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Healthcare Providers Grapple With the Transition to Value-Based Payments Tags: value based purchasing

Paying for individual healthcare services has been the norm for many years, but things are starting to change. With healthcare costs still rising far more quickly than the overall rate of inflation, many have come to believe that the fee for service model is at least partly to blame.

A potentially better alternative now seems to be paying not for services themselves but the value they combine to deliver. Instead of encouraging healthcare organizations to emphasize volume of service provision, this value-based purchasing approach aims to help them keep focused on a worthier goal. While some promising results have begun to pile up, it has also become clear that working through this transition will take plenty of planning and effort.

Switching to a Value-Focused Payment Model Requires Preparation

Billing for individual healthcare services might be counterproductive overall, but it is a fairly natural and straightforward approach. On the other hand, becoming able to charge for the health-related value that is actually being delivered is necessarily quite a bit more complicated.

For one thing, it will never be immediately and directly clear just how much value is being provided to patients in the absence of suitable metrics. Although most healthcare providers will have already put some processes in place that are designed to measure and assess this important factor, it will typically take a good bit more to successfully make a complete transition. In particular, healthcare providers will almost certainly need to have ways of measuring:

Outcomes. The simplest way to decide whether value is being delivered is to look at what is actually happening to patients. Mortality and relapse rates, readmission levels, and the incidence of complications can all be used to help assess how patients are faring.

Patient reports. Even patients who are not equipped with specialized skills and training are often well positioned to weigh in regarding the quality of the care they receive.

Compliance with established best practices. When individual healthcare providers conform to recognized best practices habitually, the quality of the care they deliver tends to be higher.

Moving Toward a More Productive Way to Pay for Healthcare

While the process is still ongoing, it seems almost certain that value-oriented healthcare funding will become increasingly more common. Healthcare providers will have to make adjustments along the way, but most expect that the effort will pay off.

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August 2018 (1)
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