Value-Based Payment: An Introduction
Value-Based Payment (VBP) is an approach that rewards quality outcomes and improved patient care, requiring providers from across the care continuum to work together to improve patient care. This is a patient-centered approach where all providers work together to improve quality of life.
Why is VBP important?
- It’s the way of the future
- Collaboration across the care continuum provides a holistic view of a patient’s health
- Allows providers to focus on preventive medicine
- Improves health outcomes
- All patients should have access to quality healthcare
- Fewer people visiting emergency rooms or being admitted for potentially avoidable occurrences which helps lower costs
Introduction to VBP Videos
New York State Department of Health (DOH) and CCN have each created short videos that provide a brief introduction into VBP and it’s importance towards achieving better quality care for the Medicaid population
Value Based Payment Levels and Roadmap
There are various levels of participation among health care providers and payers. The various levels of participation in the VBP system are generally categorized in the following way:
Under DSRIP, the State Department of Health (DOH) has established the goal to be achieved over a five-year program (through April 2020) as to have 80-90% of Medicaid Managed Care Organization (MCO) payments at Value Based Payment Level 1 or higher and at least 50-70% at Level 2 or higher. Minimally, 35% of MCO payments must be at a Level 2 or higher.
New York State Department of Health created a VBP Roadmap that would be updated annually to ensure that best practices and lessons learned throughout implementation would be leveraged and incorporated into the State’s overall vision.
Acronyms and Terminology Definitions
Bundles of Care – is where Managed Care Organizations and providers contract for a bundle of services and is generally thought of in two categories, Acute and Chronic Bundles of service. Acute examples might be maternity care episodes or stroke, while Chronic examples might be Asthma or Diabetes where bundles would be looked at over an entire continuous year of care.
CBO – Community-based Organization is a public or private nonprofit (including a church or religious entity) that is representative of a community or a significant segment of a community, and is engaged in meeting human, educational, environmental, or public safety of the community
FFS – Fee for Service is a payment system where payment is for a specific service provided and is volume based, regardless of health outcomes.
IPC – Integrated Primary Care includes behavioral health, primary care, effective management of chronic disease, medication management, community based prevention activities, and clear alignments with community based home and social services agencies (Patient Centered Medical Home (PCMH)/ Advanced Primary Care (APC) models). This type of care is continuous in nature, strongly population-focused, based in the community, culturally sensitive, oriented towards primary and secondary prevention, and aims to act as the primary source of care for the majority of everyday care needs.
MCO – Managed Care Organization is an insurance organization that is generally paid a premium to provide care to the enrolled patient. This organization generally then negotiates the payment to a provider when services are delivered.
Shared Savings – is a payment strategy that offers incentives for provider entities to reduce health care spending for a defined patient population by offering them a percentage of any net savings realized as a result of their efforts.
VAP – Vital Access Provider is a provider of health care services in a community that is a hospital, nursing home, diagnostic and treatment center, home care providers and denotes the state’s determination to ensure patient access to a provider’s services otherwise jeopardized by the providers payer mix or geographic isolation. A VAP designation is a threshold determination that will qualify providers for some level of supplemental financial assistance to support their longer-term financial viability.
VBP – Value Based Payment is a system that rewards quality outcomes and improved health versus paying for a specific service performed.
Value Based Payment: Next Steps
There is no single path to approach Value Based Payment reform. Organizations have a comprehensive range of VBP options to consider as they do from a fee-for-service to approach to that of VBP. Organizations and Managed Care Organizations can select from various types of VBP arrangements that will fit their strategy, and ability to manage these payment models. The Different types of VBP arrangements can be formed around: Total Care for General Population (TCGP), Integrated Primary Care Bundle, Maternity Bundle, and/or Total Care for Special Needs Subpopulations.
Additional Resources and Webinars
Value-Based Payment (VBP) Webinar Series
CCN hosted a series of educational VBP webinars to inform partner organizations about the upcoming transition from traditional fee-for-service payments to a new, pay-for-performance approach or Value-Based Payment program. The webinars are available on the HWApps website for partner to view. For information on how to register for a course on HWApps, click here to view the guide.
- Integration of Behavioral Health and Primary Care
- Data Collection
- Regulatory Considerations for Behavioral Health Providers Entering VBP
- Value Based Arrangements
- Delivery System Models
- Analytics Series, Part 1
- Analytics Series, Part 2
- Contracting with MCOs Overview
- Contracting with MCOs: Analytics to Support Risk Contracting
- Practice Transformation
- Analytics: Provider Performance
- Contracting with MCOs: Network Development
- Management and Distribution of Funds
- Care Management
- Provider Integration – CBOs in Traditional Provider Networks
Value-Based Payment (VBP) Bootcamps
The New York State Department of Health (NYSDOH) held a series of Bootcamp presentations in 2016 and 2017 to help equip future Value-Based Payment contractors with the knowledge necessary to implement New York State Payment Reform. To view the webcasts from each session, visit the NYSDOH Medicaid Redesign website under VBP Resource Library.
Care Compass Network’s Funds Flow Overview
CCN’s presentation overview of Value-based Payments (VBP), the required deliverables under Delivery System Reform Incentive Payment (DSRIP) program, the process, key contributors, timeline, and the proposed funds flow budget. Click here to view webinar.
CCN Payer Forum: United Healthcare
This PowerPoint presentation introduces United Healthcare’s plans for Value-based payment arrangements for the Medicaid Population. This 2016 presentation also covers ways organizations can participate in value-based payment arrangements with United Healthcare. Click here to view the PowerPoint slides.
NYS Medicaid Redesign Website
The NYS Department of Health website provides PPSs and partner organizations information and resources about DSRIP and the move towards Value-based Payments (VBP). Visit the Medicaid Redesign website for NYS for DSRIP and VBP information.
Medicaid Value-Based Payment Library
The NYS Department of Health has created a resource library for Value-based Payments (VBP) to help organizations on their journey towards implementing this payment approach. The resource library contains links to the VBP Bootcamps, VBP webinars, and the VBP Roadmap. Click here to access the VBP Resource Library for additional information on VBP.
Managed Care Technical Assistance Center (MCTAC) – 4 part webinar series on Value-Based Payment