Since the passage of the Affordable Care Act, the adoption of the value-based care model has been increasing in popularity among healthcare organizations, government officials, and especially among Medicaid and Medicare.
As more and more organizations begin implementing it, they are experiencing improvements in efficiency, profits, and patient outcomes.
In this article, we will discuss:
- What is value-based care?
- How is value-based care different from fee-for-service?
- What are the benefits of value-based care?
- How healthcare organizations can make the transition to value-based care seamlessly.
- Different ways payers can help providers along the value-based care continuum.
- How to improve your value-based care with cutting-edge technology solutions.
Let’s dive in!
What Is Value-Based Care, and How Is It Different From Fee-For-Service
Value-based care (VBC) is a reimbursement model in the healthcare industry where providers are paid based on patient health and satisfaction outcomes.
In contrast, in fee-for-service (FFS) models, providers are paid based on each service performed. FFS focuses on quantity over quality, and VBC centers around the quality of care, efficiency, and smarter spending.
For example, in FFS, payers pay providers for every visit, test, medication, MRI, and the like, conceivably encouraging providers to drag out care to make more money.
FFS providers get paid for treating people when they are sick, whereas value-based care providers get paid for keeping their patients healthy.
6 Benefits of Value-Based Care
Value-based care encourages payers, providers, and health plans to be innovative and work together to improve the quality of care they provide to their patients.
1. Lowered Costs
Patients
First, let’s examine the reduced costs for patients. One of the best features of value-based care is the focus on preventative measures to keep patients healthy. One way to accomplish this is through measurement based care, which utilizes data to improve patient outcomes.
A hidden bonus is that preventative care is often more affordable than more pervasive treatments once the patient is sick. It also leads to quicker recovery and lessens doctor visits and treatments.
Payers
Additionally, value-based care lowers costs for payers and increases efficiency by supporting bundled payments that cover the complexities of the patient’s care.
Not only that, but payers gain stronger cost control when paying for patients’ services. Improved quality of care leads to better outcomes which ultimately reduces spending. Accordingly, payers disperse less money for the services used by their patients.
2. Enhanced Quality of Care & Patient Satisfaction
With metrics and ratings based on customer satisfaction, every employee concentrates on providing the highest quality of service and placing the patient first.
When healthcare organizations focus less on pushing treatments and tests to make money, they can provide quality care.
Value-based care emphasizes treating the whole person, not just remedying the presenting illness. This practice leaves the patient feeling much healthier and satisfied with their treatment.
3. Reduced Risk for Payers
Another benefit of VBC for payers is that it reduces risk. Both payers and providers have a stake in the outcome and work together to keep costs low and deliver quality care.
When adopting the two-sided risk models, providers accept accountability if they exceed their budget or miss revenue goals. They must compensate payers for a portion of the losses.
4. Improve Coordination
When everyone has the same goal of providing quality care to the patient, everyone is on the same team. Without the friction from fee-for-service models, operations are more efficient, and processes move faster.
With value-based care, incentives and technology help improve coordinated care.
Transactions are packaged together, diminishing the time spent going back and forth. It also decreases the paperwork between payers and providers, denoting fewer lost documents.
This brings us to benefit number five.
5. Decreased Administration Burden
With VBC, payers can save time, money, and energy by managing paperwork and other tedious administration tasks.
Through bundling the entire care plan, payments and paperwork are consolidated- unlike fee-for-service, which produces a high volume of paperwork with individual treatment visits.
6. Healthier Community
Prevention is one of the pillars of value-based care. It is achieved by focusing on dietary and lifestyle changes to help stop complications from conditions, such as diabetes, from developing.
Diabetes is one of the leading drivers of healthcare costs and about 37 million Americans live with diabetes, with even more having prediabetes.
A doctor who adheres to a value-based approach would prescribe a prediabetic patient a healthy diet plan, an exercise program, and also look at the psychological aspects.
If this method takes hold, it can help reduce the number of people in America who develop diabetes. Plus, by similarly scrutinizing other conditions, the result can be a healthier community.
Even though value-based care was introduced in 2006, successful adoption and implementation are still rare. Here are a few ways to help your chances of success.
