Image credit: Castle Connolly Medical Ltd.

Most of us in the healthcare industry know that Value-Based Healthcare, or any initiative that takes Value into consideration, revolves around Patient Outcomes. In other words, instead of focusing on activities, Value is based on what benefits the patient.

In principle, this sounds like a clear definition, but still, which outcomes are we considering: quality of life, time for recovery, hospitalization period, etc.? What metrics should be considered and even more importantly, who defines them?

No Payers involved?

The current funding and reimbursement mechanisms in healthcare are based on activities, not outcomes, meaning similar activities should be paid similarly as well. It is expected that when medical technology companies come with innovative devices, these are perceived at least initially as incremental costs by payers, since the value they generate may not be fully covered by the existing mechanisms and system.

To date, most payers are using traditional payment mechanisms (although some are making tremendous steps towards Value-Based payments), and these stakeholders are not always prepared to properly define what metrics are best for patients. Sure, one can define what outcomes we want to achieve to keep patient costs low within a certain period of time, but that is a different approach than considering the best outcomes for the same patient.

It’s about medical professionals and patients

But who best to define the right patient metrics than those stakeholders working closely with patients, such as doctors and nurses? Considering their understanding of the patient treatment pathway, they would certainly know which outcomes would make that pathway better, or at least shorter.

In the US, almost all Medicare clinicians are currently being evaluated on quality, efficiency, and information metrics with costs coming in 2019. However, each of these clinicians are allowed to select those metrics they consider best represent the outcomes of their work with patients. Medicare (payer) provides the list of metrics, but it is up to the clinicians to pick the right ones.

The Austrian example

According to the General Director of the Social Security Service for Entrepreneurs of Austria (SVA), Dr. Hans Aubauer, everyone can contribute to Value-Based Healthcare.

The broad consensus among the SVA community of 8,500 entrepreneurs is that insurance deductibles should be reduced when patients achieve metrics they agreed upon themselves with doctors; no payers involved. Medical interventions can create significant impact, but to a certain point. Beyond that, it is the responsibility of patients and doctors to agree which outcomes they consider as the best.

Certainly, patients are not all prepared to discuss every single healthcare metric. On the other hand, preventive medicine aspects, such as smoke cessation, might be reinforced when patients commit themselves to metrics related to their own benefits and financial incentives.

Patient outcomes are accurate when developed between medical professionals and patients, but they must also be relevant to payers. Maybe that is one of the keys for unlocking Value-Based Healthcare.

Do you agree payers should not be directly involved in defining the patient outcomes that will drive reimbursement? Or maybe you consider their perspectives as crucial since the beginning? Let us know what you think at We look forward to hearing from you!