The Move Toward Value-Based Care

According to National Health Authority, Government of India (2022) “Value-based care is a form of reimbursement in which payments to the healthcare providers for care delivery is made on the basis of quality of care provided. Under value-based care model, healthcare providers are rewarded for helping the patients to improve their health, which consequently reduces the effect of disease in the population in the long term”.

This contrasts with the fee-for-service (FFS) model of healthcare management. This means that the provider is compensated for each office visit, test, procedure, or other service that they perform. The FFS model is often used in the private sector in India. It can lead to overuse of healthcare services, as providers may be more likely to recommend additional tests or procedures in order to earn more money. Also, it can also be financially burdensome for patients, as they may have to pay for each service separately. In addition, the FFS model may not be well-suited to addressing chronic health conditions or preventive care, as these types of services may not generate as much revenue as more acute care services.

In value based healthcare, providers are paid based on the value they provide to the patient, with value being defined as the quality of care received by the patient relative to the cost of that care. This model incentivizes providers to focus on preventative care and to coordinate care across different specialties and care settings in order to achieve the best outcomes for patients.

For example, Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AM PM-JAY) aims to shift the focus of the healthcare system from FFS to value-based care. This will encourage healthcare providers to deliver high-quality, cost-effective care. These incentives may include payments based on the achievement of certain clinical targets or the use of evidence-based practices instead of the number of doctors visited and facilities used.

Overall, the move toward value-based care in India is driven by a desire to improve the quality of care for patients while also reducing costs. This model has the potential to improve the efficiency and effectiveness of the healthcare system in India, and it may serve as a model for other countries looking to reform their healthcare systems.