3 Ways Healthcare Organizations Can Transition Seamlessly to Value-Based Care
Now that you understand why you should begin transitioning to value-based care models, here are three tips to make the switch easier.
1. Create Efficient Data Sharing Between Providers and Payers
As you know, HIPPA prohibits sharing patient data unless it is for treatment or payment. When a payer and provider work together around VBC, they must change their data use agreement.
Payers need to share back costs and utilization information with providers quickly and efficiently. Otherwise, it can lead to problems for the providers, such as not knowing their financial gains and losses.
Improving Data Sharing
Payers often base their data on claims systems that may post a paid claim several days to a month after the delivered treatment, leading to delays in data sharing.
However, when the provider can share their clinical data with payers, they can integrate that information with their claims data, creating a more efficient process.
For the two to thrive, they need to share data quickly and transparently.
Speed and transparency between the payer and provider are the keys to shaping a fluid process and advancing performance and quality of care.
2. Health Plans Need To Provide Data
Another addressable area requiring examination and development is the arrangement between healthcare plans and healthcare providers.
For providers to be proactive in their patients’ health, health plans need to provide actionable analytics reporting to the providers. This data should contain a comprehensive view of the patient and their claims.
This information benefits not only providers and their patients, but also health plans. The full-patient picture can provide a competitive edge, drive innovation, and influence the roadmap to develop new member benefits and plans.
3. Implement High-Quality Technology
To keep up with the requirements of a value-based care model, modern and cutting-edge technology is a must. Legacy systems often lack flexibility, complex coding, or automation to give healthcare plans the ability to shift to VBC.
Having the capability to configure all plans and automatically respond to any changes in regulation is essential for providing quality VBC.
How Payers Can Help Providers With the Value-Based Care Continuum
To achieve success, payers must help providers transition to a value-based care continuum when entering a new contract. The models involved in value-based care are very different from fee-for-service. Shifting them into a simpler but similar model may be the best course of action.
Additionally, there are other steps payers can take to help support providers as they maneuver towards value-based care.
Offering Payment Support
Providers are required to pay transformation costs such as:
- Coordination costs
- Practice transformation costs
- Other expenses
To help offset or cover part of the provider’s cost, a payer can offer a payment per member or a performance bonus. Also, paying them upfront can help move them along easier.
During the early stages, it is also important for payers to be understanding of growing pains and not judge providers too harshly during these early transformation stages and instead base payments on growth.
Then, as they evolve, the payment models can, too.
Implementing Technical Support
Financial isn’t the only support payers can offer providers. Technical backing is also essential to flourish. They will need data and insights during the early stages to address shortcomings and migrate faster.
For instance, furnishing them with online tools or reports helps them discern how they stack up amongst their peers. Then they can identify where they are performing poorly and overspending.
Additionally, payers can provide them with data and reports to help them form strategies to improve their performance.
Transforming Primary Care
A primary care practice initially created based on a fee-for-service model will need support transitioning to meet performance metrics.
The way they deliver care must align with the new value-based payment models. While it is the providers’ responsibility, a payer can help by providing metrics centered around patient-centered utilization to guide them.
Do More Research
Some areas that could benefit from more research are:
- Incentives quantities
- Provider movement in the value-based care continuum
- Assessing successful practices’ strategies
Data can tell a story. When you dig into the research of what has worked for others,
the analysis can lay out a blueprint for success.
Improve Your Value-Based Care With High-Quality Solutions
When payers, health plans, and providers work together, they can provide the best possible patient outcomes. Value-based care allows healthcare organizations to improve their quality of care while saving money.
But for the process to be seamless, without any delays or inaccuracies in data when sharing amongst each other, you need a high-quality system.
You need a system that can help you manage your claims, third-party data integrations, and improve workflows.
HealthAxis’ solutions provide the flexibility to configure the most elaborate contracts, provider reimbursement fee models, and payment arrangements needed for a value-based care structure.
Our end-user configuration makes it easy to build complex arrangements and helps automate the process to improve operational efficiency and lower costs. In addition, you are equipped with data and actionable analytics to support your reporting, cost tracking, and quality measurements.
Forge successful, value-based outcomes and refine member services with Healthaxis’ powerful HxOne solution.
