Value Based Care Statistics for Medtech: Fee-For-Service Decline, Care Quality Uplift


We all know that value-based care (VBC) is the goal, but how do we actually achieve that outcome in medtech? It has been a slow but steady evolution and below are some of the metrics (from payers, no less) that show that VBC may actually be working.

Use case: A small rural hospital with limited resources enlists a team of expert neurologists through a telemedicine program. Expert doctors help onsite physicians assess patients and manage treatment plans, improving results and obviating the need for ordering tests that may have little effect on the outcome of the patient.

To make an effective transition to VBC, hospitals formerly had one option: invest in their technology infrastructure. It is still expensive to manage a healthcare organization and technology investments aren’t going away soon, but many healthcare institutions are reconsidering how they allocate, staff, time, and equipment to maximize the improved results and cost-savings VBC can yield.

Insurer data is important!

Insurers are the payers and can provide a perspective that we need to guide our medical product development strategies.

According to a 2017 report [1] from Humana, patients who were treated under a VBC model received a higher level of preventive care and had costs that were 15.6% lower than the traditional medical fee-for-service.

2017 Humana VBC vs. FFS prevention and adherence [2]

Patient Management

  • 9% more eye exams

  • 2% more patients with controlled blood sugar levels

  • 4% more adult BMI assessments

  • 4% better management of rheumatoid arthritis

Patient Adherence

  • 8% more high blood pressure adherence

  • 3% more statin adherence

Patient with Diabetes Care Outcomes

  • 8% more eye exams

  • 2% more patients with controlled blood sugar levels

  • 2% more patients with controlled diabetes renal disease

  • 3% more adherence to diabetes medication

Patients with Cancer screenings

  • 10% more colorectal screenings

  • 11% more breast cancer screenings

Hospital Cost Reductions

  • 7% fewer emergency department visits

  • 5% fewer hospital inpatient admissions

The last category, hospital cost reductions, could only be possible in a VBC setting. Data from Medi-Vantage strategy research finds that FFS organizations still reject treatment methodologies that reduce procedures and admissions.

Patients and Physicians Also Benefit

Medical cost reductions for Humana plan members are seen through reduced out-of-pocket costs, lower member premiums, and travel costs. The VBC model also helps physicians spend more time with their patients, which builds stronger relationships between physicians and patients,” said Roy A. Beveridge, M.D., Humana’s chief medical officer. “The result is a bond of trust, which serves as the foundation for changing unhealthy behaviors and addressing social determinants of health. As we’ve seen at Humana, supporting physicians with actionable data gives them a deeper understanding of their patients − and that can result in more preventive care, which leads to better chronic condition management.”

The value of this important finding, that physicians get more time with patients, was echoed at the World Medical Innovation Forum held in Boston on April 8-9, 2019. In this meeting, many physicians lamented that electronic medical record management is an enormous barrier to patient interaction, which is one of the most richly rewarding aspects of their professions.

More Data from Payers

A survey of 120 health care payers performed by Change Healthcare found that 77% reported improvement in quality of care.

The Change Healthcare Study [3] supports the Humana data that VBC is reducing the cost of care.

Top 10 Payer Research Findings on VBC

  • 5.6% medical costs savings resulting from VBC strategies

  • 77% report improvement in care quality plus improvements in provider relationships and patient engagement

  • Fee-for-service declining faster than expected

  • >50% are dissatisfied with current analytics, automation & reporting

Episodes of Care Changes

  • Episodes of care models can provide medical savings as high as 7.5%

  • Care quality improves across all episode types

  • Average time needed to launch an episode of care program: 10.9 months

  • ~50% of payers have trouble gaining provider agreement on performance metrics

  • ~75% of payers are growing their episodes of care staffs

Payer research is one of the fasting growing areas of strategy research we see at Medi-Vantage. Contact us to learn more about the insights we provide in this important area of healthcare research.

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