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Why Risk-Bearing Entities Need Strong Health IT Solutions for Value-Based Care

The shift in healthcare from traditional fee-for-service (FFS) reimbursement models to value-based care (VBC) has been happening slowly over the past decade. Rather than reimburse providers per service rendered, VBC payment models offer reimbursement based on the value of the care provided to patients, as evidenced by quality measures, spending, and outcomes.

At the center of the value-based care movement are risk-bearing entities (RBEs), which are healthcare organizations that assume financial risk in the course of delivering care to patients. As an RBE, having health information technology solutions in place to support better reporting, care coordination, and reduced readmissions is key to success in value-based payment models.

What Are Alternative Payment Models in Value-Based Care?

From a clinical standpoint, value-based care is a treatment approach that focuses on preventive care and long-term health outcomes with the goal of driving down healthcare costs while improving the overall health and well-being of patients. The “Quadruple Aim” of value-based care includes improving patient experience, improving population health, reducing cost of care, and improving the provider experience for better performance.
When providers participate in value-based payment arrangements (typically with a public or private/commercial payer), they may receive payment based on their ability to deliver high quality and cost-efficient care, relative to benchmarks. These arrangements are generally called Alternative Payment Models (APMs, and can vary by levels of risk and rewards, as well as other terms and features.

Types of Risk-Bearing Entities

There is variation in the terminology used to describe risk-bearing entities. These entities are sometimes referred to as independent practice associations, physician-hospital associations, and accountable care organization (ACOs). Regardless of the name, the RBE involves physicians and other providers coming together to form a legal entity and entering into financial risk arrangements with one or more payers. The RBE assumes collective risk for their defined payer population(s).

These organizations typically have shared infrastructure, such as care management resources, analytics, technology, and other operations support. While RBEs and the payment models they participate in come in many shapes and sizes, they are commonly defined by their focus on achieving better health outcomes and lowering cost.

Why Are Quality Measures Key for RBEs in VBC Arrangements?

Risk-bearing entities must monitor, and sometimes collect and report on, quality measures as part of the reporting requirements for the APM they participate. An ACO or similar RBE can leverage data sources to compare quality measures to national benchmarks and rate their performance. Some examples of quality measures might include things like total cost reduction, all-cause readmissions, emergency department utilization, and hospitalization for preventable complications, among others.

There are several types of quality measures, but the two most often included in APMs are process and outcomes measures:

  • Process Measures – indicators of a provider’s ability to improve or maintain the health of its patient population to inform consumers of expected health outcomes with the provider and often reflect standard recommendations for clinical practice. For example, the percentage of individuals who received an annual flu shot. 
  • Outcome Measures – the impact of a healthcare service on a patient’s end healthcare result, such as surgical mortality rates and complications, or rates of hospital-acquired infections, or 30-day inpatient readmissions.

HEDIS is also a widely used performance improvement tool measuring areas like effectiveness of care, access/availability, utilization, and other measures reported from electronic clinical data systems. 

Why Do Risk-Bearing Entities Need Strong Health IT Solutions?

Health information technology is essential for success in value-based care, providing multiple benefits:

  1. Understand your population – In order to effectively manage cost, RBEs must be able to stratify their population and identify high-cost, high-risk patients, based on utilization patterns, specific conditions or diagnoses, and other factors. With these insights, RBEs can develop more informed care management strategies and programs to deliver targeted interventions to the appropriate patients. 
    IT solutions can assist by supporting analysis and reporting. RBEs who partner with an IT vendor that can utilize additional, real-time data sources, such as admission, discharge, transfer (ADT) and clinical data from electronic health records (EHRs), will reap the benefits of more timely and richer insights.
  2. Enhance care coordination – RBE providers and care managers are typically focused on supporting transitions of care and coordinating services for patients they are responsible for. With limited interoperability between IT systems and siloed healthcare data, it’s often difficult for care managers to track their patients and conduct post-discharge follow up. When care managers have medication lists, clinical notes, vitals, and other data at their fingertips, they can easily identify patients at highest risk, and know when to intervene, saving precious clinical resource time.
    Technology solutions that provide real-time visibility and insights into patient movement can mitigate these challenges. RBEs can work with health IT partners to access real time ADT alerts for select patient cohorts with automated reports sent directly to provider workflows. When a patient is admitted to the emergency department, hospital, or post-acute care facility, these notifications allow the care team to conduct proactive outreach to providers at the point of care.
  3. Support care collaboration – The fragmented healthcare IT landscape also makes it difficult for RBEs to collaborate with other providers and care team members — which is necessary to provide truly coordinated, high-quality, and efficient care. RBEs can address this problem by using health IT solutions that allow care teams from across the continuum to collaborate on shared patients, regardless of their employer or the EHR they are using. Through a common platform, users can easily access a patient’s full encounter history and diagnoses, identify who is on the patient’s care team, and share insights and recommendations for patient care to support more informed treatment decisions, resulting in more cost-effective care. 

By improving visibility, follow-up, and care coordination, technology can help RBEs to work towards the Quadruple Aim that value-based models strive to accomplish. With the right resources and tools, RBEs are the leaders in this movement to create a better, more affordable healthcare system for all.

For more information on how PointClickCare’s solutions can support ACOs and risk-bearing entities


Learn more about ACO REACH and finding the right health IT partner for success.


March 1, 2023