The Great Transition: Adopting Value-Based Care Models

In recent years, there has been a push for healthcare systems to move away from the traditional fee-for-service model and instead focus on providing value-based care. 

This shift is being driven by several factors, including the increasing cost of healthcare, the need for better coordination of care, and a desire to improve population health.

The reimbursement and care models associated with value-based care are designed primarily to promote advancing quality of care while increasing patient care access. Essentially, value-based care is also designed to reduce healthcare costs at the point of care. 

This model was first introduced in January 2014, but adoption has been slow-going. Leading health systems, including Mount Sinai health system, have helmed the effort to transition to a value-based care system. 

But providers have been reticent to adopt the system, because it’s simply easier for physicians to operate under the straightforward fee-for-service model. 

Value-based care incentivizes providers based on their performance against a variety of CMS quality metrics, which complicates payment somewhat.


What is Value-Based Care?

Value-based care is a model of care that focuses on providing the best possible outcomes for patients while also reducing costs. 

This approach is in contrast to the fee-for-service model, which reimburses providers based on the number of services they provide, regardless of whether those services are effective.

Value-based care, in theory, is clear improvement upon the current fee-for-service model. However, in practice, it’s a complex process that necessitates additional administrative effort from providers. 

Providers must report on specific metrics that reflect an improvement in a patient’s condition. Providers are accountable to demonstrate this improvement to payers, who administer incentive payments based on this data. 

Providers also must track and report on hospital readmissions, adverse health events, population health, patient engagement, and other metrics. While tracking and reporting on these metrics does take extra time on the part of the provider, it informs a healthcare system centered on improvements in patient health outcomes rather than number of services rendered. 

The Forces Driving the Push for Value-Based Care

There are several reasons why the push for value-based care is gaining momentum. Namely: the rising cost of healthcare, the need for better coordination of care, a desire to improve population health, the Affordable Care Act, and the rise of consumerism. 

The Rising Cost of Healthcare

The cost of healthcare has been rising steadily for many years, and this is one of the main reasons behind the push for value-based care. 

When providers are reimbursed based on the number of services they provide, there is an incentive to provide more services, even if they are not all necessary. This can drive up the cost of healthcare without necessarily improving outcomes.

The Need for Better Coordination of Care 

Another reason for the shift to value-based care is the need for better coordination of care. In the fee-for-service model, providers are often siloed, and there is little incentive for them to coordinate with other providers. 

This can lead to duplication of services and unnecessary tests and procedures.

The Desire to Improve Population Health

Value-based care is also seen as a way to improve population health. When providers are reimbursed based on the health of their patients, they have an incentive to focus on prevention and wellness. 

This can help to improve the health of the overall population, which can reduce the cost of healthcare in the long run.

The Affordable Care Act

The Affordable Care Act (ACA) has also played a role in the push for value-based care. 

The ACA includes a number of provisions that encourage value-based care, such as the establishment of accountable care organizations (ACOs). 

According to CMS, accountable care organizations are groups of doctors, hospitals, and other healthcare providers who come together voluntarily to give coordinated, high-quality care to Medicare patients. 

The Rise of Consumerism

Finally, the rise of consumerism is also driving the shift to value-based care. As patients become more involved in their own healthcare, they are demanding more value for their money. 

This is putting pressure on providers to deliver care that is not only effective, but also affordable.

Strategies to Increase Value in Healthcare

There are a number of strategies that healthcare organizations can use to increase the value of care they provide. These include:

Focusing on Prevention

By investing in prevention, healthcare organizations can reduce the number of people who develop chronic conditions or need expensive treatment.

Coordinating Care

Better coordination of care can help ensure that patients receive the most appropriate care for their needs and that different providers are working together to provide the best possible care.

The goal of coordinated care is to make sure patients get the right care at the right time. Improving care coordination also reduces the number of duplicative services provided to patients, which helps to prevent medical errors and keeps healthcare costs down. 

Improving Population Health

Population health initiatives can help improve the overall health of a community by addressing social and economic factors that impact health.

Investing in Technology

Technology can help improve the quality and efficiency of care while also reducing costs.

Engaging Patients

Engaging patients in their own care can help them make more informed decisions about their health and ensure that they are receiving the care they need.


It’s clear that the healthcare industry is in need of change. The current system is not sustainable, and it is not providing patients with the best possible care. The push for value over volume is a step in the right direction, and it is something that should be supported.

There are many ways to increase value in healthcare, and it is important to explore all of them. This includes things like providing more preventive care, investing in new technologies, and improving communication between patients and providers. Value-based care is the future of healthcare, and it is something that we should all be working towards.

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