Data Analysis for a Holistic Approach to Managing Costs and Improving Care

In 2015 U.S. secretary of the Department of Health and Human Services Sylvia Burwell  announced an aggressive goal to move the Medicare program from fee-for-service provider compensation to payment based on quality or value-based models. By the end of 2016 more than half of all Medicare payments will, in some fashion, be linked to a values based approach.

This mandate from Secretary Burwell dovetails with the expansion of government-sponsored health insurance programs, driving an accelerating change throughout the healthcare industry as a whole in provider reimbursement plans toward alternative payment structures.

“Whether you are a patient, a provider, a business, a health plan, or a taxpayer, it is in our common interest to build a health care system that delivers better care, spends health care dollars more wisely and results in healthier people,” Secretary Burwell said at a press conference. “We believe these goals can drive transformative change, help us manage and track progress, and create accountability for measurable improvement.”

A Values Based Approach

Creating a more collaborative and results oriented economic environment presents challenges and opportunities for physicians and payers as the shift in compensation models reflects today’s changing priorities in dispensing and monitoring healthcare.

hospital reimbursement figures

Defining Value: Building Trust

Integrating quality incentives into physician compensation improves outcomes and lowers costs. But the devil is in the details.

Physicians and providers have reported on quality-of-care measures for many years through programs such as Hospital Inpatient Quality Reporting (IQR), Hospital Outpatient Reporting (OQR) and the Physician Quality Reporting System (PQRS), but these benchmarks have previously not been incentivized. Implementing value oriented, cost-sharing metrics is historically difficult to benchmark and measu