Value Driven Health Care Essay

Under payment, an ideal healthcare system will have the challenge of delivering higher quality for lower costs. The system’s payment reform will involve a transition from fee-for-service to global from systems that are value-based important for the achievement of the overall healthcare goals. An ideal healthcare payment system will give a great deal of support to value-driven system of healthcare delivery (Kent, 2013). The fee-for-service payment system will be of great importance to the healthcare system as it will help control the costs of health care.

Pay-for-performance payment model – healthcare payment systems that offer financial rewards to providers who achieve, improve or excel their performance on specified quality of care and cost measures (HealthCare Incentives Improvement Institute, N.D.)

There is a growing trend in the United States called pay-for-performance. Pay-for-performance is a system that is used where providers are compensated by payers for meeting certain pre-established measures for quality and efficiency (What is Pay-for-Performance, n.a.). We are going to be discussing what pay-for-performance is. There are different aspects of pay-for-performance which include; the effects of reimbursement by this approach, the impact cost reductions has on quality and efficiency of health care, the affects to the providers and patients, and the effects on the future of health care.

One major trend in the healthcare environment is the shift from volume based reimbursement towards value based reimbursement. Many provider practices remain on a volume based or fee for service reimbursement plan. This system tends to reward high quantity of services with less regard for the quality or performance of the service. However, with a renewed focus on value, reimbursement plans

For example an x-ray machine could be leased and the organization would a fee depending on how many x-rays they take per month or year.

The service-based pay structure provides significant motivation for healthcare providers to deliver as many services as possible, with little to no consideration of patient outcomes. Furthermore, this structure provides no incentive for certain key elements of healthcare such as patient education and care coordination, both of which have led to diminished costs and better outcomes for patients. I am of the opinion that very little quality improvement will take place if this pay-for-service model persists. The current transition from service-based pay to quality-based pay is definitely a move in the right

Hospitals implement HCAHPS with the support of the Hospital Quality Alliance (HQA), a public or private partnership that includes key hospital and medical associations, consumer groups, measurement and accrediting bodies and government agencies that have the same interest in improving the quality of hospitals. The Hospital Quality Alliance (HQA) program that is overseen by and public and private entities, that include the Centers for Medicare and Medicaid Services (CMS) as well as the Joint Commission, is dominating this effort in the hospital district, generating reports quarterly on the delivery of effective services for mutual conditions. Even though the Hospital Quality Alliance has made this data more available to the public, there has not been enough information on the quality of hospital care from a patients ' point of view. As the Institute of Medicine shows, the foundation of patient centered care is a key factor to having a premium health care system. The HQA backs HCAHPS.

Reimbursement under VBP involves both clinical and patient satisfaction targets. In order to measure the patient satisfaction aspect, the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) survey is conducted by the Centers for Medicaid and Medicare. This external report contains useful information regarding the patients’ perspectives of hospital care, and can be compared at a local, regional, and national level. Individual health care institutions can then use this data to determine quality areas in need of improvement. Overall, there is an emphasis on the healthcare institution’s ability to deliver “patient centered” care.

The goal of a value based care system is to focus on an individualized quality of care method. Physicians and health care providers are currently being paid on a quantitative rather then a qualitative aspect of care. This meaning the more patients they encounter, more procedures and exams they run, the more they will inherit. With a value based care system, health care providers will be rewarded by the quality of care they provide as well as the satisfactory rate of the patients outcomes. This system allows for a stronger, genuine relationship between patients and health care providers because it also takes into consideration the cost of health care, making it as affordable as possible by eliminating excessive and unnecessary exams and procedures.

The Healthcare reform law is a reasonable solution for people who cannot afford or do not have private health insurance. This is what the Healthcare reform law is going to provide for people in the United States. The Affordable Care Act provides for Homeless and people who before could not get health insurance due to pre-existing illnesses, so they are finally getting the coverage they deserve at reasonable prices.

In recent years pay-for-performance (P4P) programs have grown swiftly. This program is a way to enhance the quality and value of care which is provided by healthcare providers and hospitals to achieve optimal outcomes for their patient populations (Rand, 2009). P4P appeared as payers were now starting to focus on quality with the hopes that in doing so it will reduce the costs across the board (HealthAffaris, 2012).

The positive outcomes that have resulted due to value base programs have caused the model to gain traction and ignite one of the largest changes in history in the health care marketplace. By linking reimbursements to service quality, insurers such as the Centers for Medicare and Medicaid Services have facilitated a massive leap forward in the performance of United States health care providers. This achievement is a considerable accomplishment in the face of an institution that has received reimbursement from insurers via a fee-for-service model during the last 75 years. Soon, valued based payment models will represent the norm as more insurers support initiatives such as shared savings program, integrated clinical care, and accountable care payment models.

Building on the HQID and HCAHPS hospital quality initiatives, the Patient Protection and Affordable Care Act of 2010 will take quality measures one step further; it will directly tie these measures to financial payments made to hospitals. Beginning in October 2012, HCAHPS scores will be among those measures used to calculate provider reimbursement under the new CMS Value-Based Purchasing (VBP) system. (Kouyoumdjian-Gurunlian, 2012)

Value-Based Purchasing System was created and implemented by the Center for Medicare and Medicaid Services to link Medicare payment to value based systems to improve quality of care provided to patients in an inpatient or outpatient setting. Value-Based Purchasing Systems reward excellence in measuring and reporting in excellent health care delivery to patients. An effective Value-Based Purchasing System is an external motivator for providers to re-engineer the way health care delivery is approached. Healthcare facilities that adopt a Value-Based Purchasing System and score high and maintain a high score can benefit from incentive payments. The Center for Medicare and Medicaid scores hospitals on Achievement Points, Improvement Points, and

HCAHPS is a standardized survey developed by Center for Medicare & Medicaid Services used by hospitals to gather patient opinions on care experiences during hospital stay and objectively measure patient satisfaction. Individual sections of this instrument will be used as dependent variables during