Pivoting Healthcare Towards a Value Based Healthcare Model

Pivoting Healthcare Towards a Value Based Healthcare Model

Healthcare industry is transforming dramatically with increasing Digital Health Solutions leveraging exponential technologies like AI, Wearables, IoT, Telemedicine. At the business model there is another profound shift happening and that is a shift towards a value-based care model. Healthcare providers that do not adapt their business models to this shift will be disrupted and left behind. This requires shifting the focus just on the procedures that the hospitals can provide to focus on patient outcomes, patients well-being by being patient centric to the core. 

Towards a Value Based Care Model

Health care systems are shifting from volume-based, fee-for-service (FFS) payment models to those focused on Value Based Care (VBC) models. This means compensation and incentives are given to the healthcare providers like the hospitals for the quality of care provided by them and well-being of the patients rather than for services rendered. Patient feedback on their experience at the hospital is a factor that goes into when the reimbursements are being done to the hospitals.

The shift to VBC Payment models is changing providers’ economics and placing healthcare providers under threat of commoditization unless they deliver differentiated, high-impact solutions, absorb risks and undergo a transformational pivot.

In the past hospitals would increase the bed space, invest in new high-tech technology and procedures driving up the cost without improving overall health outcomes and focusing on preventative care. Digital Healthcare products, providers and Med Tech solutions need to go beyond the device offering or any procedure and provide patients with data-driven, clinically meaningful and actionable intelligence that improve their health outcomes by being proactive and agile. This would require the hospitals to take the disease as the enemy and speed up connection between science and patient care, collaborate with the entire healthcare value chain partners like payers, insurance companies, academia, research institutions. They should promote and encourage healthy habits which requires working with public in raising awareness about preventable conditions like obesity, poor diet, lack of exercise etc. 

Value-based care (VBC) payment models exist on a continuum, with increasing levels of risk and required capabilities. The key difference with value-based care vs. fee-for-service care is that the former provides incentives for quality, while the latter emphasizes quantity. 

Consumer Centric Future of Health

Consumers are active and participants and demanding transparency, convenience, access and personalized products and services like other aspects of their lives. They are shopping for deals, taking control over their data, using more technology and willing to share data to providers to get value-based healthcare. They are using technology for measuring their fitness, ordering prescription through Alexa, monitoring their health using wearables, setting their health improvement goals and because of the widespread mobile, internet usage and information availability are even challenging clinicians. 

How can the healthcare providers fast track the transformation to value based healthcare? 

1)     Leverage data from various sources and partners to create a holistic 360-degree view of the consumer.

2)     Provide access to healthcare not restrained by geography using telehealth capabilities to connect with the specialists.

3)     Empower patients with transparency of data and providing patient centric solutions studying the entire patient/customer journey

4)     Create mass behavioral change programs from treatment to well being

5)     Fast track the development of research and its applications of scientific breakthroughs like stem cells, nanobots, and biome sensors.

Pivoting to value based healthcare is even more important post COVID19 as healthcare providers make use of digital technologies like Telemedicine and telehealth solutions which provides significant in–hospital cost savings. They also have the opportunity to reduce waste, streamline their processes to be more efficient, and reap the financial benefits.