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Comment on value-based healthcare

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Value-based healthcare links the money spent on healthcare services over the journey of the patient to the outcomes which matter most to the patient (Bodenheimer & Grumbach 2016). With a value based healthcare delivery model, physicians and hospitals are paid on the basis of the health outcomes of the patient. A value based healthcare system for patients allows patients to spend less for a better outcome and also increases the satisfaction of the patient and a reduced risk for the payer. Management of chronic diseases can be time consuming and costly but with the approach patients can recover more quickly while facing fewer doctor visits and fewer medical tests and procedures.

Bodenheimer and Grumbach (2016) assert that the value based healthcare increases the overall quality of healthcare and decreases the cost by the use of financial incentives for the promotion of a cost efficient consumer choice and health care services. As a result of this, the quality and patient engagement measures can increase when value is focused upon instead of volume. According to Bodenheimer and Grumbach (2016), the ACA encouraged the need for the development of Accountable Care Organizations (ACOs), which are organizations of health care providers that could assume both financial responsibility and health care for a group of patients.

Bodenheimer and Grumbach (2016), suggest that the benefit attached to ACO includes provision of incentives for physicians, hospitals and other providers thereby eliminating wasteful spending. Payment for performance is one example of a value based health care which ensures physicians and other health care providers deliver services with the patient at the fore front. Bundled payment is also an example of a value based health care that ensures incentives for the hospital and for the medical staff are provided thus eliminating any unnecessary costs.

Additionally, Care Coordination Payments allows small capitation payments as a result of the blended models (Bodenheimer and Grumbach 2016). These provide incentives as well as resources for a better management of patients with chronic conditions. According to Bodenheimer and Grumbach (2016), the major risks associated with Value based healthcare is in the use of bundled form of payment which in some cases leads to loss of money on the side of the physicians and the hospital relative to the traditional models of payment when average total costs for joint replacements cannot be controlled.

In the United States, a value based system greatly improves healthcare by reducing spending and decreasing the need for ongoing care. The value based health care also reduces compounding complexity and disease progression which drives the need for more patient care. An example of how a patient may be helped under a value based system can be seen in a patient centered medical home (PCMH). The medical home is simply a coordinated approach for caring of the patient led by the primary physician of the patient who is in a position to direct the total clinical care team of the patient.

In so doing, electronic medical records are shared and crucial information of the patient is incorporated in the provider’s fingerprints thus allowing the individual providers a chance to see the results of the procedures and tests that have been performed by other clinicians. The type of value based system ensures that data is shared thereby reducing associated costs and any forms of redundant care.

Bodenheimer, T. & Grumbach, K. (2016). Understanding health policy: A clinical approach (7th ed). New York: McGraw Hill Medical.
In looking at the benefit and risks of a value-based system, the hospital-based purchasing incentive is an example.
“The Hospital Value-Based Purchasing (VBP) incentive payments for the quality care provided to Medicare beneficiaries” (Hospital Value-Based Purchasing – CMS). Provide incentives: How well they perform on each measure compared to other hospitals’ performance during a baseline period How much they improve their performance on each measure compared to their performance during a baseline period” (Hospital Value-Based Purchasing – CMS, 2017).

affecting payment for inpatient stays in more than 3,000 hospitals across the country. This program is part of CMS larger quality strategy to reform how health care is delivered and paid (Hospital Value-Based Purchasing – CMS, 2017).
“CMS rewards hospitals based on: ● The quality of care provided to Medicare patients ● How closely best clinical practices are followed ● How well hospitals enhance patients’ experiences of care during hospital stays Hospitals are no longer paid solely on the quantity of services provided.

Under the Hospital VBP Program, Medicare makes incentive payments to hospitals based on either: ● How well they perform on each measure compared to other hospitals’ performance during a baseline period ● How much they improve their performance on each measure compared to their performance during a baseline period The performance information is reported through QualityNet, the secure extranet portal supporting Center for Clinical Standards and Quality (CCSQ) quality reporting programs for health care providers and vendors supporting providers”. (Hospital Value-Based Purchasing – CMS, 2017).

Performance is measure by “Safety 25% Clinical Care 25% Efficiency and Cost Reduction 25% Patient and Caregiver-Centered Experience of Care/Care Coordination” (Hospital Value-Based Purchasing – CMS, 2017).
As based on Table 2, Hospital Value-Based Purchasing – CMS, 2017), the following are examples of what is measured: Catheter-Associated Urinary Tract Infection, Central Line-Associated Blood Stream Infection Safety, CDI Clostridium difficile Infection (C. difficile), Safety MRSA Methicillin-Resistant Staphylococcus aureus; etc. (Hospital Value-Based Purchasing – CMS, 2017).
“To determine the domain scores, CMS adds points across all measures.

● Achievement points are awarded by comparing an individual hospital’s rates during the performance period to all hospitals’ rates from the baseline period: Hospital rates at or above benchmark = 10 Achievement points Hospital rates below the Achievement threshold = 0 Achievement points hospital’s rate is equal to or greater than the Achievement threshold but less than the benchmark = 1–9 Achievement points” (Hospital Value-Based Purchasing – CMS, 2017).
“Hospital VBP payment adjustments are applied to the base operating Medicare Severity Diagnosis Related Group (MS-DRG) payment amount for each discharge occurring in the applicable Fiscal year on a per-claim basis” (Hospital Value-Based Purchasing – CMS, 2017)
“The Hospital funded by reducing hospitals’ base operating MS-DRG payments by 2.0 percent. Any leftover funds are redistributed to hospitals based on their TPS. Other program funding specifics such as the law requires the total amount of aggregate value-based incentive payments equals the amount available for value-based incentive payments” (Hospital Value-Based Purchasing – CMS, 2017)
In conclusion, the benefits for patient care are top-notch care with minimal effect on health in addition to the inhouse potential nosocomial infections, the provider incentives by lowering the operating payments by 2%, and the overall fiscal impact of our healthcare system by drawing patients and healthcare together in best health care practices. One example of how a patient can be helped under a value-based system is lower infection rates, as noted earlier by incentivizing hospitals to improve infection rates giving them a score to encourage refunds.
Bodenheimer, T., & Grumbach, K. (2016). Understanding health policy: a clinical approach. McGraw Hill.
Hospital Value-Based Purchasing – CMS. (n.d.).

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