St. Louis-based BJC Health System approaches value-based care not as a single model, but as a continuum that requires alignment across clinical, operational and financial teams.
That approach dates to 2012, when the integrated academic health system became the first accountable care organization in the St. Louis region and one of 89 nationwide. Today, BJC remains deeply invested in value-based care following its January 2024 merger with Kansas City, Mo.-based Saint Luke’s, forming a 24-hospital, $10.7 billion organization.
Value-based care adoption has grown across the industry, though participation remains uneven, with fee-for-service models still widely used and 56% of primary care physicians reporting value-based payment revenue, according to the Commonwealth Fund and the Healthcare Financial Management Association.
For BJC, that shift includes continued participation in ACO models to improve patient outcomes and reduce costs, as well as expanding commercial value-based arrangements, such as a 2026 renewal agreement with Aetna covering commercial and Medicare Advantage plans.
BJC executives said data and infrastructure are foundational to its approach.
Becker’s spoke with Scott Hawig, executive vice president and CFO; Christopher Miller, MD, executive vice president and chief clinical officer; and J.C. McWilliams, senior vice president and chief managed care officer, on what value-based care looks like inside the organization — and what it will take to make it work.
Editor’s note: Responses were lightly edited for clarity and flow.
Question: When leaders talk about value-based care, it can mean different things depending on whether you’re looking at it through a clinical, financial or managed care lens. When the three of you talk about it inside BJC, how do you define what value-based care actually means for the organization today — and what level of financial risk the system is prepared to take on?
Dr. Christopher Miller: Value in healthcare spans the entire care continuum. Broadly, it’s a promise to deliver outcomes and services that matter most to those we have the privilege to serve — patients, families and communities. It’s also a promise to do so safely, consistently and equitably.
The Becker’s audience is familiar with value as a function of quality, efficiency and experience relative to cost. While that’s true, we believe it’s more than that. In addition to proving clinical outcomes and consumer experience are best in class, the value journey demands relentless attention to strengthening access and care continuity, eliminating unwarranted variation through standard work, fostering data transparency so we can improve and emphasizing culture and process to drive outcomes.
Value is often placed into a box, but it’s much bigger than that. It’s about honoring the spirit of what we do.
J.C. McWilliams: Dr. Miller defined it well in terms of quality, outcomes, patient experience and cost. That’s a fundamental definition widely acknowledged across the industry. The next question is how to translate that into value-based care and payment programs.
With that said, it’s a continuum, as we see it and as we talk about it across the system. You’ve got fee-for-service and perhaps pay-for-performance that’s rewarded based on elements of value. Then there is the other extreme, full-risk capitation. When we think about those different types of programs, the fundamental observation is whether they drive and incentivize improvement in value. There are a myriad of models that can be used to incentivize and align stakeholders.
Scott Hawig: From a clinical, operational and financial perspective, we align around the concept of value centered on the patient. Regardless of whether you call it population health, value-based care or risk, the focus is on outcomes.
It takes alignment across clinical operations, contracting and financial teams. All parties must work together to ensure comprehensive care — from primary care through post-acute — with the right access, people and care protocols to deliver on value.
Q: BJC was one of the earliest organizations to participate in an accountable care organization more than a decade ago. Looking back on that experience, what lessons have most shaped how the system approaches value-based care today?
CM: As early adopters of traditional value-based care models, we have found that clear accountability, clinician-led care design and continuous performance improvement are key drivers of success and innovation. In 2012, BJC HealthCare became the first health system ACO in the St. Louis region and one of 89 nationwide. The model initially focused on shared savings and later evolved as we participated in the second wave of the Medicare Shared Savings Program, selecting a shared decision-making structure to help shift care delivery from volume to value.
JCM: That experience provided a foundation to improve performance and expand into other value-based models, including Medicare Advantage. The combination of MSSP ACO participation and Medicare Advantage models created a natural synergy and enabled collaboration with commercial plans.
Q: J.C., your role sits at the center of payer relationships, employer partnerships and value-based payment strategy for BJC. From your vantage point, how are conversations with payers and employers evolving when it comes to structuring value-based arrangements and sharing risk?
JCM: In Medicare Advantage, earlier programs were well structured, well supported by the plans, with good resource allocation, good partnership with providers and timely, actionable reporting. Those things are the lifeblood of the value-based care arrangements and helped create a situation where incentives were well aligned.
There was more collaboration. There was an opportunity to select measures and targets together, and it was structured in such a way that surpluses were very attainable. Those surpluses were an example of where costs came in lower and quality was better than targets that had been established.
When you look at a situation where we were consistently rewarded for good quality and good efficiency, we were able to leverage that reporting. In the last four or five years, however, a lot of that quality reporting — or the quality of the reporting over time — has fallen off.
Many of the resources historically allocated to make those programs work, and to keep them collaborative between plan and provider, have struggled. We are now trying to figure out how to restructure those programs, how to better collaborate with plans and how to drive renewed support.
When we think about applying those learnings to the commercial space, it is incredibly challenging from a value-based care perspective because of the predominance of self-funding and the fragmentation of risk pools and populations through self-funded membership in many large carrier bases.
We try to identify where there is a fully insured membership base and whether programs can be supported by the plan, and whether the measures and performance targets are truly attainable. That has been elusive. We have had fits and starts in the commercial value-based care space.
One of the things that has been beneficial in the last few years is the advent of direct-to-employer programs. A health system like BJC has established programs for pharmacy and medical benefits to be a full replacement product for self-funded employers.
