Pay For What Matters To Patients: A Whole Health Population-Based Payment Approach

While value-based purchasing (VBP) programs have proliferated in the past two decades, quality measures have become increasingly important as they are employed to calculate the “value” of care. The health care industry, however, is struggling with a quality measurement dilemma. On the one hand, as the number of measures is increasing rapidly, health care organizations—both payers and providers—are investing significant resources and time in data collection and reporting of measure results. One recent study reported that a single hospital spent more than $5 million, along with an additional expenditure of more than half a million dollars in vendor fees, for the preparation and report of 162 unique quality metrics in a single calendar year. On the other hand, despite these efforts and investment, recent evidence of quality improvement is mixed. As seen in the case of chronic conditions such as diabetes, despite the adoption of numerous discrete diabetes care measures, diabetes-related outcomes such as lower extremity amputation are still far from being optimal. This raises questions about whether we are measuring and incentivizing the right drivers of health. According to the Centers for Medicare and Medicaid Services’ (CMS’s) Innovation Center’s synthesis review of their 30 payment models launched in the past decade, most of the models did not demonstrate consistent and significant improvements in quality.

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