Value-Based Care Bolsters Health Equity
The COVID-19 pandemic has amplified disparities that have long existed in healthcare and focused practitioners and policymakers on the urgency of closing these gaps. The Centers for Medicare and Medicaid Services (CMS), which runs the largest healthcare programs in the country, has committed to deploying an important tool to do this – value-based care.
Value-based care is not new, but it is different than the better-known fee-for-service model. Fee-for-service concentrates on providing piecemeal services, largely ignoring outcomes and failing to keep Americans healthy, particularly in low-income communities. This is because fee-for-service mostly repairs what goes wrong rather than what works to keep people well.
Value-based care reverses this approach to treat the whole person and the circumstances in which they live. CMS recognizes value-based care’s role in fostering better care for individuals and lowering costs. The agency has set a goal of moving every American in fee-for-service Medicare into an accountable arrangement by 2030. If the country wants the patient to be put first, the value-based approach is the way to go.
Value-based payments allow healthcare providers to leave the fee-for-service structure behind and concentrate on patients’ needs. Providers should be paid for keeping their patients healthy not for rigidly accounting for services unconnected to outcomes.
Value-based payments allow providers to have the extra conversations with their patients that ensure they’re going to their appointments and taking the right medications, not just showing up in the office. It also allows providers to spend more time with their patients because the priority is quality rather than the number of appointments. Outcomes – how healthy Americans are – should be the goal and individual services – and how much they cost – should be considered later.
The good news is value-based care has proven itself many times over. When medical providers are encouraged to keep their patients as healthy as possible – and are given the leeway to do so – costs also fall. Patients are hospitalized less, and medical providers can offer constant attention to a patient’s overall health and well-being.
Value-based care is being implemented now in communities across the country as one way to bridge health disparities. Under some variations, the government pays health clinics a flat fee to handle each patient’s healthcare needs while keeping them accountable for their health outcomes. The clinics’ financial incentive is to keep their patients as healthy as possible.
Many primary care doctors experienced financial distress during the pandemic because patients couldn’t come to the office. That is not an issue for value-based providers because the payment is on a per member, per month basis. This allows care to be delivered any place any time, including through telehealth services. Value-based-care clinics do well when their patients have better health outcomes rather than creating a “churn factory” that prioritizes keeping their schedules full.
Patients are better off, too. Value-based-care providers emphasize preventative care, wellness and mental-health monitoring and maintenance – care that keeps patients healthy rather than waiting until they’re sick. Value-based arrangements encourage patients to spend more time with their doctors and nurses, to eat better, to quit smoking, and to work through challenges, including housing and food insecurity.
Studies show this kind of ongoing care results in fewer unnecessary emergency room visits and, therefore, lower costs. At the organization I work with, Oak Street Health, in one value-based arrangement we participated in during 2020, annual taxpayer savings was $1,200 per patient versus the CMS target. Due to our value-based model, we have cut in half the number of our patients that go to the hospital or emergency room compared to Medicare benchmarks.
In many of the communities Oak Street Health serves, access to routine primary care is limited. We are working to change that by making significant investments in community outreach to encourage patients to engage with primary and preventative care. Our value-based structure contributes to the ability of our providers to see patients an average of almost eight times per year versus the Medicare average of three times annually. We are demonstrating real-world results in solving health equity challenges by building our centers in the communities affected by health disparities and that stand to benefit the most by new access to doctors. Being value-based allows us to equip our centers with community rooms where activities like bingo and line dancing attract patients while also reducing loneliness.
To be clear, all providers want their patients to be healthy. And watching costs is important. But health outcomes and bridging care disparities need to be what policymakers worry about most, just as patients do. Value-based care is the most sustainable solution because it transforms the system to focus on serving patients and their needs, not the number of services they receive.
Dr. Ali Khan, MD, MPP, FACP is Chief Medical Officer for Value Based Care Strategy at Oak Street Health, a national network of primary care centers for adults on Medicare.
