Value-based healthcare can be simply referred to as a payment model that pays for performance. The traditional fee-for-service healthcare is being replaced by value-based healthcare.
This means that healthcare organizations are being increasingly proactive in their move from treating patients when they are sick to a more population-oriented care offering.
Benefits of Value-Based Healthcare
According to the vast repertoire of value-based care articles found on the NEJM Catalyst website, there are many benefits to a pay-for-performance model for various stakeholders:
- Lower costs
- Better outcomes
- Higher patient satisfaction rates
- Better care efficiencies
- Alignment of prices with patient outcomes
- Reduced healthcare spending
- Better overall health
- Stronger cost controls
- Reduced risks
Adopting such a payment model does not come without risk, though. Capitalizing on fee-for-service will be important in the short term, as it will help the needed investments for the move towards value-based care in the long run.
Value-Based Care in the Long Run
If done right, the newer payment model will allow healthcare organizations to improve the quality of care they deliver as well as their bottom line. This can be done through management of excess utilization (overuse of emergency departments), avoidance of specific, payer-assessed penalties and the ability to capitalize on bundled payment and shared savings program incentives.
Bundled payments tend to align with the goals of population health, providing opportunities to healthcare organizations and professionals to leverage initiatives across many domains. Emphasis on collecting fee-for-service revenue in the short term is important, as it will play an important role in the possibility and viability of value-based care in the long run.
Through quantifiable, data-driven healthcare cultures and objectives that prone timely, reliable and meaningful data, organizations will be able to incorporate a sustainable outcomes-based care model.
Overall, 2019, is expected to be the leap forward into value-based care with newer reimbursement models and rewards such as:
- Bundled Payments for Care Improvement (BPCI)
- Merit-based Incentive Payment System (MIPS)
This pay-for-performance model, coupled with data-driven initiatives, ties well with MIPS’ Promoting Interoperability category. By elevating clinical and financial performance, healthcare organizations can drive business value to deliver high-quality care and proactively put in place initiatives and processes that will greatly pay off in the long run.