Each payer will have their own set of programs and models that they are using to implement value-based care. Some of the most common types of value-based programs are:
In performance-based programs, hospitals and/or physicians are rewarded with bonuses when they improve upon quality of care while maintaining cost-effectiveness. Common metrics used to measure quality of care include: the rate of readmissions, hospital-acquired conditions, and out-of-network provider use.
Bundled and Episode-Based Programs
Bundled and episode-based programs are very similar to CMS’s BPCI models. Episode initiators are provided a prospective target price that takes into account the full episode of care. Initiators are responsible for organizing post-acute care contracts and containing downstream costs. If the episode comes in under the target price, the initiator shares in the additional savings. For episodes that end up costing more than that the allotted episode payment, the initiator is typically responsible for the additional costs.
Accountable Care Organizations (ACOs)
ACOs bring together different care providers, including primary care physicians, specialists, hospitals, and other health care professionals in order to better coordinate patient care. Doing so allows these organizations to operate more efficiently and manage patients’ long-term health, including chronic conditions, more effectively. ACOs are rewarded when they meet or exceed certain benchmarks that are generally set around reducing cost while improving the standard of care.
ACOs tend to be large in scale and are most effective at managing population health across entire communities or regions.
Patient-Centered Medical Homes
Patient-centered medical homes are structured in much the same was as ACOs, except patients in patient-centered medical homes have all aspects of their care organized by their single primary care physicians. The primary care physician is compensated for each patient that is under their care, as well as a share of any savings from reducing downstream costs.