I’ve read several posts today on so called “Value-based payment” strategies and I couldn’t resist adding my 2-cents.
VBP can’t fix these fundamental problems because it is still based on a price-opaque shell game I like to call Fee-for-Coding, which results in:
1) Price insensitivity on the utilizer’s part.
2) Misaligned incentives on the provider’s part.
3) Lack of important price signals between buyers and sellers due to lack of advance pricing capabilities.
VBP utilizes the same fundamentally flawed economic system as our current billing model.
Moving to value-based care will require…
1) A system where prices are known in advance of care (not trauma or emergency care where extent of injuries or illness are unknown at onset – but even still a lot of those can be estimated ahead of time based on scenarios).
2) …that physicians be paid to be available to solve our problems, where payment is not tied to documenting work in a chart.
3) …that we move to a system that is based on defined contributions as opposed to defined benefits. As John C. Goodman is fond of saying, “money should follow people”, not programs and insurance policies.
Value will be elusive until we let the discipline of the market work in healthcare.