Unlocking the full potential of value-based care

Value-based care models are gaining traction as an alternative to traditional fee-for- service models as providers and payers respond to polychronic patient trends.

Polychronic patients (individuals living with three or more chronic conditions at the same time) have complex care needs that drive increased health care utilization and costs. In fact, 85 percent of health care spend is attributed to the growing polychronic patient population.1

In response to polychronic patient trends, value-based care models are gaining traction as an alternative to traditional fee-for-service models and for good reason.

Exploring alternative care models


The fee-for-service health care model

The U.S. health care delivery system has primarily been known for adopting a “fee-for-service” model, which pays physicians and other health care providers a fee for individual office visits, tests and procedures. This approach essentially incentivizes condition-by-condition care, paying medical care providers based on the volume of services provided rather than the outcome.

In the case of a fee-for-service model, health care providers often lack a holistic understanding of their patient’s health, further adding to behavioral factors and barriers linked to social determinants of health (SDOH). This usually results in a complex and cumbersome care experience for polychronic patients and their caregivers as they take on the primary responsibility for care coordination, contributing to a cycle of increased hospitalizations and costs.2

The value-based health care model

On the other hand, a value-based care model focuses on delivering integrated whole-person care. With this approach, health care providers’ reimbursements are tied to the quality of care, optimizing care for effectiveness as well as efficiency based on the following metrics: hospital admissions, readmissions, preventive care and more. The model is designed to leverage evidence-based practices to help reduce the impact and occurrence of chronic diseases and enhance quality of life. In short, the goal of value-based care is to deliver more value for each health care dollar spent.

Moreover, with a value-based care model, the provider typically sees less patients than with a fee-for-service practice. This holistic focus allows a more robust, multi-disciplinary care team to spend more time getting to know patients, understand their health conditions and consider the impact of SDOH factors, such as income level, home environment or transportation access.

Home-based care in value-based models

Home-based care is an effective element in the delivery of patient-centered, value-based care, especially for polychronic patients. More specifically, home-based primary care can help to improve the coordinated management of chronic conditions, ensure ongoing preventive care and address SDOH barriers by leveraging a combination of in-home visits and digital telehealth technology.

Value-based care can change the trajectory of health care costs

According to a study involving Medicare Advantage patients, increased contact with primary care physicians reduced costs by 28 percent.3 The increased frequency of contact between patient and physician results in:

  1. Better communication, which in turn, results in better medication adherence
  2. More timely diagnoses and treatment of issues which help avoid unnecessary hospitalizations
  3. Increased access to preventative care, including vaccinations and screenings

Financial risk management of value-based care

While value-based care presents positive opportunities to impact the patient care experience, it is not without financial risk for provider groups and plans. However, as value-based care continues to mature, a variation of a full-risk payment model is emerging. In a guaranteed-savings risk model, for example, provider groups and regional Medicare Advantage plans partner with a health care services firm to delegate the financial risk and access resources designed to optimize the delivery of whole-person care. Based on the health care services partner’s multi-disciplinary clinical resources, support system and financial and actuarial acumen, the partner sets a capitated rate below what the plan currently pays. As a result, the plan is guaranteed savings from day one.

Learn more about the different financial risk options of value-based care in our latest report.

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Home-Based Care
Evernorth Home-Based Care is a value-based approach with comprehensive in-home primary care solutions, including direct patient care and care enablement services. We work closely with 30+ clients (health plans, Medicare, dual eligible special needs plans (D-SNPs), commercial and more) — serving more than 26 million lives — to improve quality measures and health outcomes, reduce hospital readmissions, and upgrade the patient experience and care delivery coordination. Known for our flexibility, Evernorth is always willing to partner with your existing vendor relationships and clinical pathways to avoid disruption. This approach leverages our expertise and solutions while integrating our clients’ capabilities and third-party resources to maximize overall effectiveness.

1 Holman H. The Relation of the Chronic Disease Epidemic to the Health Care Crisis, National Library of Medicine, March 2020.

2 Skinner HG, Coffey R, Jones J, Heslin KC, Moy E. The effects of multiple chronic conditions on hospitalization costs and utilization for ambulatory care sensitive conditions in the United States: a nationally representative cross-sectional study, BMC Health Serv Res., March 2016.

3 Ghany R, Tamariz L, Chen G, et al. High-Touch Care Leads to Better Outcomes and Lower Costs in a Senior Population, The American Journal of Managed Care, August 2018.