America’s health system faces mounting pressures from an aging population, increasing chronic disease prevalence, clinician shortages and escalating costs. Finding effective solutions is critical, and emerging evidence points to the way care is delivered and paid for as a key area for improvement.
A recently published study in the American Journal of Managed Care examined whether health outcomes differ for patients with both Medicare and Medicaid (dual-eligible beneficiaries) depending on the payment model used for their care. The research was conducted by America’s Physician Groups, CareJourney, and Optum.
The study compared health outcomes across three Medicare payment models: at-risk, or “two-sided risk” Medicare Advantage plans (where physician groups assume full financial responsibility for patient care); fee-for-service (FFS) Medicare Advantage (where providers are paid per service by the Medicare Advantage plan insurer); and traditional Medicare (where providers are paid per service directly by the government).
The Shift Towards Value-Based Care
The findings underscore a growing trend in healthcare: the move towards value-based care (VBP). Traditional fee-for-service models incentivize volume – the more services provided, the higher the reimbursement. This can lead to unnecessary tests and procedures, driving up costs without necessarily improving patient health. Value-based care, conversely, focuses on outcomes. Providers are rewarded for delivering high-quality, efficient care that improves patient health and well-being.
The study’s focus on dual-eligible beneficiaries is particularly important. These individuals often have complex health needs and face significant barriers to accessing care. They are also disproportionately affected by chronic conditions, making effective care coordination and management crucial. Understanding how different payment models impact their outcomes is essential for ensuring equitable access to quality healthcare.
What the Research Reveals
While the specific details of the study’s findings are currently exclusive to STAT+ subscribers, the broader context of research in this area provides valuable insights. Other studies, as highlighted by recent reports, demonstrate a clear advantage for value-based care models, particularly those involving increased risk sharing between payers and providers.
For example, a study published in the American Journal of Managed Care showed that Medicare Advantage enrollees receiving care under fully accountable models – where physicians take full financial risk – experienced significantly better health outcomes than those in traditional fee-for-service Medicare, even when cared for by the same physicians. Specifically, patients in these accountable models were up to 43% less likely to be hospitalized for acute and chronic conditions, 39% less likely to be readmitted to the hospital within 30 days, 19% less likely to require emergency department care, and 23% less likely to use potentially harmful medications.
These findings align with a publication in the Milbank Quarterly, which noted that while alternative payment models have gained traction over the past decade, the adoption of truly population-based payment systems remains limited. The authors emphasized the need for policies that accelerate the diffusion of value-based payment, address health inequities, and encourage partnerships across sectors to address the underlying drivers of health.
The ACCESS Model and Future Directions
The Centers for Medicare & Medicaid Services (CMS) is actively pursuing innovative payment models to address these challenges. The recently announced ACCESS (Advancing Chronic Care with Effective, Scalable Solutions) model, set to begin on , is a prime example. This voluntary model tests an outcome-aligned payment approach for Original Medicare, focusing on conditions affecting a large proportion of Medicare beneficiaries – high blood pressure, diabetes, chronic musculoskeletal pain, and depression.
The ACCESS model aims to overcome barriers to technology-supported chronic care, emphasizing outcomes over activities. It seeks to empower clinicians to offer innovative care options, improve patient health, and complement traditional care. CMS anticipates that this model will lead to more options for patients, stronger partnerships for providers, and a pathway for Medicare to pay for technology-supported services effectively.
Implications for Patients and Providers
The shift towards value-based care has significant implications for both patients and providers. For patients, it means potentially more coordinated, personalized care focused on achieving their health goals. It also means increased access to innovative technologies and services designed to manage chronic conditions effectively.
For providers, it requires a fundamental shift in mindset and practice. Success in a value-based system demands a focus on population health management, data analytics, and care coordination. It also necessitates strong partnerships with other healthcare providers and community organizations to address the social determinants of health – factors like housing, food security, and transportation that significantly impact health outcomes.
Challenges and Considerations
While the potential benefits of value-based care are substantial, challenges remain. Implementing these models requires significant investment in infrastructure, data systems, and workforce training. It also requires careful monitoring and evaluation to ensure that quality of care is maintained and health inequities are not exacerbated. The complexity of these models can create administrative burdens for providers.
Despite these challenges, the evidence increasingly suggests that value-based care is a critical step towards a more sustainable and equitable healthcare system. By aligning financial incentives with patient outcomes, these models have the potential to improve the health and well-being of millions of Americans.
