Wave of the Future: Value-Based Care
The practice of insurers paying fee for services to physicians and hospitals is going the way of the dinosaurs. Look for value-based care to replace the current payment model.
With the fee for service approach, insurers pay medical providers based on the amount of health care services they deliver. With value-based care, insurers pay providers to improve patients’ health. Physicians work with patients on an ongoing basis which reduces the effects and incidence of chronic disease and keeps them healthy.
Most major insurance carriers and government health agencies are moving toward a value-based care system. Aetna expects that 75 percent of their medical payments will be for value-based care by 2020. The U.S. Department of Health and Human Services also is dedicated to the concept and has plans to move 50 percent of traditional Medicare payments to value based payment models between now and 2019.
The goal of value-based care is to improve the quality of care and reduce health care costs across the board by coordinating efforts between different health providers. According to the United Nations World Health Organization, life expectancy in the United States is lower than 30 other countries. Insurers and providers hope that the value-based care approach will improve that situation.
The benefit of value-based care is that these models focus on helping patients recover from illnesses and injuries more quickly and help clients avoid chronic disease. As a result, patients have fewer doctor’s visits, medical tests and procedures.
There also are challenges with this concept. It’s been more difficult for providers to transition to this model than was expected because providers still must focus on patient care while continuing to focus on improving patient care. Also, the volume of electronic health records and other information that must be shared requires coordination and more time.