The Ultimate Guide to Implementing Successful Value-Based Care Initiatives in 2024

In 2006, Michael Porter and Elizabeth Olmsted Teisberg co-authored the book “Redefining Health Care.” The book was the first-ever introduction of the term “value-based care,” further popularized with the value equation, which equals outcomes/costs. A higher value for the equation indicates better healthcare, and a lower value suggests opportunities for improvement. It sounds simple, but producing higher outcomes at affordable costs is challenging.

The majority of providers often need help in the execution of value-based care (VBC), even though it makes sense on paper. In this guide to value-based care, we address six critical questions that can help understand the nuances of value-based care, what it takes to implement it, and how value-based care is different from traditional fee-for-service models:

1. What are the core principles of value-based care?
2. What is the current state of the value-based care landscape?
3. What are the different payment models that support value-based care?
4. How do you execute successful value-based care initiatives?
5. What is the step-by-step approach to accurately measure and evaluate value-based care outcomes?
6. What are the must-have tools and technologies for successful value-based care initiatives in 2024?

At the conclusion of the guide, learn how leading health systems across the U.S. are implementing VBC initiatives with data-driven technologies.

What are the Core Principles of Value-Based Care?

Value-based care focuses on quality of care over volume. The latter can be measured with numbers, but how do we quantify quality? To simplify, quality requires optimization. For example, reducing care costs at a minimum level translates into quality outcomes in terms of cost. A successful VBC initiative starts with a strong foundation built on principles that keep the patient at the center of care. Each of these principles emphasizes different aims encompassed under the Quadruple Aim–enhancing patient experience, improving population health, reducing costs, and improving the work life of healthcare providers.

1. Focus on outcomes: Value-based care highlights positive patient outcomes, such as improved health and quality of life. It’s more than simply providing the volume of care services and increased focus on quality care services.
2. Cost optimization: Continually increasing healthcare costs led to the introducing of the Affordable Care Act to curb spending. The denominator in the value equation indicates better outcomes must be delivered at affordable costs.
3. Patient-centered Care: The VBC approach embraces the involvement of patients in decision-making and treatment plans. The transparent engagement of patients across the care continuum enables personalized interventions.
4. Data-Driven Decision Making: The value chain must be traced throughout the patient journey, making it crucial to aggregate, standardize, and derive insights from data at each stage. Data-driven insights enable the identification of best practices for intelligent and timely decision-making.
5. Care Coordination: One of the key strategies to implement VBC is population health management (PHM), which emphasizes end-to-end care coordination between providers. The integrated workflows with real-time information sharing among caregivers lead to effective coordination.
6. Preventive Care: A value-based approach uses proactive measures to prevent illness instead of focusing on treating patients when they are sick. This reduces the stress on healthcare resources and helps to curb the disease progression.

What is the Current State of the Value-Based Care Landscape?

If we trace the history of value-based care, instances such as the introduction of the Affordable Care Act (ACA) accelerated quality care. It’s been more than a decade since the inception of the ACA, but it’s challenging to deliver quality care, let alone at affordable costs. With increasing interest as they see the benefits, providers, payers, and patients support the value-based care approach.

According to research by McKinsey & Company, growth in value-based care has accelerated from creating approximately $500 billion in enterprise value today and may be on track to reach $1 trillion as the landscape matures. With strong support from federal agencies, value-based care has become a lucrative segment for investors. Center for Medicare and Medicaid Services (CMS) has consistently invited providers to participate in innovative models and build a roadmap for the entire industry to follow.

Source: McKinsey and Company

The McKinsey report also noted that the highest VBC adoption is in primary care, but other specialties are also evolving and embracing transformation. CMMI (Center for Medicare and Medicaid Innovation) has introduced several innovative payment models for specialty areas, such as

• The Comprehensive Kidney Care Contracting (CKCC) in Nephrology to delay kidney patients' dependence on dialysis and promote kidney transplantation.
• Bundled Payments for Care Improvement Advanced (BPCI Advanced) is a bundled payment initiative to encourage efficient care program redesign for orthopedic practices.
• The Million Hearts Initiative to prevent one million heart attacks and strokes.

Source: McKinsey and Company

What are the Different Payment Models That Support Value-Based Care?

