Helping you to understand the healthcare revenue industry in the simplest terms.

Have you been hearing about a healthcare model called value-based care, but you’re not quite sure what it means?

Healthcare professionals are touting the benefits of value-based care, and are even committing to its practice in their own facilities.

This particular model is being tested in the U.S., and we’re going to tell you everything you need to know about it. We’ll talk about what it is, how it works and more.

What is value-based care?

Let’s go over all the basics you need to know about value-based care.

Basic overview

At its most basic, value-based care compensates healthcare professionals based on the quality of a patient’s outcome, as well as the quality of their care, with metrics like equity and cost. This model incentivizes healthcare providers to offer the best care, and is more likely to hold them accountable if they offer substandard care.

In contrast, under the current system, healthcare providers are paid a set fee for any given service. This means they are financially rewarded based on the number of services they provide, over the quality of services.

What it looks like for healthcare professionals

Healthcare professionals will face less pressure to perform as many services as possible for financial gain, and can instead focus on offering the best care with the highest quality service. They will not be stretched as thin, and they will also face consequences if their service does not result in a positive outcome for their patient. 

What it looks like for patients

Patients are ultimately able to spend much less on healthcare in return for better outcomes. Value-based care focuses on treating patients holistically, and allows patients to access quality care before they develop chronic illnesses. This model results in fewer doctors visits and procedures, and less money spent on prescription medications.

How does value-based care work?

Whether this is sounding like a promising healthcare model or a terrible nightmare, you should understand how it actually works before you decide for yourself. Here are a few ways the model is being implemented.

Measures of success

There are three major metrics of success in the value-based care model. They are:

• Overall quality. Quality is naturally difficult to quantify. Still, there are a few important metrics to consider, which were laid out by the National Academy of Medicine.
  • Effectiveness
  • Efficiency
  • Equity
  • Patient-centeredness
  • Safety
  • Timeliness
• Cost. Focusing on quality, preventative care instead of expensive treatment-based care lowers costs overall, and reduces the pressure on providers to offer the most expensive services. Plus, providers are compensated based on quality of care, rather than the volume of services they provide.
• Equity. The healthcare industry is one of the industries that could improve the most by offering equitable care across all communities. The value-based model offers high-quality care to everyone, and improves access to care that prevents chronic illness.

Incentive strategies

There are a few ways that can be implemented in value-based care systems to incentivize healthcare providers to offer the highest quality care.

The first is financial incentive. Some models compensate if the quality of care met or exceeded their patient’s expectations. Others lose revenue if the care was sub-par. There are also ways to tie a portion of the provider’s compensation to a value-based model.

The second is general non-financial incentives. Many providers feel a sense of intense pressure to offer a huge number of services, which compromises on their ability to provide quality care. With this model, they’re able to offer the right care at the right time, deliver better results, provide holistic care, and genuinely improve the lives of their patients.

There are other incentives that can be implemented as well, but these are the two most common forms.

Benefits and the future of value-based care

Now that we’ve covered the basics of value-based care and how it works, we’re going to dig into whether this model is beneficial, and how it could be implemented in the future. Read on to understand the applications of value-based care

Benefits of value-based care

Currently, the U.S. spends more on healthcare than any other country, but it doesn’t have significantly positive health outcomes to show for it. This means that there could be other ways to offer healthcare that reduce costs and improve outcomes.

While there aren’t too many solid examples of this model going into practice, early results show that value-based care accomplishes both goals. It also encourages more collaboration across departments, and it allows for more opportunities to engage in services that aren’t usually included in the current model.

The future of value-based care

Value-based care is available in some health care systems, both publicly and privately. It is not currently widely offered, but the Center for Medicare and Medicaid Services has made it their goal to enroll the majority of their patients in a similar care model by the year 2030.

It is slowly gaining traction across the U.S., but it will be many years until the majority of Americans can access this type of care.

Final thoughts

We hope this article was useful in helping you understand the most important aspects of value-based care. If you’re a patient or a healthcare professional, knowing your way around these big concepts is essential to becoming better informed about the industry.

We’re working on building out the educational page on our website, so be on the lookout for more articles!

If you’re a healthcare professional and you’re worried about implementing value-based care at your facility, Marcam can help. Visit our website to learn more and get started.