The outbreak of COVID-19 exposed a number of inadequacies in the healthcare system. As healthcare utilization fell dramatically across a range of settings, providers reliant on fee-for-service payment mechanisms were threatened with sudden, precipitous drop-offs in revenue, potentially threatening their ability to remain operational and continue to serve patients. Through its experience in clinical quality improvement, efficient healthcare delivery, and innovative payment models, Intermountain Healthcare was able to build on this unique moment to provide short-term assistance to its network providers while also moving toward consensus around more resilient, longer-term models of healthcare delivery and financing.
Intermountain Healthcare is a Utah-based integrated delivery network consisting of hospitals, physicians and advanced practice clinicians combined with a substantial health plan. Throughout its existence, Intermountain has strived to shift system payment away from traditional volume-based mechanisms toward value-based payment. Important to this is moving individual provider payment away from a pure fee-for-service (e.g., payment per relative value unit) toward mechanisms that drive value-based decision making. Prior to the pandemic, many clinicians remained understandably wary of alternative compensation models such as population or capitated payment out of concern that such models were risky endeavors. The onset of the pandemic demonstrated that volume-based payment arrangements carry their own risks, as physicians across the nation saw significant impact on their revenues.
In response to COVID-19, Intermountain sought to address providers’ short-term needs while also using this moment as a catalyst for more lasting change. As a first step, Intermountain guaranteed practitioners a set percentage of their 2019 take-home pay to give them time to adjust to the new realities of telehealth (and sometimes pitching in to provide COVID treatment that was outside of their traditional scope of practice). Intermountain then moved to engage practitioners in a collaborative effort to reimagine reimbursement mechanisms going forward at an accelerated pace. Coming out of the experience of the pandemic, Intermountain found that the provider community was more open to conversations around new models of payment. Many began to view population-based or capitated payment models not as a risk – but an opportunity for more stability. Our goal and commitment is to continue to realign payment mechanisms toward value-based incentives.