Value-based care is a payment model designed to deliver better, more affordable healthcare by rewarding value and quality of care rather than the quantity. Traditional fee-for-service models, which are designed around services, are gradually ceding ground to value-based care that is designed around patients. These new payment models involve hospitals, doctors, and other providers working together to address rising health care costs, clinical inefficiencies, and duplication of services—leading to better health outcomes.
What you may not know is that you’re probably already participating in value-based care. Have you been voluntarily reporting PQRS data to CMS? PQRS was rolled into the Merit-based incentive payment system, which was a provision of the 2017 Medicare and CHIP Reauthorization Act. Other programs like the Comprehensive Care for Joint Replacement (CJR) and Bundled Payments for Care Improvement Initiatives (BPCI) are also underway as part of the CMS strategy to use hospitals and large health care organizations to bear risk and help manage the move to value-based care.
What does this mean for you?
First and foremost, this means a shifting revenue mix. The proportion of commercial payers will continue to shrink as the proportion of payer types with lower reimbursement rates will rise. As both Medicare and Medicaid expenditures continue to grow, providers may experience shrinking margins from these less profitable patients, forcing clinics to become more efficient at providing positive outcomes at a lower cost.
The good news is, commercial payers are also following CMS toward value-based care. The healthcare industry as a whole is moving away from fee-for-service. Insurance companies like Aetna, Blue Cross and Cigna are already developing value-based care programs to rein in costs, improve care quality and member/patient satisfaction. The bottom line: in the future, your practice’s financial success will be tied to meeting and reporting on quality measures for both Medicare and commercial payers.
What can you do to prepare?
Shift your focus: If you haven’t already, you’ll want to start focusing on outcomes and maximizing value for your patients. One way you can achieve this is to start measuring for value. Under a fee-for-service system, our metrics commonly measure volume (Units/Visit, Visits/Case, Billable Minutes/Therapist Hour). Measuring average improvement using a patient-reported outcome score or performance-based clinical finding per visit is a good place to start the transition to value-based care metrics.
Be prepared with the right tools: Efficient tools will be critical to a successful transition from fee-for-service to value-based care. The right tools will help you monitor patient progress and communicate with different stakeholders in the value chain. An EMR designed specifically for therapy, a single system for clinical and financial data, data analytics, patient engagement tools and interoperability will each ensure that your practice is poised to benefit from this change.