That has enabled us to identify defined populations, develop a clear understanding of trends, targets and quality focus, and create a strong combination of provider and employer collaboration for those populations. That has been a bright spot for us in trying to drive more value-based care into the commercial space.
Q: Scott, from the finance perspective, value-based care often requires significant investment in areas like care management, analytics and coordination before the financial returns are fully realized. How do you think about evaluating those investments and determining where BJC should lean in?
SH: I would be remiss if I didn’t call out data as No. 1 — what data is important and how timely it is.
J.C. touched on how we get data in a timely way and what we do with it. Ultimately, as we hand it over to physicians, how do we get it into their hands? How do we use the data to validate and support those who are doing well, identify those who have an opportunity and move the entire population, especially in a system the size of BJC?
A lot of the focus with investments over the last 24 years has been around data, implementation support, care model support and wraparound caregiver support. When we talk about value-based care, it is not just in the hands of the primary care physician, but across the entire network.
The second key point is that value-based care needs to be comprehensive — from primary care to post-acute care.
When you mention investments, it also includes investing in those sites and platforms to ensure we have the access and capability to serve people under a value-based care model. This model becomes challenging if we aim to keep people healthier through primary care and ambulatory visits but do not have sufficient access.
So in terms of investments, it is not only technology but also investing in appropriate sites of care to move care closer to home and earlier in the progression.
Q: Dr. Miller, from the clinical side, what have you learned about what it actually takes to make value-based models work in everyday practice for physicians and care teams?
CM: It is leadership work, appropriate best-evidence care and standardization deployed with as much consistency and as far across the enterprise as possible. But that won’t make us successful alone.
There are some forces to think about. The biggest one, honestly, is how we continuously mature and improve the electronic medical record so that it works for caregivers, and maybe better by their feedback. The same could be said for the rapidly evolving artificial intelligence enablers that all health systems are exploring.
Second is a spirit of empowering leaders to continuously improve and innovate so that the standards — whether leader work or care practice — don’t go stale. Their improvement and innovation are critical.
Finally, it’s important that our team members understand what the goals are and why. [It’s important they understand] the rapid maturation of data and analytics — what are we measuring, how do we tie those to our goals, whether at the unit level, practice level or enterprise level — and tie it to our why. That combination of principles works for well-defined populations, but it also applies to how we run clinical operations.
Q: Most health systems today already have some exposure to value-based models. As BJC prepares for a future where those models likely expand, what specific changes are you making inside the organization now — operationally, clinically and financially — to position the system for success?
CM: We have tried to place a premium on practical initiatives that do a few things, including empowering our front-line leaders.
We are working to simplify the medical record so it works for clinicians, not the other way around. We are also focused on efficiency, particularly in inpatient settings, to minimize excess days and ensure patients move to the right setting as soon as they are ready.
We are pushing to eliminate more variation — not just in the clinical space, but also in leadership, financial operations and across the organization.
Finally, we are focused on continuously improving processes. We leverage system-based models, especially in our enterprise data and analytics framework, to promote data transparency so we can learn in real time and optimize what we are doing as one team.
We are also focused on using the right artificial intelligence tools to support front-line caregivers.
JCM: At this point, when we look back on what we’ve learned over the last few years, we’ve had a good opportunity to reflect on things that worked well, things that aren’t working well and changes that we need to make in partnership with the health plans to drive value-based care programs that will work and drive the performance that we’re all looking to deliver.
One of the things that’s helpful to think about is that value is still the North Star for the organization. When we think about the fundamentals of incentive alignment to improve value, it does benefit all stakeholders, especially the patients. That’s a constant. Regardless of some of the challenges we’ve had in the models, that still drives us.
When we think about model improvement, there are fundamental questions. How can we reinvigorate the plan-provider partnerships? How can we reflect on where models have fallen short in the past and be innovative and drive new models that drive that incentive alignment? How can we make sure we’ve got good resource allocation between the provider and the health plan in terms of making the programs work and being able to figure out how to drive performance improvement through reporting, through better transparency, through better coordination and the right incentives in programs that work?
Once we do that successfully — and we’re in the process of doing that now — it creates an opportunity for us not only to reinvigorate our programs, whether through MSSP, Medicare Advantage and, to some extent, commercial value-based care programs, but we’re also looking at Medicaid value-based care programs as well. We’re trying to figure out how to leverage these programs across all of our payer segments, and that will benefit patients across a broad continuum.
SH: Two more strategies are at the forefront for us when we talk about value-based care. One of those is partnerships. We’ve been quite active on that. The reason I call that out is because we’ve found that to be a critical relationship-building skill to accelerate access, accelerate our learning and build our capabilities.
You would have seen us add partnerships around outpatient imaging, pediatric behavioral health and pediatrics overall. You would have seen us in the last year start to make those announcements and grow. Echoing back to that concept of comprehensive health, that isn’t us doing everything in every circumstance. There are partners that we think can accelerate our learning and capabilities in that space, as well as access points.
The second piece I would call out is around home. We absolutely are advancing that frontier. Home infusion is a good example of what used to be hospital-based, moved to an ambulatory setting and now can be done in a home setting. There are a lot of benefits to that, clearly for the patient in terms of convenience, caregiver and family support, but there is also an element key to value-based care around patient engagement, patient-reported feedback and reported outcomes that are a new analytic for us to start driving our clinical protocol.
We’re not just seeing you when you come into the office. We’re getting some amount of information from you on a daily or more frequent basis in a setting that you’re more comfortable with, whether at home or not at home.
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