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Survey Finds Value-Based Care Initiatives Account for a Quarter of Hospital Revenues

According to a recent survey of health care executives commissioned by DataGen and conducted by Sage Growth Partners, value-based care initiatives account for on average 25 percent of hospitals’ revenues.

In addition, more than 60 percent of respondents stated that they plan to enter into or expand value-based participating (VBP) participation in the next one to two years. Some 50 percent of respondents believe VBP will become the primary revenue model for the U.S. in the next five years. The findings also outline key factors that are influencing value-based care as a strategic priority.

In Pennsylvania, HealthChoices, the state’s Medicaid managed care program, is looking to hasten the adoption of VBP and has continued to increase targets set for VBP arrangements for participating managed care organizations.

In 2016, Pennsylvania Department of Human Services (DHS) announced that targets would be set at 7.5 percent (2017), 15 percent (2018), and 30 percent (2019). Recently, DHS announced the 2020 and 2021 targets at 50 percent and 70 percent respectively.

This means managed care organizations are required to develop programs like primary care medical homes, shared savings programs, bundled payments, and full-risk accountable care organizations and contract with hospitals to participate in these initiatives. 

HAP continues to ensure that the move to a value-based payment approach improves patient care in a sustainable and efficient manner by advocating to:

  • Align measures among state, federal, and commercial payors
  • Ensure providers have data so they can assume risk and manage population health
  • Develop alternative value-based programs for rural health providers
  • Support expansion of telehealth services
  • Implement opportunities to integrate physical and behavioral health
  • Leverage existing population health initiatives to support state goals

For additional information, contact Kate Slatt, HAP’s vice president, innovative payment and care delivery.


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