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What's new about value-based payment models

November 9, 2015
by Julie Miller, Editor in Chief
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Everyone in healthcare knows services that qualify for payment are services that get delivered. It's just that simple. As we move closer to value-based payment models in the future, far more services will fall into the “paid” category.

For example, care coordination activities aren’t exactly profitable services right now, regardless of how essential they may be. In the future, experts say, such services will be paid for not through the prevailing fee-for-service scheme but out of a lump-sum payment that would be allocated to a single patient for a single episode of care. For the model to work, however, two things have to happen: clinical quality measures must be met to satisfy the payer; and final payment must be worthwhile to satisfy the provider.

It sounds impossible, but as it turns out, we’re seeing the bundled model gaining a lot of traction now in acute care, especially for surgical events such as artery bypass and joint replacement. A hospital would recieve a single amount for surgery, the hospital stay, physical therapy, etc., and would have to decide the best way to allocate the cash. There would be incentive payments to prevent the hospital from shortchanging care--that's the big differentiator in these new models.

Why you should care

Pay attention because behavioral health is just as ripe for value-based pay as any other discipline.

 “I find it interesting that we are looking to what are really older payment models, such as bundled and essentially capitated rates, and adding new twists to try to find a way to make them work,” says David Chernof MSW, LCSW, MBA, vice president of quality assurance and standards for Bridgeway Behavioral Health, who is a Behavioral Healthcare editorial advisor.

He tells me that as payment models change, providers adapt to them with many iterations along the way. But the only way the new models will be superior to the old models is by baking in quality measures.

“We need nationalized standards of quality for behavioral health treatment,” Chernof says. “And they have to be created by a group that includes both providers and payers, with measures that would be difficult to manipulate when reporting the numbers.”


Julie Miller

Editor in Chief

Julie Miller


Julie Miller has more than 14 years of experience observing, analyzing and reporting on various...

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