The COVID-19 pandemic has taught us that it is possible for the health system to transform the delivery of care, and quickly. We’ve seen vaccines hitting the market in record time, increased cross-industry collaboration to track vaccine status, and an increase in the use of virtual care. Likewise, the pandemic has demonstrated that value-based care delivery models, where payment is based on outcomes relative to the number of services provided, are key to improving patient outcomes and reducing costs.
However, there is still work to be done to increase the adoption of value-based care across the healthcare continuum. To understand where value-based care is headed, it is essential to understand the forces driving value-based care delivery models forward:
States are moving forward with a focus on data standardization.
Although the Biden administration has pushed back deadlines for implementing key value-based reimbursement models, some states are moving forward. California, New York, Oregon, and Texas are rolling out their own versions of “value-based payments 2.0” programs and resetting initiatives that are paving the way for delivery system reform. These state initiatives are designed to improve outcomes by emphasizing data standardization and investing in automated channels of communication and data exchange. For example, the Council for Affordable Quality Healthcare has worked to improve transaction processing to include value-based care content that supports providers at the point of care.
Investors are placing big bets on value-based care due to market consolidation and expected policy changes.
Growing enrollment and the economics of Medicare Advantage and Managed Medicaid will continue to drive startup growth, as well as accelerate market consolidation with many payers purchasing and merging into Medicare Advantage plans. All signs point to the venture capital market continuing to build on this strategy by investing in both business plans and technology solutions that enable the integration of provider delivery systems, including care. based on value, with paying agencies. On the technology side of the healthcare market, we can expect continued consolidation as narrow-minded companies merge to create more comprehensive end-to-end products that provide solutions to business problems rather than just software tools. Fueling this speculation, the Centers for Medicare & Medicaid Services is expected to roll out support for new and renewed Medicaid waivers to advance value-based care initiatives at the state level.
Consumers expect more from the health care system and will demand value-based models of care.
With penalties increasing in 2022 for hospitals that fail to follow price transparency rules and young healthcare consumers increasingly dissatisfied with existing healthcare delivery models, providers will have nowhere to go. turn, except value-based care. This version of value-based care, however, will place a strong emphasis on actual outcomes, not just achieving acceptable value for money based on numerators and denominators.
Young consumers expect increased data sharing to ultimately lead to greater access to more personalized, high-quality care. Given how comfortable they are with sharing health information and data, the dollars they spend on wellness, and expectations around work-life balance, a conflict of values will quickly emerge with respect to the structure of our care delivery system. Their heightened expectations, combined with new technologies and government mandates, will advance value-based care more than any previous generation.
- Health IT companies are improving their risk-adjustment capabilities to drive value-driven care.
Emerging risk-adjustment technology and software allow greater control of the data entry process as well as the evaluation and interpretation of that data. Data validation capabilities that accurately code procedures and diagnoses and represent care provided exist and are now powered by technology that dramatically improves what was previously a highly manual process prone to error and inaccuracy. Technologies such as natural language processing, machine learning and artificial intelligence are applied in real time to enhance the richness of all captured data to enable value-based payment models.
Value-based care is steadily gaining ground in the healthcare industry. With payers, providers, investors, patients and technology companies joining the effort, there is no sign that adoption of value-based care will slow. Government and commercial payers foresee increased investments in the transition to value-based healthcare, and providers accept the reality that value-based care is the future of healthcare.
Michael Pattwell is a senior consultant in value-based care at Edifecs, a global health informatics company.