Value Based Healthcare

Value Based Healthcare

  • 02 Jun 0
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For several years, but especially over the past year, we have heard increasing discussions and commentary about the evolution of American healthcare toward the  concept of value.  Value is defined in several ways, but commonly is understood in terms of outcomes relative to costs.  Simply reducing costs without attention to outcomes is risky and may not produce desired results.  CMS has promoted the well-known “triple aim” with three value vectors of patient experience, improved population health and reduced costs.  The movement toward value has produced a very definite shift away from fee-for-service payment methodology, favoring payments that reflect quality performance.   The Department of Health and Human Services is testing and promoting new healthcare payment models.  Interestingly, many of these incorporate concepts that have long been integral to the PACE model of care, such as capitated payment, risk sharing, coordinated care and interdisciplinary care.

 Value-based payments are here to stay in the US.  Fee-for service will persist in some markets for years, but most payers will be shifting the payment curve toward value.  Currently, we can divide healthcare payment denominators into four general categories: 

Category 1: FFS no link to quality

Category 2: FFS with quality link

Category 3: Alternative Models built on FFS architecture

Category 4: Population Based Payment

 PACE would be in Category 4, which is rapidly expanding to include similar models of care, such as Independence at Home.   As these other models proliferate, they will be held to some value-based outcomes.  It is only a matter of time before PACE organizations will find themselves competing for census and the competition will be primarily one of value.  Consequently, we predict an increasing scrutiny and emphasis on quality and outcomes.  PACE value will be measured more objectively and more transparently in the future. 

 Consequently, measuring, tracking, reporting and analyzing outcomes in your PACE organization will be irreversibly tied to your payments at some point in the future.  .   CMS has already begun the process of adapting existing quality measures for PACE and is engaged in pilot projects.   Capstone is working to develop systems and supports to assist programs in demonstrating and improving their value propositions.  If you have questions of concerns, please contact us.