Value-Based Care News Digest - January 2020

January 13, 2020

This month's digest recaps the major themes of another busy year in value-based care. We also round up recent news from the field, spanning policy, research, innovations, payers and providers.


2019 Year-End Review

  1. Incumbent payers were very keen on expanding into care delivery for their members this year, either by building it on their own or with partners.
  • Taking the build-it-yourself route, CVS and Aetna are piloting HealthHUB primary care clinics that will expand to 1,500 locations over the next two years.
  • Among those employing the partnership approach, Blue Cross Blue Shield of Texas teamed with Sanitas Medical Center to launch 10 new primary care medical centers in the Dallas and Houston markets. In addition, UnitedHealthcare and Walgreens are opening 14 UnitedHealthcare Medicare service centers within Walgreens stores in Las Vegas, Cleveland, Denver, Phoenix, and Memphis. And Blue Cross Blue Shield of North Carolina launched an initiative to deliver highly coordinated, patient-centered primary care to its members, partnering with Iora, Cityblock, and CareMore to open new practices across the state.
  1. The current administration appears bullish on value-based care, with new payment models multiplying.
  • As health care entrepreneur Brad Smith takes over as the new director of the CMS Innovation Center (CMMI), CMS Administrator Seema Verma said she was excited to have him "build on the important work the Trump administration has undertaken to transform our health care system to deliver better value to patients." CMS's ambitious value goals include having 100% of traditional Medicare and Medicare Advantage payments flowing through two-sided risk alternative payment models by 2025. HHS also released a pair of proposed regulations aimed at breaking down barriers to value-based arrangements and care coordination due to Stark, Antikickback and Civil Monetary Penalties laws.
  • Meanwhile, these value-based payment models continue to proliferate. CMMI announced 10 new payment models in 2019, including several mandatory models and the much-awaited Direct Contracting model. Other models run the gamut from primary care and emergency triage to specialty areas (e.g. kidney and cancer care) and drug pricing. Most ramp up to implementation in 2021.
  1. The growth of value-based primary care shows the promise that both payers and providers see in this model.
  • ChenMed and Oak Street expanded into several new markets in 2019 and launched new partnerships with payers and providers.
  • Through these new relationships, payers can lower their medical costs and reach at-risk members in "primary care deserts," providing their members high-touch, personalized care. Health systems that historically haven't taken on value-based care on their own have partnered with these companies because they are effective at managing costs and improving outcomes. Even Walgreens has seen the value in outsourcing clinic operations, partnering with VillageMD to open clinics.
  1. Specialty care-focused companies continued to proliferate, with payers and providers eager to partner with them.
  • For example, several organizations have emerged with innovative methods of treating kidney disease. This includes InterWell, a kidney disease-focused population health management company started by nephrologists; RenalytixAI, an artificial intelligence-based clinical diagnostics company; and PRINE Health, a medical group that plans to take on risk-based contracts to manage chronic kidney disease patients. Somatus and BlueCross BlueShield of Tennessee also entered into an outcomes-based agreement for Somatus to provide kidney care to the plan's Medicare Advantage members with end-stage renal disease.
  • Livongo, a digital health company that provides a diabetes management program to its users, had its initial public offering in July and expanded its partnership with Blue Cross Blue Shield of Kansas City.
  • In October, Progyny, a company that manages fertility benefits for employees at large firms, became the first fertility benefits management company to go public. Progyny offers treatment bundles that cover diagnostic testing and connect members with a patient care advocate. The company also offers members access to a network of fertility specialists and a pharmacy benefits solution, Progyny Rx.
  1. As proposed mergers fell through and employed physicians pursued independent strategies, health system consolidation began to stagnate.
  • Mergers that were blocked or called off include Partners HealthCare's proposed acquisition of Exeter Health Resources, which the New Hampshire attorney general rejected, stating it would inhibit local competition. In addition, Sanford Health and UnityPoint called off a previously proposed merger, as UnityPoint was reluctant to embrace the idea of the combined health system. And Gundersen Health System and Marshfield Clinic Health System scrapped plans to merge seven months after the two Wisconsin-based systems announced they were exploring a potential merger, citing the "complexity" of combining two entities of their size and scope.
  • Meanwhile, more health system-employed physicians are exploring their independence. North Carolina, for example, has seen shakeups with health system-employed primary care physicians since 2018. First, a group of 90 physicians broke away from Atrium to form the primary care-focused Tryon Medical Partners. Tryon continues to grow, with physicians from CaroMont Health leaving the system to join. Second, 40 physicians employed with Novant broke off to join Holston Medical Group.
  1. Tech giants and retailers announced initiatives aimed at growing their role in the health care industry in 2019.
  • After several acquisitions and key hires, Google provided some clarity around its health care strategy, building on its key functionality to provide clinicians with medical records that are easy to search and analyze (albeit not without some controversy). Apple Health Records became available for three of Allscripts' flagship products, enabling providers to share data and results with patients more easily and enabling patients to view available medical data from multiple providers like doctors, testing labs, pharmacies, and therapists.
  • Retailers are also making big bets that they can find a niche in health care. Best Buy, historically known for growing without acquisition, has made three health care acquisitions over the past year to support its plan to grow into selling health monitoring devices for seniors. Sam's Club is piloting a program with big name health care companies (Humana, Quest Diagnostics, etc.) to offer customers bundled health care services ranging in price from $50 to $240 per year. And Walmart launched its "health care supercenters" (offering low-cost primary medical services, dental care and behavioral health services) rather than partnering.
  1. Recognizing that a nationwide shortage in health care workers means problems for their care delivery businesses, health systems, payers and even new market entrants are creating opportunities for medical education.
  • HCA, which employs 94,000 registered nurses, acquired its third nursing school. Geisinger also has its own medical school focused on community health, and it announced this year that it will offer free tuition. Dell Medical School and the McComb School of Business at the University of Austin created the Value Institute for Health and Care, providing a curriculum that educates students on the transition to value.
  • Among payers, Kaiser Permanente and Humana are both supporting medical schools with a heavy focus on value-based care, population health, primary care and community engagement.
  • Walmart employees will be able to earn bachelor's degrees and career diplomas in health-related fields for $1 per day, helping to organically grow its health care workforce.

December 2019 News Roundup

Industry News

Payers and Providers

Accountable Care Organizations

Primary Care

Kidney Disease

Home Health

Social Determinants of Health

Health Systems

Government & Regulatory


  • The big December health policy news is what ended up in Congress's end-of-year spending bill (most notably the repeal of several ACA taxes) and what did not (major bills on drug pricing and hospital surprise billing). As part of the deal, Congress delayed Medicaid cuts to disproportionate-share hospitals and other health care "extender" priorities through May 22. This could provide a spring legislative vehicle for drug pricing and hospital surprise billing. However, impeachment and 2020 election politics could keep Congress from getting much done, if anything.
  • The Affordable Care Act's 2020 Open Enrollment Period ended with 8.3 million sign-ups through federal insurance exchanges, a slight decline from 8.4 million last year. ACA premiums are down 4% for the 2020 plan year.

Survey Says/Studies Show


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