Methodist Healthcare Ministries Provides Philanthropic Leadership in Value-Based Funding

Change is coming!

Federally Qualified Health Centers (FQHCs) will soon be subject by law to the Merit-based Incentive Payment System (MIPS). This means that part of their funding will be at risk, based on whether their patients get healthier. This is known as value-based funding. Payment reform makes sense – our health care system should encourage providers to do what it takes to get patients healthy, even if that’s not business as usual. MIPS is a huge change for FQHCs, who are used to being paid for the provision of services, not for patient health outcomes.

Many funders are starting to look at readiness for payment reform (MIPS), trying to figure out how to help their grantees adapt to the change. Methodist Healthcare Ministries’ approach to helping its grantees, or ‘funded partners,’ is different. Rather than training funded partners, the organization is using experiential learning. Methodist Healthcare Ministries is the first grant funder in the nation to engage in value-based grant funding in health care. While managed care organizations are trying it, and some state Medicaid agencies have utilized the value-based funding model, foundations and other grant funders are not. This makes Methodist Healthcare Ministries a trailblazer in the philanthropic sector.

Prior to 2017, Methodist Healthcare Ministries used a service-based grant model for all its grants. However, it shifted its funding for FQHC partners to value-based grants to “improve the health of those least served,” and not just “count the heads of those least served.” With this grant structure, the organization pays for what it really wants: healthier patients. If patients hit a targeted level of health improvement for a co-morbidity, FQHCs receive an additional amount of money for each co-morbidity. The funding is completely flexible; FQHCs can spend the grant however they want, to help patients get healthier.

Early results

The change to a value-based funding model allows Methodist Healthcare Ministries to receive patient-level data for deep analysis of strategies that are effectively improving patient health outcomes. So far, the results have been very positive both in terms of being a catalyst for innovative changes in the participating FQHC’s delivery of care – thanks in large part to the flexibility in the use of funds, and patient health outcomes. Some have developed completely new programs, with patient commitment forms, and practice changes, including nutrition and exercise support services, and “higher touch” models such as case management and home visits, with frequent patient outreach. Gateway Community Health Center in Laredo, for example, created the “Lado a Lado” model incorporating several of these elements, which has greatly increased patient compliance and has excelled in diabetes management. Before we offered the flexible funding, Gateway’s spending on their Methodist Healthcare Ministries grant was focused on routine clinic-based care.

More importantly, patients have gotten healthier. Four core metrics were established as part of the new funding strategy in 2017, related to co-morbidities in the patient panel: 1) HbA1c control for diabetics; 2) blood pressure control for hypertense patients; 3) PHQ9 symptom reduction for depressed patients, and 4) BMI reduction. Except for BMI reduction, which was too challenging for a one-year period, most of the health centers did very well on the outcomes; 86 percent of the patients receiving care through this funding showed improvement on at least one of these co-morbidities.

Learning through doing

According to the funded partners participating in the program, it has been a tremendous source of learning. “We didn’t know what we didn’t know,” one funded partner said recently. “It’s all about the details, and you only learn those lessons through experience.”

Until one partner had to start reporting, they had no idea it would take their physicians seven hours a week to pull the data needed for MIPS. They were able to modify their Electronic Medical Record (EMR) templates and reporting system to make it faster and more efficient. That will have benefits far beyond the Methodist Healthcare Ministries grant.

As Albert Einstein said, “Anyone who has never made a mistake has never tried anything new.” We at Methodist Healthcare Ministries learned alongside our funded partners in exploring this new payment structure – lessons that may benefit other funders exploring value-based funding:

  • It’s important to gain consensus on the metrics to be used and the amounts in the payment structure. Methodist Healthcare Ministries went through an iterative process with the FQHCs to select metrics they were willing to try and worked closely with the accounting department to develop and refine the payment structure.
  • It’s important to use nationally benchmarked metrics such as those with a Medicaid average, metrics aligned to MIPS, or Healthy People 2020. That means the bar is set in a realistic place and the FQHCs are likely to be tracking those things already. The funder has a responsibility to set metrics realistically, as setting the bar too high can cost the FQHCs money in this type of payment structure.
  • It’s likely that some patients selected for the panel will leave the FQHC during the year. Low-income, uninsured populations tend to be more transitory; they could move, get a job with health insurance, change phone numbers, or lose their transportation. Methodist Healthcare Ministries adjusted its terms with funded partners so that if those type of changes occurred in the first half of the year, the FQHCs could replace those patients, within limits (to ensure there was enough time for the newly added patients to get healthier).
  • The FQHCs needed more help than anticipated with pulling data from their EMRs. Funders investing in this model should be prepared to provide technical assistance with data management. In 2018, Methodist Healthcare Ministries will fund a software project to make it easier for the FQHCs to pull report data from their systems.
  • It is important to define everything. Small differences of meaning or interpretation could affect how much money an FQHC receives. It’s important to be clear upfront about what qualifies for an incentive payment, when an FQHC will receive disbursements, what patients are eligible for panels, and which diagnosis codes qualify for each co-morbidity.
  • FQHCs need flexibility on co-payment rules. At the onset of this new funding structure, Methodist Healthcare Ministries required a co-payment waiver from participating partners. This was a problem for some FQHCs, as they found that “neighbors talk to neighbors,” and some patients that were not in the panel were distressed that those who were in the panel didn’t have to pay. For 2018, the requirement to implement a co-payment waiver was removed, allowing FQHCs to charge a co-pay, but the fee is capped at $20. Interestingly, many of the FQHCs have chosen to keep the waiver because they found it improves patient compliance. Patients are more willing to come to follow-up visits if they don’t have to pay additionally.
  • Remember that we’re all learning. We at Methodist Healthcare Ministries openly acknowledged that we were learning alongside the participating FQHCs. Listening was very important. We admitted mistakes and made any course corrections we could. For example, we changed the PHQ9 metric to a tiered structure, which allowed a more modest change for mildly depressed patients. We had expected that, on average, most patients would come in at higher levels of depression, but that wasn’t true at some of the FQHCs.

What’s next for the Methodist Healthcare Ministries’ value-based funding model?

In 2018, prevention metrics were added to supplement the disease-management and obesity metrics collected from funded partners. We have also changed the metrics to be aligned with national benchmarks and MIPS metrics, which we believe will make them more realistic and attainable. Methodist Healthcare Ministries is also commissioning a software company to build a cloud-based reporting system that will make it easier and faster for the FQHCs to report back.

The bottom line is that the experiential learning so far has been deep and detailed, both for Methodist Healthcare Ministries and our FQHC funded partners. No workshop can teach FQHCs in this much depth what they need to do to modify their EMR templates, or change the way their physicians chart, for example. This is the great value of this program; because they have learned through experience, FQHCs will be better-equipped to handle MIPS when millions of dollars, not thousands, are on the line.