Administrative infrastructure and why it is important in transforming to a fee-for-value organization

Approaches to fee-for-value arrangements have tended to focus on the financial aspects of the arrangements, while neglecting to look at the underlying technology needs that make risk-based provider performance contracts work. Practices and medical groups which invest in their administrative infrastructure now will be able to manage the increase in data liquidity, and for many providers, these investments are already in place.

But what is an administrative infrastructure and what does it mean to have one? Existing health IT investments in electronic health records, population health, care management, and other capabilities hold the promise of making the transition to fee-for-value easier than imagined, by automating many of the administrative tasks that providers will need to perform to exceed their risk-based arrangement benchmarks. This is the core of a provider’s administrative infrastructure, supplemented by use of technology to improve in 4 key areas needed for fee-for-value success:

  • Determining the appropriate risk-share arrangement and the right mix of services to be effective in meeting risk-based arrangements
  • Aligning metrics with terms of the risk-based arrangement
  • Managing payment and financial risk adjustment
  • Communicating provider performance through ongoing reporting

Automation of the infrastructure that supports areas such as provider network management, utilization management, and population health management are critical for providers, as both public and private plans focus on managing these services in their provider arrangements. This automation can occur through provider-based analytics driven by the administrative infrastructure, to continuously measure performance.

The use of analytics in coordination with existing provider health IT systems will give health plans the data they need to continually improve network contract performance by identifying quality and clinical improvements, and opportunities to reduce risk and resource use.

Because of the expected market disruption caused by MACRA, for example, especially in the solo and small practice space, the ability to leverage an administrative infrastructure to differentiate as a provider under MIPS is critical. Many providers are looking at arrangements with high-performing hospital infrastructures to leverage existing technology investments as a way to differentiate in the provider landscape. This infrastructure supports the aggregation of data that drive metrics needed to manage fee-for-value arrangements, beyond MIPS and into other fee-for-value programs such as Accountable Care Organizations (ACOs) and Alternative Payment Models (APMs) in specialty practices.

HIMSS is investing time and resources in working with providers and vendors to understand and document what an administrative infrastructure needs to look like. The ongoing work of the HIMSS APM-I Task Force is focused on defining the administrative infrastructure and the governance and best practices associated with its successful implementation.

About the author: As Managing Director of Accenture Health Service Group, Erik works on strategic transformation initiatives for clients in the healthcare provider, payer and life sciences industry. Erik has over 20 years’ experience in healthcare, including senior positions in federal, state, and commercial healthcare programs and initiatives, and served in key leadership roles within the healthcare community.