The Importance of Specialist Referral Efficiency in Value-Based Care

By Raj Lakhanpal, MD, FACEP, CEO, SpectraMedix

As risk-bearing entities (Health Plans, ACOs, IPAs, etc.) continue to advance in value-based care (VBC), one area they can’t afford to overlook is the importance of adhering to an in-network referral system for specialized practitioners. For any given patient, medical needs will arise that their regular primary care physician (PCP) can’t fulfill. For example, if a patient is suffering from back pain that is not getting better with conservative treatment, their PCP would likely refer them to an orthopedic specialist more singularly focused on diagnosing and treating back problems.

Under VBC, PCPs have numerous incentives, including financial incentives, to comply with keeping specialist referrals in-network. In spite of this, an alarming number of them fail to adhere to keeping referrals in-network.

In a 2018 survey of healthcare executives, 38% of participants attributed out-of-network specialist referrals to existing personal relationships between PCPs and those out-of-network specialists.[1] If a PCP knows a specialist that’s an old friend from medical school, for example, they’re prone to prioritizing that existing relationship over the in-network status of a specialist they don’t know personally when it comes to referrals. It’s logical on some level that PCPs would want to refer their patients to specialists they can vouch for, but it still begs the question: Why are physicians actively referring their patients to out-of-network specialists, in spite of their many incentives to do otherwise? There are three likely explanations for why this occurs. Their network:

  1. Lacks high-quality specialists in core disciplines
  2. Isn’t placing enough emphasis on the importance of your physicians to refer patients to specialists inside of your network
  3. Has the right specialists, but they aren’t visible or accessible enough to your PCPs

Thankfully, there are advanced solutions designed to make sure that all involved parties are following the right protocols without having to do any extra heavy-lifting. Providing readily available and searchable in-network specialist providers to PCPs is key. Having access to these advanced solutions is just part of the equation, as any in-network referral system can only succeed if the importance of in-network referrals is clearly communicated to those PCPs. Above all, demonstrating the extra costs to the ACO and the provider of out-of-network referrals will help PCPs maintain better discipline to refer in-network.

Having a mechanism to monitor PCP compliance with in-network referrals is absolutely necessary for your network to achieve success in VBC. It’s equally important to leverage that same technology to make sure that patients are also complying and attending their referral appointments.

When the right processes for in-network specialist referrals are put in place and then followed correctly, it benefits all involved parties. Administrators succeed when their network returns high rates of referral compliance. The provider succeeds by fulfilling the appropriate incentives under their VBC contract. The patient succeeds by maintaining their own continuity of care and assuring that they receive the most attentive and responsive care that their network and their providers can provide.

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Tags: Value-Based Care, specialist referral, referral efficiency, primary care provider, network leakage, risk-bearing entity

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