Healthcare finance experts warn that the slow development of the industry in paying to keep people healthy may slow next year as suppliers work to keep their heads clear.

The vast majority of medical services are still paid on a fee-for-service basis, and people generally blame this setting for causing costs to get out of control. People have long recognized the need for value-based reimbursement, but it is happening at an extremely fast rate.

The COVID-19 pandemic is bound to make the situation worse, because suppliers are so concerned about survival that signing value-based contracts seems trivial. Not only that, the ebb and flow of COVID-19 cases makes it difficult to predict the cost of care, and understanding cost is a key prerequisite for value-based arrangements.

Rob DeMichiei, a strategic consultant at Health Catalyst and former financial director of UPMC in Pittsburgh, said: “This will suspend this campaign because of the financial risks and uncertainty in financial performance involved.”

The problems facing the health system today are very serious. Case said that traveling nurses may cost $200 per hour, but with the increasing number of coronavirus cases and the scarcity of available nurses, they have become a necessity.

Case said that the CFO is more concerned about the cost of nursing labor than any other currency issue. Moody’s Investors Service predicts that the shortage of nurses will “Eroding financial performance Non-profit and for-profit hospitals by 2022. “

Case said that labor costs will not decrease next year. A health system with good finances should be able to weather the storm of several years, but not indefinitely. “My long-term concern is: As the CFO is concerned about the direct impact of increased staffing costs, to what extent will this drive a change in value?” he said.

The threat of financial loss is the number one reason why senior managers have not further shifted to a value-based payment model that focuses on population health this year. Survey results The consulting firm Numerof & Associates was released in August.

Value-based care has a series of definitions, but in its most meaningful form, it refers to the fact that part or all of the revenue of the system depends on meeting specific cost or quality goals. Under this arrangement, the proportion of income in the health system that is currently “at risk” is very small.

According to a study by Numerof & Associates, 44% of health systems receive 10% or less of revenue from risk-based contracts, which is far below the respondents’ predictions.

The survey found that although the COVID-19 pandemic has increased providers’ use of telemedicine and home medical care, it has not promoted the desire to risk more income under value-based payments. Only about one-third of respondents plan to substantially increase their income subject to risky contracts after the pandemic.

Michael Abrams, managing partner of Numerof & Associates, said in a statement: “Despite the federal relief fund, the pandemic has severely damaged the balance sheets of many organizations, and is even more vigilant than ever to take financial risks. .”

Nonetheless, Abrams said the health system that was committed to value-based care before the pandemic will continue to expand these efforts. He said that those who see evolution as a “marginal experiment” will continue to do so unless the Medicare and Medicaid Services Center takes decisive action.

All this may mean that healthcare providers will lag behind in the fight for patients and health insurance companies. DeMichiei said that just as providers are slowing risk-based growth, insurance companies are also expanding the scope of care they provide. Insurance companies — or “payment service providers” in this case — already have experience in managing risk, which helps them succeed in the provider’s business.

“The competition between the two about who will win the future of healthcare, insurance companies will continue to move forward and make progress in this competition,” DeMichiei said.