How Nursing Homes Can Find Value Via New Ways of Partnering with Managed Care Plans

As value-based care increasingly becomes more prevalent in the nursing home industry, providers continue to straddle traditional Medicare fee for service (FFS) and a plethora of managed care plans. But there are arrangements that can allow organizations to be both payer and provider, or partner with those that already occupy both worlds.

Amy Kaszak, executive vice president of strategic initiatives for Curana Health, said managed care payers must figure out how to create the right incentive for partnering with skilled nursing facilities (SNFs), who are still stuck between multiple payment models.

“We must get our provider partners over the fence, give them the tools and the resources and meet them where they are in their value-based care journey so we can get them to where we want them to be, and hopefully where they want to be,” said Kaszak.

Kaszak, along with other experts, discussed strategies and business collaborations to allow SNFs to have a hand in both providing care and also serve as a payer. Calling the role a “payvider,” experts talked about what it would mean for the future of value-based contracting at a webinar organized by NetSmart Technologies, a tech provider in the health care sector.

Other experts speaking on the matter included Bruce Greenstein, chief strategy officer for the LHC Group, Hank Watson, chief development officer at American Health Partners, and Devin Woodley, vice president of managed care contracting at VNS Health.

Kevin Scalia, executive vice president of NetSmart, commented that this moment in health care – for nursing homes included – is much like a “Steve Jobs moment,” meaning it’s an opportunity for the health care industry to talk to the rest of the market about the value the sector can contribute.

“People aren’t always that great about discussing the value they provide to the health care system to a payer,” added Scalia. “How do you present that in payer talk, which is a totally different language than provider talk?”

To that end, experts advised skilled nursing providers to talk with Medicare Advantage (MA) plan insurers about how they can convey value by managing patients better. Ultimately, SNFs can build that self-promotion into an operator’s overall package, said Greenstein.

“That ‘building up’ then provides a way for you to contract in a value-based relationship,” he explained.

It does help to have a health plan and provider services under the same umbrella, said Woodley. The provider and health plan arms are able to work together to comb through data and figure out where the gaps exist that many health plans aren’t set up to resolve, he said.

“We’re able to expose those gaps, figure out solutions that can be delivered more effectively through a care manager organization,” said Woodley.

For Kaszak, a big gap in understanding between providers and payers is clearly communicating a value proposition – from SNF to payer.

She believes most payers will listen to providers when they say they’ve identified a gap or pain point and address it.

“[Providers have] got some resources or ideas about how to do it, but we need your help, payer, to really pay for it,” said Kaszak.

Watson noted that it’s really difficult for single SNF operators to move the needle in this way, and a lot of the time they are simply “rate takers.” He shared strategies to simulate scale and strength.

“A lot of folks can’t even get a call back on a fee-for-service rate increase after five years. Our point of view on that, and the approach we’ve taken is, you got to move up the food chain,” said Watson. “The expectation that a large MA organization is going to engage with the nursing home in that way, it’s going to take a long time, if it ever happens at all.”

And so, becoming a Medicare Advantage plan is the quickest way to be heard, Watson said, but a provider would need the capital, the scale and clinical execution to shift to a “payvider” business model.

These are the pieces American Health Partners brings to the table, he said, through joint venture arrangements in lieu of creating an insurance business line in house.

A provider’s voice changes with such an arrangement, by engaging as a peer to payers and creating value by owning more risk.

“The I-SNP that we’re operating every day and we’re taking risk on, it enables other conversations that maybe you don’t have if you’re not out there talking to the health system,” said Watson. “That’s a very big shift that value-based care can create when you take ownership of that risk, take ownership for that premium dollar … you’re ultimately taking ownership for the clinical results of the patients you’re serving.”

Kaszak likes the partner option for SNFs, specifically with smaller organizations focused on the populations a regional operator might care for. Accountable care organizations (ACOs) are another good place to start, she said, as a “baby step” toward a managed care partnership.