What is value-based care?
Value-based care (VBC) is a holistic approach to healthcare that focuses on health outcomes. In value-based care, providers are compensated on how effectively they treat their patients and help them stay healthy, rather than on the quantity of medical services they provide. Taking a value-based approach involves delivering care in a patient-centered way, which often entails care coordination and collaboration among various healthcare professionals.
A value-based approach to healthcare is distinct from the fee-for-service model that is still prevalent across many organizations. It’s important to understand the main differences between the two approaches, the reasons for these differences, and their implications. Whereas a fee-for-service model often incentivizes healthcare providers and other medical professionals to maximize the amount of care that a patient receives, a value-based model is designed to incentivize them to help their patients be healthy. This way, value-based care helps align objectives between patients and their healthcare providers.
Because value-based healthcare stresses health outcomes, it puts a greater emphasis on patient education, engagement, and preventive care than is typical in a fee-for-service model. This gives providers an extra incentive to ensure that regular check-ups and essential screenings happen as necessary, reducing the likelihood of serious medical conditions going undiagnosed and continuing to progress for long periods. It also encourages healthcare organizations to create incentives for patients to make healthy lifestyle choices.
Risk adjustment plays a critical role within value-based care by compensating providers for the extra costs they are likely to incur when covering patients with various medical conditions and other characteristics. Risk adjustment helps ensure that providers are adequately compensated in those circumstances, and that they have enough funds to cover each patient’s healthcare needs. Risk adjustment also helps ensure that providers are not penalized for treating patients with higher levels of risk, supporting the goal of creating equity across various populations of patients.
