The essence of Value-Based Care

That healthcare is changing at a fast pace is a reality all the stakeholders are coming to terms with. Irrespective of their preferences, they are left without a choice but to adapt. The transition taking place is evolving it from being proficiency-based art to a data-driven science. Physicians are shifting from being freelancers to being employed by hospitals. The delivery methods are changing from being one-size-fits-all community hospitals to vast hospital networks which are organized around centers of excellence. There is however, a certain level of criticism from the provider community towards this demand for change – almost to the extent of being reluctant to accept it. This could well be the result of their realization that the shift will finally result in better care outcomes for patient and less inflow of money for them. This is where the fraternity needs to take a step back and look at what lies at the core of their profession – that of helping people overcome their health related ailments. One cannot deny the fact that the profession has a certain degree of nobility attached to it. As much as it is important for physicians to gain financially, the overriding factor which draws people to take up this profession is expected to be a deep desire to serve humanity by curing people of their health related problems. Infact the ones who have realized it and connect to it are eagerly looking forward to days where they would have satisfied patients with lower expenses and they would be proud of their work. The tension which now exists between patients and physicians does not please the majority of the people in the profession and they would expect the new model to give way to trust and happiness for the providers. This is not to say that physicians are expected to lead lives of monks with no desire to gain financially from their services but to let money play the most important role in the system would be going against the core tenets of the profession.

In order to emphasize on this shift in focus from a volume to a value based care, the Centers for Medicare & Medicaid Services (CMS) incorporated value-based purchasing rules which tied acute care Medicare reimbursement of hospitals to quality performance starting in the year 2012. To give this approach a push, 1% of the payments under Medicare for 2012 was put aside and later given away as bonuses to those hospitals which scored above a certain score in some identified measures. Patient satisfaction was the determining factor for about 30% of the incentive payments while the rest 70% was based upon improved clinical outcomes. Noticing the positive difference the approach brought about, a further modification was brought in that resulted in enhancing the payment under the hospital value-based purchasing program (VBP) starting October of 2013. As per the new rule, there was an increase in the payment rates to general acute care hospitals by 0.9 percent, after allowing for other payment and regulatory changes. Although it was suppose to result in increasing the Medicare spending by approximately 175 million, its real benefit was the thrust it was expected to provide towards the adoption of a value based model. There are also penalties in place for hospitals for excess readmission for certain ailments like heart attack, heart failure and pneumonia unless they are planned ones. Also, moving forward there are likely to be more such rules in place to penalize hospitals for conditions acquired during the course of treatment. These steps are intended to bring about more focus towards infection control and prevention.

As much as the reasons appear compelling for moving to a value-based model, early experiments have shown mixed results. The success of value-based approach is hinged on making everything measurable and quantifiable and this is precisely where the hurdles start. Each patient is unique and so the impact of the same disease on a population is not going to be similar. With some patients, things might get a bit more complex resulting in higher expenses. Regardless of whatever incentives are created to make it move faster, a complete shift to this new model will take time. This is going to be driven primarily by the need to bring about some changes in the overall setup. For instance, it has to first and foremost start with getting the buy-in from physicians who are willing to embrace this approach. Furthermore, a successful transition from volume to value will require investment in advanced analytics and clinical information to evaluate performance data, as well as holding all stakeholders - clinicians, staff and patients, accountable for quality improvements.

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