How Value Based Care is Changing the Way You Build Digital Health Companies

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How Value Based Care is Changing the Way You Build Digital Health Companies

Different building blocks

In this HIT Consultant article, you'll learn about:
  • Current momentum of VBC model

" In 2017, 34% of U.S. healthcare payments, representing approximately 77% of the covered population, flowed through Alternative Payment Models and Population-Based Payments. According to a 2019 Change Healthcare report, the last five years saw a seven-fold increase in the number of states implementing value-based reimbursement programs; 48 states now have value-based programs. "

  • Needed changes to vendor relationships

" Value-based care is forcing healthcare vendors (healthcare IT, healthcare services, and digital health vendors) to think differently about many aspects of their business, but especially about their revenue model as it relates to value-based care. In the last two years, provider-sponsored risk-bearing entities (i.e., health plans, ACOs, etc.) and Medicare Advantage plans have begun requiring outcomes-based contracts, where vendors are required to share in potential downside risk, as well as upside potential. "

  • Affects on executive hiring

" Finding executives who can build businesses in this new value-based care world is difficult.  As more companies are structuring outcomes-based deals based on both upside and downside risk, executives who understand the intricacies behind these models are a very hot commodity (and even hotter if they can show that they have had success executing mutually beneficial risk-based contracts in the past). "

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