Value-based healthcare is an alternative economic and medical model of healthcare that aims to deliver higher value for services through improved patient outcomes and more efficient service delivery.

Value-based health systems then work to control costs while improving outcomes by developing healthcare systems and targeted protocols designed to meet the needs of specific patient populations. Patient populations can be grouped by illness (i.e. all diagnosed with type II diabetes) or by demographic but will have a consistent set of health needs.

The backbone of value-based care is the incentives provided by the government through legislation like the Affordable Care Act and programs such as Medicaid. These programs use patient health data to set benchmarks for patent health and a payment system that rewards outcomes based on those benchmarks. Benchmarks may be reducing the number of hospitalizations in a patient pool or increasing the number of those vaccinated against a certain illness.

Value-Based vs Fee-For-Service

Value-based care can be understood by comparing it to the current fee-for-service model that reimburses providers based on the total volume of services they provide, thereby incentivizing inefficient and even unnecessary medical care.

The healthcare industry standard fee-for-service models incentivize long-term care when other, shorter-term, alternatives may be available. Conversely, value-based care helps to create an environment for medicine that’s outcome-focused by incentivizing lower-cost, high-efficiency services, typically for a shorter duration and with less frequency than fee-for-service.

How Value-Based Care Impacts Clinicians

Primary care practitioners in particular will see their roles change with the adoption of value-based care models and corresponding healthcare programs. Economic incentives and patient benchmarks play a huge role in how practitioners will deliver care. This is neither good nor bad; clinicians will always have to adapt to healthcare industry conditions.

While the promise of value-based care is just being realized in the industry, the success or failure of value-based care happens at the point of care. Clinicians are ultimately responsible for aligning the incentives of patient care and provider payments needed for value-based healthcare reforms to take hold. This will require them to take on a broader scope of care using novel approaches and require developing new skills.

This will put an even bigger emphasis on robust, comprehensive continuing medical education (CME) with a shift to be more practical and patient-focused information that supports value-based care.

Improved Resource Allocation

Healthcare stakeholders concerned with the industry’s economics may see sick people as either a cost to control or a source of revenue. As these stakeholders on opposite sides of the financial equation put pressure on the healthcare system to meet these two conflicting objectives, the patient’s best interests can be lost in the shuffle.

With value-based care, sick patients aren’t just an opportunity to pursue better outcomes (although this should always be the primary objective) but also a chance to align these incentives.

Within fee-for-service models, patient risk is pooled to avoid having too many sick people in one group. While this protects insurers and healthy patients from the high costs of ongoing treatment, it prevents the coalescing of resources needed for tailored and targeted care for those who need it most.

Value-based care encourages healthcare stakeholders like insurance companies and health systems to target sicker populations because sicker patients are a high-reward proposition. If patient outcomes improve over baseline, programs like Medicare deliver larger payments, rather than smaller ones based on a lower volume of services.

More Personalized Care

Personalization is expected to be a major factor in the transition to a value-based model, acting as facilitating incentive that also embraces new technologies. Personalized care entails providing targeted and patient-specific care in ways that provide added benefits in terms of both health and value.

Within the value-based model, personalized care will reflect a holistic evaluation of a patient’s condition and their desired outcomes. Real-time data through point-of-care testing and virtual visits will make healthcare more responsive to patient needs. Reaching successful health outcomes sooner lowers costs and improves value by making the patient healthier, faster.

More Integrated Care

The future of medicine is coordinated, multidisciplinary care between multiple practitioners using targeted, personalized health interventions to address the whole patient, instead of only their acute complaints. Called integrated care, this model is inherently value-driven because it proactively meets patient needs. For instance, if factors outside of a patient’s physical health are contributing to their condition, such as a behavioral health diagnosis, then practitioners may work with social services or apply other non-medical interventions to address it.

Primary care practitioners may see their practices change to meet demands for more integrated care. After decades of seeing scope of care shrink, value-based integrated care falls to primary care practitioners positioned to deliver multimodal care. These include preventive medicine, reproductive medicine, behavioral medicine, and internal medicine.