Breaking Barriers: Creating an Outcomes-Based Contracting Strategy for the Value-Based Environment

While price is always a critical factor in healthcare contract management, a product’s ability to affect patient outcomes positively—such as shortening the length of stay, reducing or eliminating the likelihood of hospital-acquired conditions, or minimizing the potential of a post-discharge illness that necessitates readmission—is an important consideration. These clinical benefits are always worth considering. However, in today’s value-based environment, supply chain professionals must work with hospital leaders to factor the financial implications of such outcomes into the total delivered cost of an episode of care.

Outcomes-based contracting looks at the total cost of a product (from sourcing to reimbursement) and requires that the vendor play a role in supporting the provider’s transition to value-based reimbursement by agreeing to share either savings or risk based on the ability of its product to improve patient outcomes. Achieving this progressive method of contracting represents the culmination of the supply chain’s transformation to a strategic, clinically integrated program.

Drawing on his decades of experience as a healthcare executive, Christopher O’Connor will review how to ready your program for outcomes-based contracting as well as strategies to overcome the many barriers you may face as you take on this strategic endeavor.

Learning Objectives:

1. identify what their organization must do to successfully conduct outcomes-based contracting; and
2. Establish a test model that can be brought back to their organization.

Christopher O’Connor is a member of the AHRMM Speaker’s Bureau. He is also a frequent presenter on a variety of healthcare, leadership, and supply chain topics. He has served as an adjunct instructor at Cornell University, Iona College, SUNY Binghamton, and PACE University where he has taught undergraduate and graduate courses in Healthcare and Supply Chain Management. He has also guest lectured on healthcare leadership, career management, and executive perspectives.

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