innovative value-based strategies, including The Health Care Transformation Task Force, The University of Pittsburgh Medical Center Health System, the Aetna Leap health plan in southeastern Pennsylvania, and Seattle-based Providence Health & Services.

Eleven healthcare policy experts working in health plan, provider, consulting, government, and academic settings were interviewed in the development of this report, including Amy Bassano, director, Patient Care Models Group, Centers for Medicare & Medicaid Services; Suzanne Delbanco, executive director, Catalyst for Payment Reform; and Mark McClellan, M.D., Ph.D., director, Duke-Robert J. Margolis M.D., Center for Health Policy at Duke University.

HFMA is holding a virtual conference on Sept. 15 which will explore the topics addressed in this report in depth. For more information or to register, visit The other three reports in the Health Care 2020 series, focusing on consumerism, consolidation, and innovation, will be released later this fall. All will be accessible at

About HFMA

With more than 40,000 members, the Healthcare Financial Management Association (HFMA) is the nation's premier membership organization for healthcare finance leaders. HFMA builds and supports coalitions with other healthcare associations and industry groups to achieve consensus on solutions for the challenges the U.S. healthcare system faces today. Working with a broad cross-section of stakeholders, HFMA identifies gaps throughout the healthcare delivery system and bridges them through the establishment and sharing of knowledge and best practices. It helps healthcare stakeholders achieve optimal results by creating and providing education, analysis, and practical tools and solutions. The Association's mission is to lead the financial management of health care.

The following files are available for download:

Contact Information

  • Contact information

    Karen Thomas
    Healthcare Financial Management Association
    (708) 492-3377