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What We’re Watching: November 20, 2018


HHS Secretary Azar declared a public health emergency in California, giving Medicare and Medicaid beneficiaries, providers and suppliers greater regulatory flexibility in meeting emergency health needs created by the wildfires. HHS has also deployed regional emergency coordinators.

What we’re saying: Glad they’ve taken these steps. Two hospitals and eight other facilities have had to evacuate their patients. And Premier has been working to get supplies, such as N95 masks that prevent smoke inhalation, to backup facilities and community centers so that they can continue to serve their patients. We’ve also been helping affected member facilities take steps to assess damages, cleanup and rebuild. Premier does whatever it can to help our members best serve their patients during and after these challenging times. Today, the people of California are our top priority.


Limited engagement from suppliers and data challenges are the main barriers to more widespread adoption of value-based contracts in the supply chain, according to a new Premier survey. Although 81 percent of respondents said they were interested in securing more of these types of contracts, most indicated they were unable to do so due to a lack of supplier engagement (67 percent).

What we’re saying: As providers move to risk-based payment, many are asking business partners to put skin in the game with value-based contracts. But value-based contracts between providers and suppliers are a relatively new phenomenon. That’s one reason why a majority of providers indicated a lack of understanding for value-based, two-sided risk contracts in the supply chain (55 percent). While there are few best practice examples for how they should be structured, these types of contracts could mean cost savings for providers and ROI for suppliers – creating a win-win situation. Premier has deployed several of these and have examples of success that could be easily replicated and scaled.


Early results from a bundled payment direct-to-employer contract between TriHealth and GE are proving these models may be worthwhile. Targeting cesarean sections and related complications for low and moderate-risk mothers, TriHealth and GE have implemented a timely partnership that has saved $2 million in healthcare costs with only 214 enrollees to date in Ohio.

What we’re saying: We know bundled payment models work but many employers are choosing to take them a step further by bypassing the insurer and going directly to the health system. In doing so, employers are becoming a more active and forceful driver of change. Premier is working with our member health systems on these models to ensure they’re successful.


What We’re Watching is a weekly blog focused on the current events Premier is following and their relevance to the work of Premier and its members.

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