The transition from the traditional fee-for-service (FFS) model to the VBC model requires extensive resources and continuous iterations. The best way to motivate providers to adopt VBC is to incentivize those who deliver value. From an independent practitioner to a network of hospitals, such as an ACO can participate in VBC programs that are benchmarked and regulated by CMS. The following table highlights the different payment models that incentivize quality:

For a deeper understanding of the nuances of VBC payment models, read these suggested blogs:

• Value-Based Payments: Where Are We Now? Where Are We Going?
• The Future of Value-Based Care and Alternative Healthcare Payment Models

How Can Providers Execute Successful Value-Based Care Initiatives?

Executing value-based care initiatives requires a multi-pronged approach. From the right mix of people to technology, VBC is a complex puzzle with pieces scattered across the care journey. First, VBC must be seen as a continuous process, not a plug-and-play manual to create value. To successfully implement VBC strategies at scale, providers must:

1. Integrate data-driven technologies: According to a study by Morning Consult, 42% of healthcare executives agree that data at their organizations is highly fragmented and siloed. Data encompasses all information related to patients, which is often siloed in EHRs, claims data, labs, and other sources. The adoption of advanced data-driven technologies can set providers on the path to value.
2. Empower care teams with the right tools: HIT systems include tools that can harness the power of data and solve use cases such as care coordination, patient engagement, SDOH assessments, smart workflows, and more. Care teams with such tools can effectively reduce administrative work and spend more time engaging with patients to drive quality care.
3. Focus on measurement and evaluation of outcomes at each stage of the patient journey: While implementing VBC initiatives, it’s critical to understand the need to attain quality at every touch point in the patient journey. The increased focus on data analysis can help accelerate innovation by identifying trends and opportunities to improve backed by data. For reimbursements, providers have to submit reports to CMS which makes measurement and evaluation even more critical than just data collection.

How To Accurately Measure and Evaluate Value-Based Care Outcomes?

1. Start with defining outcomes that will be measured during and after the implementation of the VBC initiative. This includes understanding such items as improved patient health, reduced hospital readmissions, or better management of chronic conditions.
2. Select appropriate metrics to measure the defined outcomes, such as patient satisfaction scores, clinical quality indicators, cost of care per patient, and adherence to evidence-based guidelines.
3. Ensure seamless data collection to gather information on the selected metrics, including electronic health records (EHR), claims data analysis, patient surveys, and other relevant sources.
4. Use analytical tools to assess performance against established outcome measures.
5. Monitor progress over time by tracking key performance indicators (KPIs) related to value-based care outcomes and making adjustments as needed.
6. Share findings with stakeholders–providers, payers, and patients–to drive transparency and collaboration in achieving value-based care goals.

What are the Must-Have Tools and Technologies for Successful Value-Based Care Initiatives in 2024?

Value-Based Care Success Stories

Franciscan Alliance’s Partnership with Innovaccer Yields $2.2 Million in Value

Franciscan Alliance is one of the largest Catholic healthcare systems in the Midwest. Their aim has always been to deliver quality- and patient-centered care across populations, including Medicare Advantage, MSSP, and commercial populations. Franciscan leveraged the Innovaccer platform and its full stack of solutions—Care Management, Patient 360, Population Health Management, and Physician Engagement—to implement customizable polypharmacy protocols to manage high-risk prescriptions and automated strategies to reduce readmissions, hospital stays, and emergency room visits, ultimately improving the continuity of care for each patient.

Franciscan Alliance generated $2.2 million in value across multiple Medicare and Medicare Advantage plans. The health network leveraged the Innovaccer platform to integrate clinical and claims data into a unified patient record and used Innovaccer’s advanced analytics to identify leading indicators that help them better manage risk and quality of care. Read more about the Franciscan Alliance’s journey in the case study.

CHI Health Generates More than $2.7 Million in Value with Innovaccer’s Automated and Data-Driven Care Management Solution

CHI Health focuses on implementing a transformative data-driven care management strategy that ensures comprehensive care during the recovery period to reduce inpatient and ED readmissions and ultimately reduce the total cost of care. To assign appropriate care management pathways for patient populations, the health system leveraged the Innovaccer platform and its comprehensive care management solution to implement automated TCM protocols.

By empowering care managers with data-backed insights at the point of care, CHI Health generated $2.75 million in value across Commercial, Medicaid, Medicare, and MA populations in just ten months. Read more about CHI Health’s value-based journey in the case study.