The Opportunity for Provider-Owned ISNPs Have Crystalized with Real Clinical Results and Shared Savings Payments

April 2, 2021

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Hank Watson, Chief Development Officer. ISNP Specialist

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“The opportunity for Provider-Owned ISNPs have crystalized with real clinical results and shared savings payments.”

There is so much to cover, and we’ll get to it all. However, first a half step backwards. In our opening post we described the Provider-Owned ISNP in lofty terms:

The Provider-Owned ISNP represents the nursing home owners and operators aspirations - an elevated position in the health care landscape, focused on clinical outcomes tied to economic incentives centered on these outcomes and defined by owners of the first dollar premium.

As such, it’s appropriate to reflect on the status of the ISNP as a fundamental shift in the way nursing homes operate. What comes to mind is the Gartner Hype Cycle.

This is a jargon heavy concept often applied to new technology. At its’ core, this diagram is a visual representation of the expectation life cycle of a new business concept from innovative concept [“Innovation Trigger”] to a reliable, broadly adopted solution [“Plateau of Productivity”].

Gartner’s Hype Cycle

Slope of Enlightenment - “Organizations draw on the experience of the early adopters. Their understanding grows about where and how the innovation can be used to good effect. Methodologies for applying the innovation are successfully codified, and best practices for its use are socialized.”

Despite the challenges of 2020, it has been exciting to watch the operational model for Provider-Owned ISNP industry mature over the last few years. In fact, the pandemic has highlighted the clinical and economic benefits of the ISNP to plans with adequate scale.  While each plan has its own story, this gives me confidence that we are well up the Slope of Enlightenment as the opportunity for Provider-Owned ISNPs have crystalized with real clinical results and shared savings payments.

Plateau of Productivity: “Mainstream adoption starts to take off. Criteria for assessing provider viability are more clearly defined. The technology's broad market applicability and relevance are clearly paying off.”

Achieving this success positions us well as an industry to head toward mainstream adoption of the model and the corresponding Plateau of Productivity described in the Gartner model as we emerge from the COVID pandemic.

But how did we get here?

Innovation Trigger: “The Gartner Hype Cycle starts when a breakthrough, public demonstration, product launch or other event generates press and industry interest in a technology innovation.”

Our industry has traveled the “Hype Cycle” roller coaster over the last decade and a half. At the start in 2005, while the Provider-Owned ISNP concept was sound, there were few infrastructure solutions. These solutions started to emerge in 2014 as nursing homes started having risk programs thrust upon them with the Bundled Payments for Care Improvement (BPCI) initiative. Under this initiative, organizations entered into payment arrangement that included financial and performance accountability for episodes of care, which led to the Peak of Inflated Expectations – as illustrated by a number of operators wading into the waters without a clear understanding of execution in a risk-based reimbursement model.

And with that, it didn’t take long for the industry to head into the Trough of Disillusionment. The term “Disillusionment” will create pause, but it actually represents an operational reset. Or as Gartner describes this stage:

Trough of Disillusionment: “Inevitably, impatience for results begins to replace the original excitement about potential value.”

No doubt, this has occurred and it would be disingenuous to represent otherwise. As American Health Plans entered the market in 2017, we learned as much from nursing home operators’ previous challenges as we did from successful Provider-Owned ISNP efforts.

What it highlighted for us was the industry’s need for a well-capitalized, comprehensive, integrated and experienced ISNP management solution, which gets us to where we are today:  Approaching the Plateau of Productivity

In my follow up post, we’ll explore this concept and how the “criteria for assessing provider viability are more clearly defined.” applies to world of Provider Owned ISNPs

We welcome your feedback. Please comment below or reach out directly at HWatson@AmHealthPlans.com