Could Value-Based Contracting Be on the Horizon for the WorkComp Arena?

Written by on 10/16/2017 3:14 AM in , , , . It has 0 Comments.

Value-based contracting models are already being used by the healthcare system. But in today’s workers comp arena, they are a hot-button topic. A Coventry white paper released earlier this year investigated the potential of this model over the current regime.

The Argument for Value-Based Contracting (VBC)
As opposed to the current workcomp model, in which utilization and care management teams rely on a fee-per-service approach via a discounted network of external vendors, value-based contracting takes a far different approach. Volume-based contracting and fee-for-service care is cast-aside for a payment structure based on performance/outcomes, not services rendered, eliminating the financial incentive to treat more.

Quality Value-Based Contracting Models…

  • Unite the goals or payors and providers.
  • Pay for better outcomes (superior quality, faster results) regardless of the number of services rendered to achieve them.
  • Utilize predictive pricing for payors/providers, with agreed upon treatment costs by injury/illness. (All costs for an episode of care, such as knee replacement, are bundled as one fee. Patient-centered medical homes cover patient care coordination and outcomes under a per member, per month fee.)
  • Have an ‘outcome focus,’ relying on a model calibrated to deliver the right combination of services to achieve the best outcome.
  • In this ‘pay for performance’ model, preventative care is seen as a way to curb costs and treat injuries and illnesses before they become serious. (Think: creeping catastrophic claims.)
  • Data analytics monitor a provider or hospital’s success.

Could the old claims mentality be replaced by value-based contracting? As the industry strives for savings and improved patient outcomes, time will tell. As the regime evolves, Minnesota Comp Advisor will be here for you through it all.

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