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A 4 minute read
August 28, 2019

The shift from fee-for-service healthcare to value-based care has been in motion since the passing of the Medicare Improvements for Patients and Providers Act (MIPPA) in 2008. Despite these early efforts, the incentives from the Centers from Medicare and Medicaid Services (CMS) didn’t become mainstream until the Hospital Value-Based Purchasing Program began in 2012.

Ever since, CMS has been introducing and modifying incentive programs to encourage hospitals and care facilities to provide comprehensive, coordinated care to reduce overall healthcare costs.

Existing value-based programs have faced criticism even amidst success. Facilities are still opting into these alternative payment models (APMs). While this can help some facilities take on risk at their own paces, the care centers that don’t participate are still using the fee-for-service system, which is less cost effective than value-based care.

Additionally, value-based reimbursement doesn’t always take into account the additional factors impacting low-performing hospitals, such as patient populations with high rates of chronic illness or low rates of insurance.

For high-performing hospitals, however, value-based financial incentives are an effective tool for lowering care costs and reducing the incidence of unnecessary testing and procedures. Here are three ways you can maximize your success in value-based care.

1. Empowering primary care providers

Primary care physicians are uniquely equipped to foster trust and meaningful relationships with patients and are the first line of defense when offering preventative care. Because primary care physicians work so closely and consistently with patients over many years, they are able to detect early symptoms of illness while they’re still easily treatable. These providers can also help to curb habits that have negative impacts on patient health, such as tobacco use.

Another measure that could improve care delivery for primary care physicians is to create a team of preventative care specialists—including nutritionists, pharmacists, and wellness coaches. By building a support team around primary care providers, facility leaders can reduce the strain of education and communication on individuals by spreading responsibility across a small team. This could also help patients better understand the many ways they can approach improving and maintain their own wellness.

2. Shifting payments and incentives

Under the current system, providers can opt into value-based purchasing initiatives. In a value-based purchasing program, providers receive bonuses for performing above average, and are penalized for performing below the average.

Some experts believe that switching to a true value-based care system would be the most effective. This would entail giving providers a single lump-sum payment offered per patient per year, with facilities owning costs outside of that. If patient care is coordinated and high-quality, facilities will keep the remaining funds and determine how they can best balance risk.

Though this could be one solution to reducing costs, it does not necessarily account for patients who see a variety of provider types or who visit assorted care centers. Would each care center receive a lump sum? Would the care centers have to divide a single payment? The current system of incentive programs may be a step in this direction—particularly with the continued integration of payers and health systems—but it’s unlikely that we’ll be seeing a fully value-based system in the next 5 or 10 years.

3. Effectively leveraging technology and data sharing

Patients have a wide variety of facility types to choose from when seeking care and are often visiting care centers in various locations due to commuting and other travel. Collecting information and coordinating care for a single patient across disparate electronic health record (EHR) systems can be challenging.

Many health networks have begun implementing a Healthcare Information Exchange (HIE) system to connect the multitude of EHR systems in use across the care sites within the network. This decision has enabled health systems to manage data collection and verification, as well as manage risk and physician workflows.

The rapid consolidation of the healthcare market is also driving consolidation of EHR systems and other technologies. When companies merge or are acquired, organization leaders must decide whether to pick an existing system from one of the parties or to choose a new vendor. For any of those options, technology interoperability is the end goal. If patient data is inaccessible to providers, it is essentially useless in terms of care coordination and preventative medicine.

Learn more

Interested in learning more about the changing value-based care environment, and its impact within the U.S. healthcare industry? Catch our on-demand webinar replay about Value-Based Care in 2019 and Beyond.

In this panel discussion, you'll hear first-hand experiences from industry thought leaders at Mayo Clinic, Dell Medical School & UT Health Austin, and more! This panel will cover topics ranging from:

  • The current state, growth trajectory, and impact of value-based care
  • Provider benefits such as increased collaborations and incentive opportunities
  • Provider challenges such as tracking and predicting those types of surgeries in their market, staffing properly, and facing a social worker shortage
  • Predictions of the future of value-based care and how to capitalize on rising opportunities such as implementing health IT systems to handle population health initiatives


Alanna Moriarty

Alanna Moriarty is a healthcare industry writer and content strategist. As the Content Marketing Manager for Definitive Healthcare, she most enjoys connecting the dots between data and care delivery. ...

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