Building the Foundation of Value-Based Care for Substance Use Disorder is Not Without Hurdles

Inadequate and mismatched business systems and cautious — if not drawn-out — negotiations impede the rapid adoption of value-based care in the substance use disorder (SUD) treatment space.

Part of the challenge comes from a lack of consensus in the marketplace about what the high-level practices of value-based care should look like.

But even when providers and payers agree on the concepts, Steve Priest, CEO and president of outpatient SUD provider Spero Health, said that value-based arrangements can’t be operationalized because payers’ systems are built only for fee-for-service business.

“The lack of system design for moving forward with some of these things gets to the point that it can’t be operationalized,” Priest said at Behavioral Health Business’ event VALUE. “If you’re a provider, you’ve basically reached an agreement. Everybody from the contracting side says we should do this, and then you can’t get it over the finish line.”

SUDs are chronic by nature, Priest said, making them potentially prime conditions for payers and providers to engage in care and payment arrangements that focus on care outcomes.

Founded in 2018, Spero Health is approaching 100 payer contracts with Medicaid and commercial health plans in the six states where it operates 77 locations. Priest notes that Spero Health has had conversations with all of its payers: Now about half of those contracts have some value-based care element.

“We’re all for it, we believe in it,” Priest said of full-risk arrangements. “But we also think that organizations have to walk before they can run.”

Admittedly, systems issues pop up on the provider side, too, Priest said. Providers generally may struggle with the sophisticated data standards that payers require or lack basic systems such as an electronic health record altogether.

Behavioral Health Business/Jason Dixon Photography

On top of the potential systems issues, insurers build caution into how they approach payer contracting to avoid potential mishaps, Eric Bailly, business solutions director for SUD strategy at Indianapolis-based Anthem Inc., said at the event.

Anthem has engaged with several value-based care arrangements in the SUD space already, Bailly said. He also said he feels an urgency to bring greater innovation to the SUD space citing the rise of drug overdose deaths in the last few years.

An estimated 107,000 people have died from a drug overdose in the U.S. in the 12-months ending November, according to recent data from the Centers for Disease Control and Prevention.

“We can’t be urgent enough with our responses. But I’m also very conscientious that we need to be very thoughtful with how we build the foundation for the future,” Bailly said. “We can’t march too quickly because we can run into problems when we’re not thinking things through thoroughly as well.

“So there’s a balance to be struck.”

Bailly expressed wide optimism about the future of value-based care in SUD treatment and said the field is still early in the movement. Specifically, he sees a structural focus on outcomes and performance, which previously has not been prominent in the field, as a boon to patients.

Still, a lack of consensus on how to approach outcomes and measures such as treatment program retention reflects the historic problems the SUD treatment space brings to the value-based care movement.

Comparing value-based care outcomes to fee-for-service

“We operate in an industry where outcomes have been opaque, and beyond opaque, they have really been crappy,” Cooper Zelnick, chief revenue officer for Waltham, Massachusetts-based SUD treatment provider Groups Recover Together, said at VALUE.

Groups Recover Together writes its own definitions and measures into their payer contracts. About 87% of the company’s payer contracts were value-based care arrangements and about 93% of the company’s revenue comes from those contracts.

Program retention rate at six months is the “North Star” measure for Groups Recover Together.

Zelnick says the reasoning comes down to people who remain in treatment for more than six months are less likely to relapse or die from a drug overdose and a patient’s total cost of care goes down.

“We’re held accountable, not for delivering services, but for retaining our members and producing lower cost of care,” Zelnick said. “We’re really proud of that.”

The industry average for six-month retention for in SUD treatment is between 25% and 30%, Zelnick said.

Groups Recover Together sees six-month retention rates of 68% for Medicaid patients and 75% for commercial health insurance patients, Zelnick said. Spero Health measures patient population retention at 90 days and at a year, Priest said. Across all patients, those rates stand at about 75% and 50%, respectively. The average duration of a Spero Health patient is about 10 months.

Behavioral Health Business/Jason Dixon Photography

Even with a focus on the two longer retention deadlines, Spero Health’s operations put an emphasis on the patient’s earliest days in treatment. Most patients, Priest said, don’t continue with Spero Health after the first day because they aren’t a good fit for the program or they aren’t ready to make major lifestyle changes.

“We have a real laser-focused on getting patients off to the right start,” Priest said. “We want to see our first 30 days, our first 15 days really improve, which I think will drive that 90-day and then that six-month and that one-year retention rate.”

Zelnick and Priest presented different timeframes, but also different definitions, for their company’s retention measures. Despite the differences, Bailly said his work at Anthem isn’t complicated by different definitions for outcomes so long as they eventually lead to improved health outcomes and reduced spending.

More activity from the federal government in establishing definitions for outcomes and approaches in value-based care may ease the adoption curve of value-based care, Zelnick and Priest said. However, they maintained that the best approach would be for the SUD treatment industry to take several different approaches to establish truly beneficial norms for the practice.

“In this period of exploration and of pioneering the world, it’s also good for people to try different things,” Priest said, adding that Spero’s payer partners often have very different approaches to what or how outcomes are defined. “None of these approaches are wrong. Someday there may be ‘the way it is’ or ‘the standard.’ But it’s also fine for people to work together to explore new ideas.”