Value-based payments that support value-based care

23 Mar 2022

A presentation by the Centre for Healthcare Quality and Reform (CHQPR) on improving healthcare payment systems

A significant proportion of current healthcare spending is avoidable. Reducing these costs would be a win-win situation for payers and patients, by reducing costs whilst improving care. However, this also provides a loss for healthcare providers, due to barriers to value in the current payment system. These barriers include inadequate payments for higher-value services, and the fact that the avoidable spending also constitutes revenue for the providers.

Therefore, value-based payment systems should improve by removing these barriers; reducing avoidable spending and including an adjusted payment system.

CHQPR propose four steps for creating successful value-based payments:

  1. Identify specific areas of potentially avoidable spending
  2. Design services that will reduce the avoidable spending
  3. Pay adequately to support higher-value services
  4. Hold providers accountable for results

Good alternative payment models can be a win-win-win for all stakeholders. Patients win by having access to better care without unnecessary services; providers win by having adequate payment for high-value services; and payers win due to lower overall spending.


Harold D. Miller