Defining and Implementing Value-Based Health Care: A Strategic Framework PMC

In the United States, healthcare spending accounts for nearly 18 percent of the gross domestic product — this is more than other wealthy countries. Yet the healthcare system in the United States is still lagging behind in many ways. While the U.S. system produces some of the best medical outcomes in the world, it also produces some of the worst, in some cases providing ineffective or unnecessary care. What value-based care aims to do is decrease the instances of poor medical care and increase positive patient outcomes, safety and service.

Facing severe pressure to contain costs, payors are aggressively reducing reimbursements and finally moving away from fee-for-service and toward performance-based reimbursement. In the U.S., an increasing percentage of patients are being covered by Medicare and Medicaid, which reimburse at a fraction of private-plan levels. These pressures are leading more independent value based definition hospitals to join health systems and more physicians to move out of private practice and become salaried employees of hospitals. (For more, see the sidebar “Why Change Now?”) The transition will be neither linear nor swift, and we are entering a prolonged period during which providers will work under multiple payment models with varying exposure to risk.


Regional National Health Service health boards are implementing pilot projects, with an emphasis on outcome collection—a critical aspect of value-based care. Replication and expansion of successful programmes is likely in the future. It is only a partial, general description of plan or program benefits and does not constitute a contract. In case of a conflict between your plan documents and this information, the plan documents will govern.

value based healthcare

Enhanced care coordination and data sharing can also help streamline administrative processes and reduce wasted spending. Groups carefully curate specialists who communicate and coordinate effectively with primary care physicians and practice high-quality, evidence-based medicine. Group selection of specialists eliminates the guess-work that sometimes plagues patients (“Who should I see for….?”). And these specialists often operate on common electronic health record systems that can more seamlessly facilitate care coordination and the flow of patient information across clinical sites. The University of Texas at Austin’s Dell Medical School offers an example of how education about value-based health care can be incorporated into undergraduate medical education.

Value Based Healthcare

Value-based healthcare aims to regulate the process of healthcare through best practices. Protecting health through quitting smoking, nutritional and lifestyle changes lessen the need for costly processes, tests, and medicines. Patients receive holistic treatment that accounts for social determinants of health and receive support from their care team and their community, leading to more accurate diagnoses, effective treatment plans, and positive health outcomes.

In 2018, 53 percent of Aetna’s medical spend was with value-based providers. Individuals have a better experience navigating the health care system. Former Babel Health solutions are now part of the Veradigm Comprehensive Submissions suite. In addition to delivering end-to-end submission and reconciliation processes that ensure regulatory compliance and mitigate revenue leakage, Veradigm enables complete and accurate tracking and status-monitoring of all encounters. Veradigm offers payers an end-to-end solution, designed to help meet their goals.

Transitioning from Fee-Based to Value-Based Healthcare

Over the past half dozen years, a growing array of providers have begun to embrace true outcome measurement. Many of the leaders have seen their reputations—and market share—improve as a result. A welcomed competition is emerging to be the most comprehensive and transparent provider in measuring outcomes.

  • Each encounter is separate from the others, and no one coordinates the care.
  • The six components of the value agenda are distinct but mutually reinforcing.
  • Indeed, rigorous measurement of value is perhaps the single most important step in improving health care.
  • Throughout the course of modern US healthcare, we have struggled to create a fair and efficient reimbursement scheme that aligns the incentives of patients, providers and payers.
  • The ideal result is fewer readmissions and less frequent hospitalizations and trips to the emergency room.
  • Patients who expect long hospital stays might be surprised when they’re discharged rapidly to their homes with home care services or to skilled-nursing facilities in lieu of an extra few nights in the hospital.
  • Value-based health care connects clinicians to their purpose as healers, supports their professionalism, and can be a powerful mechanism to counter clinician burnout.

The information contained on this website and the products outlined here may not reflect product design or product availability in Arizona. Therefore, Arizona residents, members, employers and brokers must contact Aetna directly or their employers for information regarding Aetna products and services. This excerpt is provided for use in connection with the review of a claim for benefits and may not be reproduced or used for any other purpose.

Value-based personalisation: India’s Apollo Hospital Group

So, “fee-for-value” is synonymous with value-based care, while “fee-for-service” is synonymous with volume-based care. This has different implications for how health systems are compensated for the care they provide. Offering positive experience and outreach by using innovative technology will deliver on the promise of quality health care at a lower cost. Data is assessed across the organization of care providers to recognize particular well-being risks, improve care management and improve the operations.

value based healthcare

The transformation to a high-value health care delivery system must come from within, with physicians and provider organizations taking the lead. But every stakeholder in the health care system has a role to play in improving the value of care. Patients, health plans, employers, and suppliers can hasten the transformation by taking the following steps—and all will benefit greatly from doing so. Providers remain nervous about bundled payments, citing concerns that patient heterogeneity might not be fully reflected in reimbursements, and that the lack of accurate cost data at the condition level could create financial exposure. Those concerns are legitimate, but they are present in any reimbursement model. We believe that concerns will fall away over time, as sophistication grows and the evidence mounts that embracing payments aligned with delivering value is in providers’ economic interest.

The medical record is accessible to all parties involved in care.

Patients may see multiple physicians, specialists, and other healthcare providers throughout their course of treatment. Oftentimes, each of these providers relies on a different system for storing and processing clinical data, electronic health records, provider network data, and so on. A lack of interoperability between these platforms can impede the shift to value-based care, preventing payers and providers from sharing data in a timely fashion, conducting important analyses, and having productive conversations.