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Value-based care models hung up on lack of resources

The adoption of value-based care models in healthcare is hindered by a lack of resources, according to more than 1,000 respondents of a Definitive Healthcare value-based care trends survey.

A survey of more than 1,000 healthcare providers finds a lack of resources to be the biggest hurdle when shifting to a value-based care reimbursement model.

A value-based care model pays providers based on patient outcomes rather than the amount of services provided. The Centers for Medicare & Medicaid Services began promoting value-based care in 2008. Support for the initiative quickly followed with legislation, including the Affordable Care Act, which passed in 2010.

Despite the push, the shift to a value-based care rather than fee-for-service model has been slow -- but steady. Indeed, data analytics company Definitive Healthcare LLC found that the number of U.S. states and territories with value-based care programs has risen from three in 2011 to 48 in 2018.

This year, the company surveyed more than 1,000 healthcare leaders to determine the state of value-based care, as well as what implementation will look like in 2020.

Value-based care: Barriers and accelerators

Kate Shamsuddin, senior vice president of strategy at Definitive Healthcare, said she was surprised that 25.3% of respondents pointed to lack of resources as the biggest barrier to implementing a value-based care model, given the initiative dates back to 2008.

Definitive Healthcare senior vice president of strategy Kate ShamsuddinKate Shamsuddin

"We would've anticipated that the number of resources required to support value-based care would've been increasing over time to support the success of these programs and initiatives," she said. "So that was pretty surprising to see that at the top of the list as a barrier."

Survey takers also pointed to "gaps in interoperability" and the "unpredictability of revenue stream" as barriers to implementing value-based care programs. "Changing regulations and policies" was another barrier identified by 16.2% of respondents.

Shamsuddin was struck by the "changing regulations and policies" barrier because of the amount of visibility the federal government has provided into policy implementation. Additionally, Shamsuddin said that while changing policies is listed as a barrier, 16.1% of respondents also selected it as a factor that is accelerating the adoption of value-based care.

Almost half, 44.8%, of survey respondents cited "appropriate provider compensation and incentives" as the biggest reason why adoption of a value-based care model moved forward within their organization. In a value-based care model, providers can receive bonuses for performing above-quality care standards. Yet they can also be penalized if their performance falls below those standards.

Shamsuddin said being able to adjust provider compensation and incentives is one way to ensure all stakeholders are "growing in the same direction" when implementing a value-based care program.

"That is one I think we'll continue to see as an accelerator, especially with healthcare systems being a little bit more, let's call it experimental, in how they're willing to move away from the fee-for-service model," she said.

What CIOs should pay attention to in 2020

As value-based care model implementation evolves in 2020, Shamsuddin said it will be important for healthcare CIOs to keep an eye on federal regulation and policy, which survey takers said was both a barrier and an accelerator.  

Additionally, one of the main areas that will cause change in value-based care program implementation is a growing understanding among providers of how accountable care organizations (ACOs) and bundled payment models such as the Medicare Shared Savings Program work, according to 31.1% of survey respondents.

ACOs and bundled payment models, or alternative payment models that require providers to take on risk and share in the losses and benefits of patient care, will "evolve and become easier to understand," making it more likely for providers to transition to a value-based care model, according to the survey.

ACOs are associations of hospitals, providers and insurers that assume medical and financial responsibility for their patients; the Medicare Shared Savings Program is a voluntary program that encourages healthcare providers to come together as an ACO. The program provides different participation options to ACOs and allows them to take on varying levels of risk and responsibility for patients.

Consolidation within healthcare will also create what Shamsuddin called a "wild card" in how effective value-based programs will be. When two health systems are thinking about combining, Shamsuddin said it will require healthcare providers to be "open and strategic" around how they're going to bring in value-based care initiatives during a merger.

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