- On April 16, 2018
Despite the United States’ position as an economic and technology powerhouse, our health (and health care system) still lags behind many countries. World Health Organization (WHO) figures show that our life expectancy is lower than 30 other countries, including Switzerland, Australia, and Canada. But hopefully, the tide is turning with a big shift in how we approach health care, towards a more personalized approach that focuses on each individual and all aspects of their well-being.
Overall, that fundamental change is called Value Based Care and affects insurance carriers and medical providers alike in the way this new model funds the health care dollar. In fact, the Department of Health and Human Services plans to move 50% of traditional Medicare payments to Value Based Payment models in 2018 and 2019.
The goal of Value Based Care is to improve quality and use medical resources more efficiently. Rather than focusing on the quantity of care, the value based model pays for quality. The main idea is paying for treatments and services that lead to better outcomes and a better experience for health care consumers. The insurance carrier, Medicare, or Medicaid still distributes the money to doctors, nurses and facilities, but instead of just paying when people are sick, they are paid based on how healthy they keep their patients. It is a coordinated approach to pinpoint the type and time when action needs to be taken to keep a patient healthy.
Five percent of the U.S. population accounts for 50 percent of the total health care costs (according to the Department of Health and Human Services), often because they spend long periods in hospitals while seeing little improvement. With Value Based Care, the team caring for the patients within that 5 percent may recommend home-based care, which address patients’ needs at a similar quality of life at lower costs. It really comes down to a customized, individual need of the patient and a focus at underlying results that puts value-based care ahead of other models.
Most major insurance carriers and government health agencies are working towards this value based system model. Aetna has stated that they expect 75% of their medical payments they make going to doctors and hospitals that practice value based care by 2020.
Instead of patients calling their provider only when they are sick, the doctor or insurer may contact you to keep you healthy.
The goal of value based care is the same on all constituent fronts, keeping people healthy. And via this model, it is expected to reduce health care costs across the board due to this coordinated effort.