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Homework #5: How Would you Redesign Healthcare?

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Section 1

Value-based Care

The primary goal of value-based care is to improve patient outcomes and quality of life. Getting there will need several adjustments to the way patients get care, which is why efforts are being made to make medical care proactive rather than reactive to head off problems before they arise. Quality of care, preventive screenings, and overall well-being all have a role in improving healthcare outcomes (Novikov et al., 2018).

Section 2: Value-based Program

This was developed to link provider payments to better provider performance. Health care providers must thus answer for the costs and quality of their services (Chee et al., 2016). Cutting out unneeded therapy while recognizing and rewarding the best healthcare providers is the goal of this program. This program was created to reward hospitals that provide high-quality treatment to Medicare enrollees.

Hospital Value-Based Purchasing Program

This program aims to enhance patient safety and experience by focusing on the quality of treatment rather than the number of services provided in a hospital environment. The Hospital Value-Based Payment Program affects inpatient payments at more than 3,000 hospitals throughout the United States (VBP).

Hospitals under Medicare are paid either depending on how well they perform on quality criteria or how much their performance improves as a consequence of this program. A 2% reduction will be made to all payments to cover the bonus payments. In terms of the patient’s finances, VBP has little impact. As a consequence, participating hospitals will have to reimburse the whole 2% discount (Chee et al., 2016). A hospital’s ability to recoup lost incentives may be a key differentiator between those who do well and those who do not.

Section 3: Implications for the U.S. Healthcare System

Reducing medication error as well as rewarding the best-performing health care providers are the goals of value-based purchasing. As a rule, initiatives to improve the quality of treatment by limiting incentives, such as price discussions, have been unsuccessful in the past. With value-based buying, consumers can correlate particular goals with reimbursement benefits. Health care administrators utilize patient satisfaction as a key metric to evaluate their organization’s success. Value-based buying schemes in hospitals, as a consequence, improve patient satisfaction with healthcare plans and service delivery (Ramirez et al., 2021). Patient satisfaction alone does not always imply the quality of the service that is provided. Because surveys are a simple and cost-effective technique of assessing patient outcomes, health care managers often use them to monitor organizational effectiveness.

Also, an employee’s health is negatively impacted by bad habits such as smoking, overeating, and excessive alcohol intake.   Employers, in particular, are notorious for tailoring their benefits packages to the dictates of their insurance providers. Consequently, the company’s workforce will be more inclined to follow a healthy diet. Providing incentives for good behavior, such as quitting smoking and losing weight, encourages workers to stay healthy and reduces medical expenditures. Employees benefit from greater long-term health and companies save money on medical expenses when wellness programs are effective, and this is true for all parties involved.

Peer Posts

The US healthcare system indeed has ongoing challenges in terms of keeping costs low, enhancing the quality and patient safety, and increasing or maintaining patient access to treatment. Public and private payers of healthcare are continuously on the lookout for methods to obtain the most value for their money. Providers that offer high-quality, cost-effective treatment will be rewarded, and the money they spend will reflect this. Payers and purchasers have been shifted from passive claim payers to active buyers of high-quality treatment thanks to “value-based purchasing” (VBP) methods (Claiborne et al., 2009). At this point, more than a hundred VBP projects have been implemented, as reported by the CMS. As predicted, progress has been sluggish. According to the Institute of Medicine (IOM) and others, the adoption of VBP adjustments may be hindered by different state and federal regulations. It is possible that the use of VBP in healthcare may be stymied by legal issues on the state and federal levels.

I agree that a good policy aims to limit the number of hospital-acquired infections. The HACRP and VBP deliver a clear message that quality of care matters by tying policy to financial incentives. However, even if a policy is well-intentioned and sensible, it still must be applied in a way that is fair and equitable. Additionally, the policy must not mislead patients and investors in publicly published performance comparisons. The risk-adjustment methodology utilized for the NHSN measurements has several theoretical flaws (Fuller et al., 2019). Generally speaking, self-reported data associated with payment should be validated and the variables should not be subject to arbitrary hospital judgments. It’s essential to conduct a formal assessment of risk-adjustment strategies when so much money is at stake and so much volatility is seen.


Chee, T. T., Ryan, A. M., Wasfy, J. H., & Borden, W. B. (2016). Current State of Value-Based Purchasing Programs. Circulation, 133(22), 2197–2205.

Claiborne, A. B., Hesse, J. R., Roble, D. T., Ropes, L., & Gray, L. (2009). Legal Impediments to Implementing Value-Based Purchasing in Healthcare. American Journal of Law & Medicine, 35(4), 442–504.

Fuller, R. L., Hughes, J. S., Atkinson, G., & Aubry, B. S. (2019). Problematic Risk Adjustment in National Healthcare Safety Network Measures. American Journal of Medical Quality, 35(3), 205–212.

Novikov, D., Cizmic, Z., Feng, J. E., Iorio, R., & Meftah, M. (2018). The Historical Development of Value-Based Care. The Journal of Bone and Joint Surgery, 100(22), e144.

Ramirez, A. G., Marsh, K. M., McMurry, T. L., Turrentine, F. E., Tracci, M. A., & Jones, R. S. (2021). How Total Performance Scores of Medicare Value-Based Purchasing Program Hospitals Change Over Time. Journal for Healthcare Quality, Publish Ahead of Print.

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